Yazoo & M. V. R. Co. v. Board of Mississippi Levee Com'rs

• Decision Date: 06 May 1940
• Docket Number: 33914
• Citation: 195 So. 704,188 Miss. 889
• Parties: YAZOO & M. V. R. CO. v. BOARD OF MISSISSIPPI LEVEE COM'RS
• Court: Mississippi Supreme Court

195 So. 704

188 Miss. 889

YAZOO & M. V. R. CO. v. BOARD OF MISSISSIPPI LEVEE COM'RS

No. 33914

Supreme Court of Mississippi

May 6, 1940

APPEAL from the circuit court of Washington county HON. S. F. DAVIS Judge.

Action by the Yazoo & Mississippi Valley Railroad Company against the Board of Mississippi Levee Commissioners to recover back the amount of taxes paid by plaintiff to defendant under protest. Judgment for defendant, and plaintiff appeals. Affirmed.

Affirmed.

H. P Farish, of Greenville, C. H. McKay, of Memphis, Tenn., R. C Beckett, V. W. Foster, and E. C. Craig, all of Chicago, Ill., for appellant.

The taxes levied by the Mississippi Levee District come under the class known as local improvement taxes.

Williams v. Cammack, 27 Miss. 209; Daily v. Swope, 47 Miss. 367; Vasser v. George, 47 Miss. 713; Locke v. Dantzler Lbr. Co., 119 Miss. 783, 81 So. 175.

The so-called railroad privilege tax demanded by the Mississippi Levee District is not really a privilege tax. It is an exaction of a fixed amount per mile of railroad without relation to the granting of any privilege and is arbitrary and unreasonable and therefore unconstitutional and void.

Thompson v. McLeod, 112 Miss. 393, 73 So. 193; Dawson v. Ky. Distilleries Co., 255 U.S. 288; Railroad Co. v. Adams, 90 Miss. 599, 45 So. 91; Railroad Co. v. Hewes, 77 Miss. 194, 24 So. 200.

A tax on railroad property for a local improvement which is greater than that paid by the owners of other property in similar situation is a denial of the equal protection of the law, in violation of the Fourteenth Amendment to the Constitution of the United States.

K. C. S. Ry. Co. v. Road Improvement Dist., 256 U.S. 658, 65 L.Ed. 1151; K. C. S. Ry. Co. v. Ogden Levee Dist., 15 F.2d 637; Road Improvement Dist. v. Mo. Pac. R. R. Co., 2 F.2d 340; Road Dist. v. Mo. Pac. R. R., 274 U.S. 188, 71 L.Ed. 992; Road Dist. v. Mo. Pac. R. R., 275 F. 600; K. C. S. Ry. Co. v. May, 2 F.2d 680; Thomas v. K. C. S. Ry. Co., 261 U.S. 481; O. N. Ry. Co. v. Minnesota, 278 U.S. 503, 509; Pullman Co. v. Richardson, 261 U.S. 330, 339; Galveston, etc., Ry. Co. v. Texas, 210 U.S. 217, 227; Royster Guano Co. v. Virginia, 253 U.S. 412, 64 L.Ed. 989; Louisville Gas Co. v. Coleman, 277 U.S. 32, 37; Houck v. Little River Drainage Dist., 239 U.S. 254, 60 L.Ed. 267; Vasser v. George, 47 Miss. 713; Smith v. Willis, 78 Miss. 243.

The property of the railroads and other public utilities and the privileges exercised by them within the Mississippi Levee District shall be taxable under the foregoing powers granted the Board in the same manner and to the same extent as the property and privileges of other persons and corporations within said district, but this shall not be construed to require all classes of privileges to be taxed at the same time nor at the same proportion.

Sec. 10, Ch. 254, Laws of 1932.

A tax may be perfectly valid under some circumstances and be discriminatory and void under other circumstances.

Abie State Bank v. Bryan, 282 U.S. 765, 75 L.Ed. 690, 701; Smith v. Ill. Bell Tel. Co., 282 U.S. 133, 162; Holden v. Hardy, 169 U.S. 366, 398.

Previous litigation between the same parties resulted in a finding of intentional discrimination by the Mississippi Levee Board against the Yazoo & Mississippi Valley Railroad Company.

C. M. Murphy, of Belzoni, and Ben Wilkes, of Greenville, for appellee.

Levee districts were recognized and the legislature given full power to provide system of taxation by the Constitution of Mississippi.

Art. 11, Secs. 227-239, Const. of Miss.

System of taxation followed by Levee Board is prescribed by Chapter 154, Laws 1932.

There is no difference in point of principle and constitutionality between taxes levied for general purposes and those levied for public local purposes.

Williams v. Cammack, 27 Miss. 209.

Appellant has been benefited by the system of taxation prescribed by Chapter 154, Laws 1932, in comparison with the rate fixed by the decree of the federal district court.

Prior litigation in U.S. district court involved violation of expressed terms of statute then in force.

Board of Levee Commissioners were authorized and empowered to levy and assess privilege taxes within the district by Section 7, Chapter 154, Laws 1932, and to amend, repeal or change the same.

Privilege tax levied is that prescribed by Section 176, Chapter 20, Laws Extra Session, 1935, as amended by Section 8, Chapter 154, Laws 1936.

The Board has power to levy such taxes authorized as in the discretion of the Board is necessary and proper and to reduce the rate and may abolish any one or more of said classes of taxation, as it sees fit.

Cotton tax may be abolished.

Sec. 236, Aht. 11, Const. of Miss.

The Board of Levee Commissioners had inherent power to select the subjects of taxation and to grant exemptions.

Carmichael v. So. Coal & Coke Co., 301 U.S. 495, 81 L.Ed. 1245; Southern Package Corp. v. State Tax Com., 164 So. 45, 174 Miss. 212; Clarksdale Ins. Co. v. Cole, 87 Miss. 637, 40 So. 228; Bank v. Worrell, 67 Miss. 47, 7 So. 219; Holberg v. Macon, 55 Miss. 112; Postal Tel. & Cable Co. v. Robertson, 116 Miss. 204, 76 So. 560.

The question is one of local law and decision of state courts is conclusive.

Dawson v. Ky. Distilleries, 255 U.S. 288.

The Levee Board may tax all within the district or it may select for taxation certain ones and leave others untaxed.

Coca Cola Co. v. Skillman, 44 So. 985, 91 Miss. 677.

The Board by discontinuing the cotton tax is carrying out the general policy of the state in exempting agricultural products from taxation.

Miss. Code 1930, Sec. 3108; Notgrass Drug Co. v. State, 165 So. 884, 175 Miss. 358.

Argued orally by R. C. Beckett, for appellant.

Smith, C. J., Anderson, J., dissenting. McGehee and Griffith, JJ., also dissent.

OPINION

Smith, C. J.

This is an action by the appellant to recover from the appellee taxes paid by it to the appellee under protest. A jury was waived and the case was tried by the judge, who, after hearing the evidence, rendered a judgment denying appellant a recovery. The case made by the record is as follows: The counties and parts of counties in this state lying in the Mississippi River valley, the lands of which would be subject to inundation from overflow waters of the river, are divided into two districts created for the purpose of constructing, repairing, and maintaining levees along the Mississippi River to protect the land within the districts from the river's flood waters. The Mississippi Levee District was created by Chapter 1, Laws of 1865, under the name of "The Board of Levee Commissioners for the Counties of Bolivar, Washington, and Issaquena, " which statute was amended by Chapter 45, Laws of 1877, so as to designate the district as "The Mississippi Levee District" and changing the name of its board of commissioners to "The Board of Mississippi Levee Commissioners." The 1865 statute imposed a tax of ten cents an acre per annum upon all land within the district and a one cent per pound, per annum tax on cotton grown in the district. These two taxes, with variations in the rate thereof, were continued up to the fiscal year 1938, when the cotton tax was discontinued. By Chapter 7, Laws of 1886, an additional tax for the support of the district was imposed on all railroads within the district varying according to the type of the road from $ 100 to $ 60 per annum per mile of the railroad.

By Article 11 of the State's Constitution adopted in 1890 maintenance of a levee system in the State was made mandatory. The creation by the legislature theretofore of the two Mississippi Levee districts was approved and the legislature being given power to change their boundaries by law. The article deals extensively with the powers of the two boards of levee commissioners. Section 236 thereof approves the taxes then in force for the support of the districts and makes it mandatory on the legislature to impose an acreage tax on land in the district and authorizes it to provide for the discontinuance of the tax on cotton. Section 237 grants the legislature "full power to provide such system of taxation for said levee districts as it shall, from time to time, deem wise and proper." By Chapter 63, Laws of 1892, and various statutes thereafter the foregoing taxes were continued. Chapter 125, Laws of 1908, amended Chapter 7, Laws of 1886, so as to impose an annual tax on railroads varying from $ 200 to $ 50 per mile according to the type of the road. Chapter 282 Laws of 1914, changed the rate of this tax to $ 350 per annum decreasing to $ 87.50 per annum on each mile of a railroad according to its type. That Chapter was amended by Chapter 259, Laws of 1926, so as to provide that a railroad company owning not more than 25 miles of railroad should pay a tax only of $ 50 per annum. By Chapter 154, Laws of 1932, the laws governing the Mississippi Levee District were revised. Section 7 thereof authorized the levee commissioner "to levy and assess the following taxes upon the persons, property and privileges within the Mississippi Levee District, to-wit:" (a) An acreage tax not to exceed five cents per acre; (b) an ad valorem tax of not exceeding ten mills on the assessed value of all property in the district not exempt from taxation under the general laws of the state; (c) a tax on cotton grown in the district not to exceed one-fifth of one cent per pound thereof; and (d) a tax on all privileges exercised within the district. Section 8 thereof requires the taxes to be levied annually at the July meeting of the Board of Levee Commissioners or any meeting thereafter and authorizes the board to "abolish and re-establish as it sees fit any one or more of said classes of taxation provided" sufficient...