North Carolina R.R. Co. v. Comm'rs of Alamance

• Decision Date: 31 January 1880
• Citation: 82 N.C. 259
• Court: North Carolina Supreme Court
• Parties: NORTH CAROLINA RAILROAD COMPANY v. COMMISSIONERS OF ALAMANCE.

82 N.C. 259

NORTH CAROLINA RAILROAD COMPANY

v.COMMISSIONERS OF ALAMANCE.

Supreme Court of North Carolina.

January Term, 1880.

INJUNCTION heard at Fall Term, 1879, of ALAMANCE Superior Court, before McKoy, J.

The plaintiff, the N. C. and R. & D. railroad companies, applied for an injunction, pending the action, to restrain the defendant commissioners from proceeding under the act of 1879, ch. 158, to assess and collect the taxes alleged to be due from plaintiff. The application was refused and the plaintiff appealed.

Messrs. Graham & Ruffin, D. G. Fowle and J. E. Boyd, for plaintiff .

Messrs. Scott & Caldwell and E. S. Parker, for defendants .

SMITH, C. J.

In the act of March 13, 1869, to provide for the collection of revenue, is the following clause:

“The value of the franchise of any railroad, canal, turnpike, plank road, navigation and banking company, shall be given by the president or chief officer of the said several corporations on the day fixed by this act for the giving in of taxable property, to the treasurer of the state, and shall be assessed and valued by the said treasurer, the auditor and governor of the state, and their valuation shall be returned to the county commissioners of any county in which any part of said road, or canals, or navigation works shall be, and the tax upon such franchise, so valued, shall be the same as upon property of equal value, and the tax collected in each county and township shall be in proportion to the length of such road, canal or works, lying in such county or township respectively, and such taxes shall be collected as other taxes are by law required to be. The rolling stock of every railroad company, and the vessels employed by any canal or navigation company, on its canal or works shall be valued with the franchise.” Acts of 1868-'69, ch. 74, § 13. A similar provision is found in the successive annual acts for the collection of revenue to, and inclusive of, that of February 14, 1874.

Under the provisions of the law, as interpreted and acted upon by the companies and the state board of valuation, the North Carolina railroad company made returns of its various kinds of rolling stock, fire wood, money on hand and other personal property, and of the valuation of each, which were assessed by the board, and the proportionate parts of the aggregate value distributed among the several counties traversed by the road and directed by the act. The returns for the years 1873 and 1874 contain additionally a statement in detail of the length of the track with its turnouts, bridges and depot buildings in the several counties through which it runs, and the valuation of the property in each, and this is enjoined in positive terms by the amendment made to a similar section in the act of March 17, 1875. Acts of 1874-'75, ch. 184, § 11.

The construction of this clause came before the court at January term, 1875, and it was declared that under the constitution (Art. VII, § 6,) the township board of trustees alone must “assess the taxable property of their townships” respectively, and no authority could be given by the legislature to the state board to make such assessment, and that the franchise mentioned in the statute should be valued for purposes of taxation apart from the property used in its enjoyment, and if this was included in the estimate of the state board, and the value of the franchise thereby enhanced, their action was based on an erroneous principle and the company was “entitled in a proper case to relief from the consequent tax.” The court also held that the payment of the tax upon such illegal assessment was no defence against a tax legally levied by the county authorities under the general law. W. C. & A. R. R. v. Com'rs Brunswick, 72 N. C., 10; Bridge Co. v. Com'rs New Hanover, Ibid, 15. See also R. & D. R. R. Co. v. Brogden, 74 N. C., 707 to the same effect.

In the R. & R. R. Co. v. Com'rs of Orange, 74 N. C., 506, it was decided that under the charter of the North Carolina railroad company to whose obligations and rights the plaintiff as lessee had succeeded, the real estate held for right of way, for station places of whatever kind and for workshop location, was exempt from taxation, as the dividend of profits of the former company had not exceeded six per centum per annum, and the same proposition is reiterated in R. & D. R. R. Co. v. Com'rs of Alamance, 76 N. C., 212.

The two companies having brought their suit against the commissioners for the county taxes exacted under the assessment of the state board and paid under protest, recovered and have been repaid the same, and it was declared that every counter-claim for taxes, which under a legal assessment ought to have been paid by the plaintiffs was wholly inadmissible. N. C. and R. & D. R. R. Co. v. Com'rs of Alamance, 77 N. C., 4.

In consequence of these decisions, the general assembly, by the act of February 23, 1877, refunded to the Richmond and Danville railroad company the state taxes levied upon the exempt real estate, the amount of which was ascertained and determined by the officers constituting the state board, according to its directions. Private acts of 1876-'77, ch. 35.

This is a brief history of the antecedent facts which led to the passage of the act of March 8, 1879, to arrest the execution of whose provisions the present action has been instituted. Act of 1879, ch. 158.

The act recites that the two companies “have failed to pay their proper state and county taxes upon a large amount of real and personal property in the county of Alamance,” within the years from 1869 to 1876 inclusive, on account of their failure to list the same or on account of illegal assessments and consequent litigations and the “said tax lists are erroneous and large amounts which ought to have been assessed in said corporations under the laws of those respective years are still unlisted and uncollected,” and proceeds to provide a remedy, by directing the authorities of the county, charged with the duty of listing, assessing and revising the taxes for the current year “to revise and correct the tax lists of said corporations during the specified interval” so that said tax lists shall speak the truth, as if the lists and assessments had been made under and in accordance with the laws of the said respective years. The subsequent sections of the act direct the manner in which this shall be done, prescribes the rate of taxation to be that imposed under the assessment for the successive years for which the tax lists are to be revised and corrected, and allows, in reduction of the sums ascertained to be due for any one year, whatever amount either company may have heretofore paid for that year.

The substance of the enactment and its professed object are to have the taxable property of the companies re-assessed for the series of years mentioned, and the taxes thereon, which ought to have been levied and collected under the laws applicable thereto, now levied and collected, first deducting what may have been already paid under the illegal and erroneous assessment by the state board. The defendants were engaged in the due execution of the provisions of the law when the restraining order issued, and their further proceedings were suspended until the interlocutory judgment denying the application for an injunction pendente lite, which the appeal brings up for review. The question presented, then, is this: Is the enactment so palpably unconstitutional as to call for our interference at this preliminary stage, in arresting all action in the enforcement of its directions? For unless the legislation is plainly in conflict with the constitution, the court will not so declare and especially in the revision of an interlocutory order made before...