Emory v. State

41 Md. 38 | Md. | 1874

Bartol, C. J.,

delivered the opinion of the Court.

This is an appeal from an order of the Superior Court, directing that a peremptory writ of mandamus be issued, requiring the appellant to pay to the Treasurer of the State certain taxes for the years 1870, 1871 and 1872, levied upon the capital stock of the company.

The taxes claimed are 19 cents on the $100, imposed by the Act of 1868, ch. 371, and of one cent on the $100, laid by the Act of 1870, ch. 422, sec. 18. These taxes, making 19^- cents on the $100, it is alleged were levied by the Mayor and City Council of Baltimore for each of the years, 1870 and 1871, and are payable to the Treasurer of the State, as provided by the Code, Art. 81, sec. 93. And tor the year 1872, a tax of 19 cents on each $100 in value of the shares of capital stock of the company, levied under the Act of 1872, ch. 419, according to the assessment thereof made by the Comptroller as provided by the Act of 1872, ch. 90.

The answer of the appellant sets up several defences, and a replication thereto was filed by the appellee; and by agreement of counsel the cause was heard as upon demurrer to the answer; without prejudice as to the issues' of fact raised by the pleadings.

We shall proceed to consider the several defences relied on in the answer.

1st. It is said the mandamus ought not to be granted against the appellant; because he was not President of the company before the 4th day of March, 1873, a period subsequent to the time when the taxes were due and payable, if due at all. No better or more satisfactory answer to this objection is required, than is found in the opinion of the Judge of the Superior Court. Upon this point, we are content to rest our judgment upon what has been so well said by him ; merely referring in support of his views to The State vs. Mayhew, 2 Gill, 487.

2nd. It is contended that the payment of the taxes for 1870 and 1871, cannot be enforced by this proceeding, for two reasons — First, because under the Acts of 1868, ch. 311 and 366, and 1810, ch. 422, sec. 18, they were required. to be levied by the Mayor and City Council, and to be collected by the local collector appointed for the City, and were not payable directly to the Treasurer of the State; the Act of 1868 having operated to repeal secs. 93 and 105 of Art. 81 of the Code; and if this be not so, then secondly, because by the Act of 1812, ch. 419, sec. 93, Art. 81 of the Code was expressly rej)ealed, and the power of the Treasurer (if he ever had it,) to require payment to himself of the taxes levied in 1810 and 1811, was thereby taken away.

In our judgment,-this argmnent is based upon a misconstruction of the Acts of Assembly referred to.

By 1868, ch. 311, the levy of an annual tax of 19 cents in the $100, was directed to be made by the Mayor and City. Council; but the Act expressly required that the tax “ should be collected in the manner prescribed by the Oode.” Now the Code Art. 81, sec. 93, as to the State tax on the capital stock, required the same to be paid by the proper officer of the corporation, to the Treasurer of the State. So far from repealing this -provision of the Code, the Act of 1868 recognizes it as in force, and expressly directs that the tax thereby required to be levied, “ should be collected as prescribed by the Oode of Public General Laws ; ” That is as respects the tax upon capital stock by the Treasurer of the State; and as respects the tax irpon other property, by the local collector. Chapter 366 of the same year provides for appointment of collectors and prescribes their duties, in regard to the collection of State taxes upon other property, but has no reference to taxes levied upon the capital stock of the incorporated companies.

The argument on the part of the appellant, that because the Act of 1868 directs the levy to be made by the Mayor and City Council; it follows that the particular tax in question must be collected by the local collector, find» no support in the provisions of the Act. On the contrary, as we have before seen, the mode of collection is declared to be the same as prescribed by the Code. There is nothing in the Act of 1870, ch. 422, sec. 18, which prescribes a different mode of collecting the,,tax thereby imposed. We conclude therefore that under the Acts of 1868 and 1870, the taxes for the years 1870 and 1871, for which this suit was brought, were payable to the Treasurer of the State.

The next question to be considered is the effect of the Act of 1872, ch. 419, which repealed sec. 93, Art. 81, of the Code, and enacted another section in lieu thereof. It is argued that “as the Act of 1872, contains no reservation as to taxes payable to the Treasurer directly under sec. 93, which might remain unpaid, the power of the Treasurer to require them to be paid directly to himself, is taken away.”

The same question arose in “ The Insurance Co. vs. Mayor & C. C. of Balto., 23 Md., 296.” That was a proceeding by mandamus, to compel the company to return a list as required by the Code, Art. 81, sec. 97. The objection was made, that the 97th section had been repealed by the Act of 1864, ch. 391, “ and the repeal of the law on which the proceeding was founded, and which alone created the duty, if duty it was, to return the required list, precluded the issue of a mandamus to enforce the performance of an act, which had ceased to be a duty.” (Argument of Mr. Schley, p. 307.) But the Court held that the provision of the Code, under which the mandamus was asked, had not been repealed by the Act of 1864, except for the purpose of re-enacting the same with amendments, not changing the original provision ; and that the Act of 1864 interposed no obstacle to the affirmance of the order granting the mandamus.

It will be found by reference to the Act of 1864, and the provision of the Code then under consideration, that the question then decided was the same as'the one now presented, and arose in the same way. The Constitution, Art. 3, sec, 29, requires the General Assembly, in amending any Article or section of the Code, “ to re-enact the same as the said Article or section would read when amended.” To comply with this provision, it was necessary to repeal sec. 93, £<in order that the amended section should take its place.”

The provision of the original section requiring the taxes to be paid to the Treasurer, is re-enacted in the section as amen.ded, and the right to demand them having accrued, is not taken away by the Act of 1872 ; which has the same operation as a supplementary Act, would formerly have had, leaving unimpaired, the rights and obligations which accrued under the original law, while the section as amended applies to cases arising subsequently. Under the Act of 1872, a State tax for that year, of 19 cents in the $100, was payable by the appellant to the Treasurer, assessed upon the capital stock according ■ to its market value, to be assessed as provided by the Act of 1872, ch. 90. As to this last, the only defence relied on by the appellant, is that the company is entitled to exemption, to the extent that its funds or capital is invested in mortgages. A similar exemption on the same ground, is claimed also, by way of reduction of the taxes assessed for the years 1870 and 1871. This brings ds to the consideration of the third ground of defence relied on in the answer. »

3rd. The company was originally chartered by the Act of 1867, ch. 219, as a Fire Insurance Company. By the Act of 1870, ch. 91, its charter was amended, and new and additional powers were conferred upon it; whereby it was authorized ££to purchase, improve, lease, hold and dispose of property, real, personal and mixed, to borrow and lend money, to make advances upon lands and buildings, to give and receive security for loans made to or by the company.”

The answer states that the amended charter was accepted, and under the powers thereby conferred, the company has proceeded to invest its capital or a large part thereof, and re-in vest the same as paid in, in loans secured by mortgages of real and leasehold estate, and claims that in the assessment of the State taxes on its capital stock for each of the years 1870, 1871 and 1872, it is entitled to exemption to the extent of such investments.

This exemption is claimed, first, under the Act of 1868, ch. 471, secs. 88 and 92, (the general Corporation law,) and, secondly, under the Act of 1870, ch. 394, which exempts mortgages from taxation.

As to the Act of 1868, ch. 471, it is very clear to us that its provisions have no application to this company. Section 88 exempts from taxation certain mortgages therein described, held by such corporations as are mentioned and referred to in that and the preceding sections, from section 84, inclusive, but this company does not fall within these provisions. It is not one of the class of corporations to which those provisions refer. Section 92, which makes these provisions ‘ ‘ applicable to corporations which may be formed in this State, for the purpose of loaning, on real or personal property,” has reference only to corporations formed under the general Corporation Act, and cannot, therefore, apply to this company, which had before been incorporated, under the special Acts of 1867 and 1870. That such is the meaning of section 92 is more obvious by reference to 1872, ch. 178, by which this section was re-enacted, and which in terms refers to corporations “heretofore or hereafter formed under the provisions of the general incorporation Act.”

The ground upon which the exemption is claimed under the Act of 1870, ch. 394, is that the capital stock of the company represents its property, and where any portion of the latter is by law exempt from taxation, the capital stock is also to that extent exempt.

It is unnecessary, for the purposes of this case, to enter upon a discussion of this general proposition, the question here turns upon the construction of the Act of Assembly of 1870, ch. 394. In order to entitle a party to claim exemption of any property from the common burden of taxation, it must clearly appear that it comes within the terms of the law under which the exemption is claimed. The words of the Act are, “ nor shall any tax of any kind he assessed, levied or collected on any mortgages of any kind, or on any mortgage (or) hill of sale, upon any property in this State.”

We think in passing this Act, the Legislature designed only to exempt from assessment and taxation the mortgage debt, as siieh. The words refer to the instrument, the mortgage itself, and declare that it shall not he subject to taxation. The effort here is to give such a construction to this law as will exempt from taxation the capital stock of all corporations, to the extent that their loans may he secured by mortgage.. The law subjecting the capital stock to taxation, makes no such exemption. And in our opinion the Act of 1870 does not apply to the case. By the Act of the last session, 1874, ch. 483, which repeals and re-enacts, with amendments, Art. 81 of the Code, mortgages are exempt from taxation in general terms, as in the Act of 1870 ; and yet the same law, by the 3rd section, specially exempts “all shares of capital stock of building associations, of which the funds and capital stock are imrested in mortgages on real or household property subject to taxation ; to the extent of such investment.” Such a special provision would he useless, if the appellant’s construction of the Act of 1870 were correct. We take this as a clear expression of the intent of the Legislature, that the Act exempting mortgages must be held to apply only to the mortgage securities themselves, and has no application to the taxation of'the capital stock of corporations, whether it he assessed at its par value, or at its actual market value. For these reasons we are of opinion that the appellant is not entitled to the exemption claimed either under the Act of 1868, or the Act of 1870.

(Decided 1st July, 1874.)

The order of the Superior Court, awarding the writ of mandamus, will he affirmed, and the cause will he remanded, to the end that the writ may he issued as prayed.

Order affirmed, and cause remanded.