156 P. 502 | Cal. | 1916
The differences between the plaintiff and the parties defendant were submitted to the superior court for decision under an agreed statement of facts, as contemplated by section
The stipulated facts essential to this consideration are the following: By the constitutional amendment and the legislative enactments passed in subordination thereto, public service corporations, of which plaintiff is one, pay to the state a percentage of their gross, revenues, fixed by law, as a "commutated or substituted tax for other taxes which were or might have been levied." (Pacific Gas Electric Co. v.Roberts,
Defendant Levee District No. One of Sutter County is organized under special acts of the legislature. (Stats. 1867, p. 316; Stats. 1873-74, p. 511; Stats. 1907, p. 47; Stats. 1911, p. 347.) The district has an assessor whose duty it is between the first Monday in March and the first Monday in July of each year to assess at its actual cash value "all the real and personal property in said district" for the purpose of raising revenue for the maintenance and support of the district. The personal property tax must be promptly collected and is made a lien upon the real property of the owner of both. Seizure and sale may be made of the personal property to enforce this tax. On the first Monday of July and thereafter the board of directors of the district must meet to examine and equalize the assessment. The board of directors also estimate the percentage of the tax necessary to be levied, and to do this thing must meet on the third Monday in September and fix the rate. The clerk of the board of supervisors certifies this rate to the county auditor and the corrected and equalized assessment-roll is delivered to that official. He makes the necessary computations, fixing the individual taxes at the rate prescribed, and on or before the second Monday in October delivers the assessment-book to the tax collector of the district. The tax collector of the district then publishes a notice for two weeks, specifying that all taxes are due and payable and that they will become delinquent at noon on the first Monday of January next succeeding unless paid prior thereto. From the date of the delivery of the assessment-roll to the tax collector of the district the taxes levied become a lien on the lands within the district. All moneys received by the tax collector of the district are to be paid into the county treasury of Sutter County, and the treasurer shall pay out of these moneys the interest and principal of the bonds of the district as required by law, and shall disburse the funds remaining after so doing on warrants drawn by the county auditor upon this fund.
Prior to the change in the method of taxing public utilities (Const., art. XIII, sec. 14), and continuously thereafter, up to and including the time of the submission of this controversy to the superior court, the defendant levee district had an outstanding bonded indebtedness of four hundred thousand dollars, saving that sixty thousand dollars of this bonded indebtedness had been paid. *348
The levee district proceeded to assess, levy, and enforce the collection of its annual tax upon and against the operative properties of the plaintiff. This tax, it will be noted, was not fixed as to amount nor did it become a lien until long after the date when the annual state tax of plaintiff had become due and payable and had been paid.
Before seeking to enforce the collection of this tax against plaintiff the levee district made formal demand upon the controller to pay over to it out of the tax so collected from plaintiff the amount of the district tax against plaintiff's property. Upon the controller's refusal so to do demand was made upon the plaintiff for the payment of this district tax, with threats of the enforcement of the penalty provided by law for its failure to pay. Under this compulsion plaintiff paid this district tax, accompanying the payment by written objection and protest.
Appellant's contention is that it is entitled to a recovery of the amount of the tax thus paid to the district, and it stands indifferent as to whether that recovery should be had from the district directly or from the controller. The district insists that appellant is entitled to no recovery, but if it should be held that it is entitled to a recovery that recovery should be had against the controller. The controller joins with the district in disputing appellant's right to any recovery, but further urges that no recovery can be had against the state because the tax which appellant paid to the state was paid voluntarily and without protest. The other defendants are sued merely in their representative capacities — some as directors of the district, and of the others O'Banion is the treasurer of Sutter County and thus the custodian of the district's funds, and Ohleyer is the assessor of the levee district.
These defendants are impleaded not alone as proper parties defendant for the recovery of the moneys, but because appellant also seeks injunctive relief against the district and its officers, which injunctive relief is that the district and its officers be prohibited from further levying a similar tax against appellant's operative properties within the district. With this statement of facts clearly in mind, we may proceed to a consideration of the legal questions presented by the controversy. Upon this consideration the following quotations from the constitution have a controlling bearing. "Taxes levied, assessed, and collected as hereinafter provided upon *349 [the operative properties of] railroads . . . shall be entirely and exclusively for state purposes, and shall be levied, assessed, and collected in the manner hereinafter provided." (Const., art. XIII, sec. 14.) "Such taxes shall be in lieu of all other taxes and licenses, state, county and municipal, upon the property above enumerated of such companies, except as otherwise in this section provided." (Const., art. XIII, sec. 14, subd. a.) For a better understanding of the questions presented, and for convenience, the words embraced in brackets have been interpolated into the constitutional provisions.
"All property enumerated in subdivisions a, b, and d of this section [being all of the properties of these corporations excepting their shares of stock] shall be subject to taxation, in the manner provided by law to pay the principal and interest of any bonded indebtedness created and outstanding by any city, city and county, county, town, township, or district, before the adoption of this section. The taxes so paid for principal and interest on such bonded indebtedness shall be deducted from the total amount paid in taxes for state purposes." (Const., art. XIII, sec. 14, subd. e.)
"All the provisions of this section shall be self-executing, and the legislature shall pass all laws necessary to carry this section into effect. . . . The legislature shall provide for reimbursement from the general funds of any county to districts therein where loss is occasioned in such districts by the withdrawal from local taxation of property taxed for state purposes only." (Const., art. XIII, sec. 14, subd. f.)
The first proposition advanced by all of the respondents is that the tax levied by the levee district is not a tax at all. Of course respondents do not by this mean to be understood as saying that it is not a tax as distinguished from an assessment for benefits. For the contrary has been decided in the case of this defendant levee district as to the precise form of raising revenues which the legislature has authorized it to employ. (People v. Whyler,
The next proposition, for which all of respondents contend, is that conceding this to be a tax, while the constitution has declared that the method which it has adopted for raising this revenue from these corporations for state purposes shall be in lieu of all other taxes and licenses, state, county and municipal, and has thus in effect forbidden the levy of such taxes by the enumerated corporate subdivisions of the state, namely, counties and municipalities, it has not forbidden the imposition of such taxes upon the properties of these corporations by districts which are in no true sense municipal corporations. It may at once be said, as has been frequently decided, that these district agencies and mandatories of the state are not municipal corporations. (People v. ReclamationDist. No. 551,
Of the purpose of the framers of this new taxation measure, and of the intent of the people in adopting it, there is fortunately not the slightest doubt. The state had appointed a learned commission on revenue and taxation, whose labors extended over many years. In 1906 they promulgated their first report. In 1910 they put forth their second report. These reports were most widely distributed, at the state's expense, with the avowed purpose of educating its people to a knowledge of the reasons why the change in the method of taxation of public service corporations, banks, insurance companies, etc., was deemed most desirable, and to an understanding of the benefits which would follow the adoption of the new method. Those reports themselves are official publications of the state. (Appendix to Journals of Senate and Assembly, 39th sess., 1911, vol. 1.) Some of the reasons for the change have been expressed by this court in Pacific Gas Elec. Co. v.Roberts,
It would appear to be beyond peradventure, therefore, that when the constitution declared that the state taxes "shall be in lieu of all other taxes, state, county and municipal" it used the words "state, county and municipal" as inclusive and descriptive, and not as designed to exempt districts from its operation and to authorize the levying of local taxes by such districts. (2 Lewis' Sutherland on Statutory Construction, sec. 495; Church of the Holy Trinity v. United States,
Of persuasive, though not of controlling, value to the consideration, is the contemporaneous act of the legislature, upon which is enjoined by the provisions of the constitution itself the duty "to pass all laws necessary to carry this section into effect." We will not unnecessarily prolong this discussion by quoting from the legislative acts. It is enough to refer to them. By a reading of them it is made plainly to appear that the legislature itself dealt expressly with districts and construed the constitution to forbid local taxation by such districts saving in the one instance authorized by the constitution itself. (Stats. 1911, c. 335, p. 530; Stats. of Special Sess. of Legislature, 1911, c. 23, p. 114; Stats. Regular Sess. of Legislature of 1911, c. 602, p. 1134; Stats. 1913, c. 6, p. 3, c. 320, p. 615, c. 533, p. 916.)
The conclusion thus reached and expressed is that the defendant district has not the general power to tax appellant's properties for its local purposes. The particular tax here under consideration, however, was admittedly levied under the constitutional sanction. In other words, it was a tax to pay the outstanding bonded indebtedness of the district. We next come, therefore, to the correlated rights and duties of these disputants under the admitted facts, which admitted facts for convenience may again be epitomized: The railroad company did pay, as it was called upon to pay, into the state treasury on the first Monday of July, the full four per cent of its gross revenues. The district tax at that time had not been assessed and levied. It was quite proper for the district to assess and levy this tax, because it was clearly within the contemplation of the constitutional provision that it should receive the amount of that tax either from the state by deduction from the total amount paid in by the railroad company, or from the railroad, which in turn would be entitled to reduce its total four per centum by the amount of the local tax which it had thus paid. Owing to the varying dates when these assessments became fixed and the taxes payable it was the duty of the appellant to pay in the full four per cent to the state as it did. At the time it did this it could not know and so could not withhold the amount of the district tax. Nor yet could it protest against its payment of *355 the full four per cent, since that payment was clearly contemplated by law and there was no legal ground of protest against it. The language of the constitution touching this matter is as follows: "The taxes so paid for principal and interest on such bonded indebtedness shall be deducted from the total amount paid in taxes for state purposes." In view of the erudition of the framers of this amendment, and of the study which they devoted to it, it is apparent that this language is most apt to meet just such cases as that here presented. It does not, as the controller argues, require that the corporations shall first deduct the amounts of these local taxes and pay only the balance after such deduction into the state treasury at the risk of forfeiture of the amount of the local tax, under the plea that the total state tax was voluntarily paid. Nor yet does it countenance for a moment the double taxation which would result if the state was paid the tax in full and the district in turn was paid its tax in full. Thus the language does not say that "the taxes so paid for principal and interest shall be deducted from the total amountto be paid in taxes for state purposes." It says that the deduction shall be made from the total amount paid in taxes for state purposes. If we are to give to this language the rigid construction for which the controller seems to contend, then if the constitution had meant that it should be compulsory upon the corporations themselves to deduct the amount of the local tax and pay only the balance into the state treasury, it would certainly so have said, by employing the phrase "to be paid" instead of the word "paid." It is the reasonable construction of this sentence that "the taxes so paid for principal and interest" means both that if paid to the district they may be deducted from the total amount to be paid to the state, or ifpaid to the state the state shall deduct "from the total amount paid in taxes for state purposes" the amount due to the district and make that amount over to the district.
Such should have been the course adopted by the controller after the amount of the district tax was legally fixed and payable and demand had been made upon him for the payment of the same, out of the "total amount paid in taxes for state purposes" by appellant. The controller's refusal so to do was the initial error. Upon his refusal the district turned to appellant and exacted from it a double payment *356 under protest. Appellant then is clearly entitled to its recovery.
It has been agreed by the parties that if this court shall reach the conclusion that appellant is entitled to its recovery, it may order a direct recovery from the controller. We need not therefore pause to consider with more particularity the form of the judgment.
The application of appellant for injunctive relief, after what already has been said, calls for but brief consideration. It is clearly within the power of the district to levy this tax for the purpose of ascertaining the proportion of the bonded indebtedness and interest which the property of appellant should bear and pay, and no injunction therefore should be granted to prevent the district from so doing. Upon the other hand, it is not to be anticipated that any difficulty will be experienced in the future in the matter of the payments to such districts where the conditions here present exist, namely, where the time for the payment of the state tax antedates the assessment and levy of the district tax. No force inheres in the controller's objection that the legislature has not provided adequate machinery justifying him in paying to such districts the amounts of their taxes. The constitutional amendment itself declares that "all the provisions of this section shall be self-executing." And if there be a lack of machinery in other respects, the controller will be amply protected, in the payment of these moneys, by proper vouchers showing the payment thereof, and by proper entries in his books disclosing the nature and amount of the disbursements.
It is ordered therefore that the judgment appealed from be and hereby is reversed, and in conformity with the agreement of the parties it is further ordered that the superior court enter its judgment of award in favor of the appellant and against the respondent controller for the amount sued for.
Lorigan, J., Lawlor, J., Melvin, J., Sloss, J., Shaw, J., and Angellotti, C. J., concurred. *357