State ex rel. Central Surety Ins. Corp. v. State Tax Commission

• Decision Date: 30 June 1941
• Docket Number: 37521,37522
• Citation: 153 S.W.2d 43,348 Mo. 171
• Parties: State of Missouri at the relation of Central Surety Insurance Corporation, Relator, v. The State Tax Commission, Clarence Evans, Laurence Boogher and Jesse A. Mitchell, as members thereof, Forrest Smith, State Auditor, and Wilson Bell, State Treasurer, and their respective successors in such offices. State of Missouri at the relation of Central Surety Fire Corporation, Relator, v. The State Tax Commission, Clarence Evans, Laurence Boogher and Jesse A. Mitchell, as members thereof, Forrest Smith, State Auditor, and Wilson Bell, State Treasurer, and their respective successors in such offices
• Court: Missouri Supreme Court

153 S.W.2d 43

348 Mo. 171

State of Missouri at the relation of Central Surety Insurance Corporation, Relator, v. The State Tax Commission, Clarence Evans, Laurence Boogher and Jesse A. Mitchell, as members thereof, Forrest Smith, State Auditor, and Wilson Bell, State Treasurer, and their respective successors in such offices. State of Missouri at the relation of Central Surety Fire Corporation, Relator, v. The State Tax Commission, Clarence Evans, Laurence Boogher and Jesse A. Mitchell, as members thereof, Forrest Smith, State Auditor, and Wilson Bell, State Treasurer, and their respective successors in such offices

Nos. 37521, 37522

Supreme Court of Missouri

June 30, 1941

Records of respondents quashed.

Robert B. Caldwell, Blatchford Downing and McCune Caldwell, Downing & Noble for relators.

(1) Since relators are subject to payment of gross premium tax under Section 6091 they are excluded from the applicability of the Corporation Franchise Tax Act by the express proviso of Section 5113. Secs. 5113, 6091, R. S. 1939; State ex rel. Ford Motor Co. v. Gehner, 325 Mo. 24, 24 S.W.2d 1; State ex rel. American Central Ins. Co. v. Gehner, 315 Mo. 1126. (2) The proviso in Section 5113 excluding from its operation domestic stock insurance companies which pay gross premium tax was not repealed by implication by enactment of Section 6091 imposing the gross premium tax. State ex rel. v. Macon County Court, 41 Mo. 453; State ex rel. McGuire v. Draper, 47 Mo. 29; St Louis v. Kellman, 235 Mo. 687; State ex inf. v. Goffee 192 Mo. 670; Hawkins v. Smith, 242 Mo. 688; State ex rel. v. Clayton, 226 Mo. 292; Barnett v. Bellows, 315 Mo. 1100. (3) The tax imposed by Section 6091 is one on gross premium receipts within the meaning of the exclusion in Section 5113 of the Corporation Franchise Tax Act. Secs. 5113, 6091, R. S. 1939; 3 Couch, Insurance, sec. 579, pp. 1850-51; 2 Joyce, Insurance (2 Ed.), sec. 1083, p. 2171; Rose v. Insurance Co., 153 Mo.App. 63; Sec. 5857, R. S. 1929; State ex rel. v. Hyde, 292 Mo. 342; State ex rel. v. Hyde, 304 Mo. 447.

Roy McKittrick, Attorney General, and Lawrence L. Bradley, Assistant Attorney General, for respondents.

(1) The terms of the Franchise Tax Act are broad enough to and do include domestic stock fire and casualty companies. Sec. 5113, R. S. 1939; Laws 1931, p. 238, sec. 5978a. (2) The exemption provision of Section 5113, Revised Statutes 1939, as it relates to domestic stock fire and casualty companies has been superceded or repealed by the enactment of a later statute. Secs. 5113, 6091, R. S. 1939; Laws 1931, p. 238, sec. 5978a; Laws 1939, p. 460, sec. 5978a; Schott v. Continental Auto Ins. Underwriters, 326 Mo. 92, 31 S.W.2d 7; Huntsville v. Eatherton, 182 S.W. 767; Maret v. Hough, 185 S.W. 544; State v. Stell, 14 S.W.2d 515; State ex rel. Crutcher v. Koeln, 332 Mo. 1229, 61 S.W.2d 750; State ex rel. Wells v. Walker, 326 Mo. 1233, 34 S.W.2d 124; State ex rel. City of Springfield v. Smith, 344 Mo. 150, 125 S.W.2d 883; St. Louis Y. M. C. A. v. Gehner, 329 Mo. 1007, 47 S.W.2d 776; Natl. Cemetery Assn. v. Benson, 344 Mo. 784, 129 S.W.2d 842; Stauffer v. Crawford, 248 S.W. 581; Montgomery Ward & Co. v. Becker, 334 Mo. 789, 69 S.W.2d 674; State v. Stone, 118 Mo. 388; Lawrence v. State Tax Comm., 286 U.S. 276, 76 L.Ed. 1102. (3) Relators derive no exemption from franchise tax under the terms of Section 6091, Revised Statutes 1939, but must look to Section 5113, Revised Statutes 1939, for such. Laws 1931, p. 238, sec. 5978a; Secs. 5113, 6091, R. S. 1939. (4) Relators are not exempted from the payment of a franchise tax by reason of their liability for the tax on direct premiums imposed by Section 6091, Revised Statutes 1939. Secs. 5113, 6091, R. S. 1939; State ex rel. Hardware Mut. Casualty Co. v. Hyde, 304 Mo. 447, 264 S.W. 381; Massachusetts Bonding Co. v. Chorn, 274 Mo. 15, 201 S.W. 1122; New York Life Ins. Co. v. Burbank, 216 N.W. 742; Fire Assn. of Philadelphia v. Love, 108 S.W. 158; United Pacific Ins. Co. v. Bakes, 67 P.2d 1024; New York Life Ins. Co. v. Wright, 122 S.E. 706; Jefferson Standard Life Ins. Co. v. King, 163 S.E. 653; King v. Aetna Life Ins. Co., 167 S.E. 12; Cochrane v. Natl. Life Ins. Co., 235 P. 569; New York Life Ins. Co. v. Robertson, 103 So. 222; L. R. A. 1918D, p. 958; Sec. 11344, R. S. 1939.

OPINION

Tipton, J.

This is a certiorari to review the record of the State Tax Commission in assessing a corporation franchise tax for the year 1940 against each relator, both having been organized under provisions of Article 6, Chapter 37, Revised Statutes of Missouri, 1939, and to review the certification by the State Tax Commission to the State Auditor, and the latter's certification to the State Treasurer of the amounts of such taxes. One of the relators is engaged in writing general casualty insurance and the other fire insurance. As the issues in each case are identical, the two cases have been consolidated.

The relators claim that by virtue of the exclusion clause contained in Section 5113, R. S. Mo. 1939, the Corporation Franchise Tax is not applicable to them. This section provides:

"For the taxable year 1929 and thereafter every corporation organized under the laws of this state shall, in addition to all other fees and taxes now required to be paid, pay an annual franchise tax to the state of Missouri . . ."

"Every corporation not organized under the laws of this state, and engaged in business in this state, shall pay an annual franchise tax to the state of Missouri. . . .

". . . Provided, that this law shall not apply to . . . insurance companies, which pay an annual tax on their gross premium receipts in this state. . . ."

Relators contend they are exempt from paying the annual franchise tax because they pay an annual tax on their gross premium receipts under the provisions of Section 6091, R. S. Mo. 1939, which reads:

"Every stock insurance company organized under the provisions of article 6, chapter 37 of the Revised Statutes of Missouri, 1939, shall annually pay a tax upon the direct premiums received during the preceding year, whether in cash or notes, in this state and on account of business done in this state at a rate of 2 per cent per annum in lieu of all other taxes except taxes on real estate, taxes on incomes and on franchises and license taxes: Provided, that said insurance companies shall be credited with canceled or returned premiums, actually paid during the year in this state."

It is well established that the right of the taxing authority to levy a particular tax must be clearly authorized by statute. [State ex rel. Koeln v. Lesser, 237 Mo. 310, 141 S.W. 888; Leavell v. Blades, 237 Mo. 695, 141 S.W. 893; State ex rel. Ford Motor Company v. Gehner, 325 Mo. 24, 27 S.W.2d 1.] The only statute that levies a franchise tax is Section 5113, and it expressly exempts such a tax on insurance companies that pay a tax upon gross premium receipts. The relators are domestic corporations and are subject to and do pay a tax in accordance with the provisions of Section 6091. If the tax paid under the provisions of this section is a tax on gross premiums, which question we will later discuss, then the relators come within the exclusion clause of Section 5113, and are therefore not subject to the corporation franchise tax. This is so, even though Section 6091 does contain the clause, "in lieu of all other taxes except taxes on . . . franchises. . . ."

In the case of State ex rel. American Central Insurance Company v. Gehner, 315 Mo. 1126, 280 S.W. 416, the City of St. Louis attempted to assess a tax upon the paid-up capital stock of the relator in that case. Prior to the year 1911, under Section 11357, R. S. Mo. 1909, the shares of stock in insurance companies were assessed and taxed in the same manner as were the shares of stock in banks. In the year 1911, that section was repealed and a new section enacted which eliminated from taxation the shares of stock in insurance companies. Section 6386, R. S. Mo. 1919, provided for a state, county, municipal and school tax upon insurance companies. That section contained a provision "that nothing herein shall operate to exempt from such taxation the paid-up capital stock of such companies." It was upon this exemption that the city sought to sustain its assessment. We ruled against the city's contention and held that the exclusion clause in Section 6368 was no authority for the imposition of the capital stock tax, as no tax could be imposed except pursuant to an affirmative legislative enactment expressly imposing the tax, and the proviso quoted above could not have such effect. In passing on the question, we said, "Non-exemption, however, does not carry with it the right of taxation in the absence of a statute authorizing the same." (Italics ours.) Construing Section 5113 and Section 6091 together, we conclude that relators are not subject to a franchise tax, if the tax imposed by Section 6091 is a tax upon the gross premium receipts.

Respondents contend that "the tax imposed by Section 6091, supra, is not in fact a tax on gross premium receipts. That statute only imposes a tax on what remains of the premium receipts after deductions for canceled and returned premiums are made."

"It is the duty of courts in construing two or more statutes relating to the same subject, to read them together and harmonize them, if possible, and to give force and effect to each." [Little River Drainage District v. Lassater, 325 Mo. 493, 29 S.W.2d 716, l. c. 718.] And this applies not only to acts passed at the same session of the Legislature, but also to acts passed at prior and subsequent sessions. [State ex rel. and to use of George B. Peck Co. v. Brown, Secretary of State, 340 Mo. 1189, 105 S.W.2d 909.]

Section 5113 exempts insurance...