Town Of Phcebus v. Manhattan Soc. Club

• Decision Date: 01 March 1906
• Citation: 52 S.E. 839,105 Va. 144
• Parties: TOWN OF PHCEBUS . v. MANHATTAN SOCIAL CLUB.
• Court: Virginia Supreme Court

52 S.E. 839

105 Va. 144

TOWN OF PHCEBUS .

v.MANHATTAN SOCIAL CLUB.

Supreme Court of Appeals of Virginia.

March 1, 1906.

1. Licenses—Recovery of Taxes Paid—Actions.

In order to entitle a party to maintain an action to recover back a license tax paid by it to a town, it must be shown that the town had no authority to impose the tax, that it actually received the money paid, and that the payment was not made voluntarily.

[Ed. Note.—For cases in point, see vol. 32, Cent. Dig. Licenses, § 68.]

2. Municipal Corporations — Taxation — Exemptions.

Acts 1902-03-04, pp. 155, 226, c 148, cl. 144, providing that any social club which shall desire to keep liquors on sale at its clubhouse shall pay to the treasurer of the county or corporation in which the clubhouse is situated $2 for every person who is a member of the club in lieu of all other taxes for selling liquor to its numbers, does not exempt social clubs from municipal taxation.

3. Licenses—Taxes on Clubs.

The tax imposed on social clubs by Acts 1902-03-04, pp. 155, 226, c. 148, cl. 144, requiring social clubs which keep liquors on sale to pay $2 for every member of the club in lieu of all other taxes, is, in view of the provisions of the statute looking to the regulation of such clubs, requiring them to make reports as to their membership, officers, dues, etc., and providing for a forfeiture of their charters for failure to make such reports, a license tax within the meaning of Code 1904, § 1042, authorizing a city or town to impose a tax in addition to the state tax for the privilege of doing anything for which a "license tax" is required within the city or town, and consequently an additional tax may be imposed by the town in which the club is located.

4. Taxation — Recovery of Taxes Paid — Burden of Proof.

Payment of taxes is presumed to he voluntary, and the burden is upon one seeking to recover them back to show that the payment was not voluntary.

[Ed. Note.—For cases in point, see vol. 45, Cent. Dig. Taxation, § 1013.]

5. Same — Voluntary Payments — Payment under Protest.

A mere declaration of a taxpayer, indorsed on the stub of the official's taxbook, that payment was made under protest, does not show that the payment was not made voluntarily, in the absence of any proof of pressure to make payment being brought to bear on the taxpayer.

[Ed. Note.—For cases in point, see vol. 45, Cent. Dig. Taxation, §§ 1003-1005.]

Error to Circuit Court, Elizabeth City County.

Action by the Manhattan Social Club against the town of Phoebus. There was a judgment for plaintiff, and defendant brings error. Reversed.

W. H. Power and O. D. Batchelor, for plaintiff in error. S. J. Dudley and B. A. Lewis, for defendant in error.

BUCHANAN, J. The Manhattan Social Club instituted an action of assumpsit against the town of Phœbus to recover back a license tax.

In order for the plaintiff to maintain its action it was necessary to show: (1) That defendant had no authority to impose the tax; (2) that it actually received the money paid (this is conceded); and (3) that the payment was not voluntarily made.

By section or clause 144 of chapter 148 of an act approved April 16, 1903, known as the "State Revenue Act" (Acts 1902-03-04, pp. 155, 226), it is provided, among other things, that any corporation chartered as a social club, which shall desire to keep on hand at its clubhouse or other place of meeting, wines, ardent spirits, or any mixture thereof, alcoholic bitters, bitters containing alcohol, or fruits preserved in ardent spirits, to be sold directly or indirectly or given away to the members of such corporation, shall on or before the 30th day of April of each year pay to the treasurer of the county or corporation wherein the clubhouse or other place of meeting is situated $2 for each and every person who is a member of such corporation, which shall be in lieu of all other taxes upon such corporation for selling or giving away to its members ardent spirits or any of the mixtures or materials above enumerated; provided that the tax to be paid by any one club shall not exceed the sum of $350.

The plaintiff insists that the act imposing the tax on social clubs, by expressly providing that the taxes imposed by the state should be in lieu of all other taxes for the privileges granted, was intended to exempt such clubs from municipal taxation. While the language of the statute is very comprehensive, it does not, in our opinion, sustain the claim of the plaintiff, under the decisions of this court in the cases of Orange, etc., R. Co. v. Alexandria, 17 Grat. 176, and Humphreys v. City of Norfolk, 25 Grat. 97. In those cases, as in this, the language relied on by the parties seeking to escape taxation was sufficiently comprehensive, if regard was paid only to its literal sense, to exempt them from all other taxes, both state and municipal. But the court in both cases was of opinion that the act to which the sections under consideration belonged, respectively, was a general law imposing taxes for the support of the govermnent, and related exclusively to taxes to be paid to the state; and that there were no considerations of reason or justice in either case (as there are not in this) which required that the exemption should be extended to municipal taxes for which no commutation was provided, and which was wholly independent of the tax to the state. The reasoning of the judges delivering the opinions in those cases applies with peculiar force to the case under consideration.

The next contention of the plaintiff is that, even if the act in question does not prohibit such tax, the defendant has no authority under its charter to tax social clubs.

Without discussing the extent of the taxing power of the defendant under the provisions of its charter (Acts 1890-1900, pp. 98-103, c. 96), which are very broad, it is clear, we think, that it has the power to impose the tax in question under section 1042 of the Code of 1904, which provides that: "In addition to the state tax on any license, the council of a city or town may, when anything for which a license tax is so required is to be done within the city or town, impose a tax for the privilege of doing the same and require a license to be obtained therefor. * * *"

While the tax imposed by the state upon social clubs is not called a license tax in the act under consideration, it is so designated in the act approved March 12, 1904 (Acts 1904, p. 214, c. 116), the statute now in force upon the subject. It is sometimes difficult to determine whether a sum imposed by statute is a license fee proper or a tax. In order to determine that question it is generally necessary to ascertain the purpose of the exaction and...