State ex rel. Board of Com'rs of Valley County v. Bruce

• Decision Date: 06 May 1937
• Docket Number: 7682.
• Parties: STATE ex rel. BOARD OF COUNTY COM'RS OF VALLEY COUNTY v. BRUCE, County Assessor, et al. (VORNHOLT et al., Interveners).
• Court: Montana Supreme Court

69 P.2d 97

104 Mont. 500

STATE ex rel. BOARD OF COUNTY COM'RS OF VALLEY COUNTY v. BRUCE, County Assessor, et al. (VORNHOLT et al., Interveners).

No. 7682.

Supreme Court of Montana

May 6, 1937

Rehearing Denied June 22, 1937.

Original mandamus proceeding by the State, on the relation of the Board of County Commissioners of Valley County, against Archie G. Bruce, county assessor of Valley county, and another, wherein P. C. Vornholt and others filed a complaint in intervention.

Proceeding dismissed.

ANGSTMAN J., and SANDS, C.J., dissenting.

Booth & Booth, of Glasgow, for relator.

Thomas Dignan and Otis A. Hallett, both of Glasgow, for respondents.

ANDERSON Justice.

This is an original proceeding brought by the relator, the Board of County Commissioners of Valley County, as such, seeking a writ of mandate against the county assessor and the county treasurer of that county, commanding them to levy and collect taxes in accordance with the statutes of the state upon the personal property belonging to persons and private corporations located within the townsite of Fort Peck.

The respondents appeared by motion to quash the alternative writ of mandate issued out of this court, and also without waiver of their motion filed answer to relator's petition. Certain persons, whose property would be the subject of taxation if the relief sought is granted, have, by leave of court first granted, filed a complaint in intervention. There are no material issues of fact raised by the various pleadings, although many issues are raised as to conclusions of law attempted to be drawn in the pleadings; hence we may state the facts as disclosed by the pleadings without reference to their particular source.

The United States government commenced the building of a dam across the Missouri river between Valley and McCone counties in the month of October, 1933. The construction of the dam has continued since that date to the present time, and will not be completed for several years. The Secretary of War with the approval of the Chief Engineer of the United States, began the construction of the dam under the Act of Congress of June 16, 1933, 48 Stat. 200, now sections 401 to 414, inclusive, U.S.C.A. title 40, known as the "National Industrial Recovery Act," and continued under this enactment until June 7, 1935. Thereafter the construction was continued under the Emergency Relief Act of April 8, 1935 (Public Resolution No. 11, 74th Congress, 49 Stat. 115, 15 U.S.C.A. § 728 note), until May, 1936, from which date the construction of the dam continued under the Maintenance and Improvement of Rivers and Harbors Act of Congress, of May 15, 1936, 49 Stat. 1306. The reservoir back of the dam, when filled after its completion, will cover lands in Valley, McCone, Garfield, Phillips, Petroleum, and Fergus counties. The dam is being constructed for the improvement of navigation of the Missouri river and for flood control.

The townsite of Fort Peck is in Valley county. In the fall of 1933 the United States, by purchase from the then owners, acquired various tracts of land included within and located in the vicinity of the site of the dam. On lands thus acquired, the United States about December 1, 1933, commenced the laying out of the town of Fort Peck. At its expense it constructed streets, alleys, sidewalks, waterworks, sewers, and buildings for administrative, school, and residential purposes, and for other services proper and convenient for the inhabitants of the town. Buildings were erected for stores and the usual mercantile pursuits, many of them by the United States. All of the lands in the townsite are owned by the United States. Some buildings have been erected on the townsite by individuals or private corporations for the use of the occupants, with the consent and approval of the federal government. The town is not incorporated; it is governed by a town manager who is an officer of the United States Army Corps of Engineers, and a subordinate of the District Engineer under the United States Army Chief Engineer. Fire and police protection is provided by the United States. Water supply, garbage disposal, and sanitation are maintained by the same. School facilities are provided by the Fort Peck Recreational Association. Law violators are prosecuted in the United States District Court of Montana. No elections are held in the town and no registration of electors is conducted there.

Persons desiring to engage in business within the town can do so only with the consent of the United States. They enter into what amounts to a lease which cannot be assigned, and no rights thereunder pass to a trustee in bankruptcy. They can only sell such merchandise as the government permits, and at prices which are controlled and dictated by the designated authority of the government of the United States. It may be said that, as to these persons or private corporations, their every movement in their business activity is subject to the control and direction of the proper governmental officers.

It is the purpose of this proceeding to secure the levy and imposition of taxes on the personal property of the residents of this town. The town was built and is maintained to furnish a place of residence for administrative officials and others employed in and about the construction of the dam, which is nearby. The occupants of the buildings and property pay a rental for the ground upon which their buildings are located and a license for conducting their business. The United States collects a share of the expense of installing and maintaining the streets, alleys, waterworks, sewage disposal, loss and fire protection, and other services exclusively maintained by the United States on the townsite.

On October 10, 1934, the Acting Secretary of War by letter then notified the then Acting Governor of this state that the lands indicated on a map inclosed therewith, including the site of the dam, construction, town, tunnels, and spillways, were in the possession of the United States under agreement with the owners, and that the United States assumed "complete and exclusive jurisdiction" over these lands. The Acting Governor acknowledged the receipt of this communication and the inclosed map, and stated in reply that he would file the map with the "proper state authority and advise the officials of the state of the action taken by the federal government." Mention was made that this was in accordance with the provisions of chapter 50, Laws of the Extraordinary Session of 1933-34, now section 25.1, Revised Codes.

On April 21, 1936, the Attorney General rendered an opinion to the county attorney of Valley county, holding that the property of persons and private corporations on the lands over which the federal government had assumed exclusive jurisdiction was not taxable by the several counties in which such property was located. The respondents, relying on this opinion, declined to attempt to assess and collect taxes on this property.

Chapter 50, supra, was approved by the Governor on January 17, 1934. By its terms it reserved the right in the state and its political subdivisions to tax persons and private corporations, their franchises and property. This act was one of cession by the state to the federal government of the lands on which the dam was located and under a body of water located back of the dam, and also the land touching such body of water.

It is the contention of the relator, in general, that, although the federal government is exercising exclusive jurisdiction over the lands in question, by this act of cession the right to tax the personal property of individuals and private corporations being expressly reserved to the state or its political subdivisions, they may tax such property.

The respondents and interveners contend that these lands were purchased by the United States with the consent of the state found in section 24, Revised Codes, that the purchase was made before the enactment of chapter 50, supra, and that therefore it is without application as to lands purchased before its passage and approval, and, hence that personal property on the lands is within the exclusive jurisdiction of the United States and not subject to state taxes.

Relator argues that section 24 was amended by section 25, which was the controlling act of cession at the time of the purchase, the conditions of which have not been performed, and, until performed, the act of cession is not operative, and therefore the consent of the state was never given to the purchase until the enactment of chapter 50, supra, which after its enactment superseded section 25 so far as the Fort Peck area is concerned.

Article 1, § 8, cl. 17, of the Federal Constitution provides: "The congress shall have power-- *** To exercise exclusive legislation in all cases whatsoever, over such district (not exceeding ten miles square) as may, by cession of particular states, and the acceptance of congress, become the seat of government of the United States; and to exercise like authority over all places purchased by the consent of the legislature of the state in which the same shall be, for the erection of forts, magazines, arsenals, dock-yards, and other needful buildings."

The various acts of cession to which we have referred, supra, read as follows:

"24. The legislative assembly consents to the purchase or condemnation by the United States of any tract of land within this state for the purpose of erecting forts magazines, arsenals, court-houses, postoffices, and other needful buildings, upon the express condition that all civil process issued from the courts of this state, and such criminal process as may issue under the authority of this state, against any person charged with crime, may be served and executed

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