128 Ky. 268 | Ky. Ct. App. | 1908
Opinion of the Court by
Affirming-
This action was filed in the Franklin circuit court on December 5, 1902, by the Commonwealth of Kentucky to recover of the Chesapeake, Ohio & Southwestern Railroad and the Illinois Central Railroad the franchise tax of the Chesapeake, Ohio & Southwestern Railroad Company for the years 1896 and 1897 upon an assessment made on January 20, 1898, of which notice was given on that date and final notice was given on February 21, 1898. The circuit court dismissed the petition as to the taxes for the year 1896, hut gave judgment against the Illinois Central
The report upon which the tax for the year 1896 was assessed was made on September 15, by John Echols as the general manager of the Chesapeake, Ohio & Southwestern Railroad Co.’ The report upon which the tax for. the year 1897 was assessed was made by the Illinois Central Railroad Company, which had, in some way not explained in the record, come into possession of the railroad. The circuit court dismissed the petition of the Commonwealth as to the taxes for the year 1896-, for the reason that it did not appear .that the Illinois Central Railroad Company was then in possession of the railroad, and the report for that year was made by the general manager of the Chesapeake,' Ohio & Southwestern Railroad Company. It gave judgment against the Illinois Central Railroad Company .for the taxes, for the year 1897, because that company made the report upon which the assessment was based, and was then in possession of the railroad. In doing this the circuit court followed the opinion of this court in Southern Railway v. Coulter, 113 Ky. 657, 24 Ky. Law Rep. 203, 68 S. W. 873, where the Illinois Central was held liable on this, same assessment in a well-considered opinion by this court. The court said: “It is claimed on behalf of the appellant, Illinois Central Railroad Company, that, as it’ did not get possession of the entire lines until some timé in 1897, no franchise.tax should be assessed against it prior thereto. The .record, however, discloses,the fact that'it made reports to Auditor Stone, and-upon these reports he fixed the value of its franchise, commencing' with the year Í896, up to thé samé time the other assessments
The defendant introduced on the trial Samuel II Stone, who was the auditor of the State in the year 1898, and, as such, a member of the board who made the assessment upon which the suit is based. He testified on the trial, which took place in October 6, 1905, in substance that, although the board made the assessment and sent out notice of it and at the end of 30 days sent out the final notice of assessment, they were unwilling to force a conclusion because they were not sure of their ground; and in the winter of 1899 they had a consultation with the railroads of the State, and in this consultation in the year 1899 they agreed that the assessment then made against the Illinois Central Railroad Company should be in full not only for that .year but for the previous years It also appears from the proof that the assessment which was made in 1899 'was made in this way: The board took the total capitalization of the Chicago, S' Louis & New Orleans Railroad, and deducted from it the tangible property assessed against it, and the balance was the sum on which the Illinois Centra? Railroad Company paid a franchise tax for the year 1899. But waiving this, the testimony of the assessor who makes an assessment cannot be received after
Much is said in the argument as' to the hardship of the case; but we fail to see that appellant has any substantial grounds for complaint. It has escaped the payment of all franchise taxes1 for the year 1896,- and has only been required to pay for one year, instead of two; and, as far as the amount of the assessment goes for the year 1897, it is much less than it has been- for the years. succeeding 1899. The personal judgment against the Illinois Central Railroad Company was proper because it was in possession of the property, and made the report upon which the assessment was made. The question most seriously insisted on is that the action was barred by limitation. The suit was brought within five years after the assessment was made, but it was not brought within five years after the assessment might have been made by the board. The board should have made the assessment in the winter of the year 1897, and the. action was not brought within five years from that time. Previous to the passage of the act of 1890 (Laws 1889-90, p. 149, c. 1763), it was well settled that an action to recover taxes did not accrue until the taxes were assessed. L. & N. R. R. Co. v. Commonwealth, 1 Bush, 250; Covington v. Wilson, 5 Ky. Law Rep. 778; Louisville v. Johnson, 95 Ky. 254, 15 Ky. Law Rep. 615, 24 S. W. 875. It is insisted, however, that this action is governed by the act of 1890, and that that act changes the rule. The case of the Louisville Water Co. v. Commonwealth, 89 Ky. 244, 11 Ky. Law Rep. 414, 12 S. W. 300, 6 L. R. A. 69, was decided on October 31, 1899. It was there held that,'in the absence of legislative authority,
The same question was involved in Southern Railroad in Kentucky v. Coulter, 113 Ky. 657, 68 S. W. 873, 24 Ky. Law Rep. 203. There franchise taxes from various corporations to the counties of the State for the year 1896 and the subsequent years were in question. As to a part of the taxes .more than five years had elapsed since the taxes might have been assessed. The court held the corporation liable. The question of limitation is not mentioned in the opinion, for the reason that the matter was deemed settled by the previous opinion. In the case of Louisville v. Commonwealth, 63 S. W. 580, 23 Ky. Law Rep. 598, which was an action brought under the act of 1890, and was not provided for by any other provision of the statute, the court applied the limitation of that act; thus showing that the court .clearly had in mind that actions brought under the act of 1890 were governed by the limitation prescribed in that act. Counsel cite the cases of Railroad Co. v. Commonwealth, 115 Ky. 278, 72 S. W. 1119, and Commonwealth v. Nute, 115 Ky. 239, 24 Ky. Law Rep. 2138, 72 S. W. 1090; but both of those cases were proceedings to assess omitted property under section 4241, Ky. St. 1903. There is nothing in either opinion touching suits to collect taxes. The conclusion we have indicated is in accord with these cases. It was there held that under
Judgment affirmed.