119 Ky. 574 | Ky. Ct. App. | 1905
Opinion of the court by
Reversing.
This action was instituted by'the appellee, the Louisville school board, against the city of Louisville, to recover what it claims to be its share of the interest collected by the city on delinquent taxes. Section 29S1 of the Kentucky Statutes of 1903 requires that the levy ordinance for each year shall be subdivided as follows: “A levy for schools, a levy for the sinking fund, a levy for police purposes, a levy for the fire department, a levy for street and sewer cleaning, a levy for sprinkling streets, a levy for reconstructing streets, a levy for street repairs, a levy for construction and repairs of sewers, a levy for the house of reform, a levy for charitable
The city and its various, departments of government are not presumed to deal with each other at arm’s length, as debtor and creditor. Whatever they need for their annual support, it gives, varying the per cent, of the levy coming to each in accordance with its necessity.
• On the part of the school board, great weight is given the provision of section 3004, that “the penalty provided for herein shall go to the tax receiver for the benefit of the city.” This, it is said, indicates that the interest is to follow the principal; the affirmative provision'that the penalty should go to the city negativing the idea that the interest also is to go to it. And on the surface of the statute there is some force in this contention; but it is overlooked that in the original tax law of (he city of Louisville, enacted in 1884, which was substantially the same as the tax law now provided for cities of the first class, that which is now called a “penalty” was then called a “commission,” and went to the tax receiver for his own benefit. The original act on the subject in hand is as follows: “Where the warrant calls for more than three hundred dollars, it shall allow five per cent, commission on the first three hundred dollars, and only one per cent, on the residue, . . . For issuing each warrant he [the clerk]
It is further pointed out by the school board that the statute changes the old rule that taxes do not bear interest, and that, by section 2998, uncollected tax bills shall be deemed a debt, and bear intex*est at the rate of one-half of 1 per cent, for each month and fraction thereof. But this statute only accentuates- the weakness of appellee’s contention. The provision is that all delinquent tax bills “shall be deemed a debt from such persons [the taxpayers] to said city. . . .” It will be observed that this langxxage does not import that it is a debt due in part to the various departments of the municipal government for which the tax levy is made, but it is deemed a debt due to the city, and naturally the interest on the debt goes to the creditor. The law provides that the various named subdivisions of the municipal govexmment shall receive their proportionate pax't of the tax bill after it
Strictly speaking, the appellee is not a department of the municipal government, but is an independent corporation, having in charge the education of the youth of the city of Louisville, and that city is one of the school districts of the State; but, in dividing the tax levy, it is classed along with the departments of the municipal government, and no substantial difference can be pointed out between its right to the interest in question, and that of the board of park commissioners, the commissioners of charity, or the trustees of the public library.
We are of opinion that, on the face of the statute, the claim of the school board is without foundation; but, if we were less certain of the soundness of this conclusion, we would be controlled !by the long and uniform construction given the law by all the departments of the municipal government having the matter in charge. Ás said before, the fiscal law of cities of the first class, as it is now contained in the statute, was enacted in 1884. From that time until this, without question or doubt as to its correctness, all of the interest arising on delinquent tax bills has been retained by the city, and passed to its general fund, while that part of the principal due appellee has been paid over to it as by law required. The learned lawyer who drew the original act was elected assistant city attorney for the purpose of properly enforcing it. The learned counsel who now represents the school board then represented it, and neither he nor the draftsman of the act ever had any doubt of the correctness of the original in
The case at bar fully illustratesi the necessity of the court’s giving great weight to the contemporaneous1 construction of such statutes as that under discussion. For a long period of years the city has acted upon this construction, the council has made the various levies for the consecutive years since 1884 based upon its correctness, and the money that it would produce for the support of the several departments of the city government. Each year they have decreased the amount of the levy for the general expense fund, for the reason, that it receives accretions from the interest on delinquent taxes. All of the annual fiscal budgets for many years, past have been based upon this construction, and now, after the lapse of this long period of time, we are asked to go back and uproot all that has been done in this matter and to affirm a judgment against the city .in favor of appellee for the aggregate sum of 828,450.38 — that being the amount of the interest
Petition for rehearing by appellee overruled1.