Inhabitants of Whiting v. Inhabitants of Lubec

• Decision Date: 09 February 1922
• Citation: 115 A. 896
• Parties: INHABITANTS OF WHITING v. INHABITANTS OF LUBEC.
• Court: Maine Supreme Court

115 A. 896

INHABITANTS OF WHITING

v. INHABITANTS OF LUBEC.

Supreme Judicial Court of Maine.

Feb. 9, 1922.

Report from Supreme Judicial Court, Washington County, at Law.

Two actions by the Inhabitants of Whiting against the Inhabitants of Lubec. On report. Judgment for plaintiff in each case.

Argued before CORNISH, C. J., and SPEAR, HANSON, DUNN, MORRILL, and DEASY, JJ.

C. B. & E. C. Donworth, of Machias, for plaintiff.

J. H. Gray and H. E. Saunders, both of Lubec, for defendant.

DUNN, J. If one incorporated town own property in another, employing it adjunctively in supplying light and water to its citizens, as well as in furnishing its own similar corporate wants, is such property subject to general taxation by the authorities having jurisdiction within the locus where it is situated? So is the question broadly stated. A negative answer would find ready expression, had the Legislature not spoken. Analysis makes evident the purpose of the statute to qualify the otherwise prevailing rule. Laws of 1911, c. 120.

Taxation is an essential attribute of sovereignty. These words, when run down to their last retreat, define a power limited only by positive requirements or prohibitions in the Constitution of the United States or that of this state. No general discussion of the subject of taxation need be here attempted. Sufficient it seems to be to say, by way of stressing what already has been herein said, that the competency of the lawmaking branch of the government concerning this topic, though it know constitutional bounds, does not seek its source in a constitutional grant. Thus recognized in scope, it is patent that the question of whether it be wise or unwise, fit or unfit, to prescribe that certain kinds and classes of property shall Dear taxation, and that other kinds and classes shall not, is for the determination, not of the judiciary, but of the Legislature. Brewer Brick Co. v. Brewer, 62 Me. 62, 16 Am. Rep. 395; Opinion of Justices, 102 Me. 527, 66 Atl. 726; Sawyer v. Gilmore, 109 Me. 169, 83 Atl. 673; Laughlin v. Portland, 111 Me. 496, 90 Atl. 318, 51 L. R. A. (N. S.) 1143, Ann. Cas. 1916C, 734. The public property of the state and that of its governmental divisions is presumptively immune from taxability. Camden v. Camden Vil. Corp., 77 Me. 530, 1 Atl. 689; Somerville v. Waltham, 170 Mass. 160, 48 N. E. 1092. This immunity does not result from a want of power in the Legislature. Dillon, Mun. Corp. § 1396. It rests upon the implication that, when property is held by a body politic for an essentially public purpose, it is not to be presumed that the Legislature intended to tax it. Camden v. Camden Vil. Corp., supra; Worcester County v. Mayor of Worcester, 116 Mass. 195, 17 Am. Rep. 159. There is little or no dissension in the authority but that, in the absence of legislation to the contrary, the property of a municipal corporation used for the public benefit is free from taxation, whether it be within or without the territory of the municipality by which it is owned. Camden v. Camden Vil. Corp., supra; Somerville v. Waltham, supra; Wayland v. County Comm'rs, 4 Gray (Mass.) 500; Worcester County v. Mayor of Worcester, supra; City of Rochester v. Town of Rush, 80 N. Y. 302; Trustees v. Trenton, 30 N. J. Eq. 667; New Castle Common, v. Megginson, 1 Boyce (Del.) 361, 77 Atl. 565, Ann. Cas. 1914A, 1207; West Hartford v. Water Comm'rs, 44 Conn. 360; People v. De Witt, 59 App. Div. 493, 69 N. Y. Supp. 366; People v. Board of Assessors, 111 N. Y. 505, 19 N. E. 90, 2 L. R. A. 148; State v. Gaffney, 34 N. J. Law, 131; Sumner County v. Wellington, 66 Kan. 590, 72 Pac. 216, 60 L. R. A. 850, 97 Am. St. Rep. 396; Com. v. Covington, 128 Ky. 36, 107 S. W. 231, 14 L. R. A. (N. S.) 1214; Schuylkill County Directors v. North Mauheim Directors, 42 Pa. 21; Stein v. Mobile, 24 Ala. 591; Foster v. Duluth, 120 Minn. 484, 140 N. W. 129, 48 L. R. A. (N. S.) 707. But it is clearly within the absolute discretion of the state to subject its own property, and that owned by its political subdivisions, by its arms and by its instrumentalities, to the tax laws, in common with other property. Cooley on Taxation, 263; Trustees v. Trenton, supra; Wayland v. County Comm'rs, supra; Foster v. Duluth, supra. The right of the state to tax is always presumed.

The case in hand, as set out in facts agreed, is this: Lubec, a Washington county town, is empowered to furnish water and light for public and private consumption. It has been so providing water since about 1901. The lighting dates more recently. P. & S. L. 1901, c. 489; P. & S. L. 1919. c. 47. In the town of Whiting, approximately 12 miles away, is certain land with a waterfall upon it. There and thereabouts are a dam, a penstock, and buildings, machinery, and other estate, adapted and used for generating electricity. Transmission lines run thence to and throughout Lubec, where the current traversing them makes public and private lighting conveniently available. Besides, it affords motive power for the water-pumping station, superseding steam. The development in Whiting has been by Lubec, beginning around April 1, 1920, when it entered into possession of an old mill and its privilege, as a nucleus of the present plant. At first, occupancy was under a contract of leasehold and for purchase. In the next year, Lubec bought the fee of this and contiguous real estate. In 1920, and again in 1921, the Lubec property intramarginal Whiting was taxed in the latter town. These actions are for the enforcement of collection. Plaintiff's insistence is that the Legislature, by restricting nontaxability of the property of public municipal corporations to (1) that located within their respective territories and appropriated to public uses; (2) the pipes, fixtures, hydrants, conduits, gatehouses, pumping stations, reservoirs and reservoir dams, located beyond their limits, used in supplying water, power, or light, devolved on the assessors in Whiting the doing of that which they did. Laws of 1911, c. 120. Defense goes only to the propriety of the assessments; regularity otherwise being conceded.

Blackstone regarded the principle of law as well settled that the crown is not bound by a statute, the words of which tend to restrain or diminish any of his rights or interests unless he be specifically named therein. 1 Blk. Com. 262. Like principle applies in favor of the states, in the United States. End. Inter. Stat. § 161. In our own reports, Justice Emery says:

"The state, the people, the public, is not to be considered as" bound, "unless expressly named, * * * however general and comprehensive the language." Goss v. Greenleaf, 98 Me. 436, 57 Atl. 581.

In Massachusetts:

"When land is * * * held for a public purpose, it shall be exempt from taxation in the absence of any express statutory provision to the contrary." Milford Water Co. v. Hopkinton, 192 Mass. 491, 78 N. E. 451.

Chancellor Kent:

"Statutes limiting rights and interests are not to be construed as embracing the sovereign power of government unless the same be expressly named therein, or intended by necessary implication." 1 Kent (13th Ed.) 460.

Courts elsewhere thus state the proposition, in essence: Where the Legislature has made express provision for the exemption of certain classes of public property, the inference is clear that it did not intend that other classes should be exempt. Gate City Guards v. Atlanta, 113 Ga. 883, 39 S. E. 391, 54 L. R. A. 806; Sanitary Dist. v. Martin, 173 Ill. 243, 50 N. E. 201, 64 Am. St Rep. 110.

Under a statute providing that the property of a municipal corporation should be tax free, except the portion not owned within the corporation limits, it was held in New York that real estate owned by a city, but located in another place, and used as a necessary adjunct to its waterworks system, was subject to taxation. City of Rochester v. Coe, 25 App. Div. 300, 49 N. Y. Supp. 502. This decision is affirmed without opinion in 157 N. Y. 678, 51 N. E. 1093, the appellate court saying, in an earlier case in the same volume, that such part of the waterworks system of a municipal corporation as is outside of the corporate limits is subjected to taxation where located. City of Amsterdam v. Hess, 157 N. Y. 42, 51 N. E. 410. A general tax law in that state so subjected it. People v. De Witt, supra.

It is sound principle that, in the interpretation of public statutes, the state and its political subdivisions shall be regarded as excluded unless included by positive legislation. Dillon, Mun. Corp. § 1396, and cases cited. The distinction in the cases is not more marked than is that between denotation and connotation. But the 1911 statute, though applicable to the situation in hand, is not all-inclusive. Using the word, "exemption" for rhetorical ease, rather than in strict accuracy—for "exemption" presupposes a liability to taxation, whereas public property is free therefrom till the Legislature speaks—yet exemption to some extent is still attendant in cases like that here.

Taxation is the general rule, urges the plaintiff. And from Judge Cooley's work on the subject counsel quotes:

"Where a municipality holds property not for governmental purposes, but for the mere convenience of its people, or to supply some need such as water or light which is commonly supplied by a private corporation, the presumption of an intention to exclude such property from taxation would be very slight."

Hence a rule of strict construction is invoked. But the recital is stopped too short. Taxation is the general rule as applied to private property; is the full text of the maxim. Tax laws, to speak in a general way, are understood and intended to apply to private, not to public, property. End. Inter. Stat. § 163. The great text-book, whose page was sought to buttress argument, is always, in matters of this import, somewhat in the nature of an opinion of a court of last resort. From where counsel paused in quotation, it immediately...