Wasser & Winters Co. v. Jefferson County, 43239

• Decision Date: 27 November 1974
• Docket Number: No. 43239,43239
• Citation: 528 P.2d 471,84 Wn.2d 597
• Court: Washington Supreme Court
• Parties: WASSER & WINTERS COMPANY, a corporation, Respondent, v. JEFFERSON COUNTY, a municipal corporation of the State of Washington, Appellant.

Page 597

84 Wn.2d 597

528 P.2d 471

WASSER & WINTERS COMPANY, a corporation, Respondent, v. JEFFERSON COUNTY, a municipal corporation of the State of Washington, Appellant.

No. 43239.

Supreme Court of Washington, En Banc.

Nov. 27, 1974.

W. J. Daly, Pros. Atty., Port Townsend, for appellant.

Lenihan, Ivers, Jensen & McAteer, P.S., William F. Lenihan, James C. Hanken, Seattle, for respondent.

UTTER, Associate Justice.

Jefferson County appeals from the granting of a motion for summary judgment in favor of Wasser & Winters Company who were contract purchasers of standing timber from the State of Washington. The judgment refunded taxes imposed in 1970 and 1971 and enjoined imposition and levy of property taxes on the standing timber. The court found the contract did not vest present title in the purchaser and concluded they were not liable, as a matter of law, for the ad valorem tax. We hold that purchaser's ownership interest was sufficient to be taxed as personal property and reverse the trial court.

Personal property subject to taxation is required to be listed and assessed every year with reference to its value and ownership. RCW 84.40.020. Personal property for purposes of taxation includes all standing timber held or owned separately from ownership of the land on which it may stand. RCW 84.04.080. If the timber belongs to the state it is exempt from taxation. RCW 84.36.010. Our inquiry is directed to whether or not the standing timber is held or owned by purchaser separate from the land which is owned by the State.

The Department of Natural Resources for the State of Washington entered into a contract with Jayco Timber Company as purchaser. The contract was entitled BILL OF SALE AND CONTRACT TO PAY FOR AND REMOVE FOREST PRODUCTS FROM STATE LANDS. Jayco later assigned its rights to respondent. The contract stated 'the State hereby sells and conveys to the purchaser title to forest products described in paragraph 1--2 hereof situated on the sale area described in paragraph 1--3 hereof.' Volume estimates of the timber were made within the described area which specifically did not warrant or limit the volume of timber conveyed under the contract. Purchaser was allowed to enter into the sale area and remove the itemized forest products upon execution of the contract by the Commissioner of Public Lands. In the event of destruction or damages to the products, the State was to be paid by purchaser on demand from the State.

Purchaser was to pay for forest products on a Scribner scale. The contract, however, required a deposit of $192,775.50 to be held for the final payment until all forest products were removed. Prior to any cutting, the purchaser was required to make advance payments exclusive of the initial deposit which would at all times equal or exceed the volume of the products removed. The amount to be paid was determined by the purchaser's estimate of total volume to be cut in not less than 30, or more than 90 days, from the payment on the estimate. The final determination actually taken was to be by measurement under standard log scaling rules and to be done either on a truck of ground as the Department of Natural Resources specified. The State was allowed to make adjustments in sale area boundaries or to mark timber outside such boundaries to be cut, provided it did not cover an area greater than 4 percent of the area within the adjacent cutting area.

We have identified the chief incidents of ownership of property as the right to its possession, use and enjoyment, and to sell or otherwise dispose of it according to the will of the owner. In re Estate of Eckert,14 Wash.2d 497, 128 P.2d 656 (1942). In Sloan Shipyards Corp. v. Thurston County, 111 Wash. 361, 365, 190 P. 1015 (1920), we held that the person assessed need not have a perfect and unencumbered title to the property but only that he should be vested with the apparent legal title, or with the possession coupled with such claims and evidence of ownership as will justify the assumption that he is the owner. The word 'held' as applied to property, 'is a technical one embracing two ideas, that of actual possession of some subject of dominion or property, and that of being invested with legal title or right to hold or claim such possession.' J. Ballentine, Law Dictionary with Pronunciations 583 (1930).

We believe purchaser's interest in this property is sufficient to be taxable as personal property. The contract itself indicated that the State 'sells and conveys . . . title to forest products . . .' The ordinary meaning of words used in a contract or deed will be used unless a different meaning is clearly intended. Coleman v. Layman, 41 Wash.2d 753, 252 P.2d 244 (1953); Schauerman v. Haag, 68 Wash.2d 868, 416 P.2d 88 (1966). Other indicia of ownership were that the risk of loss was placed with the purchaser in the event of destruction of the timber, and purchaser had an interest which he was able to convey. This was evidenced in this case by the sale from Jayco to Wasser & Winters.

The issue is not whether is absolute control over all aspects of the timber but whether there is an interest sufficiently distinct from the fee interest of the State of Washington to come within the statutory definition of the terms 'held' or 'owned'. RCW 84.04.080.

Our previous cases do not establish a contrary rule. In Star Iron & Steel Co. v. Pierce County, 81 Wash.2d 680, 504 P.2d 770 (1972), the court was...