In Re: Tax Assessments v. Charleston Federal! Savings & Loan Association

• Decision Date: 22 February 1944
• Docket Number: (No. 9501)
• Citation: 126 W.Va. 506
• Court: West Virginia Supreme Court
• Parties: In Re: Tax Assessments Against Charleston Federal!Savings & Loan Association, First Federal Savings &Loan Association, West Virginia Building and LoanAssociation and Empire Savings & Loan Association

126 W.Va. 506

In Re: Tax Assessments Against Charleston Federal!

Savings & Loan Association, First Federal Savings &

Loan Association, West Virginia Building and Loan

Association and Empire Savings & Loan Association

(No. 9501)

Supreme Court of Appeals of West Virginia.

Submitted January 19, 1944.

Decided February 22, 1944.

1. Taxation

"The legislature has power to prescribe the method by which the valuation of any class of property may be ascer- tained, and, where the value of the same class of property is ascertained throughout the state in the same manner, such valuation can not be regarded as unconstitutional for lack of uniformity or equality." Charleston & Southside Bridge Co. v. County Court, 41 W. Va. 658, Pt. 2, Syl., 24 S. E. 1002.

2. Taxation

Under Section 1, Article X of the Constitution of West Virginia, the legislature has power to direct by law the method of assessment of all classes and types of property, and to apply different methods to different types of property, even though included in the same constitutional classification as respects the rate of levies which may be laid thereon.

3. Taxation

To entitle a complaining taxpayer to relief under the "equal and uniform" provision of Section 1, Article X of the Constitution of West Virginia, there must be a clear showing of discrimination against him in the assessment of the same type of property. Such discrimination is not established where the showing is only that other property of a different type is assessed at less than its apparent or face value, through a process of estimation, and in a good faith effort to arrive at the true and actual value thereof.

Appeal from Circuit Court, Kanawha County.

In the matter of the tax assessments against the Charleston Federal Savings & Loan Association and others. From an order of the Circuit Court which reversed the action of the Board of Review and Equalization and fixed the assessments at the amount originally made by the assessor following instructions of George P. Alderson, State Tax Commissioner, the Charleston Federal Savings & Loan Association and others appeal.

Affirmed.

Koontz & Koontz, W. Elliott Nefflen and Harry B. Lambert, for appellants.

Ira J. Partlow, Acting Attorney General, and Kenneth E. Hines, Assistant Attorney General, for appellees.

Fox, Judge:

The appellants, Charleston Federal Savings & Loan Association, First Federal Savings & Loan Association, West Virginia Building & Loan Association, and Empire Federal Savings & Loan Association, complain of a final order of the Circuit Court of Kanawha County, entered on the 23rd day of December, 1941, fixing the 1941 assessment for tax purposes of the intangible property owned by them, respectively. Their appeal is prosecuted under the provisions of Code, 11-3-25, as amended by Chapter 41, Acts of the Legislature, Regular Session, 1933.

The Assessor of Kanawha County, following instructions of the State Tax Commissioner, made the following assessments of the intangible property of the appellants, taxable in said county, for the year 1941: Charleston Federal Savings & Loan Association, $921,180; First Federal Savings & Loan Association, $249,080; West Virginia Building & Loan Association, $69,490; and Empire Federal Savings & Loan Association, $273,880. On protest filed before the county court of said county, acting as a Board of Review and Equalization, under the provisions of Article 3, Chapter 41, Acts Regular Session, 1933, a hearing was had before said board, which resulted in an order reducing said assessments approximately thirty per cent, and they were fixed as follows: Charleston Federal Savings & Loan Association, $639,030; First Federal Savings & Loan Association, $170,450; West Virginia Building & Loan Association, $48,230; and Empire Federal Savings & Loan Association, $189,600. These reductions appear to have been made solely on the theory that other property of the same class, in the same taxing district, was assessed at approximately seventy per cent of its true and actual value, and that the assessments made by the assessor discriminated against protestants. No contention has ever been made that the assessments of the property of the appellants, made by the assessor, were in excess of the true and actual value thereof.

The State Tax Commissioner prosecuted an appeal from the action of the Board of Review and Equalization to the Circuit Court of Kanawha County, and, on December 23, 1941, that court entered an order reversing the action of said board and fixing the assessments in question at the same amounts as those originally made by the assessor, from which action of the circuit court we granted this appeal.

The property of the appellants, the assessment of which is here involved is Class I property, as defined by Article 8 of Chapter 38, Acts Regular Session, 1933, and carries an initial tax rate of fifty cents on each one hundred dollars valuation. This statutory classification was made under Section 1, Article X of our Constitution, the pertinent provisions of which are:

"Subject to the exceptions in this section contained, taxation shall be equal and uniform throughout the state, and all property, both real and personal, shall be taxed in proportion to its value to be ascertained as directed by law. No one species of property from which a tax may be collected shall be taxed higher than any other species of property of equal value; except that the aggregate of taxes assessed in any one year upon personal property employed exclusively in agriculture, including horticulture and grazing, products of agriculture as above defined, including live stock, while owned by the producer, and money, notes, bonds, bills and accounts receivable, stocks and other similar intangible personal property shall not exceed fifty cents on each one hundred dollars of value thereon * * *."

In connection with the constitutional provision quoted above, it is well to keep in mind the general provisions of our statute, Code, 11-3-1, relating to the assessment of property of all classes. These are:

"All property shall be assessed annually as of the first day of January at its true and actual value; that is to say, at the price for which such property would sell if voluntarily offered for sale by the owner thereof, upon such terms as such property, the value of which is sought to be ascertained, is usually sold, and not the price which might be realized if such property were sold at a forced sale, * * *."

Questions affecting the assessment of the property of building and loan associations have received the attention of the courts and the legislature in recent years. Prior to the adoption of the tax limitation amendment, (Section 1 of Article X of the Constitution) and enabling statutes enacted thereunder, the property of building and loan associations was not assessed for tax purposes to the association itself, but investments therein were assessed to individual firm or corporate stockholders, following the decision of this Court in Ohio Valley Building and Loan Assn. v. County Court, 42 W. Va. 818, 26 S. E. 203. However, in the later case of Charleston Federal Building & Loan Association v. James, 120 W. Va. 781, 200 S. E. 845, decided on December 8, 1938, it was held that, "Both state and federal building and loan associations are incorporated companies within the meaning of Code, 11-3-12, and are corporations within the meaning of Code, 11-3-13. Therefore, their intangible and other personal property is subject to taxation."

The legislature convened in regular session in January, 1939, and was charged with knowledge of the case last cited above when it enacted Chapter 118 of the Acts of that session, now carried in Michie's Code, 1943, as Section 14a, Article 3, Chapter 11. That section is a comprehensive one, and covers in detail all phases of the assessment of the property of building and loan and federal savings and loan associations. We note the first paragraph of the section, which reads as follows:

"The capital of every building and loan association and federal savings and loan association, as represented or evidenced by the investment shares and investment accounts in such association, shall be assessed at its true and actual value, according to the rules prescribed by this chapter, to such building and loan association or federal savings and loan association in the county, district and town where such association is located; Provided, however, That such shares and such accounts held by the United States government or any of its agencies shall not be included in determining the assessment. The real and actual value of such capital, represented by the market value of such investment shares and investment accounts as aforesaid, shall be ascertained according to the best information which the assessor may be able to obtain whether from any return made by such association to any officer of this state or the United States, from actual sales of such investment shares and investment accounts, from answers to questions by the assessor, as hereinafter provided, or from other trustworthy sources."

Paragraphs 2 and 3 of the section go into further detail as to the duties of the officials of such associations, the assessment of its real estate, and other details not necessary to consider here.

We do not understand that appellants question either the intent or the power of the legislature to fix the methods of assessment of the particular type of property owned by building and loan and federal savings and loan associations. The power of the Legislature to enact such a statute seems clear, and has been exercised in a number of instances. For example, Code, 11~6, as amended, covers the assessment of the property of public service corporations; Code, 11-3-12 and 13, prescribes how the property of other corporations shall be assessed; Section 14 of the same article, as amended by Chapter 40, Acts Regular Session, 1933, provides for the assessment of the...