State ex rel. Knox v. Union Tank Car Co.

• Decision Date: 17 December 1928
• Docket Number: 27350
• Citation: 119 So. 310,151 Miss. 797
• Court: Mississippi Supreme Court
• Parties: STATE ex rel. KNOX v. UNION TANK CAR CO. [*]

119 So. 310

151 Miss. 797

STATE ex rel. KNOX v. UNION TANK CAR CO. ^[*]

No. 27350

Supreme Court of Mississippi

December 17, 1928

Division B

1 TAXATION. Tax laws must be strictly construed, and doubt resolve in favor of taxpayer.

Tax laws must be strictly construed, and all doubt relative to meaning therein resolved in' favor of taxpayer.

2 STATUTES. Statutes will be given prospective operation unless contrary intention is clearly manifested.

Statutes will always be given prospective operation, unless the contrary intention is manifested by the clearest and most positive expression.

3 TAXATION. Lessor of railway cars, incorporated in another state, held not liable for taxes prior to enactment of law making such property subject to assessment and taxation (Laws 1926, chapter 129).

Since Laws 1926, chapter 129, relating to assessment for taxation of those engaged in business of operating, furnishing, or leasing cars for transportation of freight, or to be used in operation of railway line, was not retroactive, lessor of cars, incorporated in another state, was not liable for taxes prior to enactment of such law making property subject to assessment and taxation.

4. TAXATION. Generally, corporate situs will be considered as situs of personal property until enactment of law fixing taxable situs within state.

Generally, the situs of corporation within state wherein it was in-incorporated will be considered as a situs of all its personal property until the enactment of law fixing taxable situs within state where such property is used.

HON. W. H. POTTER, Judge.

APPEAL from circuit court, First district, Hinds county, HON. W. H. POTTER, Judge.

Proceeding by the state on the relation of Rush H. Knox to secure assessment of back taxes against Union Tank Car Company. Judgment of assessment by the Tax Commission was quashed by the circuit court, and the state appeals. Affirmed.

Judgment affirmed.

Robert S. Phifer and Chalmers Alexander, for the state.

In 1912 our legislature passed two acts, chapter 113 and chapter 114, which were to be construed in connection with each other. The validity of these acts was questioned in 1916 and this court held them to be valid. Cudahay Packing Co. v. Stovall, 112 Miss. 106. In 1920 these statutes were again attacked and the court held them invalid and the opinion in 112 Miss. 106, to be unsound. Railroad Co. v. Revenue Agt., 122 Miss. 417.

A tax is one thing and an assessment of a tax is an entirely different thing. It is our contention that the property of the Union Tank Car Company has always had a tax levied against it.

See secs. 112, 184, 185 and 195, Miss. Const.; Sec. 8154, Hem. Code, Sec. 4251, Code 1906; Morrell Co. v. Ky., 128 Ky. 447; Railroad Co. v. Revenue Agt., 73 Miss. 648; Chap. 138, Laws of 1918. In the construction of chap. 138, Laws of 1918, we request that this court carefully consider the reason of the courts in the Morrell case, 128 Ky. 447, and Railroad Co. v. Revenue Agt., 122 Miss. 417. The present chapter 129, Laws of 1926, should be construed in connection with the foregoing law and also with the general body of the common law, for it contains no repealing clause.

Although the Union Tank Car Company is a nonresident of Mississippi, yet its cars carrying commodities in interstate and intrastate commerce traversed Mississippi according to the schedules shown. These cars, or some of them, were active and in service. In the schedules there is shown the total mileage travelled by them in each of the years concerned. It is contended for the appellant that a taxable situs in Mississippi has accrued as described and defined by chapter 129, Laws of 1926, and that assessments for the years 1915 to 1925 inclusive should be made. See Sec. 4256, Code 1906; Sec. 4392, Code 1906; Chap. 120, Laws of 1916; Railroad Co. v. Adams, 73 Miss 648.

The orders of the Mississippi Tax Commission do not in any way conflict with any of the laws or the constitution of the United States. Refrigerator Co. v. Hall, 174 U.S. 70; Refrigerator Co. v. Lynch, 177 U.S. 149; Transit Co. v. Ky., 199 U.S. 194; Tamble v. Pullman Co., 207 F. 30.

It is proper to give a retrospective interpretation to Chap. 120, Laws of 1926. Railroad Co. v. Adams, 73 Miss. 648; Sturges v. Carter, 114 U.S. 511; Lambe v. McCormick, 116 Iowa 169; Becan v. Tax Commissioners, 126 Mich. 22, 60 L. R. A. 321, 86 Am. St. Rep. 524; State ex rel. Davis v. Pors, 107 Wis. 420, 51 L. R. A. 917.

The property of car line companies has always been taxable in Mississippi. This is in accord with Refrigerator Co. v. Hall, 174 U.S. 70. Chap. 129, Laws of 1926, does not levy any tax on the car line companies simply because the tax was already levied by section 4251, Code of 1906. The act of 1926 merely added a few features to facilitate the operation of the law. The legislature has the power to enact a statute which provides for the back assessment of car companies, which assessment is to be made in accordance with chapter 129, Laws of 1926. But it is unnecessary for the legislature to do this because a tax has already been levied and the state Tax Commission is now, under chapter 129, Laws of 1926, authorized to assess them. In Railroad Co. v. Adams, 73 Miss. 648, it was decided that the Revenue Agent had the power to assess the Railroad Company for back taxes for the years 1886 to 1891 inclusive, under a statute enacted in 1892. See Saint v. Welsh, 141 Ind. 382.

In the Sturges case, supra, which ended in the United States supreme court, it was sought to tax Sturges on personal property omitted from taxation for the years 1874 to 1877 inclusive. Sturges contended that if the Ohio law were given a retrospective effect it would be in conflict with the Ohio constitution, which constitution provided that the Ohio General Assembly shall not have power to pass retroactive laws. Mr. Justice WOODS, who delivered the opinion of the court, held that the act could have a retrospective operation and that to give it such effect would not violate the Ohio constitution because the act was a remedial law, and would not destroy or take away or impair vested rights, and would not create new obligations not necessary to transactions already passed.

Broom & Gober, also filed a brief for the state.

Campbell, Harding & Goodwin, Arthur E. Bristol and Green, Green & Potter, for appellee.

1. No property of the Union Tank Car Company had any taxable situs in Mississippi during any of the years 1915 to 1925, both inclusive. This proposition had seldom been more clearly stated than in Tamble v. Pullman Co., 207 F. 30, to which case the attention of this court is particularly called. The whole question of the taxation of movable property belonging to a nonresident which may be in the state temporarily is therein exhaustively treated. The case now before the court is governed by Mayre v. Railroad Co., 127 U.S. 117, 8 S.Ct. 1037, 32 L.Ed. 94, in which it was held: "That a tax sought to be imposed and collected by the state of Virginia upon movable property, engines and cars, of a Maryland corporation, could not be collected because the state of Virginia had enacted no law applicable to the taxation of such property." See also, 92 U.S. 575, 607; Cooley on Taxation, 274; Express Co. v. Patterson, 122 Tenn. 279, 123 S.W. 353; State Board v. Holliday, 150 Ind. 216, 49 N.E. 14, 42 L. R. A. 826.

In a note on the subject of the taxation of personal property in 56 Am. Dec. 520, it is said, at page 535: "This peculiar property, which has furnished the topic of so much discussion, is held to be situated in the absence of a special statute, in the town where the principal office of the corporation is; that is, at the corporate residence. Without the help of a statute, it is incapable of acquiring a permanent locality or situs separated from the owner's residence." Until the passage of Chap. 129, Laws of 1926, Mississippi had no such statute.

2. Taxing statutes are to be strictly construed. Planters Lumber Co. v. Well, 146 Miss. 101, 112 So. 12; Miller v. Railroad Co., 146 Miss. 577, 111 So. 558.

3. No authority is conferred on the State Tax Commission, the attorney-general, or any other state authority to back assess or to levy back taxes against the Union Tank Car Company, under Chap. 129, Laws of 1926. There are no words in Chap. 129, Laws of 1926, showing any intention on the part of the legislature to make said chapter retrospective. It has been clearly and consistently held by the courts of the state of Mississippi that no statute shall be construed as retrospective unless the intention on the part of the legislature to make such act retrospective is clearly expressed. State v. Cloud, 146 Miss. 642, 112 So. 19; State v. Miller, 144 Miss. 614, 109 So. 902; Power v. Mortgage Co., 112 Miss. 319, 73 So. 51; Richards v. City Lumber Co., 111 Miss. 678, 57 So. 977.

The language used in Chap. 129, Laws of 1926, is clearly prospective. The language used throughout the Act consistently looks to the future. The title of the bill is an act to provide for the assessment of nonresident persons . or corporations, engaged (not which were engaged) in the business of operating, furnishing or leasing cars for the transportation of freight or to be used in the operation of any railway line, or lines, etc. In Sec. 1, the expression occurs: "It shall be the duty," etc.; in Sec. 2, the word "Company" is defined as "any person . . . or corporation engaged in operating, furnishing or leasing cars," etc. The same expression appears again in Sec. 3 and Sec. 4. In Sec. 5 the expression occurs: "Every company . . . doing business or owning cars . . . shall annually on or before April 1st in each year," etc. The other sections of the chapter provide the method of...