Wood Oil Co. v. Commonwealth

• Decision Date: 23 June 1922
• Parties: WOOD OIL CO. v. COMMONWEALTH EX REL. REVENUE AGENT.
• Court: Kentucky Court of Appeals

244 S.W. 429

196 Ky. 196

WOOD OIL CO. v. COMMONWEALTH EX REL. REVENUE AGENT.

Court of Appeals of Kentucky.

June 23, 1922

Rehearing Denied Oct. 20, 1922.

Appeal from Circuit Court, Estill County.

Five actions by the Commonwealth of Kentucky, on the relation of its Revenue Agent, against the Wood Oil Company, against the United Oil Company, against the Tidal Oil Company, against the Federal Oil Company, and against the Associated Producers' Company. The county court dismissed the proceedings and the Commonwealth appealed. From judgments of the circuit court, denying defendants' motions to dismiss, the Commonwealth appeals, and from other alleged erroneous actions, defendants appeal. Judgments reversed for proceedings consistent with opinion.

J. P Harrison, of Monticello, Robert R. Friend, of Irvine, and Beverly R. Jouett, of Winchester, for appellants.

Logan &amp Myatt, of Louisville, John W. Walker, of Irvine, and Morris &amp Jones, of Frankfort, for appellee.

THOMAS J.

The above five cases were instituted in the Estill county court by a revenue agent, as relator, for the commonwealth, to require the respective appellants to assess for state and county taxation certain described property, which was alleged to have been omitted for the years named in the respective statements. The county court dismissed the proceedings, and the relator, for the commonwealth, prosecuted appeals to the Estill circuit court and took all the necessary steps to perfect the appeals in July, 1919, so that they were each appearances in that court at its next regular term. The defenses were a denial of the omissions alleged and an affirmative contention that the defendants in the proceedings had theretofore assessed with the proper authorities all of the property owned by each of them, and had paid the oil production tax as required by section 4223c1, Kentucky Statutes, which is a part of chapter 122, p. 540, Session Acts 1918; but it was admitted that the oil wells owned and operated by appellants had not been assessed as a separate and distinct item of property, because it was insisted that appellants were not required to assess them under the statute supra, as construed by this court in the case of Raydure v. Board of Supervisors, 183 Ky. 84, 209 S.W. 9. The circuit court, upon a trial had at the January term, 1921, assessed the producing wells of appellants for some of the years for which the assessment was sought at a valuation fixed in the judgments, and further adjudged against appellants the 20 per cent. penalty provided in the statute on the taxes to be paid, and complaining of those and other alleged erroneous actions of the court these appeals were prosecuted.

The contention of appellants is that the production tax levied by the statute, supra, and which they have paid, was, by the express terms of the statute in lieu of all other taxes "on the wells producing said crude petroleum," and that it was so held in the Raydure Case; while the commonwealth insists, by its counsel, that the Raydure opinion construed the statute to be only a license or occupation tax, and that the statement in the latter part of the opinion, containing a direction to the lower court, upon a return of the case, to exclude the value of each producing well, was unnecessary to the decision of the questions presented by that record, and was therefore obiter and not to be followed. It will therefore be seen that the two principal questions for determination on the merits of the cases are important and largely affect the interests of both the commonwealth and the oil producers; but we cannot determine them on these appeals, because of the conclusion which we have regretfully reached on a question of practice, stated below and vigorously argued in this court.

Subsection 6 of section 4260, Carroll's Statutes, 1922 Edition, which is a part of an act passed by the General Assembly at its 1912 session, says in part:

"That on and after July 1, 1912, it appearing to any court in which such an action as set out in section 1 is pending either upon original jurisdiction or appeal that no steps other than docketing the case or remanding the case, or passing the case, have been taken by the commonwealth for the prosecution of said action for a period of two terms of such court, when it is a court having terms, or for a period of ninety juridical days, when it is a court of continuous session it shall be the duty of the judge on the motion of the defendant in such case, to cause said case to be dismissed without prejudice to the commonwealth, and in which event the defendant shall recover his costs in said case expended from the officer instituting such action."

The action therein referred to and dealt with is the same remedy which the commonwealth, by its revenue agent, as relator, is prosecuting in these cases. It appears from the records that no progressive step was taken in any of the cases at the succeeding December, 1919, term of the court, after the appeals were perfected and the issues made, and that no order other than one of continuance was made in either of them, and the same is true with reference to the following March, 1920, term of the court.

At the September, 1920, term of court each appellant made a motion to dismiss the proceedings because of the failure of counsel representing the commonwealth to practice the cases as prescribed by the statute, by taking some required progressive step in them during the two terms of court mentioned, but that motion was overruled upon the ground recited in the judgments, which is thus stated:

"Came the defendant, United Oil Company (it being the same in the other cases), and moved the court to dismiss this cause for want of prosecution; the basis of said motion being that two terms of this court passed without any progressive steps being taken in this action by the plaintiff. The order book of this court shows that this appeal was taken and a copy of the judgment of the lower court filed in the clerk's office of this court on July 21, 1919, and that the next regular term of this court thereafter was held in December, 1919, and that the next regular term of this court was held in March, 1920, but that the court at that term met on March 8, 1920, the day provided by law, and was in session on that day and March 9th, and on account of an epidemic of smallpox adjourned until the 27th day of March, 1920, and was in session on that day and on March 30 and 31, 1920. The court holds that said March term of court was not such a term as is contemplated by law, and that in view of the circumstances the plaintiff was not required to take a progressive step at that term. No progressive step was taken by plaintiff at either of said terms; but at the next regular term of this court, September, 1920, a motion was made by plaintiff to docket and try this cause, and no term of this court has been held since that term until the present term. The court overrules said motion to dismiss for want of prosecution, to which ruling of the court the defendant excepts."

It is earnestly insisted by counsel for appellants that the court was in error when it adjudged that under the recited facts the sitting of the court during the time allotted for its March term...