Case Information
*1 OFFICE OF THE ATTORNEY GENERAL OF TEXAS
AdSTIN
Ronorablo Coorge PI. Sheppord
COaptrOllW OS Pub110 A000uW
A-tin, Texas
Deer Sir:
YOU r.quTt
88 r0110wet
this d~pertmmt of San Antonio.
ou to advise thir give ta this attaoh- bonda &id not nest the legal reqeiremnb inree$- ment of the fwids of tho Lloyd8,’ although there -8 ‘.
its :: ., Honorable 000. H. 3heqqard, p. iI
ample oeouritg bbok of the bonds, In saohlnery an4 equipment en4 ot.hor parSone prOpsrtpb prOViSiO~3 Or the l&W, SS it then *U&r
reed, tbe Wz~~on Z3took of & eoloent, 4ivldSn&-paying corporation no8 elIglblS for the guaranty run4 of the Lloyde~ therefore, w6 organized Dairy Iniestm5nt8, InoorporStrd, using a0 Its Cspltsl St0ok ~139,000 In bon&l8 0t Dslrylend, plus $1,000 in oaeh. D’mrpcirated, T~s boads of Dalrylrnd, Inoorporeted hMe now been oallod and in 11~ or thaiso bonds, DeIry InveetmSnte non has a Illortge@ upon the ?ort Wrth plant oi the da lry oom~~ni~e~ The InNr8naS Dopsrtment egrood with this Snbatitutlon an4 I think we h8vs oonvInood thSi# that the eeourlty b8ok ot the QUO,000 note is, now, SvSu better than it was whoa Dairy ~Invtestmnte orned Dairyland, boa48. Inoorporateb
*At Sny reto, you oan Sso that there Ma no pioperty orested organlutlon of Deity 3b?~et- i’le WQTO thfaretoiore paying taxes on tho prop- m3nte, erty eeeuring th6 bonds of. Dairyland, Inoorporatod end wo have oontinue& to do so ever sinas then1 snd aInoS the Subetltutlon of the tIret mortgdgs otl the Port iforth plant or the Company, we have, of ooure6, oontinued to pay tars4 upon the Port Prouth plant a?
the Company. *
The Iesu6 reised whether DSIry Xnveetmente, Ino, owes ad va1ors.a taxes on aid bonde and mortgage not@.
Artlolo VIII, S6otion 1 Of th@ Texae Conetitutlon Qro- older in part 5s r0now5t .
-TexatIon ohall be squel and uniform. All prbpsrty In this State, whether owned by natural persona oorpor,~tlonS, then muni0Ipal i
shall be tax04 in proportion Ite value, wh oh Shall be asoertained Sn may be provided by law.”
atlole 7145, R. 3., prov14eSr
-All prsporty, rf301, geraonol or mixed, ox- oept ouoh ES may be herslnaftar expressly Ox-
‘.,L.; ,73. ._ ._
Bonosoble Oeo. X. Sheppard, p. 3
l asptsd, IS eub,joot to texatlon, en4 t&o as&a8 ahall be rmdered and listed as bernin prsaoribed.*
Artiale 9149, R. S., provI4eer
*Parsonal property, Sor purposes ei texe-
tlon, Shall ba oonetrusd to lneluda all goods,
chattels an4 eireote, an4 all monayr, OradItS,
bonds and othar svI4eeaae debt owned by aitlrens or tbie 3tato. whatbor tbo same bo in or out of the Statei all ahlps, boats an4 vessel0 belon&$ng to
lnh@tbltaate of tbI8 Mate, lf reuiStexed in thle
Stats, whathof st hose or broa4, anC all aapltal
Invsetsd tbarein; all monaga at Iat6raet, either wlthln or kitbout tho State; due the forl)on, to be taxed over end above what he pay5 lnter*et for, and all other debte due such porfaoa over an4 abovo
his Indebte4nese~ all publio atook an4 eoouritiee;
all etook la turn-pikoe, railr0a4e, oenels and other ~oorporutione (azoept national bunks) out of the oane4 by inbabltente thI8 Stati; all per-
State, aonal estate of nonaye oorporatione, whothor the roaida in or out oT thle State, an4
owners thereof Inoome of any annuity, unle~se the aapit61 of the euoh annuity b@ taxed sit&In this state: n11 Shares in any bnnk organized or that nuy bs organlzad under tha laws or tha United Stpltss; all lwrovemmte
made by peraoau upon lands bald by them, title
to whiah ia still voata4 in the State of Taxaa, or in any rsllrca 4 oompaay, or whloh have baen amapt- a4 frora taxntlon for tba bemilt of any railroad
ootapanyb o r l ny other oorporation whose jmpsrty le the. sane no40 an4 rula oi taxation not eubjeat
a8 property.* dOrines the word *am4lts* to mean an4 In- AxtiOle for money or other valuable thing, aludo Noverf olalm and d-and and ovary annuity or sum money rooaivable at tatated parioda, duo or baooma Uutv, and all olsilps en& demunds eaoure4 doe4 or mortgage, duo or to bemse 4ue.*
The law is ‘well asttlod that bond8 and note8 ore oonaider- ed 88 wproparty* under sivid statutes. tba purpose of torutlon Guaranty Llle Inauranoe Cornpaw 08, City Austin, 8. M.
189 (Sup. Ct.)i Hall ~8, Ullar, 115 3. a. 1166 @up, Ct.); uity of Abllena ta. Pryar 143 S. ‘8. (2d) 584, 557; Texas Land and Cattle Company la. City Of Fort Worth, 93 a. k”. (26) 850, appeal “,‘~a~d,gt3 Il. 9. 716, rrkma@#$ danied 298 U. 9. 7491 26
. . . .
The uthoritfea on the auh$mt 818 almost unanfmou# IA favor or tha wpl,ll-eat8bllah& mile, uphald or reaoppiaad In auiasroua aaae8, to tax the debt aeoured by a sort@@ or that the real ostote at 1ta ruii DA real estata 8Ad elm lian value la not tloubls tarabioA.* 122 A. L. R, 743 aad ca8aa there aitod. sea ala0 40 ‘Per. furlo. 94.
In i)risns vs. Fort, 57 9. z. Bd, 91, writ o? error r&mnd,
the Court raid I
*Ia ma4 lnstanaes, if not as a geAore1 rule, WheA arodits are taxed, the renult is dupllasta Pm when property ia sold taxation. instsnoa,
OA oredlt, ths purohaeer 18 required to pay texl)a on it, regsrdlnss the fact ie not paid tbat it tar, and the aellar ia ra:uiwd pay taxes upon the amount of the debt owing to bin! By the pur- Now, while auah taxation 1s not llle,&, ohemr. la, In 8 sense, double texotion; and it is for
it raeson, and to titiaate to 60s~ oxtsnt this this hardkhlp, that ratenua lane of many atat8J
r:rE taxpayer8 dadwt the debt8 owing by
IA oonnsotion with tha inoorporatioa of Dam Tnvaa6man68, IAO., an artldavlt waa filed by incOrpoFatOr8 *ritZi ths Saa- ratory of S;ibatlr lo aaoordancr with Art1019 1308, R. 3.. to the bffeot thst full amount c? t&i ato~ck with per value *the itsl to ba lsaacd by eaid ampany, namalyr 13O,COO.O0, ha8 bOOA fA s Rood faith aubsorlbad -)l,OOO.OO thsreoi ha8 bean paid fcr and in hold tbot eald bond8 would, in d\rr oplnlon, ‘be lnaonelstant *5 l?onorabla Cao l N. Shsppard , p, 5
sera mproperty* said a valid In orCar to offdot inoorporatlon company, but to deny they ware *pri:perty” i~r tax purposes.
In the reoant oaoe of City of S’lohita ?allo va, Cooper, ‘8. (26) 777, 780, writ of error retuaod, the Court said: 170 S. is olear us ttat It woe lntended by the *It
framara of our Conaaltution tbat all property should be 8ubJeat to taxation, upon en equal and uniform baa18 tba purpose of defraylou eorernmantel expense, with cho oxoaptian only of auoh property
aa thrlt dooument epaolfloellp axaapta therefrom and auoh au tha Laglalaturo shall, under Coaatitutloaal roatrlotlonr, by expllalt language, daalero to ba @xampt. *It la the univarsel rule in tbie state tba ttat
Constitution has datlnitcly provld3d for awry Porn exemption of property tsxntion; tbot if cm fmn is so mRo it oennot bu anlargad upon elthor axersgtion by Lc~lslstura by the oourta. Sam oourta have far onourh’. say if there la a rmaonsblo ~:-. cone that doubt uta to tba slwning of the Constitution .i~ 1Mttera of exemptlone, ths doubt will ba resolved against tbit sxa~ptlon, for eXWiptlOn* iron toxetlon trr not favor- noP by tbo Courts in their ad by the Conatitutlon Z’ex. Clv. ‘City oi Dal.ioa vs. Cootcan, OOAStfUOtiOA. :;‘. 32, vcrlt rafuaodi JOAQS vs. ~LW.llaam, A>Q., 160 3.
121 Ter. 94, 45 fi. 2. Bd 130, 7-S A.L.R. 983.”
8lnoa, in our opinloA, no grounds axlat IA this oaao upon shioh an exemption oould be pradioatad, “9 bald that Dairy b is liable for ad valorom tares 0A t&a bonds VODtmenta, Ino., ornad said aorporetlon. end mortl(aga indgbtodndsa *my truly
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