Jarman v. School District of Unionville

• Decision Date: 01 April 1915
• Citation: 175 S.W. 893,264 Mo. 646
• Parties: EDGAR A. JARMAN et al., Appellants, v. SCHOOL DISTRICT OF UNIONVILLE et al
• Court: Missouri Supreme Court

175 S.W. 893

264 Mo. 646

EDGAR A. JARMAN et al., Appellants, v. SCHOOL DISTRICT OF UNIONVILLE et al

Supreme Court of Missouri, First Division

April 1, 1915

Appeal from Putnam Circuit Court. -- Hon. George W. Wanamaker Judge.

Affirmed.

E. A Jarman and B. L. Robison for appellants.

(1) Merchants' and manufacturers' statements form no part of the "assessment" and should not be counted in determining the amount of indebtedness a school district should incur. Constitution, art. 10, secs. 11 and 12; R. S 1909, secs. 11623, 11646; R. S. 1879, sec. 6318; State ex rel. v. Railroad, 116 Mo. 15; Thornburg v. School District, 175 Mo. 12; Southworth v. Glasgow, 232 Mo. 108. (2) The amendment to Sec. 6899, R. S. 1889, now Sec. 11623, R. S. 1909, in 1895, has not changed the rule of the cases above cited, because sections 11 and 12 of article 10 of the Constitution prescribe the taxing powers of school districts and must be strictly construed, as must all powers of municipal corporations. 1 Dillon on Mun. Corps. (4 Ed.), 89, 509; 28 Cyc. 1575; 38 Cyc. 647; Carthage v. Light Co., 97 Mo.App. 20. And statutory enactments must harmonize with the provisions of the Constitution. Kansas City v. Thornton, 152 Mo. 570.

N. A. Franklin, J. C. McKinley and Lorenzo Jones for respondents.

(1) Under the Constitution and laws of Missouri school districts are permitted to incur an indebtedness not exceeding in the aggregate five per cent "of the value of taxable property therein," to be ascertained by the assessment next before the last assessment for State and county purposes. Constitution, art. 10, sec. 12; R. S. 1909, sec. 10778. (2) Merchants' stocks of goods are a part of the taxable property in the district, as well as a part of the assessment for State and county purposes, and should be taken into account in determining the amount of the indebtedness that may be incurred by the school district. R. S. 1909, sec. 11623; Thornburg v. School District, 175 Mo. 28; Southworth v. Glasgow, 232 Mo. 108; Baush v. Cabool, 165 Mo.App. 486.

RAILEY, C. Brown, C., concurs.

OPINION

RAILEY, C.

The plaintiffs, who are citizens and taxpayers of the city and school district of Unionville, Putnam county, Missouri, on August 25, 1914, filed in the circuit court of Putnam county, their first amended petition against said school district, the members of the board of directors of said district, and J. T. Morgan, clerk of the county court of said county, in which they charge that at the annual election held in said school district on April 7, 1914, there was submitted to the qualified voters thereof a proposition to incur an indebtedness for thirty thousand dollars for the purpose of erecting a new school building. At said election there were cast "For the Loan" 304 ballots, and "Against the Loan" 99 ballots, thus giving more than two-thirds of the total vote cast for the incurring of the indebtedness.

It is alleged that defendants composing said board advertised for proposals for the purchase of said bonds, to be issued pursuant to said election, and have contracted for the sale of said bonds with Francis Brothers & Company of St. Louis, Missouri; that Putnam county is organized and governed under what is known as the Township Organization Law of this State.

It is alleged that the total taxable property in said school district on June 1, 1911, on which taxes for 1912 were levied, including merchants' and manufacturers' licenses, amounted in the aggregate to $ 747,197.62; that the total valuation of said property, excluding that under merchants' and manufacturers' licenses, was $ 678,757.52 for the 1911 assessment, and $ 686,992.62 for the year 1912; that five per cent of said amounts, the greatest sum for which the said district may become indebted, is $ 33,937.87 for 1911 assessment, and $ 34,349.63 for the 1912 assessment.

It is averred that there is already an outstanding indebtedness of said district of $ 5000, making a total indebtedness for said district, if said bonds for $ 30,000 are issued, of $ 35,000, which is in excess of the indebtedness said school district may lawfully incur.

It is further alleged that said board of directors are preparing to issue said bonds, to negotiate same, and to levy a tax upon the taxable property situate in said district for the purpose of creating a sinking fund for the payment of said bonds and to pay the interest on said bonds; that said county clerk is about to extend said taxes on the tax books of Putnam county, against the property of plaintiffs and others in said district, and that the issuing of said bonds would cause a multiplicity of suits.

The above petition was demurred to by defendants, for the alleged reason that it failed to state a cause of action. The demurrer was sustained; plaintiffs refused to plead further, stood upon said petition, and a final judgment was entered in due form in favor of said defendants. The cause was duly appealed to this court, and we are called upon to determine whether said petition states a cause of action.

Appellants contend that merchants' and manufacturers' statements form no part of the "assessment" and should not be counted in determining the amount of indebtedness a school district might incur. On the other hand, respondents concede that if the merchants' and manufacturers' licenses are to be excluded in determining the value of taxable property in the school district, then the proposed bond issue is in excess of the constitutional limit of indebtedness, as prescribed in sections 11 and 12 of article 10 of the Constitution of Missouri, and the cause will have to be reversed.

In State ex rel. Kidder School District v. Kinney, 48 Mo. 373, 375, this court, in construing the law as it stood in 1868, speaking upon this question, through Judge Bliss, said: "No more comprehensive language could be used than is contained in both acts. The one provides for entering in the merchants' tax book the amount of each kind of tax levied upon the goods, and the other provides that boards may levy taxes upon all property within the district, to be collected as state and county taxes. No exception is made, or exemption provided for, in favor of merchandise, either in the acts under consideration or in the general revenue law; nor can any be implied from the peculiar mode of ascertaining the taxable value of such merchandise."

So that, as the law existed in 1868, and of course before the present constitution was adopted, merchants' and manufacturers' licenses were subject to taxation, with other property located in the school district. The principle of the foregoing case was upheld in City of Cape Girardeau v. Riley, 72 Mo. 220, 223, under the law as it stood prior to 1875.

In State ex rel. v. Tracy, 94 Mo. 217, 221, 6 S.W. 709, this court followed the ruling in State ex rel. v. Kinney, 48 Mo. 373, 375, supra. On page 225, Judge Black, referring to the above case, said: "The merchant's license tax law was the same as now; and the defense was, that there was no law authorizing these school corporations to tax merchants' statements." Then follows the above quotation from the Kinney case, supra. He sustained relator's right to levy the tax in question upon merchants' licenses.

In State ex rel. Allen v. K. C. St. J. & C. B. Ry. Co., 116 Mo. 15, and following, the collector of Holt county, Missouri, sued defendant for delinquent taxes for the year 1888. A controversy arose as to whether the merchants' licenses should be considered in fixing the value of the property in said county for taxation. If included, it made the value of taxable property in said county in excess of six million dollars, and under the provisions of our Constitution only forty cents on the one hundred dollars' valuation could be levied. If the total value of said property were less than six million dollars, then fifty cents on the one hundred dollars' valuation could be levied.

In view of the subsequent change in the statutes upon this subject, we will set out section 6896, Revised Statutes 1889, which reads as follows:

"Merchants shall pay an ad valorem tax equal to that which is levied upon real estate, on the highest amount of all goods, wares and merchandise which they may have in their possession or under their control, whether owned by them or consigned to them for sale, at any time between the first Monday of March and the first Monday in June in each year . . ."

As section 6899, Revised Statutes 1889, was repealed (Laws 1895, p. 223, and following), we simply quote what Judge Burgess said in reference to same, at page 22 of above volume: "The merchant is required to file a sworn statement with the county clerk, on the first Monday in June in each year, of the greatest amount of goods on hand at any time between the first Monday in March and the first Monday in June next preceding; and upon this statement the tax is directly levied. [R. S. 1889, secs. 6896, 6899, 6900.] The merchant's goods and stock in trade never go on the assessor's books at all, nor has the assessor anything whatever to do with it. Neither the assessor nor the board of equalization ever act upon it in any manner."

Judge Burgess, on page 23 of above volume, disposed of the question under consideration, as follows: "The tax of merchants and dramshop keepers, although they are required to pay an ad valorem tax on their stock in trade, is in the nature of a license tax, and the property upon which the taxes are thus paid does not go into and form a part of the general wealth of the county within the meaning of the revenue laws upon which taxes are levied for revenue purposes. No such property is listed by the assessor. The county court is required to fix the rate of taxation and make the levy at the May term (R....