Wyatt v. State Bd. of Equalization

• Decision Date: 02 June 1908
• Citation: 70 A. 387,74 N.H. 552
• Parties: WYATT v. STATE BOARD OF EQUALIZATION.
• Court: New Hampshire Supreme Court

70 A. 387

74 N.H. 552

WYATT

v. STATE BOARD OF EQUALIZATION.

Supreme Court of New Hampshire. Belknap.

June 2, 1908.

Transferred from Superior Court.

Petition for certiorari by Walter C. Wyatt against the state board of equalization. There was a demurrer to the petition, and the cause was transferred from the superior court without a ruling. Demurrer sustained.

Shannon & Tilton and James W. Remick, for plaintiff.

Edwin G. Eastman, Atty. Gen., for the State.

William B. Fellows and John M. Mitchell, for defendants.

John R. Eastman, pro se.

PARSONS, C. J. The question in controversy is the meaning of the statute which provides that "every railroad corporation in this state, not exempted from taxation, shall pay to the state an annual tax upon the actual value of its road, rolling stock, and equipments on the first day of April of each year, at a rate as nearly equal as may be to the average rate of taxation at that time upon other property throughout the state." Pub. St. 1901, c. 64, § 1. Similar language is used in the sections governing the taxation of telegraph and telephone companies (Id. § 3), of express companies (Laws 1907, p. 83, c. 81, § 6), and of sleeping, dining, and parlor cars (Laws 1907, p. 92, c. 91, § 1). The petition sets up the legal proposition that the rate is to be found by taking the average of the local tax rates, without including the assessment laid upon savings bank deposits and fire insurance capital. The defendants deny the plaintiff's proposition, and the case has been argued upon this point alone. All other questions have been waived for the time being, and the parties have united in an effort to present this controversy unhampered by any collateral issue.

The plaintiff says that his construction was adopted by the court when it acted as the assessing board; that the question was decided the same way in 1883, and that no change has been made in subsequent re-enactments, of the statute; and that a construction including the savings bank tax in determining the average rate of taxation upon other property throughout the state would necessitate a conclusion that the statute is unconstitutional, unless it were held that the Legislature intended to grant to railroads a special exemption supportable under the protective power. The constitutionality of the statute is material in the present proceeding only as evidence of the legislative intent. If it were discovered that the statute sought to be enforced herein was in contravention of the Constitution, the necessary result of such conclusion would be the dismissal of the petition. But whether the Legislature can constitutionally burden railroad corporations by imposing higher taxes upon them than upon other owners of property throughout the state, or whether they may without violation of the organic law relieve them by a special exemption from the whole or a part of the taxes generally assessed upon property, need not be considered. Judicial decisions in view of which existing legislation upon the subject was originally adopted and subsequently re-enacted establish a legislative intent to treat railroads, for the purpose of taxation, as individuals taxable for the true value of their property at the rate at which other property is taxed in the same taxing district, and exclude any purpose to tax them "for a greater sum than their proportionate and equal share with the other property in the state, ascertained as nearly as it reasonably could be." Boston & Maine R. R. v. State, 63 N. H. 571, 572, 4 Atl. 571; Boston, etc., R. R. v. State, 60 N. H. 87; Atlantic, etc., R. R. v. State, 60 N. H. 133; Cheshire County Tel. Co. v. State, 63 N. H. 167; Western Union Tel. Co. v. State, 64 N. H. 265, 9 Atl. 547. The state board of equalization, upon whom the duty of assessing taxes upon railroads is placed, are required to "determine the value of the property to be taxed * * * and the rate of taxation." Pub. St. 1901, c. 63, § 3; Id. c. 64, § 14. In the performance of this duty, it is alleged that the board added together the taxes assessed and collected by municipal officers, those assessed and collected upon unincorporated places by state and county officers, and those collected by the State Treasurer upon savings bank deposits, the capital stock of building and loan associations and insurance companies, and obtained the average rate of taxation by dividing the total amount of such taxes by the total of the selectmen's inventories, the valuation of unincorporated places, the savings bank deposits, and the building and loan and insurance capital. They then assessed the railroads of the state at the rate which in this way they found all other property in the state was assessed. If one person owned all the property in the state except the railroads, although he paid taxes at different rates upon different portions of it, the average rate of the taxation of the whole would be obtained by the division of the total tax by the total amount of property upon which the several sums were levied. As between two persons, one owning all the railroads and the other owning all the other taxable property in the state, the taxation of the total property of each at the same rate would produce the equal division of public expense required by the Constitution. As the taxation of all other property in the state at the 'same rate as railroads are taxed would produce in the aggregate the sum levied by varying rates on different classes or parcels of property, the owner of the whole could not complain that he paid too much, or the railroad owner too little, because each would pay the same. As the property in the state is divided among many, who hold the different classes of property in varying ratios, it follows that, as between certain individuals and railroads generally, some individuals will pay more and some less than is paid on the same value of railroad property. But, so long as railroads pay upon their property the same amount as is paid on the average throughout the state upon that amount of property, their share of the public burden is borne by them. This is the rule applied in tax appeals from local assessors. Amoskeag Mfg. Co. v. City of Manchester, 70 N. H. 200, 46 Atl. 470. As the method adopted by the board in assessing railroad taxes assesses upon the $28,000,000 of railroad property (the appraisal of which is not in question in this case) the same amount in taxes as is assessed upon the average upon each $28,000,000 of property throughout the state, the result complies with the constitutional rule of equality in taxation, which "requires that throughout the same taxing district the same tax shall be laid upon the same amount of property." Amoskeag Mfg. Co. v. City of Manchester, 70 N. H. 336, 344, 47 Atl. 74. As the method of the board is apparently mathematically proportional and constitutionally just, the only ground upon which the result can be attacked is that some one or more of the taxes considered by them in finding the average is not a tax upon property, and cannot be considered in the distribution of the burden of taxation placed upon property. Amoskeag Mfg. Co. v. City of Manchester, 70 N. H. 336, 47 Atl. 74.

The plaintiff contends that the tax upon savings bank deposits, building and loan associations, and insurance capital should not be considered. It is not suggested that the tax on building and loan associations stands any differently from the tax on savings bank deposits. So far, however, as the consideration of the tax upon insurance capital is concerned in this case, the question is purely academic. The tax is so inconsiderable as not to affect the result. Considering it, the exact arithmetical average is a small fraction of a cent less than the rate ($1.72) found by the board. Excluding it, the same rate is a similar fraction more than $1.72. In either event, it cannot be held that the rate found by the board is not the average rate "ascertained as nearly as it reasonably could be." Boston & Maine R. R. v. State, 63 N. H. 571, 572, 4 Atl. 571. The substantial question is as to the savings bank tax. The plaintiff's contention is that the tax levied with reference to some $66,000,000 of what the board considered property, owned by 183,243 depositors—nearly one-half the population of the state—should be excluded from the computation, and the tax be determined by the rate upon the remaining $238,000,000, i. e., that more than one-fifth of the whole property taxed should be omitted from the calculation. Upon the concession of the plaintiff as to the power of the Legislature, the question appears to be, as stated at the outset, purely one of statutory construction. Giving to the language of the section its ordinary meaning, the only question raised by the plaintiff's contention that the sum collected by the state from savings banks should not be included in computing "the average rate of taxation * * * upon other property throughout the state," is whether the sum so collected is a tax "upon other property throughout the state." As there is no contention that this sum so collected is not a tax of some sort, or that it is not exacted "throughout the state," the question is whether the savings bank tax is a tax upon property. As the question is the meaning of the statute—what the Legislature intended by the words used—the exact point in issue is much narrower, and is: Was the savings bank tax understood by the Legislature in 1891 to be a tax upon property? Savings banks, under provisions of the Public Statutes enacted contemporaneously with the section under consideration, are required to pay taxes in two ways. They are taxed for all real estate owned by them in the towns where it is situate, precisely as all other individuals and corporations, except railroad, telegraph, and telephone companies, who are not so taxed for real estate used in their ordinary business. Pub. St. 1901, c. 64, § 12. This is conceded to be a property tax. The...