12 So. 2d 204 | La. | 1943
[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *418 This is a summary proceeding to collect additional corporation franchise taxes for the years 1933, 1934, 1935, 1936 and 1937. The suit was filed on December 8, 1941. The amount claimed, with the 20% statutory penalty and 10% attorneys' fees, is $1,961.82. It is admitted in the plaintiff's affidavit on which the suit is founded that the defendant paid the tax for each of the five years mentioned, amounting to $3,666.28, but it is claimed that the amount of the tax for those years should have been $5,152.41, and hence that the amounts paid left a shortage of $1,486.13, to which is added the statutory penalty and attorneys' fees.
The defendant, answering the rule to show cause why judgment should not be given for the amount claimed, denied that there was any balance due, and at the same time pleaded that the suit was barred by the prescription of three years under the provision in Section 19 of Article XIX of the Constitution "that all taxes and licenses, other than real property taxes, shall prescribe in three years from the 31st day of December in [of] the year in which such taxes or licenses are due." The Judge of the Civil District Court maintained the *420
plea of prescription and dismissed the suit, but the Court of Appeal reversed the judgment, overruled the plea of prescription, and remanded the case. State v. Alden Mills,
The constitutional provision on which the plea of prescription is founded was added as a proviso to Section 19 of Article XIX of the Constitution and was adopted as a constitutional amendment in the congressional election held on November 8, 1938, pursuant to Act 35 of 1938, thus: "and provided, further, that all taxes and licenses, other than real property taxes, shall prescribe in three years from the 31st day of December in the year in which such taxes or licenses are due."
The Governor issued his proclamation on November 19, 1938, proclaiming that the amendment had been adopted. According to Section 1 of Article XXI of the Constitution the amendment became a part of the Constitution, effective twenty days after the issuance of the Governor's proclamation. The twentieth day after the 19th day of November is the 9th day of December. There might be some doubt whether the constitutional amendment became effective on that day or on the 10th day of December, 1938, if the question were at issue, but, as that is a matter of no importance in this case, we take it that the amendment became effective on the 10th day of December, 1938, as far as it had the effect of barring suits to collect license taxes which were due in or before the year which ended on December 31, 1934. But, as to the license taxes which became due *421 in the year ending on December 31, 1935, the plea of prescription provided for in the constitutional amendment did not become available until January 1, 1939. According to the decision rendered by the Court of Appeal the constitutional amendment did not become effective as a bar to a suit to collect back taxes — no matter how long past-due — until the 10th day of December, 1941. That is to say, a suit to collect taxes which were past due for any number of years was not barred by prescription until the end of three years after the date on which the constitutional amendment became effective; that is, until December 10, 1941.
The attorneys for the plaintiff rely upon the general rule of statutory construction, stated in Article
"A statute is not rendered retroactive merely because the facts or requisites upon which its subsequent action depends, or some of them, are drawn from a time antecedent to the enactment."
The suit of Reynolds v. United States was brought in the Court of Claims by an honorably-discharged veteran of the Spanish-American War, to recover from the United States money deducted from his pension fund on account of board furnished to him while he was an inmate of a government hospital in which he was entitled to hospitalization under an act of Congress, section 202 (10) of the World War Veterans' Act of 1924, as amended, 38 U.S.C.A. § 484. He was committed to the *423 hospital as an insane person on June 19, 1911, and remained there until April 25, 1930. During that period there was placed to his credit on the books of the hospital, under the certificate of the Bureau of Pensions the sum of $4,036, representing funds paid to the institution by the Bureau of Pensions for the relief of Reynolds. On his discharge the hospital deducted from his pension fund the sum of $3,259.17 on account of board furnished during the period of his confinement in the institution. On July 2, 1926, 44 Stat. 794, an amendment to the World War Veterans' Act was adopted, declaring that the pension of a veteran entitled to hospitalization should not be subject to deduction by a government hospital, for board, maintenance, or any other purpose incident to hospitalization. The government contended that the pension funds placed to the credit of Reynolds were subject to deduction for his board during the period of hospitalization, and particularly "for board furnished prior to July 2, 1926, when the proviso first came into effect", exempting such funds from any such deduction. In rejecting the contention the court said:
"The final contention of the government is that, in any event, petitioner is not entitled to recover so much of the funds withheld by the hospital as equal the charges for board furnished prior to July 2, 1926, when the proviso first came into effect, since to allow him to do so, it is said, would be to give the proviso a retroactive operation contrary to the intention of Congress. * * *
"But in no aspect of the matter would the allowance of that portion of the amount *424
sued for which was applicable to board furnished prior to July 2, 1926, cause the proviso to operate retroactively. A statute is not rendered retroactive merely because the facts or requisites upon which its subsequent action depends, or some of them, are drawn from a time antecedent to the enactment. Cox v. Hart,
In Cox v. Hart [
"A statute is not made retroactive merely because it draws upon antecedent facts for its operation."
That principle was recognized by this court in the case of Hurry v. Hurry,
It is argued by the attorneys for the plaintiff that the word "shall", in the declaration that "all taxes and licenses, other than real property taxes, shall prescribe in three years from the 31st day of December in the year in which such taxes or licenses are due", shows the intention that the plea of prescription was not to be available in any suit filed within three years after the amendment would go into effect, — that is, within the three years commencing on December 10, 1938, and ending on *425 December 10, 1941. Our opinion however is that the word "shall" in the phrase "shall prescribe in three years" does not indicate an intention that the plea of prescription was not to be available immediately after the constitutional amendment would go into effect, on December 10, 1938, as a defense to a suit filed on or after that date, for license taxes then more than three years past due. The word "shall" meant that the prescription would be available at any time after the amendment would go into effect, under Section 1 of Article XXI of the Constitution. The word "are", in the phrase "three years from the 31st day of December in the year in which such taxes or licenses are due", does not indicate whether the intention was that the plea of prescription would be available immediately when the amendment would go into effect, on December 10, 1938, or would not be available within three years after that date. If the framers of the amendment had intended that the plea of prescription should apply only to taxes becoming due after the amendment would go into effect, they would have used some such phrase as "shall become due". If the framers of the amendment had used the past tense, "became due", instead of "are due", it might be argued that the amendment was not applicable to taxes coming due subsequent to the date on which the amendment would become effective, — December 10, 1938. The phrase "are due" was used advisedly, to make the amendment applicable to taxes which would be already three years or more past due when the amendment would go into effect, on December 10, 1938, as well as to taxes which would become due *426 after that date. There is therefore in the wording of this amendment nothing which indicates an intention that the plea of prescription should be unavailing until the lapse of three years from the date of the amendment's becoming "effective" under Section 1 of Article XXI of the Constitution.
When we consider that this constitutional amendment, adopted in pursuance of Act 35 of 1938, could not possibly impair the obligation of a contract, or affect any vested right except rights of the State herself, there is no reason why we should not apply the general rule of construction announced in De Armas v. De Armas, 3 La.Ann. 526, in 1848, — and affirmed only two years ago in Shreveport Long Leaf Lumber Co. v. Wilson,
"Laws of prescription, and those limiting the time within which actions may be brought, are retrospective in their operation."
But, of all of the rules of statutory construction, the one which is most appropriate to this case is the so-called universal rule, stated in article 18 of the Civil Code, thus:
"The universal and most effectual way of discovering the true meaning of a law, when its expressions are dubious, is by considering the reason and spirit of it, or the cause which induced the Legislature to enact it."
The cause which induced the Legislature to enact the joint resolution, Act 35 of 1938, proposing to amend the Constitution *427
so as to put an end to the bringing of suits on stale claims for back taxes alleged to be more than three years past-due, was the disclosure in the case of State v. Standard Oil Co.,
The most convincing proof that the Legislature, in providing this law of prescription or limitation of three years against the right of the State to claim back *431
taxes, or additional taxes, did not intend that the period of prescription should not include any time preceding the going into effect of the new law is the fact that the law was proposed and adopted as an amendment of the Constitution, instead of being enacted merely as an act of the Legislature. The procedure required for adopting an amendment of the Constitution is cumbersome and expensive. According to Section 1 of Article XXI of the Constitution, every proposed amendment must be published twice in a local newspaper in each and every parish in which a newspaper is published; and, as there is now and was in 1938 at least one newspaper published in each and every parish in the state, it was necessary to publish Act 35 of 1938 twice in sixty-four newspapers. The Legislature could have avoided this trouble and expense of amending the Constitution, by enacting an ordinary statute of limitation, if the intention had been that the period of prescription should not include any time that would have elapsed at the time when the law would go into effect according to the terms of the Constitution. But the Legislature was forbidden by the provisions of Section 13 of Article IV of the Constitution to release or extinguish, in whole or in part, any indebtedness, liability or obligation of any corporation or individual to the State. That restriction upon the authority of the Legislature was made in article 59 of the Constitution of 1898 and of the Constitution of 1913. For that reason, in the Succession of Popp,
The adopting of this law of prescription by way of a constitutional amendment allowed the tax collecting authorities ample time, between the date of the introduction of the bill proposing the amendment, May 10, 1938, and the date on which the amendment went into effect, December 10, 1938, to save for the state — by suing for — all back taxes or additional taxes which were already more than three years past-due.
The attorneys for the plaintiff cite and rely upon four cases, namely, Succession of Parham, 51 La.Ann. 980, 25 So. 947, 26 So. 700; Etchison Drilling Co. v. Flournoy,
"The view we have expressed as to the intention of the constitution is confirmed by the fourth paragraph of article 325 (schedule) to the effect that `all fines, taxes, penalties, forfeitures and rights due, owing or accruing to the state of Louisiana, or to any parish, city, municipality, board, or other public corporation therein, under the constitution and laws heretofore in force, * * * shall continue and remain unaffected by the adoption of this constitution.'"
In the opinion rendered in the Succession of Parham is a dissertation on the subject of the distinction between retrospective and prospective laws, which seems to have been misleading. But the expressions on that subject were not the basis for the decision which was rendered, and were not at all pertinent to the decision. That fact was disclosed in the opinion written by the author of the original opinion and given as the reason for the refusal to grant a rehearing, — thus: *435
"This case was tried in the lower court exclusively upon the theory that the taxes and tax inscriptions under consideration had been remitted by the terms of the 186th article of the constitution of 1898, and, in the lower court, that theory was sustained, and the tax collector appealed. That was the only question argued at bar, or in briefs by counsel on either side; and therefore it was the only question that could be tried and decided there".
It is plain therefore that the decision in the Succession of Parham went no further than to declare that the change in article 186 of the Constitution of 1898, of the wording of the proviso in article 176 of the Constitution of 1879, did not have the effect of remitting any taxes that were due to the state at the time of the adoption of the Constitution of 1898.
In the case of Etchison Drilling Co. v. Flournoy, the court decided merely that Act 196 of 1910, levying an annual license tax upon the business of severing minerals from the soil, was unconstitutional because it violated the provision in article 229 of the Constitution of 1898 forbidding the Legislature to levy a license tax upon those engaged in mining pursuits. By a joint resolution, Act 154 of 1910, the Legislature proposed an amendment of article 229 of the Constitution of 1898 so as to permit a license tax to be levied upon the occupation of severing natural resources from the soil but the amendment of course did not go into effect until after the November election in 1910; hence it was held that, as the Act 196 of 1910 was unconstitutional when enacted, it did not become valid *436 by virtue of the constitutional amendment which became effective afterwards. That decision is cited by the attorneys for the plaintiff in the present case merely as authority for the general rule that a constitutional amendment has only a prospective and not a retrospective effect unless the wording shows plainly the intention that it shall have a retrospective effect. We have pointed out that the difference between a retrospective and a prospective effect of a statute or constitutional amendment is a matter of no importance in the present case.
The decision rendered in Mayer v. Gros, 5 Cir.,
The decision in State v. Spence Goldstein, Inc., being that of one of the courts *437 of appeal, is of course not controlling. The decision would be persuasive, but for the fact that it was founded upon the idea that to hold that the constitutional amendment of 1938 went into effect on the 10th of December, 1938, would give it a retrospective effect, — and but for the fact also that the case was abandoned by the parties litigant without applying for a writ of review or even for a rehearing. The reason for the abandonment of the case was that the judgment of the district court was amended by the court of appeal so as to make it merely a money judgment against a nonexistent corporation. The district judge allowed a tax lien on the property which the defunct corporation, Spence Goldstein, Inc., had disposed of; but the court of appeal amended the judgment by sustaining a plea of prescription, or peremption, of the tax lien, which amendment had the effect of making the judgment against the nonexistent corporation utterly worthless. When the judgment was amended the holders of the property which had formerly belonged to the corporation had no further interest in the case; the defunct corporation itself of course had no interest in the case; and the State, acquiescing in the amendment by which the plea of prescription or peremption of the tax lien was maintained, had no interest in the money judgment against the nonexistent corporation. It is disclosed in the opinion rendered in that case, 6 So. 2d 103, that the defendant, Spence Goldstein, Inc., was liquidated "long ago", that the liquidator had filed with the Secretary of State more than five years before the judgment was rendered "proper evidence" of *438 the fact that the liquidation had been completed and that all of the assets of the corporation had been disposed of, "and, therefore, its corporate existence had ceased." The amending of the judgment appealed from, by sustaining the plea of prescription or peremption of the tax lien, made the opinion which was rendered in the case merely an academic discussion of the subject.
We find therefore, from our analysis of the cases cited, no precedent in the jurisprudence to justify overruling the plea of prescription in this case.
This suit was filed originally by the Secretary of State, under authority of Act 10 of the First Extra Session of 1935, and was prosecuted in his name through the civil district court and the court of appeal, but when the case was called for argument in the supreme court the Collector of Revenue appeared and obtained an order making him the party plaintiff, under authority of Act 12 of the Extra Session of 1942, amending the statute as theretofore amended by Act 163 of 1942. The attorneys for the Collector of Revenue contend that the day on which the suit was filed — which was the 8th day of December 1941 — was the last day — or was the day next to the last day — before the claim otherwise would have become barred by the prescription of three years — even for the additional taxes claimed for the year 1933. But our opinion is that the claim for the additional taxes for the years 1933 and 1934 became barred by the prescription of three years on the day on which this constitutional amendment became effective — which was *439 the 9th or 10th day of December 1938, — and that the claims for additional taxes for the years 1935, 1936 and 1937 became barred by the prescription of three years at the end of December 1938, 1939 and 1940, respectively.
The judgment of the court of appeal is annulled and the judgment of the civil district court, maintaining the plea of prescription and dismissing the suit, is affirmed.
ROGERS, J., absent.
HAMITER, J., takes no part.