Franklin Cnty. v. Nashville

• Decision Date: 31 December 1883
• Citation: 80 Tenn. 521
• Parties: FRANKLIN COUNTY v. NASHVILLE, CHATTANOOGA & ST. LOUIS RAILWAY, NASHVILLE, CHATTANOOGA & ST. LOUIS RAILWAY v. FRANKLIN COUNTY.
• Court: Tennessee Supreme Court

80 Tenn. 521

FRANKLIN COUNTY

v.NASHVILLE, CHATTANOOGA & ST. LOUIS RAILWAY,

NASHVILLE, CHATTANOOGA & ST. LOUIS RAILWAY

v.FRANKLIN COUNTY.

Supreme Court of Tennessee.

December Term, 1883.

FROM FRANKLIN.

Appeal in error from the Circuit Court of Franklin county. J. J. WILLIAMS, J.EAST & FOGG for Railroad Company.

JOHN R. BEASLEY and ____ METCALF for Franklin County.

COOPER, J., delivered the opinion of the court.

The Legislature, by the act of 1875, ch. 78, undertook to declare the mode and manner of valuing the property of a railroad company for taxation. This act provided for the filing by each railroad company on or before the first of May of each year of certain schedules of its property, and the value thereof, for the appointment of a Board of State Assessors to assess the value of the property and franchises of each company, and a Board of Examiners, consisting of the Governor, Secretary of State and Treasurer, to revise the work of the assessors. The assessors, after having ascertained the total value of the property in the mode pointed out, were directed to deduct therefrom one thousand dollars, as well as the real cash value of the individual shares of each shareholder. The balance thus found was to be divided by the number of miles in the entire length of the road and the result was to be the value per mile of the property of such company for the purpose of taxation. The product of this value multiplied by the number of miles in the State, was to constitute the sum to be taxed to such railroad for State purposes. The product of the value per mile multiplied by the number of miles or fractions thereof, lying and being in any county, was to constitute the sum to be taxed for county purposes. Section 10 of this act reads thus: “That the property of any railroad company lying or being in any city or incorporated town, may be taxed for city purposes, upon a valuation thereof made upon the same basis as of the property belonging to a citizen tax-payer.” The eleventh section of the act exempted from its provisions companies that would accept an amendment to their charter to pay annually for ten years one and one-half per cent on their gross receipts.

In the case of Ellis v. Louisville & Nashville Railroad Company, one opinion in which is reported in 8 Baxt., 530, and another opinion cited in the Memphis & Charleston Railroad Company v. Gaines, 3 Tenn. Ch., 606, the eleventh section of this act was held to be unconstitutional and void.

By the act of 1877, ch. 19, the act of 1875 was amended so as to take away from incorporated towns and cities the right conferred upon them by the tenth section to tax the property of the railroad companies lying within their boundaries, and to restrict the right of taxation of these corporations to the amounts apportioned to such towns by the railroad tax assessors. In the case of the City of Chattanooga v. Railroad Company, 7 Lea, 561, this amendment was held to be unconstitutional and void. It was also held that the provision of the act of 1875, directing the tax assessors to deduct from the aggregate value of the property of each company the cash value of the individual shares of the shareholders was equally unconstitutional and void. That provision was intended to be repealed by the sixth section of the act of 1877, which is: “That the railroad tax assessors, in giving railroad companies exemptions under section 3 of the act passed March 20, 1875, shall deduct only one thousand dollars.” And it appears from the testimony in the case now before us that the cash value of the shares was not deducted from the value of the property of the Nashville, Chattanooga & St. Louis Railway in the assessments made by the State assessors during the period in controversy. The act of 1877, ch. 19, sec. 13, contains this further provision: “That nothing in this act shall prevent the authorities of the various counties and incorporated towns from assessing the value of all railroad property held in their respective counties and towns not included in the assessment herein provided for, or which may not be assessed by the assessors as herein provided.”

The act of 1875 has been further amended by the acts of 1881, ch. 104, and 1882, ch. 16. The latter act was passed to meet the objection to the acts of 1875 and 1877, pointed out by the decision in the case of the City of Chattanooga v. Railroad Company [7 Lea, 561] that they practically prohibited counties and municipal corporations from taxing the real property of the company, lying inside their limits, at their actual value. It provides that the road-bed, rolling-stock, franchise, choses in action and personal property, having no actual situs of a railroad company, shall be known as its distributable property, and shall be valued by the assessors separate from the other property of the company, and the value thereof, after a deduction of $1,000, is to be divided by the number of miles of the whole road, and the result shall be the value per mile of such distributable property of such company for the purpose of taxation. The product of this value multiplied by the number of miles in the State shall be the sum to be taxed to such company upon such distributable property for State purposes. And the products of the value per mile multiplied by the number of miles or fractions thereof in each county and incorporated city or town through which the road passes, shall be the sums to be taxed upon such distributable property by said counties, towns and cities respectively. The depot buildings, yards, grounds and other property, real, personal and mixed, having an actual situs, the act further provides, shall be known as the localized property of such railroad, and shall be valued by the county assessors and city assessors of the several districts and wards in which said property is situated, in the same manner and upon the same principles as the assessment of similar property owned by individuals. The State, counties and towns shall be entitled to a tax upon the value of such property as in other cases.

The act of 1879, ch. 79, sec. 1, provides: “That all collectors of taxes are hereby made assessors to assess all property which, by mistake of law and fact, has not been assessed, and it is hereby made the duty of such collectors in all cases whereby property has not been assessed, but on which taxes ought to be paid by law, to immediately assess the same, and proceed to collect the taxes, and if the owner of the property admits the liability of the property to taxation, but disputes the assessment, he may have a revaluation before the judge or chairman of the county court at any time within one month, and in such case the judge or chairman aforesaid may hear proof and fix the assessment or valuation, and this shall be final.” In Otis v. Boyd, 8 Lea, 679, it was held that the power intended to be conferred by this act was simply to cure any omission of the assessors as to taxes accruing in the year for which the collector was elected, qualified and gave bond. The act directs the collector, as the mode of collecting the tax thus assessed, to obtain from any justice of the peace of his county a warrant or warrants for the taxes, which shall be served on the owner of the property, and returned before a justice of the county, jurisdiction being expressly conferred to try such cases, no matter what the amount, to be tried at once, either party to have the right of appeal to the circuit court, that court, and this court impliedly upon a further appeal, to hear the cases in preference to all others.

The Nashville, Chattanooga & St. Louis Railway is a corporation chartered by the State of Tennessee, whose road extends from Chattanooga, through Nashville, to the Mississippi river at Hickman, in the State of Kentucky. The property of the company, including its road-way and superstructure, has been assessed for taxation during the years 1875, 1876, 1877, 1878, 1879, 1880 and 1881, by the State board of assessors and examiners under the acts of 1875, 1877 and 1881. The road extends through the county of Franklin about thirty-four miles. The value of the road within the county was ascertained in the mode prescribed by the acts referred to, and certified to the county authorities for taxation under the local rates, the taxes for county and school purposes assessed for the years mentioned respectively, and the taxes paid by the company.

In this situation of affairs, on November 29, 1881, the trustee of Franklin county, as tax collector, gave written notice to the Nashville, Chattanooga and St. Louis Railway that on the ninth of December following the company might appear before the county judge of Franklin county, and make defense, if any it had, to an assessment of the property of the company in the county which he had made for taxation, under the act of 1879, for the years 1875 to 1881 inclusive, at the rate of $40,000 of valuation per mile. The company appeared and contested the right of the county to tax its property for those years, and also the value fixed in the assessment. The assessment of the county trustee, after stating the rates of county and school taxes for the years mentioned, was in these words: “My assessment for thirty-four miles of the Nashville, Chattanooga & St. Louis Railroad lying in Franklin county, I have assessed at the rate of forty thousand dollars per mile, which is based upon the best evidence I can get upon the same.” The county judge, after hearing the evidence on both sides, fixed the valuation at twenty-five thousand dollars per mile for each of the years, and ordered the trustee, after allowing the company credit for the assessments paid under the acts of 1875 and amending acts, to collect the taxes due the county for the years specified, upon the basis determined by the decision. The company prayed an appeal from the action of the county judge, which was refused, the judge being of opinion that no appeal would...