Missouri, K. & T. Ry. Co. of Texas v. Shannon

• Decision Date: 01 March 1907
• Citation: 100 S.W. 138
• Parties: MISSOURI, K. & T. RY. CO. OF TEXAS v. SHANNON et al.
• Court: Texas Supreme Court

100 S.W. 138

MISSOURI, K. & T. RY. CO. OF TEXAS v. SHANNON et al.

Supreme Court of Texas.

March 1, 1907.

Error from Court of Civil Appeals of Third Supreme Judicial District.

Suit by the Missouri, Kansas & Texas Railway Company of Texas against O. K. Shannon and others. There was a decree of the appellate court (97 S. W. 527) affirming a decree in favor of defendants, and plaintiff brings error. Affirmed.

T. S. Miller, J. W. Terry, N. A. Stedman, E. B. Perkins, H. M. Garwood, and A. H. McKnight, for plaintiff in error. R. V. Davidson, Atty. Gen., I. Lovenberg, Jr., Asst. Atty. Gen., and Claude Pollard, Asst. Atty. Gen., for defendants in error.

GAINES, C. J.

This suit was brought by the Missouri, Kansas & Texas Railway Company of Texas against O. K. Shannon, Secretary of the State of Texas, John W. Stephens, Comptroller, and W. R. Davis, tax commissioner of the state, constituting the state tax board, to enjoin them from taking any action under the act of the Twenty-Ninth Legislature, approved April 17, 1905, commonly known as the "Intangible Assets Act." A temporary restraining order was applied for and was refused. Upon the hearing an exception to the jurisdiction of the court was overruled, but a demurrer and exceptions to the merits of the petition were sustained, and, the plaintiff having declined to amend, the suit was dismissed. Upon appeal to the Court of Civil Appeals the decree was affirmed. The complainant has applied to this court for a writ of error, and it has been granted.

In the Court of Civil Appeals the defendants filed a cross-assignment of error, alleging that the court erred in overruling their exception to the jurisdiction of the court to hear and determine the case. This question confronts us at the threshold of the case, and logically is the first to be decided. The proposition of defendants in error in support of their cross-assignment is "that this is a suit against the state of Texas." So far as the question thus presented is affected, we are unable to distinguish this case from that of Fargo v. Hart, 193 U. S. 490, 24 Sup. Ct. 498, 48 L. Ed. 761. In that case the suit was to enjoin the Auditor of the state of Indiana from certifying an assessment for a certain year to the auditors of the several counties of the state, on the ground, as stated in the opinion, that the assessments will result in unconstitutional interferences with commerce among the states, and is also contrary to the fourteenth amendment to the Constitution of the United States. The Supreme Court of the United States held that the suit should have been maintained and the relief granted. In discussing the question of the power of the court to grant an injunction is such case, Mr. Justice Holmes, speaking for the court, said: "We do not abate at all from the strictness of the rule that in general an injunction will not be granted against the collection of taxes. State Railroad Tax Cases, 92 U. S. 575, 23 L. Ed. 663. But it was recognized in the passage just quoted from People's National Bank v. Marye, 191 U. S. 272, 24 Sup. Ct. 68, 48 L. Ed. 180, that under the present circumstances a resort to equity may be proper. The course adopted is the same that was taken without criticism from the court in Adams Express Co. v. Ohio State Auditor, 165 U. S. 194, 17 Sup. Ct. 305, 41 L. Ed. 683. It avoids the necessity of suits against the officers of each of the counties of the state, and we are of opinion that the bill may be maintained. Union Pacific Ry. v. Cheyenne, 113 U. S. 516, 5 Sup. Ct. 601, 28 L. Ed. 1098; Pittsburg, Cincinnati, Chicago & St. Louis Ry. v. Board of Public Works, 172 U. S. 32, 19 Sup. Ct. 90, 43 L. Ed. 354." 193 U. S. 503, 24 Sup. Ct. 498, 48 L. Ed. 761. The quotation referred to above is as follows: "`If there was no right to assess the particular thing at all, * * * an assessment under such circumstances would be void, and, of course, no payment or tender of any amount would be necessary before seeking an injunction.' People's National Bank v. Marye, 191 U. S. 272, 281, 24 Sup. Ct. 68, 48 L. Ed. 180." The intimation is clear that in a proper case of the character of that referred to a court has power to enjoin a state officer. The suit of Adams Express Co. v. Ohio State Auditor, supra, was brought under an act very similar to the act in question in this case, as was that of Fargo v. Hart, supra. The principle, as we understand it, is that the courts have no power to enjoin the officers of a state from taking action under a statute claimed to be unconstitutional and deemed to be prejudicial to the complainants, unless the officers are about to do some act which, if not authorized by a valid law, constitutes an unlawful interference with their rights. A corollary to the proposition seems to be that, if the proposed acts may subject the complainants to a multiplicity of suits, they may be enjoined. The present case is clearly distinguishable from that of Stephens v. Texas & Pacific Railway Co., 97 S. W. 309, 16 Tex. Ct. Rep. 918. In that case the tax, which was a state tax was enforceable only by a suit in behalf of the state; and the railroad company had a plain, adequate, and complete remedy at law, by showing in defense of the suit the invalidity of the tax as to it.

It is also urged in behalf of the defendants in error that the suit should proceed no further, because the acts which were sought to be enjoined have already been performed. If the suit were merely to restrain action as to the assessment for the year 1906, a serious question would be here presented; but, as we understand the prayer of the petition, it is to enjoin action generally under the statute. Unless enjoined, the taxing board will doubtless proceed to value the property referred to in the statute for the present and all subsequent years. Therefore, we think that it is proper to maintain the suit to forbid future acts under the act, provided, of course, the act be invalid for the reasons alleged.

This brings us to the meritorious question in the case. Is the act in question invalid, either under the Constitution of the state, or that of the United States? The alleged grounds upon which the invalidity of the statute is claimed are presented in the able and exhaustive argument for the plaintiff in error; and we will treat them in so far as they require separate discussion as nearly as may conveniently be done in the order in which they are there presented.

The first proposition is that "the state tax board as constituted and organized by the intangible asset act is an illegible body, in that said act attempts to confer upon the Secretary of State and the Comptroller of Public Accounts, each of whom is an executive officer, powers that are not executive, and compels the exercise by them of powers which are not executive, but are legislative and judicial in their nature, in violation of section 1, art. 2, of the Constitution of the state of Texas." Section 21, art. 4, of our Constitution, defines some of the duties of the Secretary of State, but also provides that he shall "perform such other duties as may be required by law." A like provision is found in section 23 of the same article, which prescribes the duties of the Comptroller of Public Accounts. But it is insisted, as we understand the argument, that no duties can be imposed upon these officers except such as pertain to the executive department of the government, and that the duties imposed by the act in question are judicial in their character. The first is probably correct. Since it is declared in section 1 of art. 2 of the Constitution that the powers of the government shall be divided into three distinct departments, namely, the legislative, the judicial, and the executive, we are not prepared to hold that the Legislature has the power to devolve upon the Secretary of State and the Comptroller either judicial or legislative functions. It is very clear to our minds that the act in question does not attempt to confer upon the tax board any legislative powers; nor do we understand that such a construction is claimed for it. But it is urged that their powers are judicial in their nature, and that, therefore, the act is void. We think the argument is based upon a confusion as to the meaning of the word "judicial." Article 5 of our Constitution provides for the organization of the judicial department of the government. It prescribes what courts shall be established and defines their jurisdiction, names the officers of courts and prescribes their powers, and in every instance, save one, the province of the courts so provided for is to hear and determine causes between parties affecting the rights of persons as to their life, liberty, and property. The exception is the commissioners' courts, which are not properly a part of the judicial department. But the whole scope of the article shows clearly what is meant by the judicial department of the government. The word "judicial" is, however, used, not with strict accuracy in another sense. It is applied to the act of an executive officer, who in the exercise of his functions is required to pass upon facts and to determine his action by the facts found. This is sometimes called a "quasi judicial" function. This question came up in the case of Arnold v. State, 71 Tex. 259, 9 S. W. 120, and it was there held that the land board, which was created under the act of 1883, and which was composed of the Governor, the Attorney General, the Comptroller, Treasurer, and Commissioner of the General Land Office, was a lawful body. They were intrusted as a body with the classification, valuation, and sale of the public free school and asylum lands. The duties of the board necessarily required it to inquire into and to determine facts. While the act was held valid, this question we are now discussing was not alluded to in the opinion, but it is not likely that either the court or the very able and careful judge who spoke for it overlooked...