Riley v. Ayer & Lord Tie Co.

• Decision Date: 30 May 1927
• Docket Number: 26586
• Citation: 147 Miss. 105,113 So. 214
• Parties: RILEY, STATE AUDITOR, v. AYER & LORD TIE CO. [*]
• Court: Mississippi Supreme Court

113 So. 214

147 Miss. 105

RILEY, STATE AUDITOR, v. AYER & LORD TIE CO. ^[*]

No. 26586

Supreme Court of Mississippi

May 30, 1927

APPEAL from chancery court of Hinds county, First district.

(In Banc)

1. CONSTITUTIONAL, LAW. Licenses. Privilege tax of twenty-five cents per thousand feet on timber treated by creosoting plant held unconstitutional as denying equal protection (Laws 1926 chapter 118, section 77; Const. U. 8. Amend. 14).

Privilege tax of twenty-five cents per thousand on each thousand feet of lumber treated by creosoting plant, imposed by Laws 1926 chapter 118, section 77, held unconstitutional and void as in violation of Const. U.S. Amend. 14, in that it denied equal protection of law in imposing a prohibitive tax for carrying on business of creosoting timber.

2 LICENSES. Annulment of law imposing privilege tax on creosoting plants re-establishes law thereon in full force (Laws 1926, chapter 118; Laws 1912, chapter 111).

Where Laws 1926, chapter 118, imposing privilege tax on creosoting plants, was void, annulment re-establishes, in full force previous law relative thereto, being Laws 1912, chapter 111, in view of provision that no law not conflicting therewith should be repealed thereby though not brought forward.

Hon. V. J. STRICKER, Chancellor.

HON. V. J. STRICKER, Chancellor.

Suit by the Ayer & Lord Tie Company against George D. Riley, State Auditor. Judgment for complainant, and defendant appeals. Affirmed.

Judgment affirmed.

Rush H. Knox, Attorney-General, for appellant.

After giving this matter thorough consideration, I am of the opinion that this case should be affirmed, inasmuch as I am convinced that it was not the intention of the legislature in rewriting the Privilege Tax Code to prohibit any legitimate business enterprise from conducting its business in this state; and to contend that the privilege tax should be twenty-five cents per thousand feet, as provided in section 77, chapter 118, Laws of 1926, would be contending for a tax that would prohibit the operation of creosoting plants in Mississippi.

I believe the legislature intended to make this tax two and one-half cents per thousand feet, board measure, which I find makes a very reasonable privilege tax in keeping with the tax imposed upon enterprises of similar nature.

It is my idea that while the principle as laid down in the case of Miller v. I. C. R. R. Co., 111 So. 558, is peculiarly applicable to ad valorem taxes, yet I see no reason why it should not apply in cases like this where it is evident a mistake has been made in the recodification of a statute.

C. C. Grassham and F. H. and F. I. Lotterhos, for appellee.

I. It was not the intention of the legislature to change the basis or rate of taxation. The so-called codification of privilege tax laws was substantially a compilation into one chapter of the many laws found in the Code of 1906 and the acts of the legislature subsequent thereto, and it was provided that nothing should be repealed except such as might be in conflict with the chapter codifying the many statutes.

It is easy to understand how in this translation a misplaced decimal point brought about the shocking result of language purporting to multiply the already heavy taxation and penalties ten times. Consideration of the act of 1912 sought to be brought forward into the compilation, and particularly sections 2 and 3 thereof, as brought forward sections 78 and 79, unchanged, makes it manifest that the intention was to continue the tax upon the basis of the timbers treated and sold and, therefore, that the omission of reference to the sale of the treated timbers as being the basis for taxation was an unintended omission.

In the light of the purpose to develop industry rather than to destroy it, shown by the laws of 1926, one is entirely warranted in urging that it conclusively appears that the legislature did not intend to impose such a tax as section 77 would imply, and drive from the state the only industry conserving the forests and one which creates large values from otherwise practically worthless materials for the benefit of the landowners in Mississippi.

Courts seek to find the legislative intention regardless of words used, and have the power and the desire to carry out that intention if not violative of the constitution, as is well illustrated by authorities such as: Boyd v. Cole, 111 So. 600; Roseberry v. Norsworthy, 135 Miss. 845, 100 So. 514; Adams v. R. R. Co., 75 Miss. 275, 22 So. 824.

There are many decisions of this court to the effect that in construing a statute the court must seek the real intention of the legislature and then adopt such interpretation as will give effect thereto. Kennington v. Hemingway, 100 Miss. 259, 57 So. 809; Holly Springs v. Marshall County, 104 Miss. 752, 61 So. 703, where the rule is announced that the court will look to the history of the law, the entire legislation on the subject, its policy and reason, and statutes relating to the same subject which are to be taken as one system with the act in question and construed consistently; Adams County v. Catholic Diocese, 110 Miss. 890, 71 So. 17; Henderson v. Blair, 102 Miss. 640, 59 So. 856; Johnston v. Reeves & Co., 112 Miss. 227, 72 So. 925; and State v. Ware, 102 Miss. 634, 59 So. 854, where the court concluded that a word in the statute should be regarded as having been inserted by a clerical mistake.

It is submitted that upon the impossibility of operation as written and upon the intention of the legislature not to impose this unjustifiable measure of taxation, the court should before reaching the questions of unconstitutionality, find that the tax should be at the rate and upon the basis provided by section 1 of chapter III, Laws of 1912, whether the administrative feature be taken from sections 2 and 3 of the act of 1912 or sections 78 and 79 of the act of 1926.

II. The act of 1926 is unconstitutional and void. The proposed tax of twenty-five cents on each thousand board feet of timber treated and sold, or treated, denies the appellee the equal protection of the laws in violation of the fourteenth amendment of the Constitution of the United States, and deprives it of its property without due process of law in violation of said fourteenth amendment and in violation of section 14 of the Constitution of Mississippi.

*Reporter's Note: A host of authorities cited in this brief are set out in the court's opinion.

HOLDEN, P. J. SMITH, C. J., expressed no opinion. ETHRIDGE, J. specially concurring.

OPINION

HOLDEN, P. J.

The Ayer & Lord Tie Company, a corporation operating a creosoting plant, enjoined the state auditor from the collection of the privilege tax imposed against it for the privilege of carrying on the business of a creosoting plant in this state, under sections 77, 79, chapter 118, Laws of 1926. Section 77 of the act imposing the tax reads as follows:

"Creosoting Plants.--Each creosoting plant operated in this state shall pay a privilege tax or occupation fee for running their business of twenty-five cents (25c) per thousand upon each thousand feet of timber board measurement, of any kind and all kinds treated at the plants."

Section 78 of the act provides the method of ascertaining the tax and the collection thereof by the state auditor, and section 79 provides a penalty for failure to pay the tax, after demand, and the manner of collecting the penalty from the taxpayer.

The last two sections named are exact rescripts of sections 2 and 3 of chapter 111, Laws of 1912, which provide for the ascertainment and collection of the privilege tax imposed by section 1 of chapter 111, Laws of 1912, which reads as follows:

"Each creosoting plant operated in this state shall pay a privilege tax or occupation fee for running their business of one fortieth (1-40) of one mill upon each foot of timber, board measurement, of any and all kinds treated at the plants and sold,"

and is brought forward as section 77 of said chapter 118, Laws of 1926; but it will be observed that the provisions of section 77, chapter 118, Laws of 1926, are different from those of section 1, chapter 111, Laws of 1912, as we shall point out and discuss.

Section 1 of chapter 111, Laws of 1912, provided that each creosoting plant should pay a privilege tax of one-fortieth of one mill upon each foot of timber, board measurement, of any and all kinds treated at the plants "and sold." One-fortieth of one mill equals two and one-half cents upon each thousand feet of timber treated by the creosoting plant. The said section 77 of chapter 118, Laws of 1926, changes the said section 1 of chapter 111, Laws of 1912, in that it imposes a privilege tax of twenty-five cents per thousand upon each thousand feet of timber "treated at the plant" ("sold" being omitted).

Thus it will be seen that, in bringing forward the privilege tax law, the first section of that chapter imposing the tax against creosoting plants was changed, either by intention or by mistake in the transcript, so as to impose a privilege tax of twenty-five cents per thousand feet of timber treated with creosote, instead of two and one-half cents per thousand feet of timber treated "and sold." The tax imposed by the 1926 act is ten times greater than that imposed by the act of 1912. It will also be noticed that the 1912 section fixes the tax against the timber treated "and sold;" whereas the tax under the 1926 sections is alone against the timber treated.

Therefore it will be seen that sections 78 and 79 of chapter 118, Laws of 1926, which are exact rescripts of sections 2 and 3 of chapter 111, Laws of 1912, are not workable with section 77 for the reason that the ascertainment and collection sections do not fit in with section 77, chapter 118, Laws of...