In re Assessment of Prop. Taxes Makee Sugar Co.
| Decision Date | 28 January 1909 |
| Citation | 19 Haw. 331 |
| Parties | IN RE ASSESSMENT OF PROPERTY TAXES MAKEE SUGAR COMPANY. |
| Court | Hawaii Supreme Court |
OPINION TEXT STARTS HERE
APPEAL FROM TAX APPEAL COURT, FOURTH DIVISION.
Syllabus by the Court
The valuation of a sugar plantation made by the tax appeal court is sustained.
W. A. Kinney ( Kinney & Marx on the brief) for the taxpayer.
W. L. Whitney, Deputy Attorney General, for the tax assessor.
This is an appeal by the Makee Sugar Company from a decision of the tax appeal court of the fourth division fixing an assessment of the company's property for taxation at $900,000 as of January 1, 1908, the return being $686,180.90 and the assessor's valuation $1,000,000. This taxpayer conducts a sugar plantation, its property consisting of real and personal property of several classes or kinds of each which are combined and made the basis of an enterprise for profit within the meaning of R. L. Sec. 1216. It was therefore properly assessed on the enterprise for profit theory. In re Wichman, 16 Haw. 793.
The plantation conducted by the taxpayer is situated on Kauai, is an irrigated one, its average annual crop for the eight years preceding 1908 being 8584 tons, the yield per acre varying from 4.04 tons in 1903 to 3.24 in 1907, the average yearly net profit from 1900 to 1907 having been a little over $117,000. The yield for 1908 was estimated to be about 7500 tons, which would return a net profit for that year of about $170,000. The plantation is a well managed one and run economically without having any agent. The capital stock is $500,000. No sales of shares of stock are reported. About one-half of the available cane land of this company was leased from the government, which leases expired May 1, 1907, and were continued by mutual agreement up to May 1, 1908, during which time negotiations in regard to the continuation of the use of the land on new terms were being carried on by the taxpayer and the government. On January 1, 1908, the date of the assessment, it was uncertain how these negotiations would turn out. The testimony taken before the tax appeal court in August, 1908, showed that the negotiations between the government and the taxpayer had been broken off and the land had been returned to the lessor. It was the opinion of the manager of the plantation that with the reduced amount of land the annual crop hereafter would not exceed 3500 tons, which at the most and under extremely favorable circumstances would not return a net profit of more than $50,000, it being also his opinion, however, that there would be no profit...
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