Tanner v. Premier Photo Service, Inc.

• Decision Date: 29 May 1962
• Docket Number: No. 12158,12158
• Citation: 147 W.Va. 37,125 S.E.2d 609
• Court: West Virginia Supreme Court
• Parties: Ned H. TANNER v. PREMIER PHOTO SERVICE, INC., and C. Howard Hardesty, Jr., Tax Commissioner and Intervenor.

Page 609

125 S.E.2d 609

147 W.Va. 37

Ned H. TANNER v. PREMIER PHOTO SERVICE, INC., and C. Howard Hardesty, Jr., Tax Commissioner and Intervenor.

No. 12158.

Supreme Court of Appeals of West Virginia.

Submitted March 27, 1962.

Decided April 3, 1962.

Opinion Filed May 29, 1962.

Syllabus by the Court.

1. 'The journals of the two houses of the Legislature and other legislative records, when clear and unambiguous, are presumed to be correct and the contrary must be clearly and convincingly established to overcome such presumption; and when such records are clear and free from ambiguity or conflict extrinsic evidence can not be admitted to impeach them or to overcome the presumption that they are correct.' Point 4, Syllabus, State v. Heston, 137 W.Va. 375, 71 S.E.2d 481.

2. An Act of the Legislature, enacted as urgency legislation within the meaning of Section 29 of Article VI of the State Constitution, is not unconstitutional for the reason that the journals do not define the supposed urgency, or for the reason that the journals do not expressly state that the Legislature considered and found that an urgency existed: where the journals are silent as to such facts it will be presumed that the legislators performed their constitutional duties in relation thereto.

3. Where a bill has been duly passed by the State Senate, accepted by the House of Delegates, read in the House of Delegates on two different days, a motion is then duly made to suspend the 'constitutional rule' relating to the reading of the bill on three separate days, the motion carried by four-fifths of the members of the house, and the bill duly passed, Section 29 of Article VI of the State Constitution has been complied with in respect to its mandatory requirements relating to the reading of the bill.

4. The reading of a bill contemplated by Section 29 of Article VI of the State Constitution is the reading of the bill as drafted. Generally, the reading of a law or statute referred to in the drafted bill is not required.

5. The provision of Section 1 of Article X of the State Constitution relating to the exemption from taxation of incomes 'below a minimum to be fixed from time to time' has no necessary relation to the allowance of deductions or credits necessary to determine net or taxable income.

6. The people, in the adoption of the present Section 1 of Article X of the State Constitution relating to personal income taxation, did not intend to, and did not in effect, limit the power or policy of the Legislature in the manner or method of arriving at the amount of income of a taxpayer to be taxed.

7. The provisions of Chapter 155, Acts of the Legislature, 1961, Regular Session, imposing personal income taxes, allowing exemptions and creating classifications and graduations in connection with such taxes, are not violative of Article X, Section 1 of the Constitution of this State and are constitutional and valid.

C. Donald Robertson, Atty. Gen., Andrew J. Goodwin, Asst. Atty. Gen., Charleston, for appellant.

Richard F. Pence, Jack L. Miller, James W. Simonton, Parkersburg, for appellee.

GIVEN, Judge.

Involved in this proceeding is the constitutionality of the West Virginia Personal Income Tax Act, Chapter 155 of the 1961 Acts of the Legislature, Regular Session, Code, 11-21, as amended. The plaintiff, Ned H. Tanner, instituted his proceeding in the Circuit Court of Wood County, praying that his employer, Premier Photo Service, Inc., be restrained from collecting any withholding tax from the wages of plaintiff, and that the Act be adjudged unconstitutional. The circuit court held the Act unconstitutional and void. C. Howard Hardesty, Jr., Tax Commissioner of the State of West Virginia, as intervenor, brought the proceeding to this Court for review. This Court, by order entered on the third day of April, 1962, reversed the judgment of the Circuit Court of Wood County and remanded the proceeding, with directions, stating in the order that an opinion would be filed at a later date.

At a pre-trial conference the issues before the trial court were reduced to nine. On motion for summary judgment made by the Tax Commissioner, the court sustained the motion as to seven of such issues, and overruled the motion as to the other two of such issues. We think that any question relating to the seven issues has been effectively abandoned by plaintiff. No cross-assignment of error was made, and we find no necessity for further mentioning any question not arising from the issues argued before this Court.

The two issues, as stated in the pre-trial order, are, first, that: 'Said Act was not validly enacted by the Legislature of West Virginia, in that the provisions of Article VI, Section 29, of the Constitution of West Virginia were not complied with, since the House of Delegates did not expressly define 'a case of urgency' and the Internal Revenue Code of 1954 was never read by the House of Delegates at the passage of the bill', and, second, that: 'Said Act violates Article X, Section 1, of the Constitution of West Virginia, in that it allows more exemptions than said article and section of the Constitution of West Virginia sets forth, and permits classification and rate graduation on a basis other than the amount of the income.'

Article VI, Section 29, of the State Constitution, reads: 'No bill shall become a law, until it has been fully and distinctly read, on three different days, in each House, unless, in case of urgency, by a vote of four-fifths of the members present, taken by yeas and nays on each bill, this rule be dispensed with: Provided, in all cases, that an engrossed bill shall be fully and distinctly read in each House.'

Article X, Section 1, of the State Constitution, in so far as appears pertinent, reads: 'Subject to the exceptions in this section contained, taxation shall be equal and uniform throughout the State, and all property both real and personal, shall be taxed in proportion to its value to be ascertained as directed by law * * * [here described are numerous exceptions] The legislature shall have authority to tax privileges, franchises, and incomes of persons and corporations and to classify and graduate the tax on all incomes according to the amount thereof and to exempt from taxation, incomes below a minimum to be fixed from time to time, and such revenues as may be derived from such tax may be appropriated as the legislature may provide.'

The Act in question, the 'West Virginia Personal Income Tax Act', Chapter 155 of the 1961 Legislature, Regular Session, Code, 11-21, as amended, became effective February 10, 1961. It contains ninety-four sections, many of which contain numerous subsections or paragraphs, dealing with practically every pertinent phase of a State Personal Income Tax Law. Obviously, we need to point out only certain provisions thereof giving rise to, or affording answer to, the questions here involved.

A legislative finding, stated is Section 1 of the Act, is to the effect that 'the adoption by this state for its personal income tax purposes of the provisions of the laws of the United States relating to the determination of income for federal income tax purposes will (1) simplify preparation of state income tax returns by taxpayers, (2) improve enforcement of the state income tax through better use of information obtained from federal income tax audits, and (3) aid interpretation f the state tax law through increased use of federal judicial and administrative determinations and precedents.'

Section 3 of the Act imposes an income tax 'for each taxable year on the West Virginia taxable income of every individual, estate and trust', and Section 4 provides that the rate of the tax 'shall be equal to six per centum of the federal income tax which would be imposed on an identical amount of federal taxable income under' Section 1 of the United States Internal Revenue Code of 1954, 26 U.S.C.A. § 1, with certain exceptions detailed, not material here. Section 9 provides that 'all amendments made to the laws of the United States prior to the first day of January, one thousand nine hundred sixty-one, shall be given effect in determining the taxes imposed by this article but no amendment to laws of the United States made after said date shall be given effect.'

Numerous sections of the Act deal with the manner of procedure in arriving at the amount of taxable income of a taxpayer under the Act, such as personal exemptions, deductions, or other credits allowable against gross income. It is clear, we think, that for the most part such exemptions, deductions and credits are intended to reach the same result as to taxable income under the State Act as the taxable income resulting from an application of the federal income tax laws, the exceptions, generally, at least, resulting from the differences in the powers of the taxing sovereignties.

The Act provides for the manner of making reports and returns by the taxpayer, the withholding of estimated taxes by employers, the collection of the tax by the State Tax Commissioner, and vests in such commissioner the authority to 'administer and enforce the tax herein imposed and shall issue all needful regulations, rules and interpretations thereof.'

The first issue quoted above raises two questions as to the constitutionality of the Act: First, it is contended that unconstitutionality results from the fact that the Legislature did not, in the enactment of the Act as 'urgency' legislation, define the existing 'urgency' or record such finding in the house journal as required by the constitutional provision, and, second, that the failure to read in full the United States Internal Revenue Code of 1954, mentioned in the Act, violates the provisions of Section 29 of Chapter VI of the State Constitution, quoted above, providing that 'no bill shall become a law, until it has been fully and distinctly read, on three different days', it being admitted that the United States Internal...