State ex rel. State Bd. of Equalization v. Glacier Park Co.

• Decision Date: 11 December 1945
• Docket Number: 8603.
• Citation: 164 P.2d 366,118 Mont. 205
• Parties: STATE ex rel. STATE BOARD OF EQUALIZATION et al. v. GLACIER PARK CO.
• Court: Montana Supreme Court

164 P.2d 366

118 Mont. 205

STATE ex rel. STATE BOARD OF EQUALIZATION et al. v. GLACIER PARK CO.

No. 8603.

Supreme Court of Montana

December 11, 1945

Appeal from District Court, First District, Lewis and Clark County George W. Padbury, Jr., Judge.

Suit by the State of Montana, on the relation of the State Board of Equalization, and E. A. Dye and others, as members of and constituting said board, against Glacier Park Company formerly glacier Park Hotel Company, for a declaratory judgment to determine the applicability of the Store License Tax Law, c. 163, Laws of 1939, with reference to seven stores maintained by defendant in Glacier National Park, and for a judgment for unpaid license fees upon stores for the years 1941 and 1942. From a judgment for defendant, the plaintiffs appeal.

R. V. Bottomly, Atty. Gen., and I. W. Choate and H. O. Vralsted, both of Helena, for appellants.

Weir Clift & Bennett and Enor K. Matson, all of Helena, for respondent.

JOHNSON, Chief Justice.

This suit was filed against Glacier Park Company by the State of Montana, on the relation of the State Board of Equalization for a declaratory judgment to determine the applicability of the Store License Tax Law, Chapter 163, Laws of 1939, with reference to seven stores maintained by defendant in Glacier National Park, and for a judgment for $382 as the unpaid license fees upon them for the years 1941 and 1942. The cause was submitted to the court upon an agreed statement of facts and plaintiff has appealed from a judgment rendered thereon in favor of defendant.

The agreed statement of facts shows that during the years in question the defendant maintained eight stores within the boundaries of the State of Montana, seven of which were within Glacier National Park, the eighth being at Glacier Park Station outside of the Park; that defendant has paid the license and filing fees upon the latter store for each year but has refused to procure any license or pay any fee for its seven stores in Glacier National Park because of its belief that such requirement is beyond the jurisdiction of the State of Montana; that Glacier National Park was created by act of Congress on May 11, 1910, 36 Stat. 354, Title 16 U.S.C.A. § 161; that by Chapter 33, Laws of 1911, now section 22, R.C.M. 1935, the State of Montana ceded to the United States exclusive jurisdiction over the territory then or thereafter to be included in Glacier National Park, with certain reservations including 'the right to tax persons and corporations, their franchises, and property, on the lands included in said park'; that on August 22, 1914, the Congress of the United States enacted a statute, 38 Stat. 699, Title 16 U.S.C.A. § 163, assuming sole and exclusive jurisdiction subject to those reservations; that the said seven stores in the Park are operated by defendant under a written contract between it and the Assistant Secretary of the Interior, acting on behalf of the United States, a copy of which contract is annexed to the agreed statement of facts; that Chapter 163, Laws of 1939, requires that all persons and corporations owning, operating, establishing, or maintaining any store or stores in the state of Montana shall secure a license from the State Board of Equalization and shall pay a filing fee of fifty cents for each application together with an annual license fee for each store operated, established or maintained in the following amounts: Upon one store, $5; upon the second store, $7.50; upon the third store, $15; upon the fourth store, $22.50; upon the fifth store, $30; upon each store in excess of five, $37.50; that if the chapter is applicable to the defendant's seven stores within Glacier National Park, plaintiff is entitled to recover as such fees thereon $191 for each year, or a total of $382 with interest thereon at the rate of 6% per annum from January 15, 1942, to date of judgment; and that if it is not applicable thereto, defendant is entitled to a judgment for its costs.

Thus the sole question is whether the provisions of Chapter 163, with reference to the seven stores in question, are within the state's reserved power of taxation under section 22, Revised Codes, supra.

Section 1 of Article XII of the Constitution of Montana provides in part: 'The legislative assembly may also impose a license tax, both upon persons and upon corporations doing business in the state.' There can be no doubt that the lands included within Glacier National Park are also included within and constitute part of the State of Montana. With regard to a similar situation, the United States Supreme Court said in Collins v. Yosemite Park & Curry Co., 304 U.S. 518, 58 S.Ct. 1009, 1017, 82 L.Ed. 1502: 'The Act is restricted to sales 'in this State,' but that term embraces all territory within the geographical limits of the State.'

The entire Glacier National Park area is included within Montana by virtue of the state boundaries described in section 1 of the Organic Act of the Territory of Montana, recognized by section 1 of the Enabling Act, and again described by section 1 of Article I of the State Constitution. This is true even of military reservations; for section 1 of Article II of the State Constitutional granted exclusive jurisdiction to the United States over those reservations only 'so long as said places remain military reservations,' which can only mean that the land remains part of the state and that the cession was of the specified jurisdiction over the land in question, but not of the land itself nor of complete sovereignty over it. Section 20, Revised Codes 1935, provides: 'The sovereignty and jurisdiction of this state extends to all places within its boundaries, as established by the constitution, escepting such places as are under the exclusive jurisdiction of the United States; but the extent of such jurisdiction over places that have been or may be ceded to, purchased, or condemned by the United States, is qualified by the terms of such cession, or the laws under which such purchase or condemnation has been or may be made.'

Certainly there are no words in section 22 which can be interpreted as excluding the Glacier National Park lands from the state or terminating the state's sovereignty or jurisdiction over them, and any such intent is negatived by the reservation of certain powers. The same is true of all other acts by which the assembly of Montana has ceded jurisdiction to the United States. See sections 21, 23, 24, 25, 25.1, 25.2, and 26.1, Revised Codes. The lands included within Glacier Park continue to constitute part of the State of Montana and are subject to the provisions of Chapter 163 in so far as those provisions do not exceed the powers reserved to the State by section 22, supra.

It is well settled that a license may be required either for taxation purposes or to defray the expense of regulation and that the legislature has the power to impose license taxes for revenue purposes under section 1 of Article XII, Constitution of Montana. Johnson v. City of Great Falls, 38 Mont. 369, 99 P. 1059, 16 Ann.Cas. 974.

In its brief defendant states affirmatively that in numerous respects the provisions of this Act are the same as those of its predecessor, Chapter 155, Laws of 1933, sections 2420.1 to 2420.11, Revised Codes 1935, which this court held, in Standard Oil Co. v. State Board of Equalization, 110 Mont. 5, 99 P.2d 229, constituted a valid license tax law, on the authority of State Board of Tax Commissioners of Indiana v. Jackson, 283 U.S. 527, 51 S.Ct. 540, 75 L.Ed. 1248, 73 A.L.R. 1464, 75 A.L.R. 1536; Liggett Co. v. Lee, 288 U.S. 517, 53 S.Ct. 481, 77 L.Ed. 929, 85 A.L.R. 699, and other authorities.

The power of taxation reserved to the State by section 22, Revised Codes, is not so limited as to exclude license taxes and there is no reason why such license tax cannot, in general, be imposed. Nor is there any reason why it may not extend to the portions of the State over which the State's jurisdiction is limited to matters of taxation as distinguished from matters of regulation unless the license tax provision is so related to or involved with regulatory provisions as not to be susceptible of separate or independent application. However, if the license tax were imposed to defray the expense of regulation or were so related to regulatory provisions that it could have no separate existence, it must, to that extent, be inapplicable in areas over which the state has relinquished regulatory jurisdiction.

Collins v. Yosemite Park & Curry Co., supra, was an appeal from a decree of the United States District Court permanently enjoining state officials from enforcing the California Alcoholic Beverage Control Act against the appellee Company with respect to sales of intoxicating liquors in Yosemite National Park, over the lands of which the state cession of jurisdiction was substantially the same as in the present case. That Act, as its name implies, was adopted for the purpose of control of alcoholic beverages within the state. As originally enacted in 1935, it consisted of 70 sections. In 1937 one section was repealed, some 44 were amended, and some 66 new sections were added. As in the case of the short Montana statute here involved, the usual separability clause was included in the Act.

Section 5 of the California Act provided for 24 different varieties of licenses covering all phases of the alcoholic beverage business, and sections 23 and 24 included excise taxes upon the sale of such beverages in California. The other sections numbering some 132, regulated every phase of the importation and sale of alcoholic beverages in the state, contained provisions defining those to whom licenses might or might not be issued, regulating their businesses, requiring bonds...