Ex parte City of Birmingham

• Decision Date: 17 June 1915
• Docket Number: 6 Div. 118
• Citation: 70 So. 184,195 Ala. 60
• Parties: Ex parte CITY OF BIRMINGHAM.
• Court: Alabama Supreme Court

70 So. 184

195 Ala. 60

Ex parte CITY OF BIRMINGHAM.

6 Div. 118

Supreme Court of Alabama

June 17, 1915

Rehearing Denied Dec. 2, 1915

Petition for certiorari to Court of Appeals.

Petition for certiorari by the City of Birmingham to review a judgment of the Court of Appeals (68 So. 586) affirming a judgment acquitting and discharging D.J. O'Connell on a charge of conducting a business without having first taken out the prescribed license. Writ denied.

Romaine Boyd and J.P. Mudd, both of Birmingham, for appellant.

Percy Benners & Burr, of Birmingham, for appellee.

By direction of the court Mr. Justice McCLELLAN prepared the following OPINION:

The city of Birmingham levied a license tax on waterworks companies for the year 1912 which the Birmingham Waterworks Company refused to pay, on the ground that it was exempt from said tax under section 36f of the statute entitled "An act to further provide for the revenues of the state of Alabama," approved March 31, 1911. Acts 1911, p. 159 D.J. O'Connell, appellee in the Court of Appeals, who was the superintendent of the company, was arrested and convicted in the recorder's court of Birmingham on a charge of conducting a business without having first taken out the license prescribed therefor. On his appeal the circuit court held that section 36f was valid, and that, in consequence the license fee exacted of the waterworks company by the city's ordinance, which was in conflict with provisions of section 36f, was invalid, and accordingly discharged the company's superintendent. The city brought its appeal to the Court of Appeals, where the judgment of the circuit court was affirmed for reasons set forth in its opinion reported in 68 So. 586. The city now seeks the review and reversal of the judgment of the Court of Appeals (Const.1901, § 140) affirming the judgment of the circuit court whereby O'Connell was acquitted and discharged. This court concurs in the conclusion attained and given effect by the Court of Appeals, but upon different considerations and grounds from those on which the Court of Appeals rested its conclusion and judgment in the premises.

The question is whether section 36f is violative of the Constitution of Alabama and of the Fourteenth Amendment of the Constitution of the United States? Section 36f is as follows:

"36f. The maximum amount of privilege or license tax which the several municipalities within the state may annually assess and collect of persons, firms, or corporations operating street railroads, electric light companies, gas companies, steam heating companies, and waterworks companies under the laws of this state any other state or whether incorporated at all or not, shall not exceed two per centum of the gross receipts of said business of such persons, firms, or corporations, provided, however, that the amount paid by such persons, firms, corporations as intangible property tax to such municipalities shall be allowed as a credit on and against the said privilege or license tax." Acts 1911, p. 188.

1. Section 221 of the Constitution of Alabama reads:

"The Legislature shall not enact any law which will permit any person, firm, corporation, or association to pay a privilege, license, or other tax to the state of Alabama, and relieve him or it from the payment of all other privilege and license taxes in the state."

This court, in Ex parte Bozeman, 183 Ala. 91, 63 So. 201, gave consideration to this section (221) of the Constitution; but the decision then made is not applicable to the status now presented by section 36f. See, also, Bozeman v State, 7 Ala.App. 151, 61 So. 603, for opinion of the Court of Appeals.

This court is of the opinion, and so holds, that section 36f does not fall within the restrictive provisions of section 221 of the Constitution. It does not permit the payment to the state of Alabama of a privilege or license tax, and thereupon exonerates any person, firm, corporation, or association from the payment of all other licenses or privilege taxes in the state. Section 36f does no more than fix the maximum amount of the license taxes, in the instances therein specified, to be exacted by municipalities, tolling or crediting that by the sum paid by the licensee on intangible property to the municipality. The section does not purport, nor intend, to exonerate the licensee, within the terms of the section, from any other license or privilege taxes. It simply and only fixes a rule for municipal privilege or license taxes. The court does not think the matter is at all debatable, whatever reasonable interpretation is accorded section 221 of the Constitution.

2. There is, of course, no questioning of the power of the state to validly classify appropriate objects of taxation. The question raised and urged is that section 36f attempts an arbitrary, unreasonable classification of persons corporations, etc., for the purpose of their subjection to license or privilege taxes by municipalities, thereby, without legal basis or reason, exonerating some to the disadvantage of others not exempted by the proviso written in section 36f. This section may be taken as creating two classes for the exaction, within the maximum of 2 per cent. of the gross receipts of the business done, of sums for the privilege enjoyed, viz., one composed of those who have paid taxes on their intangible property, and one composed of those who have not paid any taxes on...