G. P. Halferty & Co. v. King County

• Decision Date: 16 April 1948
• Docket Number: 30105.
• Citation: 192 P.2d 736,30 Wn.2d 561
• Court: Washington Supreme Court
• Parties: G. P. HALFERTY & CO. v. KING COUNTY et al.

192 P.2d 736

30 Wn.2d 561

G. P. HALFERTY & CO. v. KING COUNTY et al.

No. 30105.

Supreme Court of Washington, En Banc.

April 16, 1948

Rehearing Denied May 27, 1948.

Action by G. P. Halferty & Company against King County, a municipal corporation, Ralph Stacy, Assessor of King County, and Carroll E. Carter, Treasurer of King County, to cancel an assessment and restrain collection of a personal property tax. From the judgment, plaintiff appeals.

Affirmed.

ROBINSON STEINERT, MILLARD, and SIMPSON, JJ., dissenting in part.

Appeal from Superior Court, King County; Howard M. Findley, judge.

Jones & Bronson, of Seattle, for appellant.

Lloyd Shorett, Wm. R. Bell (now deceased), and Milton Heiman (on rehearing), all of Seattle, for respondent.

HILL Justice.

The question here presented involves the construction of the last proviso of Rem.Rev.Stat. § 11130, as amended by chapter 66 Laws of 1939, which reads as follows:

'* * * And provided further, That goods, wares and merchandise manufactured or produced in any of the territories or possessions of the United States situated outside the boundaries thereof, and all raw furs produced outside the State of Washington and brought into the state for the sole purpose of transportation through and to points without the state, while being so transported, or while held in storage in a public or private warehouse awaiting such transportation, shall be considered and held to be property in transit and non-taxable if actually shipped to points outside the state on or Before April 30th of the first year for which they would otherwise be taxable; and the county assessor shall list and assess all such goods, wares, and merchandise as of January 1st of each year, without regard to any average inventory, but shall cancel any such assessment in whole or in proportionate part upon receipt of sufficient documentary proof that the identical property so assessed was actually shipped to points outside the state on or Before April 30th of such year; but no such concellation shall be made unless such proof be furnished to the county assessor Before June 1st of such year. A sale of or transfer of title to any such property, while being so transported or held in storage, shall not operate to defeat the intent or purpose of this proviso.' (Italics ours.) Rem.Rev.Stat. (Sup.) § 11130.

Appellant brings this action to cancel assessments and the personal property taxes based thereon, and to restrain the collection of such taxes. The amended complaint alleges that the appellant was the owner of approximately thirty thousand cases of canned salmon and canned clams which were held in storage in a public or private warehouse in King county of January 1, 1944, and which had been manufactured or produced in territories or possessions of the United States outside the boundaries of the state of Washington, and had been brought into this state within six months prior to that date for the sole purpose of transportation through, and to points outside of, the state of Washington; and that all except five hundred forty-five cases were actually shipped to points outside the state of Washington prior to April 30, 1944; that, through inadvertence and the mistake of appellant's employee, the documentary proof furnished the county assessor listed 11,316 cases as having been shipped to points within the state of Washington; that, in truth and fact, 10,773 of the 11,316 cases had been shipped to points outside the state of Washington Before April 30, 1944. The mistake is thus explained:

'That through the inadvertence and mistake of plaintiff's [appellant's] employee who prepared said affidavit and proof, the proof submitted erroneously indicated that 11,316 cases of salmon and clams at the East Water Way and Salmon Terminal had been shipped to points within the State of Washington; that said mistake arose out of the following circumstances: the plaintiff itself sells a substantial portion of its canned goods directly to dealers throughout the United States; the remaining portion of its canned goods was at that time sold by a firm of brokers known as Pacific Packers Co. in Seattle, Washington, acting as sales and shipping agents; the sales made by and through Pacific Packers Co. were likewise sold to various dealers throughout the United States; as to sales made by Pacific Packers Co. the plaintiff made a memorandum billing to the latter named firm of brokers; the employee, who prepared the pencilled memorandum from which the affidavit filed on May 31, 1944, was copied, listed under the heading of Washington deliveries all cases of salmon and clams sold by and through Pacific Packers Co., who was acting solely as shipping and sales agent, notwithstanding the fact that the cases of salmon and clams included in the sales made by Pacific Packers Co. were also shipped out of the State of Washington prior to April 30, 1944; the mistake of listing, under the column Washington Deliveries in the affidavits and proof that were filed with the defendant [respondent] assessor, all shipments upon sales made by and through Pacific Packers Co. was the result of the employee's failure to understand or comprehend that such sales or deliveries should not be classified as Washington deliveries.'

The amended complaint and bill of particulars further show that an amended and corrected proof was furnished the assessor on August 28, 1945, showing that these 10,773 cases had actually been shipped outside the state of Washington Before April 30, 1944, but that the assessor refused to cancel the assessment on the 10,773 cases, and that a tax had been levied against them in the sum of $2,624.82, and that the county treasurer was threatening to enforce force the payment thereof by distraint proceedings.

Appellant asked that the assessor and the treasurer of King county be required to correct their records to show that the 10,773 cases of canned salmon and clams were exempt, and to cancel the assessment thereof and the tax levied thereon, and that the collection of the tax be restrained.

A demurrer having been sustained to the amended complaint and appellant having failed to plead further, a judgment of dismissal was entered, from which this appeal is taken.

Appellant contends, first, that the timely filing of proof of shipment outside the state is not a necessary condition to the right of exemption under Rem.Rev.Stat. § 11130, as amended by chapter 66 of the Laws of 1939. With this contention we cannot agree. We have had occasion to construe a somewhat similar statute enacted by the same legislature, being chapter 67 of the Laws of 1939. Section 2 of that chapter is as follows:

'All grains and flour, fruit and fruit products, vegetables and vegetable prodducts, and fish and fish products, while being transported to or held in storage in a public or private warehouse shall be exempt from taxation if actually shipped to points outside the state on or Before April 30th of the first year for which they would otherwise be taxable: Provided, That proof of shipment be furnished as required in section 3 of this act.' (Italics ours.) Rem.Rev.Stat. (Sup.) § 11130-5.

Section 3, so far as material, is as follows:

'The county assessor shall list and assess all such grains and flour, fruit and fruit products, vegetables and vegetable products, and fish and fish products as of January 1st of each year, without regard to any average inventory; but shall cancel any such assessment in whole or in proportionate part upon receipt of sufficient documentary proof that the property so assessed was actually shipped to points outside the state on or Before April 30th of such year: Provided, That no such cancellation shall be made unless such proof be furnished to the county assessor Before June 1st of such year: * * *.' (Italics ours.) Rem.Rev.Stat. (Sup.) § 11130-6.

And we also quote § 6 of that chapter:

'The purpose of this act is to encourage the storage of the commodities herein defined in the State of Washington and this act shall be liberally construed.' Rem.Rev.Stat. (Sup.) § 11130-9.

In Libby, McNeill & Libby v. Ivarson, 19 Wash.2d 723, 144 P.2d 258, 260, this statute and the following portions of Rem.Rev.Stat. (Sup.) §§ 11112 and 11265, were construed together:

'§ 11112. * * * All personal property in this state subject to taxation shall be listed and assessed every year, with reference to its value and ownership on the first day of January of the year in which it is assessed: * * *.'

'§ 11265. * * * The taxes assessed upon each item of personal property assessed shall be a lien upon such personal property from and after the date upon which the same is listed with and valued by the County Assessor * * *';

And this court there said:

'In construing and applying these statutes, chapter 67, and this constitutional provision [Art. XI, § 9], they must be read and considered together and with reference to the subjects and classes of property to which they relate. Sections 11112 and 11265 are general statutes dealing with and relating to personal property generally subject to taxation in the state. In the enactment of chapter 67, the legislature stated its purpose, as set forth in § 6 thereof. It was recognized that annually there were large quantities of commodities enumerated therein, that were transported in interstate and foreign commerce; that it would be convenient or necessary to store them for a time in a warehouse; and that under existing statutes they might become subject to taxation. The problem of whether their interstate character was such that they would be subject to taxation without a violation of the Federal constitution, or whether they had come to rest within the state and no longer had an interstate status, would be ever...