Morril v. Bentley
| Decision Date | 04 April 1911 |
| Citation | 130 N.W. 734,150 Iowa 677 |
| Parties | CHAS.W. MORRIL and others v. F. J. BENTLEY, Treasurer, and others, Appellants |
| Court | Iowa Supreme Court |
Appeal from Black Hawk District Court.--HON. F. C. PLATT, Judge.
THE county treasurer of Black Hawk County assessed as omitted property certain shares of common and preferred stock in the United States Gypsum Company to each of the twenty-five appellees herein, and an appeal therefrom was taken by each to the district court. By agreement the appeal of Charles Morril was heard, the findings of the court therein to be conclusive, save as to number of shares held by each, and the deductions on account of any debts which might be offset against the same. The district court set aside the several assessments, and the treasurer appealed. Subsequently the plaintiffs also appealed. On rehearing affirmed on plaintiffs' appeal, reversed on defendants' appeal and remanded.
On plaintiff's appeal the judgment affirmed. Reversed on defendant's appeal and remanded.
Edwards & Longley and McCoy & McCoy (Robt. O. Brennan, City Solicitor, on the brief), for appellants.
Myers & Spies and Mears & Lovejoy, for appellees.
The foregoing statement of the case and the first and second divisions of this opinion are adopted from the opinion of Mr. Justice Ladd on the original submission of this appeal.
I. No transcript of the assessment of omitted property certified by the county treasurer was filed with the clerk of the district court. As this was not essential to jurisdiction an appeal having been taken, the court did not err in hearing the appeal. In White v. City of Marion, 139 Iowa 479, 117 N.W. 254, the taxpayer recited the facts in a petition to which a demurrer was filed and a stipulation that the exemption was claimed and denied by the city and this was held sufficient; it being said: "All required is that the complaint before the board, its decision thereon, and the appeal to be shown in order that the court before whom the case is to be tried may know the issue, and that there is some decision to be reviewed." In Murrow v Heath, 146 Iowa 347, 125 N.W. 259, an official demand of payment of taxes assessed with interest by the county treasurer reciting the assessment as made was held to be showing enough to exact a hearing. All essential is that the transcript of the assessment by the board of review or treasurer be officially authenticated by certificate, or agreement of parties, or the facts be admitted by demurrer of such body or official or agreed upon, so that it appear that complaint or objection was made to the assessing body or officer and the decision made thereon which is to be reviewed. Anything to the contrary in Peterson v. Board of Equalization, 138 Iowa 717, 116 N.W. 818, is to regarded as dicta, for there was nothing in the record therein showing that an appeal had been taken. In the case at bar objections to the several assessments were filed with the treasurer, and, notwithstanding these, the assessment complained of was made. The court rightly heard the appeal.
II. The county treasurer assessed sixteen shares of preferred stock and ten shares of common stock in the United States Gypsum Company to Charles Morril as having been omitted from taxation in the years 1896, 1897, and 1898; the aggregate amount of taxes with interest being $ 139.86. The company was a corporation organized in New Jersey, and, unless the shares were exempt from taxation under section 1319 of the Code, they were assessable. Judy v. Beckwith, 137 Iowa 24, 114 N.W. 565. If any doubt as to this was suggested in First National Bank of Albia v. City Council, 86 Iowa 28, 52 N.W. 334, it was removed by the above decision. To the same effect, see Cook v. City of Burlington, 59 Iowa 251, 13 N.W. 113. The corporation was engaged in manufacturing plaster in this and other states. Its capital stock consisted of $ 3,666,300 of preferred stock and $ 2,249,600 of common stock of the par value of $ 100 per share issued in payment of properties acquired of several smaller concerns. It owned land in the state valued at $ 73,896.16 and buildings, machinery, and the like worth $ 137,724.93. Four thousand, one hundred and forty-four shares of its preferred and two thousand, four hundred and eighty-seven shares of its common stock were owned by residents of the state, but the assessed value of these was less than that of the company's real and personal property therein. The section of the statute under which exemption is claimed provides that:
Any firm or corporation who purchases, receives or holds property of any description for the purpose of adding to the value thereof by any process of manufacturing, packing of meats, refining, purifying, or by the combination of different materials, with a view of making gain or profit by so doing, and selling the same, shall be held a manufacturer for the purpose of this title, and he shall list for taxation such property in his hands, but the average value thereof to be ascertained as in the preceding section, whether manufactured or unmanufactured, shall be estimated upon those materials only which enter into its combination or manufacture. Machinery used in manufacturing establishments shall, for the purpose of taxation, be regarded as real estate. Corporations organized under the laws of this state for pecuniary profit and engaged in manufacturing as defined in this section, and which have their capital represented by shares of stock shall, through their proper accounting officers, list their real estate, personal property and moneys and credits in the same manner as required of individuals. The owners of capital stock of manufacturing companies as herein provided for, having listed their property as above directed, shall be exempt from assessment and taxation on such shares of capital stock.
It will be noted that this sections defines (1) a manufacturer; (2) directs that the average value of materials entering into the product shall be the assessable value and that machinery shall be assessed as real estate; (3) that certain corporations organized under the laws of this state "which have their capital stock represented by shares of stock" shall list their property like individuals, and the only doubt is whether the last sentence refers to the companies just previously mentioned or to corporations generally. The portions defining manufacturer and how assessable value shall be ascertained, and directing that machinery be treated as part of the realty, are quite as applicable to foreign as to domestic corporations, but, unless the remainder relates to domestic corporations, the restriction thereto in next to the last sentence is meaningless. If the shares of all the manufacturing corporations were intended to be exempt, why direct how the property of a particular class of corporations shall be listed? The property of foreign corporations is made assessable by the Constitution the same as that of individuals (article 8, section 2), and section 1312 provides for listing the same. Section 1323 of the Code relates solely to corporations organized under the laws of this state, so that the portion authorizing the deduction of the value of real estate is not applicable to corporations organized elsewhere. Section 1327 of the Code has reference to real estate of domestic corporations as it relates to real estate returned in the statement of the corporations as part of their assets, and no statement of assets is exacted from foreign corporations, save of specified classes. Section 1323 provides that the shares of stock in every such corporation (organized under the laws of the state) except when otherwise provided shall be assessed to the owners thereof at its principal place of business, and section 1325 declares the corporations liable for the taxes levied thereon.
But for the exemption of the shares in section 1319 quoted and a different assessment being exacted the general mode of reaching the property of domestic corporations as prescribed in the above sections must have obtained. The evident design of the lawmakers was to provide a different scheme of assessment for domestic manufacturing corporations, and this as we think, clearly appears from the language employed. Exemption of the shares of the stock is allowed only to (1) "owners of capital stock of manufacturing companies as herein provided for," and (2) which have "listed their property as above directed." The only companies "provided for" in the section are those organized "under the laws of this state," and these only are directed as to the manner of listing their property. Exemptions from taxation should be expressed in unmistakable terms. They are not to be inferred or implied from doubtful or ambiguous language. The presumption is that all property is taxable. Lacy v. Davis, 112 Iowa 106, 83 N.W. 784; In re Dille, 119 Iowa 575, 93 N.W. 571; Sturges v. Carter, 114 U.S. 511 (5 S.Ct. 1014, 29 L.Ed. 240). In the last case shares in a foreign corporation were held to be assessable notwithstanding those in domestic corporations were exempt from taxation. See, also, Commonwealth v. Lovell, 125 Ky. 491 (101 S.W. 970). In Judy v. Beckwith, 137 Iowa 24, 114 N.W. 565, stock in a foreign manufacturing corporation was held to have been rightly assessed; the court saying: "Without taking time for further reference to the astute, we feel entirely safe in the assertion that there is no existing legislation in this state which expressly or by implication excepts from the category of taxable property the shares of capital stock owned or held by residents of the state in a foreign corporation." The circumstance that such corporations are expressly authorized without unseemly restrictions to do...
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