Hugo v. City of Oxford

• Decision Date: 04 October 1937
• Docket Number: 32758
• Citation: 179 Miss. 450,176 So. 156
• Court: Mississippi Supreme Court
• Parties: HUGO v. CITY OF OXFORD

176 So. 156

179 Miss. 450

HUGO v. CITY OF OXFORD

No. 32758

Supreme Court of Mississippi

October 4, 1937

Division B

LICENSES.

Statute imposing privilege license tax on all checking agents in business of checking affairs of business concerns for persons, corporations, or joint-stock companies engaged in business of disseminating information for commercial purposes, did not require that employee of company having contract with motion picture producing company to check business of theaters exhibiting picture company's pictures and to make confidential reports to picture company pay privilege tax, since to "disseminate for commercial purposes" means to spread abroad information to whomsoever will pay for it (Laws 1935, Ex. Sess., chapter 20 section 225, subsec. (n-1), as added by Laws 1936, chapter 154, section 15).

HON. T H. MCELROY, Judge.

APPEAL from the circuit court of Lafayette county HON. T. H MCELROY, Judge.

Action by the City of Oxford against A. B. Hugo. From a judgment in favor of the plaintiff, the defendant appeals. Judgment reversed, and judgment entered for defendant.

Reversed and judgment for appellant.

Hill Jarratt and Thos. J. Tubb, both of West Point, for appellant.

The motion of the defendant for a judgment of "Not Guilty" should have been sustained.

Ross Federal Service, Inc., employer of the defendant, is not a person, firm or corporation, engaged in the business of disseminating information for commercial purposes as defined by Section 15, sub-section (n-1), Chapter 154, Laws of 1936.

The appellant without question was a checking agent engaged in the business of checking the affairs of a place of amusement for a corporation. The question is whether under the facts here he was the agent of Metro-Goldwyn-Mayer or of the Ross Federal Service, Inc., and if an agent of the Ross Federal Service, Inc., whether it was engaged in the business of disseminating information for commercial purposes.

If appellant was the agent of Metro-Goldwyn-Mayer he is not liable for the tax here sought to be imposed. Under the contract between the distributor and exhibitor, the distributor has the right to have present at a percentage picture exhibition, its representative to check the ticket sale, books and gross receipts of the exhibitor. Under the facts the appellant was present at the Lyric Theatre armed with a letter of introduction from the distributor to the exhibitor, making him the representative of the distributor. His authority was direct from the exhibitor. He was not a representative of Ross Federal Service, Inc. Had he been present as a representative of Ross Federal Service, Inc., he would have had no right to check the ticket sale, etc. It is true that appellant was employed by Ross Federal Service, Inc., and made his report, etc., to the distributor through Ross Federal Service, Inc., but this did not change the character of his business employment or service. He performed all of his duties as an agent of the distributor and Ross Federal Service, Inc., was merely the means through which he was employed to represent the distributor. As an agent of the distributor he could not be held liable for the tax. The distributor did not want the information or facts obtained from the check for dissemination for commercial purposes. In fact, its contract was that such information would be treated confidential.

If we be mistaken in our analysis of the facts above and the court should hold appellant the agent or representative of Ross Federal Service, Inc., then the Ross Federal Service, Inc., was the agent or representative of the distributor.

If we be mistaken in both of our contentions above and appellant was no more than the agent of Ross Federal Service, Inc., then Ross Federal Service, Inc., is not a corporation engaged in the business of disseminating information for commercial purposes.

Taxing statutes will be strictly construed in favor of the taxpayer and against the taxing power.

Miller v. I. C. R. R. Co., 111 So. 558, 146 Miss. 422; Wilby v. State, 47 So. 465, 93 Miss. 767; Middleton v. Lincoln County, 84 So. 907, 122 Miss. 673; Board of Levee Comrs. v. Howze Mer. Co., 116 So. 92, 149 Miss. 843; State v. Union Tank Car Co., 119 So. 310, 151 Miss. 797; Pan Am. Pet. Co. v. Miller, 122 So. 393, 154 Miss. 565; McKenzie Lbr. Co. v. Adam Banks Lbr. Co., 128 So. 334, 157 Miss. 482; Conrod Furn. Co. v. Miss. State Tax Co., 133 So. 652, 160 Miss. 185; Gully v. Jackson International Co., 145 So. 905, 165 Miss. 103; Town of Utica v. State ex rel. Rice, 148 So. 635, 166 Miss. 565; State ex rel. Rice v. La. Oil Corp., 165 So. 423, 174 Miss. 585.

Laws imposing taxes are not to be construed beyond the natural import of the language, and are never to be construed as imposing burdens, upon doubtful interpretations.

State v. Grenada Cotton Compress Co., 85 So. 137, 123 Miss. 191; Sperry & Hutchinson Co. v. Harbison, 86 So. 455, 123 Miss. 674; Board of Levee Comrs. v. Howze Merc. Co., 149 Miss. 843; Frazier v. Stone, 156 So. 596, 171 Miss. 56.

Neither Ross Federal Service, Inc., nor this defendant are transient vendors or dealers as defined by Section 15, Chapter 154, Laws of 1936.

Mathiston v. Brister, 145 So. 358.

This defendant in his work comes within the provisions of the exemption allowed by Section 251, Chapter 20, Laws of 1935, Extra Session.

The tax and classification imposed and made by subsection (n-1), Section 15, Chapter 154, Laws of 1936, is confiscatory and the classification is unreasonable and violative of both the Federal and State Constitutions, as to this defendant.

Riley, State Auditor, v. Ayer & Lord Tie Co., 113 So. 214; Adams v. Standard Oil Co. of Kentucky, 53 So. 692; 12 C. J. 1155; Chicago & St. Paul Ry. Co. v. Westby, 178 F. 619; 17 R. C. L. 508; Ballard v. Oil Co., 34 So. 533.

A classification that arbitrarily and unreasonably discriminates between different modes of conducting the same business is void unless there is something in the one mode which makes it more dangerous to the public.

Mayor, etc., City of Vicksburg v. Mullane, 63 So. 412; 37 C. J. 201; 17 R. C. L. 510; Johnson v. Long Furniture Co., 74 So. 283; 37 C. J. 192; Mayor and Board of Aldermen v. Streckfus Steamers, 150 So. 216; Riley, State Auditor, v. Ayer Lord Tie Co., 113 So. 214; Garbutt v. State, 77 So. 189; Wilby v. State, 47 So. 465, 93 Miss. 767.

The tax if held to apply to the defendant is invalid as a restraint on trade and tending to create a monopoly.

Riley v. Ayer & Lord Tie Co., 113 So. 214; Allgeyer v. Louisiana, 165 U.S. 578.

The tax imposed by subsection (n-1), Section 15, Chapter 154, Laws of 1936, is upon interstate commerce and violative of the commerce clause of the Federal Constitution, as to this defendant.

The business of leasing, licensing and distributing motion pictures films is interstate commerce.

State v. Paramount Publix Corp., 152 So. 534; Binderup v. Pathe Exchange, 263 U.S. 291, 68 L.Ed. 308; Fox Film Corp. v. Fed. Trade Co., 296 F. 353; Fox Film Corp. v. Trumbull, 7 F.2d 715; U. S. v. First National Pictures, Inc., 34 F.2d 815; Majestic Theatre Co. v. United Artists Corp., 43 F.2d 991.

The motion of the plaintiff to exclude part of the evidence should not have been sustained.

Mathiston v. Brister, 145 So. 358.

J. W. T. Falkner, of Oxford, for appellee.

The motion of the defendant for a judgment of "Not Guilty" was correctly overruled.

Ross Federal Service, Inc., employer of the defendant, is a person, firm or corporation engaged in the business of disseminating information for commercial purposes as defined by subsection (n-1), Section 15, Chapter 154, Laws of 1936.

Appellant admits that he was employed by Federal Services, Inc., and made his report to Ross Federal Services, Inc., who in turn made a report to Metro-Goldwyn-Mayer. The report was made as a business service flowing from Ross Federal Services, Inc. The distributor grantedly did not want the information for the purposes of commercial dissemination. But Ross Federal Services, Inc., did.

Words, of course, will not be construed beyond their natural import, but neither will they be given a strained meaning to suit the need of the one who must pay the tax.

Commonly the word disseminate conjures up the picture of one person imparting information. He may impart the same information to more than one person or not.

The information which Metro-Goldwyn-Mayer desired belonged first to the agent (appellant), who in the course of his agency imparted it to his principal who in turn sold it to Metro-Goldwyn-Mayer.

It would not be possible to get a set of facts which more clearly fit into a statute than the ones now present. Appellant clearly was a checking agent, he was engaged in the business of checking the affairs of the Lyric Theatre, for his corporation, Federal Services, Inc., who had been engaged to disseminate the information to Metro-Goldwyn-Mayer, for a sufficient...