Kussrow v. Pitney-Bowes Postage Meter Co.

• Decision Date: 09 May 1944
• Citation: 154 Fla. 417,18 So.2d 25
• Parties: Van C. KUSSROW, Acting Tax Assessor of Dade County, Florida; H. Ernest Overstreet, Tax Collector of Dade County, Florida; and J. M. Lee, Comptroller of the State of Florida, Appellants, v. PITNEY-BOWES POSTAGE METER COMPANY, a Delaware Corporation Authorized to Transact Business in the State of Florida, Appellee.
• Court: Florida Supreme Court

18 So.2d 25

154 Fla. 417

Van C. KUSSROW, Acting Tax Assessor of Dade County, Florida; H. Ernest Overstreet, Tax Collector of Dade County, Florida; and J. M. Lee, Comptroller of the State of Florida, Appellants, v. PITNEY-BOWES POSTAGE METER COMPANY, a Delaware Corporation Authorized to Transact Business in the State of Florida, Appellee.

Florida Supreme Court

May 9, 1944

Rehearing Denied June 7, 1944.

Appeal from Circuit Court, Dade County; Arthur Gomez Judge.

Ward &amp Ward, Melbourne L. Martin, and Hudson & Cason, all of Miami, for appellants.

R. P Terry, of Miami, for appellee.

PER CURIAM.

Affirmed.

It is so ordered.

BUFORD, C. J., and TERRELL, CHAPMAN, THOMAS, and SEBRING, JJ., concur.

BROWN and ADAMS JJ., dissent.

ADAMS, Justice (dissenting).

The Circuit Court of Dade County held invalid a tax levied against certain postage meter machines and fixed a lower valuation thereon for tax purposes. The court based its decree on the finding:

'* * * that the Plaintiff's property so assessed had a value as of the time of assessment, based upon manufacturing cost depreciated upon a basis accepted by all parties to the suit, of $1767.45; that said property in the year 1941 yielded a net income of $989.03; that such property when new has a useful life of five years of which three and one-half years had elapsed in the case of the property in question so that, based upon earnings said property was worth at the time of assessment a maximum of $1,483.54; that said property is never sold and therefore has no market value; that it appears that the earnings of said property are produced in part by Plaintiff's service organization but the evidence as to this contribution is insufficient to be given weight in this decree; that the true cash value of Plaintiff's property should be determined by giving due weight to the depreciated cost thereof and its net earning power, which latter factor is a sum which is earned over a period of a year and a half; that from a consideration of said factors the Court does hereby determine that the true cash value of the Plaintiff's property as of the time of assessment was the sum of Twelve Hundred ($1200.00) Dollars * * *.'

The appellants' position can best be shown by this part of his answer:

'(A) These defendants admit that the plaintiff returned these eighty-three postage meters for a full depreciated value of $1,767.45, which said figure was assumed to be correct by the Tax Assessor and threr is no dispute on that item.

'(B) The Tax Assessor then capitalized the net income for the year 1941 which was taken from the returns filed by the plaintiff, to-wit, the amount of $989.03. This item of $989.03 was the net income from these meters according to the figures of the plaintiff and after the plaintiff had taken full credit for all repairs and servicing costs. The defendants would further show that the item of depreciation was considered in the figure arrived at the Subdivision (A) hereof, and that therefore there is no dispute between the plaintiff and the defendants or the Tax Assessor with reference to the depreciated value of $1767.45 or the net income for the year 1941 of $989.03.

'(C) Further answering said paragraph, these defendants would show unto the court that these particular machines are patented machines and that they have a value far in excess of the actual physical replacement cost; that the value of the machines which can be used only under the rules and regulations of the United States Post Office Department is made up not only of the cost of physical replacement, but the many years of experimentation, patent rights and the monopoly created thereby in the nature of a franchise right insuring a constant and monopolistic return to the plaintiff and as a conditional element of value the experimentation and ultimate adoption by the Post Office Department under those rules and regulations permitting the use of these machines is an increased item of value. That as an additional increased item of value the Tax Assessor must have considered under his official duties the installation value of these articles in that they were actually in use and doing business and yielding a return and that therefore the only way to place a tangible value upon these pieces of equipment is to consider the intangible worth together with the actual physical value, less the reasonable depreciation. That in order to capitalize the intangible value of the tangible assessment, the earning capacity or income reduced to a net figure is the most important of all factors entering into an assessment of this type. That based upon this theory, the Tax Assessor capitalized the net income value on the agreed figures on a 6% table which is the percentage basis adopted by the Comptroller of the State of Florida acting as Tax Commissioner on fixing the valuation of intangible personal property which is based only upon its net return and productivity. That at the present time the Tax Commissioner aforesaid has reduced the figure of 6% to 4% thereby increasing the assessed value of said properties when based upon the...