State ex rel. Gisholt Mach. Co. v. Norsman

• Decision Date: 06 November 1918
• Citation: 169 N.W. 429,168 Wis. 442
• Parties: STATE EX REL. GISHOLT MACH. CO. v. NORSMAN, CLERK OF BOARD OF REVIEW.
• Court: Wisconsin Supreme Court

168 Wis. 442

169 N.W. 429

STATE EX REL. GISHOLT MACH. CO.

v.NORSMAN, CLERK OF BOARD OF REVIEW.

Supreme Court of Wisconsin.

Nov. 6, 1918.

Appeal from Circuit Court, Dane County; James Wickham, Judge.

Certiorari proceedings by the Gisholt Machine Company against O. S. Norsman, as clerk of the Board of Review of the City of Madison, to review the action of the board in affirming the assessment made on relator's property by the assessor. From judgment that certain property assessed as real estate should have been assessed as personal property, in which particular the action of the board was reversed, and in all other respects affirmed, both parties appeal. Judgment reversed on defendant's appeal, and affirmed on plaintiff's appeal, and remanded with instructions to enter judgment affirming the order of the board.Olin, Butler, Stebbins & Stroud, of Madison, for plaintiff.

William Ryan, City Atty., of Madison, for defendant.

OWEN, J.

The Gisholt Machine Company is the proprietor of a machine tool manufactory located in the city of Madison. Its plant consists of several factory buildings of standard design and covers six or seven city blocks. It is equipped with various kinds and types of machinery adapted for the purpose of the manufactory. A part of this machinery, which the assessor valued at the sum of $301,173, was assessed by him as real estate or land improvements. The relator contends, and the circuit court held, that this machinery is personal property, and should have been so assessed. This presents the main question for consideration. It is important, because if the property be assessed as personalty the tax paid thereon operates as an offset to the income tax paid by the relator.

The machinery in question ranged from very small machines to machines weighing thirty or forty thousand pounds. For the most part, they were held in position by their own weight and were neither bolted nor screwed to the floor. All, however, were attached either to electric motors by electric wires or to the steam power plant by belts and pulleys. The floors of the buildings were of solid concrete construction, and any part thereof was of sufficient strength to support the weight of the heaviest machine. The machines are occasionally moved from place to place in the factory to suit the varying convenience and necessities of the plant. For only one machine in the plant, valued at a few thousand dollars, was it necessary to build a pit, and even that machine could be moved in the same manner as the others, no structural change being required beyond the filling of the pit. All of this machinery was adapted to the purposes of the manufactory.

[1] Section 1035, Stats., provides that the terms “real property,” “real estate,” and “land,” when used in this title, shall include not only the land itself, but “all buildings, fixtures, improvements, rights, and privileges appertaining thereto.” The assessor considered this machinery to be fixtures, and assessed it as a part of the land. It appears that a part of this factory and a part of the machinery here in controversy were located on land not owned by the relator, but held by it under lease from the owner. The terms of the lease, however, are not disclosed by the record, and it was frankly stated upon the argument that no importance was attached to this fact. We therefore lay out of the case any consideration of the question as affected by the relation of landlord and tenant and nothing said herein is to be construed as affecting or modifying the decisions of this court in dealing with the question of fixtures arising between landlord and tenant. The question is here treated as though the machinery were located on land owned entirely by the relator. So considered, the question is ruled adversely to the contentions of relator by a long line of decisions in this state. Frankland v. Moulton, 5 Wis. 1;Kimball v. Darling, 32 Wis. 675;Taylor v. Collins, 51 Wis. 123, 8 N. W. 22;Kendall Mfg. Co. v. Rundle, 78 Wis. 150, 47 N. W. 364;Homestead Land Co. v. Becker, 96 Wis. 206, 71 N. W. 117;Gunderson v. Swarthout, 104 Wis. 186, 80 N. W. 465, 76 Am. St. Rep. 860;Fuller-Warren Co. v. Harter, 110 Wis. 80, 85 N. W. 698, 53 L. R. A. 603, 84 Am. St. Rep. 867. The effect of these decisions is that when machinery adapted to the purposes of a manufacturing plant is installed therein and connected with the building by wires or belts, such machinery becomes a part of the freehold, and the land, buildings, and machinery so attached constitutes an entity, and pass by deed, mortgage, or other conveyance of the land. This doctrine is so firmly written into the decisions of this court as to have become a rule of property in this state, which it is our duty to respect and protect.

[2][3][4] An attempt to distinguish this case from the prior decisions of this court upon that question would introduce refinements which would result in uncertainty and confusion. Neither business nor general interests would be promoted by such an attempt. A principle of law in the nature of a rule of property, once established, should be adhered to. If the rule be deemed wrong it may be changed by the Legislature, but property interests should not be jeopardized by judicial vacillation. Because we consider this case to fall within the scope of our previous decisions, it is unnecessary to indulge in a discussion of the underlying principles by which the question of whether certain property is to be regarded as fixtures is tested. It is proper to say, however, in response to relator's contention that this machinery should be considered personal property because of the fact that it was carried on the books of the company under the head of movable equipment, indicating an intention on the part of the company to preserve its character as personal property, that the act of the company in installing this machinery in its manufacturing plant, connecting it up by wires and belts to the building, constitutes greater, if indeed it should not be considered conclusive, evidence of its intent in the premises. It is true that the question of whether property constitutes fixtures is largely one of intent. But where property is adapted to the use to which the realty is devoted, the use thereof in such manner furnishes such strong evidence of intent to make it a part of the freehold as not to be overcome by bookkeeping practices. Hannon v. Kelly, 156 Wis. 509, 146 N. W. 512, and cases cited.

[5] Relator contends that the assessor adopted arbitrary, and...