National Bank v. Barber

24 Kan. 534 | Kan. | 1880

The opinion of the court was delivered by

Valentine, J.:

The sole question presented to the court for its decision in this case is, the validity of § 7 of ch. 90 of the Laws of 1870. The section reads as follows:

“ If any county or township tax shall be assessed and collected from any railroad which may have been built in whole or in part in any township which may have subscribed stock as provided in the foregoing sections, all such county and ’ township tax arising from said railroads within said township, shall be set apart and held by the treasurer for the benefit of ■such township, and applied to the payment of the' interest and principal of said bonds, and after the payment thereof, "the same shall be added to the school fund of said township; if only a general county or other tax is levied and collected from said railroad in the county, then the township or townships which may have aided in the construction of said road as aforesaid, shall be entitled to have of said tax a fair proportion thereof, to be determined by comparing the length of the road in the township to the whole length in the county.” (Laws of 1870, p. 191. See also Laws of 1879, p. 253, §1; Comp. Laws of 1879, pp. 796, 797, §7; Laws of 1876, p. 215, §7, and pp. 220, 221, §10; Comp. Laws 1879, p. 791, §7, and p. 794, §10.)

The defendants in error claim that said section 7 is void, because, as they claim, it is in contravention of sections 1 and 4 of art. 11 of the constitution of the state of Kansas. So much of section 1 of art. 11 of the constitution as is necessary to be considered in this case reads as follows:

“The legislature shall provide for a uniform and equal rate of assessment and taxation.”

Said section 4 of art. 11 of the constitution reads as follows:

“No tax shall be levied except in pursuance of a law, which shall distinctly state the object of the same; to which object only such tax shall be applied.”

This litigation has reference to that portion of the county tax of Douglas county and that portion of the township tax of Eudora township, which was levied on the railroad property of the St. Louis, Lawrence & Denver railroad company, in said Eudora township and county of Douglas. We shall first consider the question raised with reference to the county tax; but what we shall say with reference to the county tax, we think will also have application in principle to the township tax.

This county tax, which-is now in litigation, is a portion of the general county tax which was levied on all the taxable property of the county by the county commissioners for general county purposes, under § 83 of the tax law. (Comp. .Laws of 1879, p. 956. See also id., p. 275, § 16, sub. 4; id., p. 312, §§181, and 1.) This general county tax was levied for “county purposes,” for “county charges and expenses,” for “current expenses of the county,” and no portion of it was levied for the purpose of paying principal or interest on township railroad bonds. And it was levied for said “ county purposes” “in pursuance of a law;” and therefore, no portion of it can now be diverted from such purpose or purposes. (Const., art. 11, §4; The State v. Comm’rs of Marion Co., 21 Kas. 419.) Certainly no portion of this tax was levied for the purpose for which the plaintiff now desires to use it.

The tax now in litigation either is or is not a part of the county tax. If it is, then it cannot be diverted from county purposes as before stated. But if it is not, then neither it nor the real county tax is levied on the taxable property of the county or township at “a uniform and equal rate.” That is, if it is not a part of the county tax, then all taxable property in the county, except the railroad property, in which this tax was levied, is subject to a county tax, while this railroad property is not subject to any county tax, and no property in the county or township, other than this railroad property, is subject to so high a township railroad bond tax, as this railroad property is. While this railroad property is subject to the same township railroad bond tax that other property in the township is, it is also, in addition thereto, subject to another township railroad bond tax equal to the county tax and the township tax levied on other property, and called a county tax and a township tax. Hence, it will be seen that if the tax now in litigation is not a county tax or a part thereof, then neither it nor the real county tax is levied on the taxable property of the county and township at “a uniform and equal rate,” and hence, both it and the statute attempting to create it must be held to be void. Besides, if it is not a county tax, then both it and the statute attempting to create it, must be held to be void, for the additional reason that it is not levied in pursuance of any law which distinctly states the object of the tax. (Const., art. 11, §4; A. T.& S. F. Rld. Co. v. Woodcock, 18 Kas. 20.) If it is not a county tax, then it is really not levied in pursuance of any law. No statute can be found authorizing the levy of any such tax. And it will not do t® call it a county tax for the purpose of giving authority to the county commissioners to levy it under the statutes which authorize the levy of county taxes, and also for the purpose of avoiding that constitutional provision which requires the tax to be imposed at a uniform and equal rate, and then, after the tax is supposed to be legally levied, to say that it is not a county tax for the purpose of avoiding that other constitutional provision which requires that a tax shall be applied only to the object for which it was levied. It either must or must not be a county tax, and in either ease the statute attempting to apply it as a township railroad bond fund must be void.

It will be noticed that under the statute in question, the tax in question is never to go into'the county fund, or to become any part thereof. The statute provides that it “ shall be set apart and held by the treasurer for the benefit of such township, and applied to the payment of the interest and principal of said bonds; and after the payment thereof, the same shall be added to the school fund of said township.” That is, the statute in effect provides that the railroad property in the township, belonging to the railroad company to which the bonds were issued, shall be exempt from bearing its just proportion, or any proportion, of the expenses or other indebtedness of the county or township.

This court has intimated that it is possible that the legislature may have the power to exempt from taxation personal property, in addition to that exempted by the constitution. (Ottawa Co. v. Nelson, 19 Kas. 237, 238; Francis v. A. T. & S. F. Rld. Co., 19 Kas. 311, 312.) But this court has never intended to intimate or decide that real estate may be so exempted. And the bulk of all railroad property is real estate.

It will also be noticed that under the statute in question, no part of the tax in question is ever to go into or become a part of the township fund, although a part of such tax was levied as general township tax. And the plaintiff, the National Bank of Lawrence, which now owns the coupons for interest due on said bonds, so construes the statute, and commenced this action to compel the county treasurer to pay all such tax collected by him directly to it, the plaintiff. But as substantially the same principles which govern with reference to the county tax, also govern with regard to the township tax, it is not necessary to say anything further as to the township. In both cases it is a clear attempt on the part of the statute to divert funds, raised by taxation for one object, to another object.

The judgment of the court below will be affirmed.

All the Justices concurring.