Opinion
No. 3911.
Decided May 2, 1950.
Real estate owned by one municipality for the purpose of a water supply but located within another is exempt from taxation by the latter if yielding no rent or "revenue in the nature of rent" (R. L., c. 73, s. 12); and the sale of water by the former to its own inhabitants and a small portion to a third district does not constitute rent or "revenue in the nature of rent" within the meaning of the statute. The prior judicial interpretation of a statute is considered adopted by reenactment of the statute.
PETITION, for the abatement and repayment of taxes amounting to $2,139.12 assessed and collected by the town of Roxbury from the city of Keene for the year 1948 on real estate situated in Roxbury and used by Keene for a water supply. The plaintiff has paid this tax under protest. It is agreed that the property is used for a water supply for Keene and the dispute arises because the plaintiff sold a very small proportion of its total consumption of water to the North Swanzey Water and Fire Precinct. The defendant claims this sale constituted revenue in the nature of rent from the real estate and seeks to tax the city on the current valuation which thereby results. From the reserved case it appears that the plaintiff is willing to pay the defendant the sum of $589, upon submission of a proper statement, for the year 1948 which it is agreed would be the sum payable on this property provided the sale of water to the precinct does not constitute revenue in the nature of rent. Transferred without ruling by Lampron, J. Other facts appear in the opinion.
Kenneth J. Arwe, for the city of Keene.
Robert J. Doyle, for the town of Roxbury.
The first question before us is whether the sale of water by the plaintiff to the North Swanzey Water and Fire Precinct constitutes revenue in the nature of rent, making the property in question subject to taxation. In our opinion the answer is no, for the cases of Keene v. Roxbury, 81 N.H. 332 and Lisbon District v. Lisbon, 85 N.H. 173, are decisive in favor of the plaintiff. In the Keene case the facts were identical with those before us except that there water was sold to the town of Roxbury as well as to the city and here it was sold to the city and to the North Swanzey Precinct. We do not see that this affects the situation. The argument was advanced in the Keene case and again in the Lisbon case as it is here that the proceeds of such sales constituted revenue in the nature of rent from land or buildings held for the purpose of a water supply. The court in both cases declined to adopt this view. It appears that the statutes under which these cases were decided, being Laws 1911, c. 40 and P. L., c. 60, s. 10, respectively, are similar for all purposes here essential to R. L, c. 73, s. 12, which is now applicable. The prior judicial interpretation of these statutes must be considered as adopted by R. L, c. 73, s. 12. Lisbon District v. Lisbon, supra.
The assessment provided for by R. L., c. 73, s. 12, is not strictly speaking a tax. It may be viewed as a condition annexed to the grant of a municipal franchise to the plaintiff to hold real estate in the defendant township. Keene v. Roxbury, supra, 335. There should therefore be an order for abatement, but upon receipt of a proper statement the plaintiff should pay the defendant $589 which is due under R. L., c. 73, s. 12.
The conclusion reached renders unnecessary consideration of the second question transferred to us.
Abatement ordered.
All concurred.