Great Western Sugar Co. v. Mitchell
| Decision Date | 26 November 1946 |
| Docket Number | 8654. |
| Citation | 174 P.2d 817,119 Mont. 328 |
| Parties | GREAT WESTERN SUGAR CO. v. MITCHELL, Secretary of State. |
| Court | Montana Supreme Court |
Appeal from District Court, First Judicial District, Lewis & Clark County; A. J. Horsky, Judge.
Action by the Great Western Sugar Company, a corporation, against Sam W. Mitchell, as Secretary of State, to recover taxes paid under protest. Judgment for plaintiff, and defendant appeals.
Reversed and remanded with directions
R. V. Bottomly, Atty. Gen., and Clarence Hanley Asst. Atty. Gen., for appellant.
Gunn Rasch & Gunn, of Helena, for respondent.
This action is to recover taxes paid under protest. Defendant's general demurrer to the second amended complaint was overruled. He refused to plead further and judgment was entered for plaintiff, from which defendant has appealed.
The essential allegations of the complaint are these: That plaintiff is a New Jersey corporation, organized in that state in 1905; that on February 19, 1916, it filed in the office of the secretary of state of Montana a duly certified copy of its articles of incorporation, for the purpose of qualifying to do business in this state, and paid for the filing thereof the fee prescribed by section 1 of Chapter 37 of the Laws of Montana of 1915; that in February, 1945 plaintiff filed a verified report stating the proportion of its capital stock represented in Montana by its property located and business transacted therein during the year 1944, as required by section 4 of Chapter 169 of the Laws of 1931, now section 145.4, Revised Codes; from the report it appears that the proportion of plaintiff's capital stock so represented in Montana during the year 1944 was of the value of $8,193,645, which was an increase of $5,540,145 over the value thereof represented in this state prior to the year 1931; that between the first days of January and March, 1934, plaintiff filed its annual report for the year 1933, as required by section 4, Chapter 169, Laws of 1931, which showed a greater proportion of its capital stock represented by its property and business in Montana for 1933 than that upon which the fee for filing its articles was based, and paid to the secretary of state the sum of $516.68, being the fee for the additional amount represented in Montana for the year 1933, which fee was calculated according to the provisions of section 1, Chapter 37, Laws of 1915; that at the time of filing the report in 1945, the defendant demanded of plaintiff payment of the sum of $929.91, as an additional fee, based upon the increase in the amount of plaintiff's capital stock represented in Montana, as shown by the report. In arriving at that sum, it is alleged, the defendant calculated and determined the additional fee according to the schedule of fees prescribed by section 1, Chapter 169, Laws of 1931, Rev.Codes, § 145.1, which amounted to the sum of $1,478, upon which defendant allowed a credit of $516.68, the fee paid in 1934, and the sum of $31.41 tendered with the report filed in 1945, which sum of $31.41 was the correct amount of the additional fee payable when calculated and determined according to the schedule of fees prescribed by section 1, Chapter 37, Laws of 1915.
The question involved is whether the additional fee of plaintiff corporation must be measured by the rate provided in Chapter 37, Laws of 1915, as contended by plaintiff or by the rate provided in Chapter 169, Laws of 1931, now sec. 145.4, as contended by defendant. That Chapter 37 does not apply we think is clear. It is no longer in effect.
It was entirely supplanted by Chapter 132, Laws of 1923. Chapter 132 doubled the fees to be paid and increased the minimum fee from $20 to $50. It repealed all acts and parts of acts in conflict with it. Section 4 of that Act provided: 'Whenever such report shall show a greater proportion of the capital stock of such foreign corporation represented by its property and business in Montana than that upon which the fee for filing was based, such foreign corporation at the time of filing such report, shall pay such additional fee as it would have been required to pay for filing if such fee has been calculated on the basis of the proportion of the capital stock represented by its business and property in Montana as shown by such report; Provided, that all foreign corporations which have entered Montana for the transaction of business subsequent to February 27, 1915, up to the time when this law shall become effective, shall pay only upon the actual amount of increase in proportion of capital employed in Montana as shown by this report at the rates set out above, but this law shall in no way be considered to authorize collection of fees upon capital stock of such corporations as are in this provision referred to whereby such collection would cause such corporation or corporations to pay upon its entire proportion of capital employed in Montana at the schedule of rates set forth in Section One of this Act.'
The proviso in that section constitutes a legislative interpretation of what the legislature meant by what precedes the proviso. 'The natural and appropriate office of a proviso is * * * to except something from the enacting clause, to limit, restrict, or qualify the statute in whole or in part, or to exclude from the scope of the statute that which otherwise would be within its terms.' (50 Am.Jur., p. 457). This is not always the function of a proviso, however, as the author continues to point out in 50 Am.Jur., p. 457. And see 59 C.J., p. 1087 et seq. It may have the meaning of the conjunction 'and.' State ex rel. Board of County Com'rs of Valley County v. Bruce, 104 Mont. 500, 69 P.2d 97. As used in section 4 above, it is clear that the legislature intended to limit or restrict what had gone before and to exclude from the scope of the statute that which it evidently thought might otherwise be within its terms.
In other words, the obvious legislative intent from the language preceding the proviso was that the increased rate should apply to all foreign corporations. Out of excess precaution the legislature added the proviso to make sure that the increased rate would apply only to the increased capital shown by its report to be represented by Montana business and property and not to that part upon which it had already paid a fee upon filing its articles.
If what precedes the proviso were intended to apply to the rate in effect when the corporation entered the state, then the proviso would be meaningless because in and of itself it does not impose the higher rate but assumes that without the proviso the higher rate applies and the proviso simply assumes to restrict the higher rate to the actual increase in capital represented by Montana business and property over and above that shown at the time of filing its articles. Actually, the proviso adds nothing to section 4 because its provisions without the proviso affected only such increased capital. It does, however, indicate what the legislature thought it had done by the language preceding the proviso.
The question then remains as to whether the provisions of Chapter 169, Laws of 1931, now section 145.1 to 145.7, which have supplanted Chapter 132, Laws of 1923, have application and if so whether that Act prescribes the applicable fee for increased capital shown by the annual reports.
It should be noted that Chapter 95, Laws of 1925, re-enacted the provisions of Chapter 132, Laws of 1923, except that the fee was calculated on the 'authorized capital stock' instead of on the 'capital stock.' The 1925 Act was condemned by this court in Chicago, M., St. P. & P. R. Co. v. Harmon, 89 Mont. 1, 295 P. 762, 764.
Chapter 169, Laws of 1931, is practically a re-enactment of Chapter 132, Laws of 1923, excepting that it omits the proviso in section 4 of Chapter 132 and a change was made in section 5 which is of no moment here. It expressly repeals Chapter 132, Laws of 1923, and Chapter 95, Laws of 1925, and all other acts and parts of acts in conflict therewith. Section 7-A of the Act, now sec. 145.7, provides that the Act shall not apply to corporations which entered Montana for the transaction of business prior to February 27, 1915. In the Harmon case, supra, this court recited the contents of Chapter 95, Laws of 1925, and as to section 4, which is the same as section 145.4 except that it uses the words 'authorized' capital stock, the court stated: "Section 4. Whenever such report shall show a greater proportion of the authorized capital stock * * * represented by its property and business in Montana than that upon which the fee for filing was based, such foreign corporation at the time of filing such report, shall pay such additional fee as it would have been required to pay for filing if such fee had been calculated' at the time of filing its articles.'
The words 'at the time of filing its articles' were not in the statute. There was in that case no issue raised or presented as to which of two rates applied. The only issue was whether the tax could properly be computed on the authorized capital stock. What was said by the court that might be said to be a construction of section 4 was dictum.
The statute meant, however, what the court said as applied to the situation then under consideration because there had at that time been no intervening amendment. We have here a subsequent amendment and hence have before us a different situation. To arrive at the legislative intent, the whole of Chapter 169, Laws of 1931, must be considered.
Section 1 of that Chapter, now section 145.1 Revised Codes, of 1935 provides for the filing of a fee based in amount upon a graduated scale. In part it provides: 'That every foreign corporation required by law to file in...
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