People ex rel. Mercer v. Wyanet Elect. Light Co.
| Decision Date | 07 February 1923 |
| Docket Number | No. 14516.,14516. |
| Citation | 306 Ill. 377,137 N.E. 834 |
| Parties | PEOPLE ex rel. MERCER, County Collector, v. WYANET ELECTRIC LIGHT CO. |
| Court | Illinois Supreme Court |
OPINION TEXT STARTS HERE
Proceeding by the People, on the relation of T. W. Mercer, County Collector, against the Wyanet Electric Light Company. From a judgment in favor of the latter, the Collector appeals.
Reversed and remanded, with directions.
Appeal from Bureau County Court; J. R. Prichard, Judge.
Edward J. Brundage, Atty. Gen., Carey R. Johnson, State's Atty., of Princeton, and Clarence N. Boord, of Springfield, for appellant.
Claude Brown, of Princeton, and Harry E. Brown, of Geneseo, for appellee.
The county court of Bureau county sustained objections of appellee, the Wyanet Electric Light Company, to an application of the county collector for judgment and order of sale for taxes for the year 1920. The tax is a capital stock tax and amounts to $137.28. Appellee filed the statement required with the tax commission and the commission assessed its capital stock at $2,000. Appellee applied for a review, claiming that its tangible property had been assessed by the local assessors; that it is a corporation engaged solely in the business of buying and selling electric current; that it does not manufacture or make the current, and is therefore a purely mercantile corporation; and that, if its capital stock is assessed, it will result in double taxation. The tax commission fixed a day for the hearing and notified appellee of the hearing, but no one appeared for appellee, and the commission affirmed the assessment. The tax objected to was extended by virtue of that assessment.
Appellee objected to judgment in the county court for the tax upon two grounds: (1) That it is organized for purely manufacturing and mercantile purposes, and that therefore its capital stock is not assessable by the tax commission; (2) that at the June term, 1919, the county collector made application to the county court for judgment for taxes levied on a capital stock assessment of appellee's capital stock; that appellee objected to the tax, and judgment therefor, on the same ground now raised by its first objection, and that the county court denied judgment for the tax; that said judgment was not appealed from, is final, and is res judicata of the right of the tax commission to assess the capital stock of appellee.
The object for which appellee was incorporated is, as stated in the application for incorporation, ‘to own and to operate an electric light, heating, and power plant for profit.’ The proof shows that since 1917 appellee has not produced electric current, but has been engaged in buying electricity from the Spring Valley Utilities Company, distributing it over its own poles and wires, and furnishing it to customers in the village of Wyanet. It made reports to the Public Utilities Commission and filed its schedule of rates. It is recognized as a public utility, and it concedes that it is such a utility, and it has had its rates regulated and controlled by the Public Utilities Commission of this state.
It was stipulated in the record that appellee waived all irregularities in the proceedings prior to and including application for judgment, that the state has made a prima facie case, and that the only objections to be urged on the hearing were the two objections above stated and which werefiled before the county court.
Appellee claims that the business in which it was actually engaged at the time of the assessment of the tax is the controlling fact that determines the class of corporations to which it belongs for the purposes of this suit, while appellant makes the contention that the thing which determines and controls that question is the charter which gave it life. We think that the appellant's contention must be sustained. The section of the statute under which the parties make their respective claims is paragraph 4 of section 3 of the Revenue Act, which provides, as follows:
‘The capital stock of all companies and associations now or hereafter created under the laws of this state, except companies and associations organized for purely manufacturing and mercantile purposes or for either of such purposes, or for the mining and sale of coal, or for printing, or for the publishing of newspapers. or for the improving and breeding of stock, shall be so valued by the state board of equalization as to ascertain and determine respectively, the fair cash value of such capital stock, including the franchise over and above the assessed value of the tangible property of such company or association, such board shall adopt such rules and principles for ascertaining the fair cash value of such capital stock as to it may seem equitable and just.’ Hurd's Stat. 1921, p. 2654.
The real question in this case is whether or not appellee was organized for purely manufacturing and mercantile purposes or for either of such purposes, and in deciding that question we must look to its charter. Evanston Illuminating Co. v. Kochersperger, 175 Ill. 26, 51 N. E. 719;Central Union Tel. Co. v. Onken, 271 Ill. 638, 111 N. E. 603. We do not think that appellee can be considered as having been organized for purely manufacturing and mercantile purposes, or for either of such purposes, within the meaning of the statute. An electric light plant organized for the purpose of producing electricity and delivering the same over its wires and poles to its customers for lighting purposes for profit might under some of the definitions given be considered as a manufacturing corporation and also as one engaged for mercantile purposes, but it certainly could not be considered as a corporation organized purely for either of said purposes under the definitions of manufacturing and of merchandise, as those terms are ordinarily understood. Appellee belongs to the class of corporations ordinarily known and referred to as public utilities. Such corporations form a particular class by themselves and are...
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