Opinion
No. 28358.
April 7, 1930. Pending on Appeal to U.S. Supreme Court.
1. TAXATION. Constitutional requirements. Uniformity. Equality.
Uniform and equal taxation clause does not require that all property be classified for taxation purposes at true value (Constitution, section 112).
2. CONSTITUTIONAL LAW. Equal protection. Taxation. National banks.
Assessment of national bank's property at full value, where other property was assessed at sixty-five per cent of value, held not denial of equal protection (Constitution U.S. Amendment 14, section 1).
APPEAL from circuit court of Harrison county. HON.W.A. WHITE, Judge.
W.L. Guice, of Biloxi, and Jno. L. Heiss, of Gulfport, for appellant.
The whole scheme of taxation as devised by section 112 of Constitution 1890 is plain, simple, and easily understood. In order to carry out that design, three things are necessary: (1) Property must be assessed for taxes under general laws. (2) Property must be assessed at its true value. (3) Property shall be taxed in proportion to its value, and taxation shall be equal and uniform.
Adams v. Mississippi State Bank, 23 So. 396, 397; Adams v. Bank of Oxford, 29 So. 402; Edward Hines Yellow Pine Trustees v. Knox, 108 So. 907; Chicago R.I. E.R. Co. v. Robertson, 84 So. 449; Knox v. Southern Paper Company, 108 So. 288; Hemingway's Code of 1927, section 8211; section 4381, Mississippi Code of 1906.
Where a State Constitution provides for the assessment of property at its true value and also provides for uniformity of taxation, the true value provision gives way under the uniformity provision and where boards of taxing authorities, even though separate and distinct in their personnel, fix a higher rate for one class of property than is charged against another class of property, this is in effect a deprivation of the equal protection of the law and such assessment is void and invalid.
Sioux City Bridge Co. v. Dakota County, 43 Sup. Ct. Rep. 190; Sunday Lake Iron Co. v. Wakefield Tp., 247 U.S. 350, 352, 353, 38 Sup. Ct. 495, 62 L.Ed. 1154; Green v. Louisville Interurban R. Co., 244 U.S. 499, 516, 517, 518, 37 Sup. Ct. 673, 61 L.Ed. 1280; Cummins v. National Bank, 101 U.S. 153, 160, 25 L.Ed. 903; Taylor v. Louisville N.R. Co., 88 Fed. 350, 364, 365, 372, 374, 31 C.C. 199 A. 537; Louisville N.R. Co. v. Bosworth (D.C.), 209 Fed. 380, 452; Washington Water Power Co. v. Kootenae County C.C.A., 270 Fed. 369, 374; Bohler v. Callaway, 45 Sup. Ct. Rep. 431; Knox v. Southern Paper Co., 108 So. 288.
O.J. Dedeaux and Mize Mize Thompson, all of Gulfport, for appellee.
No constitutional violation of the provision for equal and uniform taxation or of due process of law or the equal protection of the laws is effected by taxing the capital of a bank at full value while other property is assessed at only a percentage of its value, where the Constitution expressly authorizes the taxing of bank capital according to the value thereof and requires the valuation of corporate property at its true value, and that each state has a sovereign right to classify property for taxation and so long as property of the same class bears the same rate, there is no violation of the provisions of the Federal Constitution guaranteeing due process of law and equal protection of the laws.
Sections 112 181 of Constitution of 1890; Magnolia Bank v. Pike County, 111 Miss. 857, 3 A.L.R. 1365; Bank of Tupelo v. Board of Supervisors, 155 Miss. 436; Magnolia Bank v. Board of Supervisors of Pike County, 248 U.S. 546, 63 L.Ed. 248, 39 Sup. Ct. Rep. 135; Mich. R.R. v. Powers, 50 L.Ed. 744; Ky. R.R. Cases, 29 L.Ed. 414; State R.R. Cases, 23 L.Ed. 663; Y. M.V.R.R. v. Adams, 77 Miss. 764; G.C.M.A. v. Harrison County, 89 So. 617; Bank v. Adams, 93 So. 442; Miller v. Bank, 110 So. 439.
Argued orally by W.L. Guice, for appellant, and by S.C. Mize, for appellee.
At the time and in the manner required by law, the assessor of Harrison county, Mississippi, presented to the board of supervisors of that county, the assessment rolls for the year 1928, including the personal assessment roll, and thereupon the board of supervisors gave notice to the public that these assessment rolls would be equalized in accordance with the provisions of law at its August, 1928, meeting. At this meeting of the board of supervisors the First National Bank of Biloxi filed its petition, averring that it is a national banking corporation, organized under the laws of the United States, and domiciled at Biloxi, Mississippi; that the assessment of its property as reflected by the assessment roll of Harrison county, Mississippi, was an assessment at the rate of one hundred cents on the dollar of its entire assets consisting of capital, surpus, and undivided profits; that it was entitled to have this assessment reduced to an amount that would equal sixty-five per cent on each dollar of its assets, for the reason that all other property in said county, except the banks, was assessed at such a rate.
The petition further averred that, although the Constitution of the state of Mississippi, particularly section 112 thereof, and the various laws enacted in the taxation scheme based upon this section, provided that all property should be assessed at its true value, this constitutional and statutory mandate was disregarded by the board of supervisors of Harrison county, as well as all boards of supervisors in the state of Mississippi, which, for the purpose of keeping down the assessment of their respective assessing districts, had adopted a system of lowering the assessment and increasing the rate of taxation; that this was intentional and for the purpose of evading the state tax levy and for other reasons, and had resulted in adopting as a standard of values, or as a true value, a rate which equaled sixty-five cents on the dollar of the true value, and at this rate all assessments of all other property, except the banks, were made and approved by the board of supervisors, and, in fact, such per cent of its true value would become the value required by the Constitution by reason of such act of said board of supervisors; and that, notwithstanding its adoption with reference to every one else, the said board had required a strict construction of the law with reference to the assessment of banks, so that, in effect, the banks were paying a rate of thirty-five per cent in excess of the rate of assessment required on the same values owned by any persons other than the banks.
It was further charged that the effect of this discrimination was to deprive the bank of its property without due process of law, and to deny to the said bank the equal protection of the law required to be given to all persons in the same jurisdiction, and that for these reasons the board should correct the assessment of the bank so that this assessment would be sixty-five per cent of the actual true value of its property, thereby conforming to the rule it had established in assessing all other property in its jurisdiction at not over sixty-five per cent of its true value. The petition concluded with a prayer that this change be made, for the reason that otherwise the assessment would be void, being in violation of section 112 of the Mississippi Constitution of 1890 and section 1 of the Fourteenth Amendment to the Constitution of the United States.
The board of supervisors having considered this petition denied it by an order entered on its minutes, and thereupon, after final approval of the rolls, an appeal was prosecuted to the circuit court, where a demurrer was interposed to the petition and was sustained; and, from a final order dismissing the petition, this appeal was prosecuted.
Upon this record there are two questions presented for decision, which are stated by counsel for appellant in the following language:
"First. Under section 112 of the Constitution of the State of Mississippi, is there a requirement that all property assessed for taxes in the State of Mississippi, irrespective of its type, situation and classification, be assessed for the purpose of taxation at its true value?
"Second. If such is the requirement of said section 112 of the Mississippi Constitution, that is, that all property shall be assessed at its true value, is it a denial of the equal protection of the law guaranteed by the Fourteenth Amendment, when the property of banks alone of all the property situated in a county is assessed at its actual or one hundred per cent value when for many years past and at the particular time of the assessment complained of, all other property was deliberately and intentionally assessed at sixty-five per cent of its value?"
Upon facts and pleadings practically identical with those appearing in the record of the case at bar, this court in the case of Magnolia Bank v. Pike County, 111 Miss. 857, 72 So. 697, 3 A.L.R. 1365, expressly decided each of the questions now presented; and counsel for the appellant concedes in his brief that, unless the Magnolia Bank case is overruled, this cause must be affirmed, and, in an effort to have us overrule that case, counsel has presented a very able and exhaustive brief and argument. The doctrine announced in the Magnolia Bank case has been accepted and acted upon by the banks and taxing authorities of this state for more than thirteen years, and, while we have carefully considered the questions presented, in the light of the authorities cited by counsel, we are unwilling to overrule the case. In all respects the case at bar is ruled by the Magnolia Bank case, and consequently the judgment of the court below will be affirmed.
Affirmed.