75 N.J.L. 771 | N.J. | 1908
The opinion of the court was delivered by
The several plaintiffs in error, who were the prosecutors below, attack by these proceedings the constitutionality of three supplements to the act for the taxation of railroad and canal property, approved respectively on the 5th of April, the 18th of April and the 18th of
This legislation was almost immediately attacked by the railroad and canal companies affected by it, upon the ground that it violated that provision of our state constitution which requires that “property shall be assessed for taxes under general laws, and by uniform rules, according to its true value,” and also because it infringed that provision of the federal constitution which prohibits the states from depriving any person of life, liberty or property without due process of law. At the hearing had of those causes in this court at the March 'Term, 1886, the constitutionality of the law was affirmed, all but'three of the judges concluding that the taxation imposed by the act was valid in- tobo, Justices Dixon and Eeed considering that it was invalid so far as the additional burden imposed upon real estate outside of main stem was concerned, but valid as to the tax of one-half of one par cent, imposed upon the whole mass of the property, while Justice Depue considered that the legislation was invalid because it attempted to assess taxes by a rule which was not uniform. Central Railroad Co. v. State Board of Assessors, 19 Vroom 146.
No changes of any importance were afterward made in the statute until the year 1897, when it was amended by the legislature so as to provide that all moneys raised by the taxation of real estate used for railroad or canal purposes other than main stem or waterway should be paid over by the state comptroller to the various taxing districts in which the property was situate. Pamph. L. 1897, p. 147. The legality of this amendment has never been before the courts for consideration, but its constitutionality must be accepted as having been established bv this court,, by necessary implication, in the case of Bergen and Dundee Railroad Co. v. State Board of Assessors, 45 Vroom 742, hereinafter referred to.
In the year 1905 the legislature further amended the statute, so far as the burden imposed upon real estate outside of main stem or waterway was concerned, by repealing the limitation which prohibited its taxation at more than one and one-half per cent, and enacting that thereafter it should bear the same burden as other taxable property located in the same taxing district. No change, however, was made in the machinery for its assessment and collection. Pamph. L. 1905, p. 189. The validity of this amendment was promptly chai
This detailed recital of the legislative scheme for the taxation of property used for railroad or canal purposes, as it existed at the time of the passage of the first of the supplements enacted in the year 1906, and of the decisions of this court upon the question of its constitutionality, is necessary for the purpose of making plain the grounds upon which we rest our determination of the causes now under consideration, for the reason that we accept as settled the principles established by those decisions, and as controlling us in our determination, so far as they are applicable to the questions now presented for solution.
It is to be borne in mind, in dealing with those questions, that each of the three supplements subjected to attack by these proceedings is entirely independent, passed at different times, and having no relation to one another until they were engrafted upon, and became a part of, the original act of 1884, and that we are to consider, therefore, what effect each supplement in turn had upon the constitutionality of the parent act when it took its place in that act as a component part thereof.
Turning now to the first of these supplements. Its sole purpose is to change the rate of taxation upon property used for railroad and canal purposes (except “real estate outside of main stem or waterway”) from one-half of one per cent, (the rate established by the original act) to the average rate of taxation prevailing in the various taxing districts of the state. It provides a method by which that average rate shall be ascertained each year, and requires the state board of assessors to value and assess the main stem of the railroad of each railroad company and the waterway of the canal of each canal company, the tangible personal property of these companies used for railroad or canal purposes and their fran
These several grounds of attack upon the constitutionality of the supplement, and the able arguments of counsel of plaintiffs in error in support of them, rest principally upon the assumption that it is an independent enactment, by force of which a certain portion of the property of railroad and canal companies used for railroad or canal purposes is arbitrarily selected from the mass of property so used and a separate tax imposed upon the portion so selected. If this was the fact it would be difficult to avoid the conclusion which counsel insist should be reached. The supplement, however, is plainly not an independent enactment, but a mere amendment of the act of 1884, making no change whatever in that act, as has already been pointed out, except by substituting in the place of the tax rate of one-half of one per cent., fixed by the original act as the basis for the taxation of main stem or waterway, tangible'personal property and franchises, the average rate prevailing in the various taxing districts of the state, and by directing how that average rate should be
Tt has not been contended before us that an “average rate,” to be computed by the state board of assessors, is unconstitutional merely because it is an average rate, to be so ascertained, rather than some other rate definitely fixed by the legislature. As the question is in the case, however, we deem it proper to say that it has received consideration by us, and that we concur entirely in what was said by Mr. Justice Pitney, speaking for the court below, in dealing with it. We think, further, that this court by its decision in the 19 Vroom case, that an arbitrary rate of one-half of one per cent, fixed by the legislature, and which was to continue for an indefinite period, without regard to what amount of money would be required from year to year for the needs of the state, was constitutional, established the right of the legislature to arbitrarily fix such rate for the taxation of this class of property as it might from time to time see fit, provided that the burden imposed was not at any time greater than that which the property of the other taxpayers in the various taxing districts of the state was required to bear.
The supplement next attacked is that of April 18th, 1906. Pamph. L., p. 220. It provides that the term “main stem” of each railroad company, as used in the act of 1884, shall be held to include the roadbed, not exceeding one hundred feet in width, with its rails and sleepers, and all structures erected diereon and used in connection therewith, not including, however, any passenger or freight buildings erected thereon. By the original act passenger depots were defined to be a part of the main stem, without regard to whether they were within or without the one-hundred-foot limit, while freight buildings were included in the “real estate outside of main stem,” whether they were located within or without the one-hundred-foot strip. As a consequence a different rate o'f taxation prevailed as between passenger depots and freight depots, irrespective of location. The supplement now under consideration
The last of the supplements which it is contended renders the scheme of taxation violative of the constitutional provisions already specified is that of May 18th, 1906. Pamph. L., p. 571. Tt is as follows: “The taxes which shall hereafter be assessed upon the property of railroad and canal companies referred to in subdivision 2 of section 3 of the act to which this act is a supplement [that is, Teal estate outside of main stem or waterway’] shall be assessed and taxed in each taxing district in this state in the same manner and at the same rate as other property located in said taxing district is assessed and taxed, and the amount of tax derived there
Reading this supplement into the act of 1884 we have this scheme for the taxation of the property of railroad and canal companies: (1) The assessment and taxation of so much of their property as is not used for railroad or canal purposes, and of all of the real estate of such companies which is used for such purposes (except a strip one hundred feet wide, with the rails, sleepers and structures, other than passenger or freight depots, thereon), including tire roadbed outside of the one-hundred-foot strip, waterways, reservoirs, tracks, passenger and freight stations, &c., &c., in the same manner, at the same rate and for the same purposes as the taxable property of other owners in the same municipal division or taxing district; (2) the assessment and taxation of what remains of their property used for railroad or canal purposes, i. e., the one-hundred-foot strip, the tangible personal property and the franchises, in a different manner, at a different rate and for different purposes than those for which the taxable property of other owners in the state is assessed and taxed. In other words, the effect of this act, with this last supplement engrafted upon it, is to separate from the mass of the property of these companies which is used for railroad or canal purposes certain specified parts thereof, and to treat the property so separated as constituting a class for the purpose of taxation. Has such a scheme of taxation been declared constitutional by our former decisions in the Central railroad and the Bergen and Dundee railroad cases ?
It is argued on behalf of the state, and was considered by the court below, that this supplement merely alters the machinery created by the original act for the assessment and collection of the taxes imposed by it, and makes no fundamental change in the scheme of taxation itself; that the original act not only segregated for taxation property used for railroad or canal purposes, but, after doing so, distributed it into arbitrary parts or sub-classes, and dealt with these sub-classes as independent subjects of taxation, and that this
l’t must be conceded that certain expressions in our opinion in the Bergen and Dundee case lend color to the idea that the view above expressed was assumed by us to be that held by the judges in the earlier case. The determination of the Bergen and Dundee case, however, involved only the question of the power of the legislature to change the rate of taxation so far as “real estate other than main stem or waterway” was concerned, and not its power to tax independently an arbitrarily selected portion of property used for railroad or canal purposes, and what was said by us as to the conclusion to be gathered from the opinions in the Central railroad case, with reference to the view of the judges upon the latter point, was not only not required for the decision of the case then under consideration, but was not (as we conclude after more mature deliberation) justified by the opinions themselves. The act of 1884 was capable of being construed as designed to authorize either (1) an annual tax for the direct use of the state, and also an independent annual tax for each taxing district, to be levied upon “real estate outside of main stem or waterway,” or (2) as designed to authorize a single annual tax to be levied on all property in the state used for railroad or canal purposes under a franchise. The first construction would result from giving controlling force to the declaration of the act that “each company shall pay to the state for general state purposes a tax at the rate of one-half of one per cent, annually, * * * and shall also pay, in addition to «aid tax of one-half of one per cent., a tax at the local rate” upon real estate outside of main stem or waterway, and that the money received for the tax assessed at the local rate upon real estate outside of main stem or waterway should be distributed among the several taxing districts in which it is located. The other construction would result from giving controlling force to the declaration of the act that the sum of
The fact that none of the judges who held that the law was constitutional in toto attempted to refute this view; the fact that they considered the law general because property used
We conclude, therefore, that the decision of this court in the Central railroad case affords no support to the contention that the legislature may separate railroad and canal property into arbitrarily designated parcels, and separately tax such parcels by different methods at different rates and for different purposes. It seems hardly necessary to acid that, under the construction which we find to have been given to the act of 1884 by the decision which we have been discussing, the contention that the supplement under consideration does, nothing except to alter the rate at which “the local tax”' imposed by the act is to be assessed has no foundation upon, which to rest.
Being of opinion that the question whether the engrafting of this supplement upon the act of 1884 (as amended by the other legislation heretofore referred to) renders that act unconstitutional is still an open one, we proceed to its determi
The fact that the supplement of May 18th, 1906, is void
The conclusions which we have reached upon the various questions discussed in this opinion lead to a reversal of the judgment of the Supreme Court in the case of United New Jersey Railroad and Canal Co. v. Parker, Collector, that judgment having declared valid a tax assessed by the local assessors of the city of New Brunswick for local purposes upon that portion of the property of the plaintiff in error designated by the Railroad Tax act as “real estate other than main stem,” and situated in that municipality. As to the judgments in the other cases under review, our conclusions lead to their affirmance. The taxes in those cases were assessed by the state board of assessors, under the provisions of the Railroad Tax act, for state purposes, and while it is true that they were not assessed upon all of the property of the plaintiffs in error used for railroad or canal purposes (the state board of assessors having acted upon the supposition that they were debarred from imposing them upon the property described in the supplement of May 18th, 1906), this fact worked no harm to them, for the reason that the only result to them was to diminish, for the time being, the amount of the taxes which they were respectively required to pay.
The judgments in the cases of the Central Railroad Co. v. State Board of Assessors, the Morris and Essex Railroad Co. v. State Board of Assessors, the Lehigh Valley Railroad Co.
For affirmance — Mache, Chancellor, The Chiee Justice, Garrison, Swayze, Trenchard, Parker, Bergen, Bogert, Vredenburgi-i, Vroom, Green, Gray, Dill, J.J. 13.
For reversal — None.
The judgment in the case of the United New Jersey Railroad and Canal Co. v. Parker, Collector, was reversed by the following vote:
For affirmance — None.
For reversal — Magie, Chancellor, Ti-ie Chiee Justice, Garrison, Si/ayze, Trenchard, Parker, Bergen, Bogert, Vredenburgi-i, Vroom, Gray, Dill, J.J. 12.