State v. Maine Cent. R. Co.
Decision Date | 08 February 1883 |
Citation | 74 Me. 376 |
Parties | STATE OF MAINE v. THE MAINE CENTRAL RAILROAD COMPANY. |
Court | Maine Supreme Court |
ON REPORT on agreed statement
Debt under stat. 1880, c. 249, §4, to recover one-half the tax assessed by the Governor and Council against the defendant corporation, for the year 1880, which fell due July 1, 1880 and amounted to eleven thousand dollars--the whole tax being twenty-two thousand dollars.
The report stated: " The defendant denies the legality of said tax on the sole ground that the said act is in contravention of the constitution of the state."
" If the act is constitutional, judgment is to be rendered for the state for the sum of eleven thousand dollars, and interest from July 1, 1880; otherwise, judgment for the defendants."
Henry B. Cleaves, attorney general, for the state, cited: Com v. The Peoples' Five Cent Savings Bank, 5 Allen 428; Lunt's case, 6 Me. 412; Society for Savings v. Coit, 6 Wall. 607; State Freight and Tax Case, 15 Wall. 232; Com. v. Lowell Gas Light Co. 12 Allen 75; Att'y General v. Bay State Mining Co. 99 Mass. 148; State Railroad Tax Cases, 2 Otto 603; 5 Allen 432; 4 Wheat. 428; Brewer Brick Co. v. Brewer, 62 Me. 62; Opinion of Justices, 68 Me. 582; W. U. Tel. Co. v. Mayer, etc. 28 Ohio St 533; Reeves v. Treas. Wood Co. 8 Ohio St. 333; Baker v. Cincinnati, 11 Ohio St. 534; Home Ins Co. v. Augusta, 50 Ga. 543; 2 Head (Tenn.) 363; Bright v. McCullough, 27 Ind. 223; Kitson v. Mayor, 26 Mich. 325; People v. B. and A. R. Co. 70 N.Y. 569; Albany N. R. Co. v. Brownell, 24 N.Y. 345; C. B. and Q. R. Co. v. Iowa, 94 U.S. 155; Ducat v. Chicago, 48 Ill. 172; Paul v. Virginia, 8 Wall. 168; Walker v. Springfield, 10 The Reporter, Oct. 13, 1880 (Ill.); Durach's Appeal, 62 Penn. St. 491; Cooley, Taxation, 128, 328; License Tax Cases, 5 Wall. 472; Railroad v. Penn. 15 Wall. 282; Catlin v. Hull, 21 Vt. 152; Duer v. Small, 4 Blatch. 263; Pullen v. Wake Co. 66 N.C. 361; Chicopee v. Hampden, 16 Gray 38; Prov. Inst. v. Mass. 6 Wall. 611; Com. v. Hamilton M'f'g Co. 12 Allen 298; Com. v. Cary Imp. Co. 98 Mass. 19; Prov. Bank v. Billings, 4 Pet. 514; DeCamp v. Eveland, 19 Barb. 81; Tappan v. Merchants, 19 Wall. 490.
Drummond and Drummond, and Orville D. Baker, for defendants.
We agree with the attorney general that the presumption is that the act is constitutional; but if it appears otherwise, the court will not hesitate so to declare.
As the court say in the Peoples' Five Cent Savings Bank case, 5 Allen 428, the authority to impose taxes
The provisions of the constitution of Maine, which can be said to touch the matter of taxation, are the following: Article IV, Part III, § 1; Article 1, § 22; Article IX, § § 7, 8, 9.
General laws providing for the taxation of railroads: Laws of 1845, c. 165; R. S. of 1857, c. 6, § § 4, 5 and 11, par. 2; R. S. of 1871, c. 6, § § 4, 5 and 14, par. 2.
In 1874, (c. 258,) the taxation of the shares in the capital stock of railroad companies was transferred to the Governor and Council, who were to ascertain their value, and, after deducting the valuation of the real estate taxed by the towns, assess a tax of one and one-half per cent. upon the balance.
By the act under consideration the Governor and Council are " To appraise the several railroads in this state, with their franchises, rolling stock and fixtures, at their cash value, and upon this valuation to levy a tax of one per centum, so as to make said tax equal, as near as may be, to the taxes of all kinds upon other property, through which said roads may extend."
Like the preceding laws, it leaves all railroad property outside of the roadway to local taxation.
There is a mathematical paradox in the first section. They are to appraise the property at its cash value, and upon that levy one per cent tax; mathematically speaking, this fixes the amount of the tax; but the statute adds a further condition of the problem--making the tax equal as near as may be to the taxes of all kinds upon other property through which the roads may run! Now this condition is a mere " stump speech in the belly" of the act, or it is to limit the rate or the appraisal--but both of them are expressly fixed, the former at one per cent and the latter at the cash value of the property.
One imperative rule of taxation, under such constitutions as ours, is well stated by Chief Justice DOE, in an opinion upon the New Hampshire Statute: " A state tax must be uniform throughout the state, a county tax throughout the county, and a town tax throughout the town." This proposition is self-evident, but it is supported by the authority of text-books and judicial decisions. Cooley on Taxation, 180; Burroughs on Taxation, § 51 (p. 62) and § 26; Banks v. Hines, 3 Ohio 1; Gilman v. Sheboygan, 2 Black 510, 517; Pine Grove v. Talcott, 19 Wallace 666, 675.
The application of this rule to the statute in question at once shows its unconstitutionality. The tax is of a triplicate character. One portion of the tax is a municipal tax of the towns where the property is situate; another portion of the tax is a municipal tax of the towns where the stockholders reside; the remainder is a state tax. The first portion is apportioned and assessed equally with the other property in the town where it is situate, and is, therefore, valid; another portion is assessed in the town where stock is owned, either by an arbitrary standard or by the valuation of a different town--that is, " the towns through which said roads may extend," and not the towns in which the stock is owned, and for which it is assessed; and the balance goes to the state for state purposes, at just two and one-half times the rate at which all the other state tax was assessed. Tax Act of 1880, Special Laws, c. 295, p. 312.
The New Hampshire statute provides that one-quarter of the tax shall be paid to the towns through which the railroad extends, and the other three-quarters are disposed of precisely as under our Maine statute. Of the New Hampshire statute, and the tax assessed under it, Chief Justice DOE, in B. C. & M. R. R. Co. v. The State, says (and his remarks as to the three-quarters of that tax apply to the whole of our tax):
In Portland Bank v. Apthorp, 12 Mass. 252, a tax of one per cent was assessed upon a corporation; the court sustained the tax as an excise tax upon the franchise of the corporation, but held that it could not be sustained as a tax upon property.
The court say, (page 255):
This principle is affirmed in Commonwealth v. The Peoples' Five Cent Savings Bank, 5 Allen 428; Oliver v. Washington Mills, 11 Allen 268; Dorgan v. Boston, 12 Allen 223; Commonwealth v. Hamilton Man'g Co. 12 Allen 298; Commonwealth v. Provident Institutions for Savings, 12 Allen 312. See also, 101 Mass. p. 585; 118 Mass. 389; 125 Mass. 567; Opinion of the Justices, 4 N.H. 565, 568; Brewer Brick Co. v. Brewer, 62 Me. 62; Jones v. Winthrop Savings Bank, 66 Me. 242; Knowlton v. Supervisors, 9 Wis. 410. 3 Ohio 1; 11 Wis. 42.
In Michigan and Illinois, the constitution contains express provision by which special taxes upon such corporations may be assessed. Hence Illinois and Michigan decisions, and decisions of the United States courts in cases from those states, are inapplicable to the case at bar.
This act, if it assesses a tax upon real or personal property, is invalid, for at least three reasons:
1. It assesses a state tax of ten mills upon this property, while upon other property the law assesses a tax of but four mills.
2. It assesses a tax for general municipal purposes at a fixed rate instead of the rate in the towns where the tax is paid.
3. It assesses a tax of one town upon property situated in another town. Dyar v. Farmington Village Corporation, 70 Me. 515.
But the attorney general...
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