In re McConaughy

• Citation: 106 Minn. 392,119 N.W. 408
• Parties: In re McCONAUGHY.
• Decision Date: 08 January 1909
• Court: Supreme Court of Minnesota (US)

106 Minn. 392

119 N.W. 408

In re McCONAUGHY.

Supreme Court of Minnesota.

Jan. 8, 1909.

Appeal from District Court, St. Louis County; Homer B. Dibell, Judge.

In the matter of the appeal of Samuel G. McConaughy from the action and decision of the State Canvassing Board declaring the amendment of Const. art. 9, relating to taxation, to have been adopted. Judgment in the district court for contestant, and the State appeals. Reversed.

(Syllabus by the Court.)

Ed. T. Young and Geo. T. Simpson, for the State.

H. H. Phelps (Baldwin, Baldwin & Dancer and Wm. W. Billson, of counsel), for respondent.

ELLIOTT, J.

This appeal from a judgment entered in the district court of St. Louis county presents questions of very great importance and the results of the decision will be very far-reaching. It will determine the power of the Legislature over methods of taxation, and thus vitally affect the future development of the commonwealth and the individual interests of every citizen. As the Constitution stood from the organization of the state, all taxes were required to be raised under the system known as the ‘general property tax.’ Dissatisfaction with the results of this method and the development of more scientific and satisfactory methods of raising revenue induced the Legislature to submit to the people an amendment to the Constitution which provided merely that taxes shall be uniform upon the same class of subjects. This proposed amendment was submitted at the general election held in November, 1906, and in due time it was certified by the state canvassing board and proclaimed by the Governor as having been legally adopted. Acting upon the assumption that the amendment had become a part of the Constitution, the Legislature enacted statutes providing for a State Tax Commission and a mortgage registry tax, and the latter statute, upon the same thoery, was held constitutional by this court in Mutual Benefit Life Ins. Co. v. Martin, 104 Minn. 179, 116 N. W. 572. The district court found that the amendment had not in fact been adopted, and on this appeal we are required to determine the correctness of that conclusion.

1. The Legislature proposed to the people of the state for their approval or rejection a certain amendment to article 9 of the Constitution, which, when adopted, was to be known as section 1 of said article 9, and to be as follows: ‘Section 1. The power of taxation shall never be surrendered, suspended, or contracted away. Taxes shall be uniform upon the same class of subjects, and shall be levied and collected for public purposes, but public burying grounds, public schoolhouses, public hospitals, academies, colleges, universities, and all seminaries of learning, all churches, church property, and houses of worship, institutions of purely public charity, and public property used exclusively for any public purpose, shall be exempt from taxation, and there may be exempted from taxation personal property not exceeding in value $200, for each household, individual, or heard of a family, as the Legislature may determine: Provided, that the Legislature may authorize municipal corporations to levy and collect assessments for local improvements upon property benefited thereby without regard to a cash valuation, and provided further, that nothing herein contained shall be construed to affect, modify or repeal and existing law providing for the taxation of the gross earnings of railroads.’ Laws 1905, p. 216, c. 168. This proposed amendment will be referred to as the ‘tax amendment.’

By chapter 212, p. 280, of the Laws of Minnesota for the year 1905, the Legislature also proposed to the people of the state for their approval or rejection a certain amendment to section 16 of article 9 of the Constitution of the state, so that said section 16, when amended, should read as follows: ‘Sec. 16. For the purpose of lending aid in the construction and improvement of public highways and brings, there is hereby created a fund, to be known as the ‘state road and bridge fund,’ said fund shall include all moneys accruing from the income derived from investments in the internal improvement land fund, or that may hereafter accrue to said fund, and shall also include all funds accruing to any state road and bridge fund, however provided. The Legislature is authorized to add to such fund, for the purpose of constructing or improving roads and bridges of this state, by providing, in its discretion, for an annual tax levy upon the property of this state of not to exceed in any year one-fourth (1/4) of one mill on all the taxable property within the state: Provided that no county shall receive in any year more than three (3) per cent. or less than one-half (1/2) of one (1) per cent. of the total fund thus provided and expended during such year; and provided, further, that in no case shall more than one-third (1/3) of the cost of constructing or improving any road or bridge be paid by the state from such fund.' This proposed amendment will be referred to as the ‘good roads amendment.’

These two proposed tax amendments were submitted to the people of the state for their approval or rejection at the general election held on November 6, 1906. At this election 284,366 votes were cast. On December 21, 1906, the state canvassing board found from the returns submitted to it that 156,051 of the electors of the state voting at the election had voted for the tax amendment, and thereupon it declared that the tax amendment had been adopted by a majority of 13,568 votes. On December 27, 1906, the Governor of the state made his proclamation of the fact, as required by law. On December 21, 1906, the state canvassing board on the returns submitted to it also found that 141,870, and no more, of the electors of the state voting at the general election of 1906, had voted for the good roads amendment, and thereupon declared that the good roads amendment lacked 313 votes of being adopted. Both amendments were submitted throughout the state as required by law upon a separate pink ballot, and the result of the ballots cast thereon was likewise counted upon separate pink tally sheets. On the ballots the good roads amendment appeared as No. 1, and the tax amendment as No. 2. No. 3 was an amendment which is in no wise involved in the present matter. On the tally sheets the tax amendment was printed first and the good roads amendment second, in order. At the time of the election there were 83 counties in the state, divided into 2,670 election districts.

On December 29, 1906, the contestant, Samuel G. McConaughy, served upon the Secretary of State a notice of contest, in which it was alleged that the tally books and tally sheets used in each precinct at the general election of 1906 had printed thereon the so-called tax amendment as the first in order, and the so-called good roads amendment as the second in order, and that on the official ballots used at the election the good roads amendment appeared first and the tax amendment second in order, and that by reason of such transposition many ballots cast for or against the good roads amendment were by mistake counted and returned as having been cast in favor or against the tax amendment, and that many of the ballots cast for or against the tax amendment were by mistake counted for or against the good roads amendment; that of the votes of the electors voting at said election a majority of the same were not cast in favor of the adoption of the tax amendment, and that in fact the tax amendment had been thereby rejected, but that a majority of the votes of the electors voting at the election had been cast in favor of the good roads amendment and that the same had been thereby adopted. By the filing of the points of contest and notice of appeal with the Secretary of State the contestant attempted to institute a contest and to appeal to the district court, under the provisions of sections 336 and 337, Rev. Laws 1905, from the determination of the state board of canvassers as to the adoption of the tax amendment and the proclamation of the Governor of the state declaring the same a part of the Constitution of the state. A similar contest was entered and appeal taken from the finding that the good roads amendment had not been adopted. The notices of appeal and points of contest were delivered by the Secretary of State to the Attorney General.

In January, 1907, the district court, under the provisions of sections 336 and 337, Rev. Laws 1905, appointed inspectors to inspect the ballots cast on the constitutional amendments at said election, and thereafter the inspectors examined and counted the ballots in 654 of the election districts out of the 2,670 election districts in the state, and in six months' time counted in all about 141,000 of the ballots cast on the good roads and tax amendments. The inspectors also endeavored to count the ballots in 71 of the other election precincts of the state, but were unable to do so for the reason that the ballots therein had been lost or destroyed. No effort was made to inspect or count the ballots in the remaining 1,945 voting districts of the state, and no ballot evidence was offered before the court with reference to those precincts. The inspectors appointed by the court endeavored to count ballots in all of the counties of the state except two, but not all of the ballots in any one county were counted. When the matter came on for hearing before the district court, the Attorney General appeared and objected to the jurisdiction of the court and to the proofs. This objection was overruled, and the court found upon the evidence submitted to it that the total number of affirmative votes for the tax amendment in the state was 140,714. This conclusion was reached by taking the return of the state canvassing board as to the precincts of the state which were not recounted by the inspectors, and finding therefrom that 83,349 votes had been cast therein in favor of said tax amendmen...