The Alpha Corp. v. Multnomah Co.

• Decision Date: 25 February 1948
• Citation: 182 Or. 671,189 P.2d 988
• Parties: THE ALPHA CORPORATION <I>v.</I> MULTNOMAH COUNTY
• Court: Oregon Supreme Court

182 Or. 671

189 P.2d 988

THE ALPHA CORPORATION

v. MULTNOMAH COUNTY

Supreme Court of Oregon.

Argued February 3, 1948.

Affirmed February 25, 1948.

Appeal and error — Findings of fact — Assumed — No bill of exceptions

1. Findings of fact of trial court would be assumed on appeal to be supported by the evidence where no bill of exceptions was brought up with record.

Appeal and error — No bill of exceptions — Questions considered

2. Without a bill of exceptions, the only questions which could properly be considered on appeal were the jurisdiction of the court, the sufficiency of the complaint, and whether the findings of trial court were sufficient to support judgment.

Pleading — Insufficiency — Complaint — Not waived — Answering over — Demurrer

3. Question of insufficiency of complaint was not waived by answering over, after demurrer on ground that complaint did not state a cause of action, was overruled and defendant could object to sufficiency of complaint on appeal. O.C.L.A. § 1-710; Rules of Supreme Court, rule, 2.

Taxation — Corporation — Doing business

4. A corporation which was organized to engage in business for profit, and which after pursuing such business for a time discontinues it, and thereafter maintains its corporate existence for sole purpose of liquidating its assets and distributing the net proceeds of such liquidation among its stockholders, is not "doing business" so as to be subject to state excise tax.

See Words and Phrases, Permanent Edition, for all other definitions of "Doing Business".

Taxation — Corporation — Not doing business

5. A corporation not organized for profit but merely passively to hold real estate or securities for ultimate disposal and the distribution of the avails of such disposal to the persons entitled thereto is not "doing business" so as to be subject to state excise tax.

Taxation — Corporation — Doing business

6. Corporation organized to hold, manage, and liquidate assets of state savings and loan association which were unacceptable for transfer to federal savings and loan association upon conversion to federal association and which managed part of assets consisting of real estate and business enterprises, the management of which necessitated aggressive activity not required by mere passive holding and liquidation, was "doing business" in state as a financial institution subject to state excise tax and exempt from all other state, county, and municipal taxes except upon realty. O.C.L.A. §§ 110-1502, 110-1504, 110-1505.

Appeal and error — Constitutionality — Tax exemption — Defense — Not raised

7. On appeal from judgment for plaintiff corporation in action against county to recover personal property taxes paid by corporation, the constitutionality of statutory tax exemption would not be considered where the defense was not raised in trial court.

                  See note, 124 A.L.R. 1109
                  51 Am. Jur. 714
                  61 C.J., Taxation, § 246
                

Appeal from Circuit Court, Multnomah County.

WALTER L. TOOZE, Judge.

Manche I. Langley, Deputy District Attorney, of Portland, argued the cause for appellant. With her on the brief were John B. McCourt, District Attorney, and Dan M. Dibble, Deputy District Attorney.

M.M. Matthiessen, of Portland, argued the cause for respondent. On the brief were Wood, Matthiessen & Wood, of Portland.

Before ROSSMAN, Chief Justice, and LUSK, BELT, BRAND and HAY, Justices.

Action by The Alpha Corporation against Multnomah County, a political subdivision of the State of Oregon, to recover personal property taxes paid by plaintiff for the years 1935-1945, inclusive. From an adverse judgment, defendant appeals.

AFFIRMED.

HAY, J.

In this action, plaintiff corporation seeks to recover of defendant the amount of certain personal property taxes paid by it for the years 1935-1945, inclusive.

The amended complaint alleges as follows: Plaintiff is a Washington corporation, qualified to do and, during the years 1935-1945, doing intrastate business in Oregon. Pacific Savings & Loan Association was a Washington corporation, incorporated as a savings and loan association. Section 5 of the Home Owner's Loan Act of 1933 authorized the conversion of state savings and loan associations into federal savings and loan associations. Pacific Savings & Loan was, on or about February 12, 1935, converted into a federal savings and loan association under the name of Pacific First Federal Savings and Loan Association of Tacoma, which association ever since has been, and now is, authorized to do and doing an intrastate business in Oregon. The federal authority required, as a condition to its conversion into a federal savings and loan association, that Pacific Savings & Loan should transfer to the federal association only such of its assets as could readily be liquidated, and should cause a corporation to be organized under the laws of Washington, to take title to its "inacceptable" assets, and to issue in respect thereof to Pacific Savings & Loan's shareholders certificates of indebtedness, ratably in accordance with the ratio that their respective share holdings bore to the total outstanding shares. In accordance with such requirements plaintiff corporation was organized, and, in February, 1935, took title to Pacific Savings & Loan's inacceptable assets, consisting of numerous apartment houses and other buildings in Oregon and personal property contained therein. Plaintiff has an authorized capital stock of $500, all of which was subscribed and paid for by Pacific First Federal Savings and Loan, and is beneficially owned and held by such association for the account of the former shareholders of Pacific Savings & Loan as of the date of the conversion of that association into a federal savings and loan association. The sole purpose, function and activity of plaintiff was and is to hold, manage, operate and liquidate said inacceptable assets for the account and benefit of said former shareholders, their successors and assigns. Plaintiff has been at all times and now is an adjunct to said Pacific First Federal Savings and Loan, and has operated as a department of such association and under its supervision. Said association and plaintiff filed consolidated corporation excise tax returns, as provided for by section 110-1525, O.C.L.A., for the years 1935-1945, inclusive, and plaintiff was subject to and has paid the Oregon excise tax imposed by section 110-1504, O.C.L.A., for each of said years. By virtue of such circumstances, plaintiff claims to be and is a savings and loan association within the meaning of section 110-1505, O.C.L.A., under which such associations, subject to the excise tax imposed by section 110-1504, O.C.L.A., are exempted from payment of all state, county and municipal taxes except taxes upon real property. The assessor of defendant county refused to recognize plaintiff's status and exemption aforesaid, included plaintiff's personal property upon the county assessment rolls for the years 1935-1945, inclusive, assessed thereon taxes in the aggregate sum of $8,024.55, and demanded of plaintiff payment thereof, and plaintiff "improperly and inadvertently" paid such taxes. Plaintiff is entitled to a refund of such taxes, and such refund has been demanded and refused. Judgment is sought for the amount of such taxes, with legal interest.

Defendant's answer, while admitting the assessment and payment of the personal property taxes as alleged in the amended complaint, denied plaintiff's asserted status as a savings and loan association, and denied that it was entitled to exemption from payment of such taxes.

The case was tried by the court without a jury. Findings of fact and conclusions of law were made in favor of plaintiff, and judgment was entered thereon in accordance with the demand of the complaint. Defendant appeals.

1, 2. No bill of exceptions has been brought up with the record. The court will assume, therefore, that the findings of fact are supported by the evidence. Supreme Court Rules, Rule 1; Nelson v. Smith, 157 Or. 292, 294, 69 P. (2d) 1072. Without a bill of exceptions, the only questions that may properly be considered on appeal are the jurisdiction of the court, the sufficiency of the complaint, and whether or not the findings are sufficient to support the judgment. Astoria v. Zindorf, 96 Or. 332, 334, 189 P. 884; Kapischka v. Tillamook Hotel Co., 86 Or. 498, 501, 168 P. 938; Gellert v. Bank of California, N.A., 107 Or. 162, 167, 214 P. 377; McCargar & McKay v. Federal Securities Co., 134 Or. 342, 354, 284 P. 179, 293 P. 595; Kulisch v. Stewart, 157 Or. 382, 384, 71 P. (2d) 796.

3. Although it does not appear in the abstract, the record itself shows that defendant demurred to the amended complaint on the ground that it did not state facts sufficient to constitute a cause of action. The demurrer was based upon the provisions of section 110-1502, O.C.L.A., and was submitted upon the authority of Welch Holding Co. v. Galloway, 161 Or. 515, 89 P. (2d) 559. The demurrer was overruled. While no error is assigned upon such overruling (and, in fact, there are no assignments of error at all), the question of the insufficiency of the complaint was not waived by answering over. Section 1-710, O.C.L.A.; Ross v. Robinson, 169 Or. 293, 314-315, 124 P. (2d) 918, 128 P. (2d) 956; Supreme Court Rules, Rule 2. The defendant, accordingly, in its brief on appeal, has objected to the sufficiency of the amended complaint, maintaining that, by the allegations thereof, plaintiff is...