State ex rel. Aetna Life Ins. Co. v. Lucas

• Decision Date: 08 July 1941
• Docket Number: 35701
• Parties: State of Missouri at the relation of Aetna Life Insurance Company, Relator, v. Ray B. Lucas, Superintendent of Insurance Department of the State, and R. W. Winn, State Treasurer
• Court: Missouri Supreme Court

153 S.W.2d 10

348 Mo. 286

State of Missouri at the relation of Aetna Life Insurance Company, Relator, v. Ray B. Lucas, Superintendent of Insurance Department of the State, and R. W. Winn, State Treasurer

No. 35701

Supreme Court of Missouri

July 8, 1941

Rehearing Denied July 25, 1941.

Peremptory writ denied.

Jones Hocker, Gladney & Grand for relator.

(1) Annuities are neither insurance nor life insurance, and the premiums or considerations therefor are not taxable under Section 5979, Revised Statutes 1929, nor are the annuity contracts (exhibits to the return), or any of them, contracts of insurance or life insurance. Daniel v. Life Ins. Co of Va., 102 S.W.2d 257; State v. Equitable Life Assur. Society, 282 N.W. 411; State of Wyoming ex rel. Equitable Life Assur. Society v. Ham, 88 P.2d 484; Hall v. Met. Life Ins. Co., 28 P.2d 875; Commonwealth v. Met. Life Ins. Co., 254 Pa. 510, 98 A. 1072; People ex rel. Met. Life Ins. Co. v. Knapp, 184 N.Y.S. 345, affirmed 231 N.Y. 630, 132 N.E. 916; Rishel v. Pac. Mut. Life Ins. Co., 78 F.2d 881; Rinn v. New York Life Ins. Co., 89 F.2d 924; Curtis v. New York Life, 104 N.E. 553; People v. Security Life Ins. Co., 78 N.Y. 114; Cannon v. Nicholas, 80 F.2d 935; American State Bank v. Natl. Life Ins. Co., 17 N.E.2d 256; Bowman v. Comr., 20 N.E.2d 916; Carroll v. Equitable Life Assur. Soc., 9 F.Supp. 233; Coyne v. Pac. Mut. Life Ins. Co., 47 P.2d 1079; Wellman v. Board, 252 P. 193; Chisholm v. Shields, 66 N.E. 93; Parson v. Powell, 9 Bing. 320; Old Colony Trust Co. v. Comr. of Int. Rev., 37 B. T. A. 435, affirmed 102 F.2d 380; Moskowitz v. Davis, 68 F.2d 818; In re Walsh, 19 F.Supp. 567; Chemical Bank & Trust Co. v. Comr., 37 B. T. A. 535; Cannon v. Nicholas, 80 F.2d 935; Guaranty Trust Co. v. Comr., 16 B. T. A. 314; Schultz v. Comr., 38 B. T. A. 59; In re Sothern's Estate, 14 N.Y.S. (2d) 1; Lynch v. Houston, 138 Mo.App. 167; State ex rel. v. Universal Service Agency, 151 P. 768; Jordan v. Group Health Assn., 107 F.2d 239; State ex rel. Beach v. Citizens Benefit Assn., 6 Mo.App. 163; Schott v. Continental Auto Ins. Underwriters, 326 Mo. 92, 31 S.W.2d 7; Mathews v. Modern Woodmen, 236 Mo. 326, 139 S.W. 151; Logan v. Fidelity & Cas. Co., 146 Mo. 114; Lamport v. General Accident, etc., Co., 197 S.W. 95; Wahl v. Interstate B. M. Acc. Co., 207 N.W. 395; Jones v. Prudential Ins. Co., 208 Mo.App. 679; Zimmer v. Central Acc. Co., 297 Pa. 472, 56 A. 1003; Key v. Continental Ins. Co., 101 Mo.App. 344; Artophone Corp. v. Coale, 133 S.W.2d 343; State ex rel. Kansas City P. & L. Co. v. Smith, 342 Mo. 75; Leavell v. Blades, 237 Mo. 697, 700; In re Clark's Estate, 270 Mo. 351; Crooks v. Harrelson, 282 U.S. 55; State ex rel. v. Gehner, 325 Mo. 329; State ex rel. v. Phillips Pipe Line, 339 Mo. 459; State ex rel. Natl. Life v. Hyde, 292 Mo. 342; State ex rel. Koeln v. Lesser, 237 Mo. 310; City v. Wenneker, 145 Mo. 230; Berry-Kofron Dental Co. v. Smith, 137 S.W.2d 452; Cleaver v. Central States Life, 142 S.W.2d 474; United States v. Supplee-Biddle Co., 265 U.S. 189; State ex rel. v. Revelle, 257 Mo. 529; Imperial Fire Ins. Co. v. Coos County, 151 U.S. 452; Johnson v. Fidelity & Casualty Co., 151 N.W. 593; Vance on Ins. (2 Ed.), pp. 2, 5, 57, 39; Walford, Cyclopedia of Ins., pp. 98, 111, 124, 170; 3 C. J., p. 202; 3 C. J. S., pp. 1375, 1378; Bouvier Law Dictionary, p. 201; 12 Am. Jur., p. 772; 25 R. C. L., pp. 992, 1043, 1060; 2 Bacon on Life & Accident Ins., sec. 503, p. 1150. (2) Prior to the levy of the assessment complained of herein, the Missouri Insurance Department and the Legislature had always construed Section 5979, Revised Statutes 1929, as not applying to annuity premiums or considerations, and such departmental construction is entitled to great, if not controlling, consideration. Ewing v. Vernon County, 216 Mo. 681; State ex rel. v. Baker, 316 Mo. 852; Williams v. Williams, 325 Mo. 963; State ex rel. v. Cupples, 283 Mo. 115; State ex rel. Koeln v. St. Louis Y. M. C. A., 259 Mo. 233; Ross v. Railroad, 111 Mo. 18; State v. Frear, 120 N.W. 216; Wellman v. Board of Tax Comrs., 252 P. 193; 25 R. C. L., pp. 996, 997, 971; Bowring v. Bowers, 24 F.2d 918; Helvering v. Bliss, 293 U.S. 144; Lang v. Comr., 304 U.S. 264. (3) Neither the annual licenses issued to relator to transact business in Missouri nor the manner or method of relator's computation of annuity premiums or considerations have any bearing on the question whether such premiums or considerations are taxable under Section 5979, Revised Statutes 1929. Coyne v. Pac. Mut., 47 P.2d 1079. (4) Relator is not subject to the franchise or income tax statutes of Missouri. Rinn v. New York Life Ins. Co., 89 F.2d 924; Bates v. Equitable Life Assur. Soc., 288 N.W. 834; Hawkins v. Smith, 242 Mo. 688; State ex inf. v. Lincoln Trust Co., 144 Mo. 562. (5) The alternative writ of mandamus issued herein should be made permanent, but in any event the court may amend the alternative writ to conform with the proof, and order that the alternative writ as so amended be made permanent. State ex rel. Natl. Life v. Hyde, 292 Mo. 342; State ex rel. Wahl v. Speer, 284 Mo. 45; State ex rel. v. St. Louis School Board, 131 Mo. 505; State ex rel. v. Oliver, 116 Mo. 188; State ex rel. v. West, 272 Mo. 304; State ex rel. Dilliner v. Cummins, 338 Mo. 609; State ex rel. v. Hudson, 226 Mo. 239; School District No. 1 v. Board of Education, 73 Mo. 627; State ex rel. v. Wurdeman, 183 Mo.App. 28; State ex rel. v. Baggott, 96 Mo. 63; State ex rel. Kent v. Olenhouse, 324 Mo. 49; Baker v. Tener, 112 S.W.2d 351; 21 C. J., p. 660.

Roy McKittrick, Attorney General, and McHaney & Aschemeyer, Special Counsel, Charles L. Henson, Chief Counsel and Wm. G. Chorn, Assistant Counsel Missouri Insurance Department, for respondents.

I. Considerations for the annuity policies involved here are properly and commonly called "premiums;" and such contracts are properly and commonly referred to as "policies." Knight, Advanced Life Ins. (1926), p 20; Maclean, Life Ins. (1929), p. 45; Huebner, Life Ins. (1935), pp. 108, 109, 110, 158, 246, 251; Riegel and Loman, Ins. Principles and Practices (3 Ed.), p. 65; Record of American Institute of Actuaries, Vol. XX, pp. 30, 31, Vol. XIX, pp. 101, 106, 188; T. E. Young, Ins. (1904), p. 294; New York Life Ins. Co. v. Sullivan, 89 N.H. 21, 192 A. 297; Northwestern Mut. Life Ins. Co. v. Murphy, 223 Iowa 333, 271 N.W. 899; State ex rel. Holt v. New York Life Ins. Co., 198 Ark. 820, 131 S.W.2d 639; State ex rel. Gully v. Mutual Life Ins. Co., 196 So. 796. II. The evident legislative intent expressed in Sections 5979-80, Revised Statutes 1929, as amended, is to tax life annuity premiums on policies issued in Missouri. Sections 5979 and 5980, since they are sections of the same act, must be construed together and their provisions made to harmonize, if possible. Consolidated School Dist. v. Day, 328 Mo. 1105, 43 S.W.2d 428; State ex rel. Globe-Democrat v. Gehner, 316 Mo. 694, 294 S.W. 1017; State ex rel. Marquette v. Tax Comm., 282 Mo. 213, 221 S.W. 721; State v. Koeln, 278 Mo. 41, 211 S.W. 31; Logan v. Matthews, 330 Mo. 1213, 52 S.W.2d 992. If Section 5979 does not include premiums from life annuity policies, then such section conflicts with Section 5980, and the latter section provides for a tax return upon which it is impossible to assess the tax imposed by Section 5979. New York Life Ins. Co. v. Sullivan, 89 N.H. 21, 192 A. 297; Northwestern Mut. Life Ins. Co. v. Murphy, 223 Iowa 333, 271 N.W. 899; State ex rel. Holt v. New York Life Ins. Co., 198 Ark. 820, 131 S.W.2d 639; State ex rel. Gully v. Mut. Life Ins. Co., 196 So. 796. Where intent of tax statutes is not clear, as here, resort may be had to all recognized rules for the construction of statutes to the end that the legislative intent may be ascertained and made effective. State ex rel. Peck v. Brown, 340 Mo. 1189, 105 S.W. 909. The rule of "strict construction" does not resolve all ambiguities and conflicts against the taxing power. Its proper office is to help solve ambiguities, and to be an element in decision when all other tests of meaning have been employed which experience has afforded. If the intention of the Legislature, under well-recognized rules of construction, has been made clear, then it becomes the duty of the court to make effective such intention. Meyering v. Miller, 330 Mo. 885, 51 S.W.2d 65; State v. Toombs, 324 Mo. 819, 25 S.W.2d 101; State v. Stone, 118 Mo. 388, 24 S.W. 164; State ex rel. v. St. Louis-S. F. Ry. Co., 318 Mo. 285, 300 S.W. 274; Penn Mutual Life Ins. Co. v. Lederer, 247 F. 559; Citizens Bank v. Parker, 192 U.S. 73. A. Section 5980, a subsequent section of the same legislative act, discloses that Section 5979 was intended to apply to "all premiums received on account of policies issued in this state." Sections of the same original act must be construed together and harmonized, if possible, so as to make effective all of the provisions of the act. The only way to harmonize Section 5979 and Section 5980 is to construe such sections as imposing a tax upon "all premiums received on policies issued in this state," which construction would include life annuity premiums. State v. Naylor, 328 Mo. 335, 40 S.W.2d 1079; Black on Interpretations, p. 317. Points and authorities under Point I. B. Statutes in pari materia (Income Tax Act and Franchise Tax Act) can be harmonized with Sections 5979-80 only by construing latter sections as imposing a tax upon "gross premium receipts in this state." Statutes in pari materia must be construed together, and their provisions made to harmonize, if possible. State on inf. Barker v. Koeln, 270 Mo. 174, 192 S.W. 748; State ex rel. v. Gordon, 261 Mo. 631, 170 S.W. 892; State v. Davis, 314 Mo. 373, 284 S.W. 464; State v. Imel, 280 Mo. 554, 219 S.W. 634. The rule requiring sta...