269 S.W. 3 | Tenn. | 1924

This was a suit to recover privilege taxes for the years 1918 to 1921, inclusive. While defendants had paid for and procured licenses as security dealers for these years, the chancellor found that they were engaged in the business of loan agents, at the excess rates which call for the payment of certain privilege taxes prescribed by the revenue acts.

Appealing, numerous errors are assigned. On the merits it is insisted that the business conducted was that of dealing in securities only, and not loaning money, in *43 that it consisted only of buying or acquiring by assignments claims of various customers, being mainly railroad employees, for wages. The record discloses that the transactions are of practically the identical class described, and dealt with inMcWhite v. State, 143 Tenn. 222, 226 S.W. 542, and this case on the merits is ruled by that decision. We approve and apply the reasoning of Chief Justice GREEN in that case. The court looks through the form to the effect and substance of such transactions.

Nor are the assignments to the action of the chancellor in overruling the second, fourth, and fifth grounds of demurrer well taken. This is not a suit to recover usury, and is not controlled by McFerrin v. Woods, 3 Baxt., 242, relied on for appellants. It was necessary only to allege generally that defendants were engaged in or pursuing the occupation made a privilege by the act. There can be no doubt that the pleadings sufficiently charge this fact. Nor was it necessary to make proof of specific collections of excess interest in order to make out a case of doing business. A few transactions only were sufficient. Indeed, a single transaction may under certain circumstances constitute conclusive evidence that a party is engaged in a business made a privilege. Trentham v. Moore, 111 Tenn., at page 353, 76 S.W. 904.

We are not of opinion that defendants are in position to demand a credit of the amounts paid by them for licenses as security dealers. The two privileges are distinct, and the licenses issued protected defendants in the doing of the business thereby covered only. Moreover, it is probable that the stipulation of counsel appearing in the record precludes the contention that the licenses *44 issued were intended to cover, or did cover, the business of loan agents at excess rates.

We have carefully considered the assignments challenging the constitutionality of the acts. The incorrect references to pages or paragraphs of the act of 1919 in the amendatory act of 1921 are innocuous. The caption of the amended act was expressly referred to in the amendatory act. We think it apparent that the constitutional requirement was complied with. Nor is the exclusion of banks complained of such arbitrary and capricious discrimination as to be violative of the pertinent section of the Constitution. A very wide range of discretion is vested in the legislature in the matter of classification under revenue statutes. See the recent expressions of this court in State v.McKay, 137 Tenn. 280, 193 S.W. 99, Ann. Cas., 1917E, 158, andMemphis v. State ex rel., 133 Tenn. 83, 179 S.W. 631, L.R.A. 1916B, 1151, Ann. Cas., 1917C, 1056. Reasons readily occur for the particular exclusion in the instant case, some of which are well stated in the opinion of the learned chancellor. The foregoing are substantially the questions presented on this appeal. It results from the conclusions reached that the decree of the chancellor must be affirmed. *45

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