Watson v. Sabine Royalty Corporation

• Decision Date: 27 July 1938
• Docket Number: No. 5495.,5495.
• Citation: 120 S.W.2d 938
• Parties: WATSON et al. v. SABINE ROYALTY CORPORATION et al.
• Court: Texas Court of Appeals

Page 938

120 S.W.2d 938

WATSON et al. v. SABINE ROYALTY CORPORATION et al.

No. 5495.

Court of Civil Appeals of Texas. Texarkana.

July 27, 1938.

Rehearing Denied September 29, 1938.

Appeal from District Court, Rusk County; Nat W. Brooks, Judge.

Suit by the Sabine Royalty Corporation and others to enjoin J. T. Watson and others from doing any acts prescribed by virtue of the provisions of a county-wide equalization school tax act. From a judgment holding the act unconstitutional, defendants appeal.

Reversed and rendered.

Smith & West and Brachfield & Wolfe, all of Henderson, for appellants.

Tilley & Tocker and Hamilton Rogers, all of Fort Worth, for appellees.

WILLIAMS, Justice.

This litigation involves the constitutionality of H.B. No. 1096 enacted at the Regular Session, 45th Legislature, 1937, c. 231, designated as Article 2744e in Vernon's Annotated Civil Statutes of Texas. This statute is hereinafter referred to as the "Act." Appellees Sabine Royalty Corporation, T. A. Johnston, and C. O. Christian, plaintiffs below, taxpaying property owners in Rusk County, filed suit in the district court against Rusk County, its Commissioners' Court, the County-wide Equalization School District, the County Board of School Trustees, the respective members of each, both in their individual and official capacities, the County Tax Assessor-Collector, County School Superintendent, Treasurer, and County Depository. The respective parties will be referred to as plaintiffs and defendants, their trial court designation. Other property owners (not necessary to mention) sought to intervene. No question is raised as to proper parties, plaintiffs, or defendants.

Plaintiffs upon various grounds later herein discussed sought to have the act declared unconstitutional and void. They prayed for permanent injunction to restrain the defendants and each of them named from doing any act prescribed by virtue of the provisions of said act, and for other relief not necessary here to mention. The trial court held that H. B. No. 1096 applied to Rusk County only and could never apply to any other county because of the failure of the statute to provide any standard, rule or regulation by which it may be determined in the future when any other county may have an assessed valuation of $75,000,000 or more, holding, therefore, that it was a local or special law and could have not been legally enacted without a properly published notice of intention to apply to the Legislature for its passage being first given; that such notice was not so given and therefore this bill was unconstitutional and void and in contravention of Sections 56 and 57 of Article 3, and Section 3 of Article 7 of the Constitution of Texas, Vernon's Ann.St.Const. art. 3, §§ 56, 57; art. 7, § 3. The court sustained none of the other grounds of plaintiffs attacking the validity of the law.

Section 57, Article 3, provides that no local or special law shall be passed, unless notice of the intention to apply therefor shall have been published in the locality where the matter or thing to be affected may be situated. The clauses in Section 56 of Article 3 pertinent read:

"The Legislature shall not, except as otherwise provided in this Constitution, pass any local or special law, authorizing: * * *

"Regulating the affairs of counties, cities, towns, wards or school districts; * * *

"Creating offices, or prescribing the powers and duties of officers, in counties, cities, towns, election or school districts; * * *

"Regulating the management of public schools, the building or repairing of school houses, and the raising of money for such purposes; * * *

"And in all other cases where a general law can be made applicable, no local or special law shall be enacted; * * *"

A summary of the pertinent provisions of the Act is deemed necessary to the understanding of the nature and scope of the controversy presented in this appeal.

"Section 1. All counties in this State having a population of not more than thirty-two thousand, five hundred (32,500) nor less than twenty thousand (20,000), according to the last preceding Federal Census, and containing a valuation of Seventy-five Million Dollars ($75,000,000) or more, are hereby created into county-wide equalization school districts, and each such county shall have the county unit system of education to the extent specified in this Act and may exercise the taxing power conferred on school districts by Article 7, Section 3, of the Constitution to the extent hereinafter provided but such taxing power shall not be exercised until and unless authorized by a majority of the qualified property taxpaying voters residing therein at an election to be held for that purpose as hereinafter provided.

"Sec. 2. The general management, supervision, and control of the public schools and of the educational interests of such counties shall be vested in the County Board of School Trustees, except as otherwise provided by law and said Board shall perform such duties as are or may be required of it by existing law and by the provisions of this Act and shall constitute the Board of Trustees for such county-wide equalization district. Any such county-wide school equalization district may levy and collect annually on all taxable property in the county an equalization tax not to exceed Twenty-five (25) Cents on the One Hundred Dollars ($100) valuation of property situated in said county and the money derived from said tax shall be known as an equalization fund for the support of the public schools of the county, which funds shall be distributed to the school districts of the county as provided herein." Vernon's Ann.Civ.St. art. 2744e, §§ 1, 2.

Prior to the institution of this suit, Rusk County had held an election and had adopted the provisions of this Act. As plaintiffs make no attack upon this election, the provisions of the Act in Section 3, Vernon's Ann.Civ.St. art. 2744e, § 3, which specify the manner of calling, conducting and declaring the results of such an election has been omitted.

"Sec. 4. In counties voting such equalization tax the County Tax Assessor shall assess all the taxable property in the county at the same rate of valuation as it is assessed for the State and county purposes, and the County Tax Collector shall collect said tax at the same time and in the same manner as State and county taxes are collected. The Tax Collector shall have the same authority and the same laws shall apply in the collection of said tax as in the collection of county ad valorem taxes. He shall on or before the 10th of each month make a report to the County Board of School Trustees and to the County Superintendent of Schools showing all moneys collected by him during the last month by said tax. The officers assessing and collecting said equalization tax shall receive therefor the same compensation as is paid for assessing and collecting school taxes in common school districts." Vernon's Ann. Civ.St. art. 2744e, § 4.

The first question presented is to determine the meaning of the word "valuation" as used by the Legislature in this bill. Section 4 of the Act may be considered to ascertain the intent of the Legislature in the use of this term. Said section provides: "In counties voting such equalization tax the County Tax Assessor shall assess all the taxable property in the county at the same rate of valuation as it is assessed for the State and county purposes." It is observed that the County Tax Assessor is mentioned and not the assessor of some other political subdivision. The valuation mentioned in Section 4 is that "for State and county purposes." Section 2 of the Act, Vernon's Ann.Civ.St. art. 2744e, § 2, may also be looked to in ascertaining the intent of the Legislature wherein it provides: "Any such * * * equalization district may levy and collect annually on all taxable property in the county." This term "valuation" used, as here, in a taxation statute naturally would imply an assessment for taxes by some legally constituted authority. Articles 7177 to 7244 of Revised Civil Statutes of 1925 detail the time, form and manner of assessing taxes and preparing the tax rolls. These statutes, art. 7219, further make it mandatory on the County Tax Assessor to prepare such a tax roll each year. When completed, one of three copies is required to be filed in the County Clerk's office of that county. These requirements afford a definite method of ascertaining the amount of the assessed valuation for the respective counties for any particular year. Construing these sections mentioned in the Act and the use of the term in this taxing statute, we conclude that the trial court correctly held that the word "valuation", as used, should be construed to mean "assessed valuation," and because of provisions in Section 4 we further conclude that the Act means assessed valuation according to the tax rolls of a county as assessed for State and County purposes. 39 Tex.Jur. p. 201, Sec. 108; 66 Cor.Jur. pp. 417, 418.

With the conclusions just reached, the next question arises if the provisions of this Act can be construed to include any other county in Texas if and when such county reaches in the future a valuation of $75,000,000 or more. It is to be observed that Sec. 1, Vernon's Ann.Civ.St. art. 2744e, § 1, provides: "All counties in this State having a population of * * * according to the last preceding Federal Census, and containing a valuation of Seventy-five Million Dollars ($75,000,000) or more, are hereby created into county-wide equalization school districts, * * *." The trial court in his conclusions of law, pertinent to the construction placed on the last quoted section, found:

"That the court, although it may be authorized to read into the law that `valuation' herein means `assessed valuation,' since the word as used in the law can have no fixed or ascertained meaning without reading that meaning into it, yet, it is concluded that the court may not in law be...