Town of Canaan v. Enfield Vill. Fire Dist

Decision Date05 May 1908
Citation74 N.H. 617,70 A. 250
PartiesTOWN OF CANAAN v. ENFIELD VILLAGE FIRE DIST.
CourtNew Hampshire Supreme Court

Hearing on amended case. Judgment for defendant.

For former opinion, see 64 Atl. 725.

George F. Morris, John M. Mitchell, James B. Wallace, and Mitchell & Batchellor, for plaintiffs.

Streeter & Hollis, for defendants.

WALKER, J. The Enfield Village Fire District is a public corporation created by the Legislature for the promotion of the public welfare. It was organized in 1873 under the general law then in force authorizing its creation (Gen. St. 1867, c. 97), and it thereby became a body politic, and was invested with certain limited governmental powers. Its essential character as a governmental agency, as contradistinguished from a private corporation, is as apparent as though the territory and the inhabitants of which it is composed had been specially designated by the Legislature as a town. While its territorial boundaries are within the town of Enfield, it is, like a school district similarly situated (Union School District v. District, 71 N. H. 269, 52 Atl. 850), distinct from the town as a governmental agency. Within the limit of the powers conferred upon it, it may be deemed to he a town. Pub. St. 1901, c. 2, § 5.

In 1903, the Legislature by special act (Laws 1903, p. 217, c. 221) authorized and empowered the defendant to establish waterworks "for the purpose of introducing into and distributing through said fire district an adequate supply of pure water in subterranean pipes, for extinguishing fires and for the use of its citizens and for other purposes." It was also authorized to acquire by purchase or by the power of eminent domain streams and ponds, and to build canals and reservoirs for its waterworks. The act did not specifically define the territory within which this power might be exercised. So far as the acquisition of the property is concerned, it was not expressly limited to the territory of the district, or to that of the town of Enfield. By section 4 of the act it was provided; "The purchase of real estate and water rights already made by said fire district, the authority voted for the issue of notes or bonds for construction of the said waterworks, and the vote of the town of Enfield exempting such notes and bonds from taxation are hereby ratified and confirmed; and all the property of said fire district used in the construction and operation of its waterworks shall be exempt from taxation." Before the passage of this act the defendant purchased certain land and water rights located in the town of Canaan, which it now uses for the supply of water to its water system; and the question, which is presented by an amendment to the original case (74 N. H. 8, 64 Atl. 725), is whether this property is subject to taxation by the town of Canaan. It is apparent the Legislature of 1903 intended to authorize the district to acquire real estate in Canaan, and in fact ratified and confirmed the acquisition of such property.

In behalf of the plaintiff, it is claimed that the exemption authorized in section 4 only applies to property of the defendant situated in the town of Enfield. It is argued that, though the language used is broad enough to include land situated in other towns owned by the defendant, the intention of the Legislature, found from the competent evidence bearing on the subject, does not warrant so broad a construction. In support of this contention, the case of Newport v. Unity, 68 N. H. 587, 44 Atl. 704, 73 Am. St. Rep. 626, is relied upon. In that case it was held that real estate used for waterworks and owned by Newport, but situated in Unity, is not exempt from taxation by Unity, under section 2, c. 55, Pub. St. 1901, which provides that "real estate * * * is liable to be taxed, except houses of public worship, * * * schoolhouses, seminaries of learning, real estate of the United States, state, or town used for public purposes, and almshouses on county farms." The question decided in that case is not precisely the same as the one presented in this case. In that case the element of a special exemption was wanting. Immunity from the tax burden was sought under the general statute of exemptions. But if the theory of the decision is sound, it affords much support to the plaintiff's contention, that the Legislature did not intend to exempt other property of the defendant than that situated in Enfield. One ground upon which that decision was based is that before 1867, when the section above quoted was first enacted, there was no statutory exemption of the real estate of towns from taxation; that at that time towns had no general authority to purchase land beyond their limits; and that "if there were, at the time of the Revision of 1867, no statutes authorizing towns to purchase real estate outside their limits, it seems plain that the statute is not necessarily to be construed as exempting such property from taxation. The Legislature could not have had it in mind. Hence, when they subsequently authorized towns and cities to acquire for public purposes lands in other towns, it cannot be justly presumed that they intended such property to be exempt from taxation." If it is conceded that when the Legislature authorizes a town to acquire land in another town for public purposes, a general statutory exemption of public property is not intended to apply to such extraterritorial property, it may be argued with some degree of plausibility that the Legislature of 1903, by general words of exemption, did not intend to exempt the defendant's property located in Canaan. If the words of the exemption had been "the real estate of the district used for public purposes," in analogy to the general language used in section 2, c. 55, Pub. St. 1901, which the court held in Newport v. Unity did not apply to land located without the town of Newport, the intention to exclude the Canaan property from its operation would not have been more apparent. If the comprehensive language of the general law, exempting the real estate of towns "used for public purposes" from taxation, relates only to real estate located within the territorial boundaries of the town, similar language used in a special act creating a water district might reasonably be restricted to land in the town in which the district is located, in contradistinction to land of the district located in another town. It seems to be important, therefore, to consider whether the reasoning by which the decision in Newport v. Unity was reached is logically sound as an authoritative exposition of the legislative intention relative to the exemption from taxation of town property used for waterworks purposes located in another town. The opinion in that case is based to some extent upon the assumption that previous to 1867 the property of towns used for public purposes was taxable, and that the Legislature of that year created the exemption having reference solely to intraterritorial property, for the reason above suggested. If this assumption is sound, it affords weight to the plaintiff's contention that, upon a strict construction, the Legislature of 1903 did not intend to extend the defendant's exemption to property which, though used for public purposes in Enfield, was located in Canaan, and that the express mention of the exception, though unnecessary, was inserted out of abundant caution. If the property in question falls within the taxable class of property, it is taxable unless it is clearly exempted by express legislative language. And the court in Newport v. Unity, holding that the public waterworks of Newport located in Unity fell within the general statutory definition of ratable estate, decided that they were taxable, the same as they would be if owned by an individual or a private corporation. If the court had started with the opposite assumption, viz., that being property devoted to a public use by a town the waterworks were not taxable unless specially made so by statute, the conclusion that the Legislature did not intend to exempt them, though located in an adjoining town, would have been less obvious. The evidence of that legislative intent would have been less convincing, and the decision would not be an authority for the proposition that, in the absence of an express legislative exemption, the property of towns used for public purposes is taxable. By applying that doctrine to the case at bar, and adopting the rule of strict construction which is observed when the question relates to the exemption of the property of private corporations or of individuals (Portsmouth Shoe Co. v. Portsmouth, 74 N. H. 222, 66 Atl. 1045), it might not be difficult to hold that the Legislature did not intend to exempt the defendant's extraterritorial property, and hence that it Is taxable. But a re-examination of the grounds of that decision, it is believed, will show that they are fallacious.

When the Legislature in 1807 excepted from taxable real estate the "real estate of the United States, state, or town used for public purposes," it did not thereby introduce an innovation, and withdraw from taxation property otherwise subject to that burden. It did not create a new class of nontaxable property. It merely recognized an ancient and uninterrupted rule, which would have been as controlling if it had not been put into legislative language. "It is certainly not true that all lands in the town were ever taxed, or now are. Lands owned by the town are not taxed, and yet are not exempted by any statute; the parsonage, school lot, etc., are of this description. All buildings are to be taxed; but was it ever heard of to tax a meeting house or schoolhouse? Were the public buildings in Exeter, Concord, Hanover, etc., ever taxed? There are and always have been exemptions, where the statute has not expressly made any. They depend upon invariable usage, growing out of the reason and nature of the thing. They are more ancient than our statutes (1770)...

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