McPherson v. Fisher

CourtSupreme Court of Oregon
Writing for the Court[143 Or. 616] CAMPBELL, Justice.
Citation23 P.2d 913,143 Or. 615
Decision Date05 July 1933
PartiesMcPHERSON v. FISHER et al., State Tax Commission.

23 P.2d 913

143 Or. 615

McPHERSON
v.
FISHER et al., State Tax Commission.

Supreme Court of Oregon

July 5, 1933


In Banc.

Appeal from Circuit Court, Multnomah County; Robert G. Tucker, Judge.

Suit by Ruth C. McPherson against Earl L. Fisher and others, as the State Tax Commission. From a decree of dismissal, plaintiff appeals.

Affirmed.

W. Lair Thompson and Ralph H. King, both of Portland (Arthur K. McMahan, of Albany E. O. Immel, of Eugene, and McCamant, Thompson & King, of Portland, on the brief), for appellant.

Willis S. Moore, of Salem (I. H. Van Winkle, Atty. Gen., on the brief), for respondents.

[143 Or. 616] CAMPBELL, Justice.

This is a suit instituted under chapter 335, p. 572, General Laws of Oregon, 1931, for the purpose of reviewing the action of the state tax commission in refusing to assess plaintiff's intangible income tax for the year 1931 under the law known as the Property Tax Relief Act of 1929, § 69-1501 et seq., Oregon Code 1930.

Plaintiff, during the entire year of 1931, was the wife of George L. McPherson, and for that year had a net income from intangibles owned by her separately of $488.94. For the same year, her husband had a net income from all sources in excess of $3,000. Plaintiff made her income tax return for the year 1931 on forms furnished by the tax commission showing the above facts, and was assessed a tax, at the rate of 8 per cent. on her full income, amounting to $39.11, which was paid in semiannual installments. Thereafter she petitioned the tax commission for a revision of the tax assessed against her. The commission denied her petition. She thereupon brought this suit under section 28, chapter 335, p. 585, Oregon Laws 1931, in the county of her residence within 60 days after receipt of notice of the order of the tax commission denying her petition for revision, her contention being that chapter 335, Oregon Laws 1931, and particularly division b of subdivision 1 of section 11 thereof, is unconstitutional, in that it violates the due process and equal protection clauses of the Fourteenth Amendment of the United States Constitution; that it is repugnant to sections 20 and 32 of article 1, and section 1 of article 9, of the Oregon Constitution.

A demurrer was filed to the complaint on the grounds (1) that the court had no jurisdiction of the subject-matter, and (2) that the complaint did not state [143 Or. 617] facts sufficient to constitute a cause of suit. The demurrer was sustained, and, plaintiff declining to further plead, the suit was dismissed. Plaintiff appeals.

The pleadings present two questions: (1) Is the procedure adopted sufficient to give the court jurisdiction to entertain this suit? (2) Is the Intangibles Income Tax Act of 1931 (chapter 335, Oregon Laws 1931) constitutional?

"The controversy is one as to the boundaries of legislative power. It must be dealt with in a large way, as questions of due process always are, not narrowly or pedantically, in slavery to forms or phrases." Justice Cardozo in Burnet v. Wells, 53 S.Ct. 761, 764, 77 L.Ed. -.

We approach the consideration of the constitutionality of the statute with the [23 P.2d 914] thought that the legislative branch of the government, in enacting the law, had in mind the various provisions of the Constitutions of the United States and of the state of Oregon. We must presume that the enactment is valid. We understand that the burden of proof is on the party attacking its invalidity to establish his contention, and that, before we should declare the act void, by reason of conflict with the organic laws of the country, we should be convinced beyond a reasonable doubt of its repugnance thereto. We must also realize that we are not concerned with, nor permitted to take into consideration, the "desirability, expediency, policy, justice, or wisdom of its enactment." Eastern & Western Lumber Co. v. Patterson, 124 Or. 112, 258 P. 193, 196, 264 P. 441, 60 A. L. R. 528; Wright v. Beveridge, 120 Or. 244, 251 P. 895; Kinney v. Astoria, 108 Or. 514, 217 P. 840; Astoria v. Cornelius, 119 Or. 264, 240 P. 233. The duty of raising revenue is one that the Constitution has declared absolutely to be a legislative function only.

[143 Or. 618] "No tax *** shall be imposed without the consent of the people or their representatives in the legislative assembly. ***" Article 1, § 32, Oregon Constitution.

We must appreciate the fact that it is very difficult, if not nigh impossible, to construct a revenue raising law, by which it can be demonstrated to a mathematical certainty that the tax burden is laid evenly on each taxpayer according to his ability to pay or benefits received. Nor can such an act be so framed as to make the duty of contributing to the cost of government a pleasure to all taxpayers. "The average citizen can usually contemplate with undisturbed serenity the law that imposes a tax on the other fellow." With these fundamentals in mind, we proceed to the further consideration of the cause.

1. It is unnecessary to pass upon the question of procedure at this time. Plaintiff, in her opening brief, asserts that section 28 of chapter 335, Oregon Laws 1931, makes provision for this kind of a suit. In her reply brief, she claims that the suit is brought under section 69-1528 and section 69-1529, Oregon Code 1930. We are not concerned at this time with the procedure by which the case got to this court. It is here. The circuit court, in which it was tried, is a court of competent general jurisdiction, and had jurisdiction of the subject-matter and of the parties. The statute has made provision for the maintenance of such a suit "in any court of competent jurisdiction." Chapter 335, section 28, Oregon Laws 1931. The state thereby consents that such a suit may be maintained. The controversy has been presented in such a way that the court may determine the questions involved without injury to any one. It is important that the procedure laid down by the Legislature should be followed in order that parties [143 Or. 619] have a trial in the manner provided by law. However, "procedure is a means to an end and not a fetish to be worshipped."

The Intangibles Income Tax Act of 1931 (chapter 335, Oregon Laws 1931) must be read in connection with the Property Tax Relief Act of 1929 (chapter 448, General Laws of Oregon, 1929, section 69-1501 et seq., Oregon Code 1930). The Property Tax Relief Act of 1929 imposes a tax upon every individual with respect to the taxpayer's entire net income from every source whatsoever. Id.§ 69-1503. "'Net income' means the gross income *** less the deductions allowed by this act." Id. § 69-1505. The term "gross income" does not include "interest, dividends and/or other income which may be otherwise taxed by this state as income of the taxpayer." Id. § 69-1506, subd. 2.

"There should be deducted from the net income of individuals the following exemptions:

"(a) In the case of a single individual, a personal exemption of $1,500.

"(b) In the case of the head of a family, or a married individual living with husband or wife, a personal exemption of $2,500. A husband and wife living together shall receive but one personal exemption of $2,500 against the aggregate net income; and in case they make separate returns the personal exemption of $2,500 may be taken by either or divided between them." Id. § 69-1513.

The Legislature at its session in 1929 also enacted chapter 429, p. 636, of...

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8 practice notes
  • Colgate v. Harvey
    • United States
    • Vermont United States State Supreme Court of Vermont
    • November 14, 1934
    ...as to earned income and income from intangibles. In re Opinion of the Justices, 84 N. H. 557, 149 A. 321, 327; McPherson v. Fisher, 143 Or. 615, 23 P. (2d) 913; In re Opinion of the Justices, 270 Mass. 593, 170 N. E. 800, 803. It may allow reasonable deductions of business expenditures from......
  • Jarvill v. City of Eugene
    • United States
    • Supreme Court of Oregon
    • May 28, 1980
    ...214 P.2d 1000 (1950). In previous decisions we have upheld the legislature's classification of income for taxation (McPherson v. Fisher, 143 Or. 615, 622, 23 P.2d 913 (1933)); the legislature's classification of occupations for taxation (State v. Winegar, 157 Or. 220, 225, 69 P.2d 1057 (193......
  • Fox v. Galloway
    • United States
    • Supreme Court of Oregon
    • May 9, 1944
    ...of establishing its invalidity: State v. Bunting, 71 Or. 259, 139 P. 731, L.R.A. 1917C, 1162, Ann Cas. 1916C, 1003; McPherson v. Fisher, 143 Or. 615, 23 P. (2d) 913; Semler v. Oregon State Board of Dental Examiners, 148 Or. 50, 34 P. (2d) 311. The act here in question, imposing a tax on cer......
  • Middlekauff v. Galloway
    • United States
    • Supreme Court of Oregon
    • February 20, 1940
    ...721; and on that basis the law was declared unconstitutional because corporations were exempted from its provisions. McPherson v. Fisher, 143 Or. 615, 23 P. (2d) 913, sustained the present law before its amendment. It was there assumed, though not decided as plaintiffs assert, that the tax ......
  • Request a trial to view additional results
8 cases
  • Colgate v. Harvey
    • United States
    • Vermont United States State Supreme Court of Vermont
    • November 14, 1934
    ...as to earned income and income from intangibles. In re Opinion of the Justices, 84 N. H. 557, 149 A. 321, 327; McPherson v. Fisher, 143 Or. 615, 23 P. (2d) 913; In re Opinion of the Justices, 270 Mass. 593, 170 N. E. 800, 803. It may allow reasonable deductions of business expenditures from......
  • Jarvill v. City of Eugene
    • United States
    • Supreme Court of Oregon
    • May 28, 1980
    ...214 P.2d 1000 (1950). In previous decisions we have upheld the legislature's classification of income for taxation (McPherson v. Fisher, 143 Or. 615, 622, 23 P.2d 913 (1933)); the legislature's classification of occupations for taxation (State v. Winegar, 157 Or. 220, 225, 69 P.2d 1057 (193......
  • Fox v. Galloway
    • United States
    • Supreme Court of Oregon
    • May 9, 1944
    ...of establishing its invalidity: State v. Bunting, 71 Or. 259, 139 P. 731, L.R.A. 1917C, 1162, Ann Cas. 1916C, 1003; McPherson v. Fisher, 143 Or. 615, 23 P. (2d) 913; Semler v. Oregon State Board of Dental Examiners, 148 Or. 50, 34 P. (2d) 311. The act here in question, imposing a tax on cer......
  • Middlekauff v. Galloway
    • United States
    • Supreme Court of Oregon
    • February 20, 1940
    ...721; and on that basis the law was declared unconstitutional because corporations were exempted from its provisions. McPherson v. Fisher, 143 Or. 615, 23 P. (2d) 913, sustained the present law before its amendment. It was there assumed, though not decided as plaintiffs assert, that the tax ......
  • Request a trial to view additional results

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