Kelly v. Finney

• Decision Date: 21 February 1935
• Docket Number: 26442
• Citation: 194 N.E. 157,207 Ind. 557
• Parties: KELLY v. FINNEY et al
• Court: Indiana Supreme Court

194 N.E. 157

207 Ind. 557

KELLY v. FINNEY et al

No. 26442

Supreme Court of Indiana

February 21, 1935

Action by Hubert S. Kelly, on behalf of himself and others similarly situated, against Frank Finney, etc., and others. From a judgment for defendants, plaintiff appeals.

Affirmed.

Appeal from Superior Court, Marion County; Clarence E. Weir, judge.

Albert Ward and Fred F. Shick, both of Indianapolis, for appellant.

Philip Lutz, Jr., of Boonville, and Joseph P. McNamara, and Joseph W. Hutchinson, both of Indianapolis, for appellees.

OPINION

ROLL, Judge.

This is an action by appellant, Hubert S. Kelly, the owner and operator of several motor vehicles for hire on behalf of himself and others, similarly situated, but too numerous to be joined as plaintiffs, against appellees, for an injunction to prevent appellees and those acting under their direction and in concert with them, from enforcing chapter 153 of the Acts of the General Assembly for the year 1933, Burns' Ann. Stat. 1933, § 47-1106 et seq.; Acts 1933, p. 803 ^[1] concerning the payment of fees by the owners of motor vehicles for hire. The issues were joined by a general denial by each appellee, and the cause was submitted to the court with the request for special findings of facts and conclusions of law. Special findings of fact with conclusions of law stated thereon were made, signed, and filed by the court.

Conclusions of law to which appellant reserved proper exceptions were as follows:

'First. That the law is with the defendants, and said chapter No. 153 of the Acts of the General Assembly of the State of Indiana, at its session of 1933, being House Bill No. 157, and entitled 'An Act concerning the payment of fees by the owners and operators of motor vehicles for hire,' is constitutional and valid.

'Second. That the plaintiff take nothing by his action herein, and the defendants shall recover their costs taxes at $ _____.

'Dated at Indianapolis, Indiana, this 6th day of April, 1934.

'Clarence E. Weir,

'Judge of Superior Court Room No. 4.'

Judgment was afterwards rendered against appellant upon said conclusions of law, and it was adjudged by the court that said chapter 153 was constitutional and valid. Appellant thereafter perfected this appeal, assigning as error: (1) The court erred in its first conclusion of law; (2) the court erred in its second conclusion of law.

The facts as found by the court disclose that appellant is a citizen of the United States and a resident of the city of Terre Haute, Ind. He owns and uses four motortrucks in which he has invested $ 3,600; that said trucks were duly and properly listed for taxation, and that all ad valorem taxes due thereon have been paid, and all other taxes except the taxes imposed by the act here in question; that the Highland Creamery Company of Terre Haute, Ind., is engaged in the manufacture of dairy products and as an incident to said business has established and maintains what is known as substations at various points in Illinois and in Indiana; that said substations serve as a market depot for farmers and producers in their respective localities; that appellant is employed by the said Highland Creamery Company to haul the cream from these various substations to its plant in Terre Haute; and that by reason of being so engaged the trucks owned by him and used in such hauling are subject to the tax imposed by chapter 153, hereinafter set out.

The special findings disclose that appellant uses four trucks in this business, and each truck has a different route. On one route appellant's truck traverses approximately 5,400 miles of Indiana highways per annum; another, 4,675 miles; another, 10,400 miles; and the other, 792 miles. The record further discloses that other persons, firms, and corporations engaged in truck transportation of freight use larger trucks and a larger number and to a greater extent than does appellant. Some of these users of the highway transport merchandise owned by themselves as an incident to their business; others are engaged in truck transportation for hire, but pay no tax under the act in question, being exempt therefrom under section 2 of said act. For example, the record shows that the Polk Sanitary Milk Company owns 76 motortrucks, the average weight of which is 4,000 pounds, and each travels an average of about 33 miles daily in the city of Indianapolis and within a radius of 40 miles thereof, said trucks being used in the distribution of dairy products to consumers; that they use 56 additional trucks averaging 5,600 pounds each to haul dairy products from the farmers and producers to their plant in Indianapolis. The record further shows that the Indiana Condensed Milk Company uses 35 motor vehicles and 5 4-wheeled trailers and 19 one-half ton trucks, weighing from 2,775 pounds to 9,200 pounds, engaged in the business of processing raw milk; that said trucks travel about 45,000 to 55,000 miles per year over Indiana highways; that Schlosser Brothers are engaged in the creamery and ice cream business and use 162 trucks weighting from 2,500 to 9,000 pounds, most of which are engaged in collecting milk and cream at the farmers' door and hauling it to the plant of the company where it is manufactured into butter and ice cream. Each truck averages about 60 or 70 miles per day. The record also shows that large department stores use a great number of motor vehicles in delivering merchandise sold to their customers; that meat packing companies and canning companies use a large number of heavy trucks in the distribution of their own products; that transfer and storage companies engaged in transporting household goods use many large trucks in their business.

We have not mentioned all of the persons, firms, and corporations mentioned in the record, but sufficient, we think, to present the questions fairly.

The record further discloses that the state of Indiana, through its highway commission, from 1919 to 1933 expended in round numbers $ 82,000,000 in highway construction, and the further sum of $ 26,000,000 for 'betterments,' which is a class of small construction; that the cost of maintenance of these highways from 1920 to 1932 amounted to approximately $ 36,000,000; that the average cost for maintenance of highways from 1924 to 1932, inclusive, was $ 488 per mile.

Chapter 153 of the acts of the General Assembly of the state of Indiana for the year 1933, supra, provides, in substance, as follows:

Section 1 defines the meaning of certain terms used in the act.

Section 2 provides that the provisions of the act shall not apply to certain motor vehicles.

Section 3 provides:

'That in addition to all license fees and taxes otherwise imposed by law upon motor vehicles, there shall be paid to the secretary of state of the State of Indiana, annually, by each motor carrier to which this act applies, the following fees upon each motor vehicle to which this act applies owned or operated by such motor carrier upon any of the highways of the State of Indiana, to wit:

'Upon each motor truck, tractor, trailer or semi-trailer the sum of one dollar ($ 1.00) per one hundred pounds of actual gross weight, fully equipped for transportation of freight.'

Section 4 provides that the act shall apply to interstate as well as intrastate business.

Section 5 provides the effective date of the act, and further provides for one-half of the fees provided the vehicle is acquired or operated after August 1st of any year.

Section 6 provides that the fees herein prescribed shall become a part of the general funds of the state to be credited to the state highway fund and to be used by the highway commission for the construction, maintenance, and repair of state highways, except so much thereof as may be appropriated for the expenses of administering the act.

Section 7 provides for application blanks to be furnished by the secretary of state and metal plates to be displayed on the vehicle.

Section 8 makes it a misdemeanor for failure to comply with the act, and fixes penalty therefor.

Section 9 provides the date when the act takes effect.

Appellant's first proposition under his first assignment of error is that said chapter 153, supra, is unconstitutional and void; that said act denies to him the equal protection of the law and deprives him of his property without due process of law as guaranteed him by section 1 of the Fourteenth Amendment of the Federal Constitution. Section 1 of the Fourteenth Amendment provides as follows: 'No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, of property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.'

Appellant says that the classification made by said chapter 153, supra, namely, trucks used for hire as distinguished from trucks not used for hire, is an unauthorized classification.

We are unable to agree with this proposition. It is clear, we think, that chapter 153, supra, is not a regulatory measure, exercised under the police power granted by the Constitution, but has for its purpose the raising of revenue to be used in constructing and maintaining its highways, and, in furtherance of this purpose, selects as a general class motor vehicles used in transporting property for hire over the public highways of the state as the basis for the imposition of the tax.

It must be remembered that the Fourteenth Amendment to the Constitution of the United States, as far as the taxing power of the state is concerned, does not compel an unbending rule of equal taxation, nor does it prevent discretion in the selection of subjects or the...