T. Gould & Co. v. The Mayor

• Decision Date: 31 January 1876
• Citation: 55 Ga. 678
• Parties: T. Gould & Company et al, plaintiffs in error. v. The Mayor and General Council of the City of Atlanta, defendant in error.
• Court: Georgia Supreme Court

55 Ga. 678

T. Gould & Company et al, plaintiffs in error. v. The Mayor and General Council of the City of Atlanta, defendant in error.

Supreme Court of the State of Georgia

(Atlanta, January Term, 1876.)

Tax. Peddlers. Injunction. Illegality. Before Judge Peeples. Fulton county. At Chambers. January 26th, 1876.

Reported in the opinion.

D. F. & W. R. Hammond; Hulsey & Hulsey, for plaintiffs in error.

W. T. Newman; O. A. Lochrane, for defendant.

Bleckley, Judge.

The complainants, Joiner & Ellis, are auctioneers residing in the city of Atlanta, and having a regular municipal license *to pursue their calling. The other complainants, T. Gould & Company, are residents of the city of New York. The latter firm shipped from New York to Atlanta, a stock of merchandise, consisting of carpets, woolens, and a general assortment of dry goods, the whole worth about $40,000 00. The packages arrived by railroad, marked and consigned to T. Gould & Company, and were, by them and their employees, opened in a house on Whitehall street, rented for the purpose by Joiner & Ellis, the money to pay the rent being furnished by T. Gould & Company. This house was procured because the regular auction-house of Joiner & Ellis was not large enough to accommodate the stock, and because T. Gould & Company wished their goods kept separate from all others. Joiner & Ellis obtained from the city a fresh license as auctioneers, covering this new place of business, and advertised that the goods would be there sold by them at auction, from day to day, until the entire stock should be disposed of. By an arrangement between them and T. Gould & Company, they were to receive a commission on the sales, and were to comply with the city ordinances in reference to keeping accounts, making returns, and paying taxes at the regular rates on auction sales. They, however, did not have full and complete control. They did not keep the keys of the store at night, nor did they receive or handle the cash. When the sale commenced, one of the firm officiated as auctioneer for about fifteen minutes, and then gave place to Mr. T. Gould, who was the real crier of the auction. He and his partner went on with business, seemingly under a mere nominal supervision of Joiner & Ellis, who were interested, doubtless, to the extent of the agreed commissions, and who held themselves responsible for verifying accounts, making returns, and seeing that all taxes were paid, as if the goods had been sold by themselves on regular consignment. Indeed, both they and their principals called and treated it as a consignment, notwithstanding the active part taken by the latter in transacting the businessand the comparatively passive part taken by the former. They appear to have thought that the *arrangement between them was the legal equivalent of exposing goods at auction by resident licensed auctioneers, at their own stand, by themselves or their agents, in the clue course of such business. On the other hand, the city authorities considered the arrangement as merely colorable; they regarded T. Gould & Company as having retained possession of their goods; as never having made any consignment or delivery of them to Joiner & Ellis; and as engaged in selling them themselves, by their own auctioneer, using the name of Joiner & Ellis as a cover. What the relation between the two firms actually was we shall not undertake to decide. We find it unnecessary to do so. For the purposes of the present case, we shall assume that T. Gould & Company can derive no protection whatever from connecting themselves with Joiner & Ellis, and that they are to be treated in this controversy as if they had acted throughout alone. We shall apply to them that law which we think would be applicable if they, being residents of New York, had brought hither from thence, by railroad, a large stock of goods, placed them in a house in the city of Atlanta, and then proceeded to sell them out at auction. It may be that by reason of their connection with Joiner & Ellis they are in a better situation than this supposes, but certainly they are in no worse.

The sale commenced on the 24th of January, 1876, and amounted at the close of business at night to a few dollars over one thousand. The city claimed a tax thereon of $5 00 per hundred, and accordingly issued execution against T. Gould & Company, as itinerant non-resident traders, for the sum of $50 00 and costs. On the next day this execution was levied by seizing certain of the goods. The authorities announced their purpose to issue similar process daily, if sales continued, and if T. Gould & Company failed to make returns and pay tax as itinerant traders.

The complainants thereupon filed their bill, praying that the city be enjoined from the collection of this tax. The injunction was refused by the circuit judge, and that refusal is assignedas error.

*The charter of the city grants power to tax property, real and personal, to the extent of one and a half per cent. ad valorem, to which may be added, as an extraordinary tax, one-half of one per cent. more—in all, two per cent. Power is also granted to exact a license or registration fee of not exceeding $25 00 on each person or firm engaged in any trade, business, avocation, calling or profession within the city. The section of the charter which relates to itinerant traders is as follows: "That said mayor and general council shall have power to levy and collect from itinerant traders who may, directly or indirectly, by themselves or others, sell any goods, wares or merchandise in said city, such tax as to them may seem proper: Provided, that no person or persons shall be prohibited from selling, free from tax, any number of books, maps, charts, or mathematical instruments, made in this state or elsewhere, within said city of Atlanta: " See acts of 1874.

The tax ordinance, in so far as it rests on this section of the charter, reads thus: "On each $100 00 of the amount of sales of goods, wares, merchandise, produce, shingles, lumber, and all other articles sold by transient, itinerant, non-resident speculators or traders, (not including those who bring the above mentioned articles on wagons,) there shall be levied a tax of five dollars: Provided, that parties making such sales as above stated return the same to the clerk of council within one hour after they have been made, and pay the tax thereon; and in case these provisions are not complied with, then a tax of ten per cent. shall be levied and collected by execution, as in other collections of taxes. Any person selling as aforesaid and failing or refusing to pay said tax as aforesaid, shall, on conviction before the recorder, be fined in a sum not exceeding $100 00, or imprisonment not exceeding thirty days, or both, at the discretion of the recorder, mayor, or mayor pro tempore."

Under this ordinance the tax was imposed which is now resisted. A more pungent paragraph of legislation we have not met with. It gives but one hour to find the clerk, make the. return and pay the tax. For failure to run this fast *race, it doubles the tax and turns loose execution. It then puts the defaulter in the dock as a criminal, and forces him to submit to be fined or imprisoned. It would be difficult, we think, to recognize this ordinance as a law for raising revenue, even if it pursued the statute on which it is founded; it seems to be designed rather as a measure of prohibition, and we think, in respect at least to the shortness of the time allowed for making returns and payment, it might well be pronounced unreasonable, and therefore void.

1. But the ordinance is singularly at variance with the grant of power contained in the charter. The power is, to tax itinerant traders generally. The ordinance is no attempt to exercise the power upon residents of the city, but upon non-residents only. Again, even non-residents are not taxed if they come in wagons. This is a discrimination founded on vehicles, or modes of conveyance. If T. Gould & Company had transported their merchandise in wagons and not in railroad cars, they would havebeen clear of this ordinance, but having come by railroad they are within its jaws. This discrimination alone would perhaps be sufficient to render the ordinance invalid. Its chief defect, however, considered with reference to the grant of power on which it rests, is that it spends its whole force on non-residents and spares residents entirely. Suppose a citizen peddles his wares through the city, is he not an itinerant trader? and if so, where is the authority in the charter for an ordinance taxing itinerant traders that leaves him untaxed as such? When power is given to municipal corporations to impose taxes, whatever else the grant may mean, it certainly means that the citizens are to be taxed. That is the plainest and most obvious construction in all cases. Other persons may be included, but citizens must be, unless expressly excepted. It is for them, and upon them chiefly, that local legislation is to act. Until there is an ordinance that binds the citizen, there can be none (other than a mere police regulation) that binds the stranger. When the stranger comes into the city he may be watched, but he cannot be taxed if citizens of his class are not taxed, unless there *is some special grant of authority enabling the municipality to tax him as a non-resident. As to his right to claim equality with citizens in whatever taxes are imposed: see 2 Dillon on Municipal Corporations, 631; 5 Caldwell, 554. The power to discriminate against him has been recognized by this court in one case involving slaves—a species of property peculiarly related to the police: 25 Georgia Reports, 610.

2. But were the ordinance operative alike upon resident and non-resident traders, would the tax it imposes be a lawful tax? The limit of taxation upon property is fixed by the charter at two per cent. By the constitution taxes upon property must be ad valorem and uniform upon all species of...