Opinion
No. 32075.
February 10, 1936.
1. TAXATION.
County supervisors' order granting statutory tax exemption to certain enterprises of public utility held not incomplete where, under statute, order became effective within specified time in absence of petition for election, notwithstanding statutory provision for order declaring it to be supervisors' "intention" to grant tax exemption (Code 1930, sections 3109, 3110; Constitution, section 182).
2. TAXATION.
Statutory tax exemption to new enterprises of public utility held not waived merely by delay in claiming exemption, or by antecedent payment of taxes, provided claim is made within five-year exemption period (Code 1930, sections 3109-3112; Constitution, section 182).
3. TAXATION.
Where corporation was entitled to tax exemption as new enterprise of public utility, purchaser of corporation's property at foreclosure sale held entitled to similar exemption for balance of five-year exemption period (Code 1930, section 3109; Constitution, section 182).
4. CONSTITUTIONAL LAW. Taxation.
Statutes under which county supervisors' order granting statutory tax exemption to new enterprises of public utility becomes effective within specified time in absence of petition for election held not unconstitutional as granting legislative power (Code 1930, sections 3109-3112; Constitution, sections 33, 182).
APPEAL from the circuit court of Forrest county; HON.W.J. PACK, Judge.
E.C. Fishel, of Hattiesburg, for appellant.
The statutes and their meaning must be strictly construed against the exemptionist.
Greenville Ice Coal Co. v. Greenville, 69 Miss. 86, 10 So. 574; Adams County v. National Box Co., 88 So. 168, 125 Miss. 598; Gulfport Bldg. Loan Assn. v. City of Gulfport, 124 So. 658, 155 Miss. 498; Magnolia Bldg. Loan Assn. v. Miller, 128 So. 585, 51 S.Ct. 86, 282 U.S. 803, 75 L.Ed. 722; State v. Union Tank Car Co., 119 So. 310, 151 Miss. 797; Currie-Finch Brick Lbr. Co. v. Miller, 86 So. 579, 123 Miss. 850; New Standard Club v. McRaven, 71 So. 289, 111 Miss. 92, Ann. Cases 1918E, 274; Hollandale Ice Co. v. Board of Supervisors, Washington County, 157 So. 689; Leaf Hotel Corp. v. Hattiesburg, 150 So. 779, 168 Miss. 304; 61 C.J. 391.
If the board of supervisors have the right to grant the exemption in spite of the Constitution, we respectfully submit to the court that by section 3110 of the Code all and the most that the board of supervisors could do under this first order was to give notice of its intention to exempt from ad valorem taxation. The court will bear in mind that this was the order entered at the May, 1931, session of the board of supervisors, the board of supervisors having made and entered no order after entering this order, until June 7, 1933.
Sections 3109 to 3112, Code of 1930; 15 C.J. 842, sec. 162; Williams v. Cammack, 27 Miss. 209; Turner v. Thomas, 77 Miss. 866, 28 So. 803.
It is true that the statute fixes that the exemption as to corporations shall go into effect from the date of the charter, if a corporation, but nothing in the statute indicates that a corporation must get the benefit of the exemption, and nothing in the statute confers jurisdiction on the special court of limited jurisdiction in this suit by the exemptionist against the taxpayers pending before the board of supervisors, except those acts prescribed by statute as being necessary, and the doing of them must appear on the record of the inferior tribunal to give that tribunal jurisdiction.
15 C.J. 842; Bolivar County v. Coleman, 15 So. 107, 71 Miss. 767; Lay v. Shores, 72 So. 881, 112 Miss. 140; Green v. Board of Supervisors, 161 So. 139; Currie-Finch Brick Lbr. Co. v. Miller, 86 So. 579, 123 Miss. 850; Leaf Hotel Corp. v. Hattiesburg, 150 So. 779, 168 Miss. 304.
The taxes for 1933 had clearly accrued and become a lien before the applicant itself had made any application or any move to procure its alleged rights to claim exemption.
61 C.J. 391, sec. 394; Bank of Oxford v. Board of Mayor, 12 So. 203, 70 Miss. 504.
It is true that the trial court in its opinion held that the application provided for in section 3111, Code of 1930, could be filed at any time. We agree that it could be filed at any time within five years from the date of its charter, where a corporation, but that under the law no exemption began or could be obtained until this application was filed; and therefore, under the existing state of facts in this case, the property would have been taxable for the year 1933, at all events. To hold otherwise it would be necessary to give the application filed in August, 1933, retroactive effect and make it effective as of January 1, 1933, the date the tax lien attached, and to give the order adjudicating the initial notice of intention to exempt retroactive effect to January 1, 1933, this order being entered August 11, 1933, by the board of supervisors. Section 100 of the Constitution of 1890, would preclude giving this effect to this order.
McHenry Baptist Church v. McNeal, 38 So. 195, 86 Miss. 22; William G. Halkett Co. v. City of Philadelphia, 175 A. 299.
A person must bring himself within the statute to obtain benefits.
Hollandale Ice Co. v. Board of Supervisors, Washington County, 157 So. 689.
Exemptionist must do all required to be done under the law before exemption is effective.
61 C.J. 391, sec. 394; Bank of Oxford v. Board of Mayor, etc., 12 So. 203, 70 Miss. 504.
Burden of proof is on exemptionist.
61 C.J., page 411, sec. 429, and page 412, sec. 430.
Exemptions are not retroactive.
Section 100, Constitution of 1890; Adams v. Fragiacomo, 71 Miss. 417, 15 So. 798; McHenry Baptist Church v. McNeal, 38 So. 195, 86 Miss. 22; William G. Halkett Co. v. City of Philadelphia, 175 A. 299.
We submit and earnestly urge upon the court that section 3110 of the Code of 1930, is unconstitutional and void and violative of section 33 and section 112 of the Mississippi Constitution of 1890.
The Legislature cannot delegate to the whole or any portion of the people, or to any other department of the government, its power to make laws.
Alcorn v. Hamer, 38 Miss. 652; Clark v. State, 152 So. 820, 169 Miss. 369.
John R. Tally, of Hattiesburg, and Green, Green Jackson, of Jackson, for appellee.
The statutes here are plain, so that no construction is necessary; and no interpretation will be adopted by the courts which "will ascribe to the Legislature intention to be unfair and unjust . . . so . . . as to cause unthought of results."
Section 3110, Code of 1930, was enacted by the Legislature pursuant to the taxation provisions of Mississippi's Constitution: Section 112, "Taxation shall be uniform and equal throughout the state. Property shall be taxed in proportion to its value . . .;" Section 181, "The property of all private corporations for pecuniary gain shall be taxed in the same way and to the same extent as the property of individuals . . ."
Adams v. Tombigbee Mills, 78 Miss. 676, 692, 29 So. 470.
Section 3110 is a general law prescribing the terms under section 182, whereby this exemption may be made operative. The board "may enter an order on its minutes declaring it to be the intention of the board of supervisors to exempt from ad valorem taxation . . . all new factories and new enterprises of public utility." But the law did not stop there; it then said, "Such order shall be spread on the minutes . . . and shall thereafter be published in two issues of some weekly newspaper having a general circulation in said county."
Jackson v. Edwards House Co., 145 Miss. 135, 110 So. 231.
Tax exemptions of this type are assignable.
Robertson v. Mississippi Packing Co., 134 Miss. 837, 98 So. 539.
The exemption attaches to the property, not to the person.
New Jersey v. Wilson, 3 L.Ed. 303, 7 Cranch 164, 165; Shoats v. Trapp, 224 U.S. 675, 56 L.Ed. 946; Gleason v. Wood, 244 U.S. 679, 56 L.Ed. 947; English v. Richardson, 224 U.S. 680, 56 L.Ed. 949; Grand Canyon R. Co. v. Treat, 95 P. 189; Morris Canal Banking Co. v. State Board, 71 A. 329.
Initially, the Legislature possessed plenary power to exempt.
Moseley v. Mobile Ohio R. Co., 52 Miss. 127; Mississippi Mills v. Cook, 56 Miss. 40, 50; Adams v. Railroad Co., 77 Miss. 194.
Pursuant to the provisions of sections 112, 181, 182, beginning in 1892, and continuing continuously save for a period of about ten years, these property exemptions have been continuously in effect.
The order appeared at large in Minute Book 12, page 539, and was published in the Hattiesburg American on May 8th and May 15th, 1931. No petition was filed and thereafter the supervisors and this appellee, as well as all other persons, have assumed that said order was thus operative and have in reliance thereon acted.
Robertson v. Miss. Packing Co., 98 So. 539, 134 Miss. 837; Morris v. Riley, 99 So. 466, 468, 135 Miss. 1; Jackson v. Fire Insurance Co., 95 So. 845, 132 Miss. 415; Ethridge, "Mississippi Constitutions," page 340; Adams v. R.R. Co., 77 Miss. 194; City of Jackson v. Edwards House Co., 110 So. 232; Adams v. Tombigbee Mills, 78 Miss. 676; Board v. Merck, 120 So. 839, 153 Miss. 346; City of Jackson v. Trust Co., 133 So. 198; Miller v. Lamar Life Ins. Co., 131 So. 285; Board of Supervisors v. Military Academy, 126 Miss. 729, 89 So. 615; Adams v. Winona Cotton Mills, 92 Miss. 743, 40 So. 401.
Obviously that at which section 182 was aimed was the irrepealable grant in perpetuity of immunity, not the grant for a limited period to encourage the establishment of the new industry.
Board v. Academy, 89 So. 618.
Hence, where, as here, there was a consideration, and under the Constitution the Legislature was required to move by general law, which has been done, and that thus granted for the time limited has been held to be a valid obligation, this court will thus treat and accord defendant the right thus demanded.
George County Bridge Co. v. Catlett, 135 So. 217, 161 Miss. 120; Nickey v. Attorney-General, 167 Miss. 650, 145 So. 630, 146 So. 859, 147 So. 324, 292 U.S. 393, 78 L.Ed. 1323.
Any difference in the thing taxed must have as its predicate an adequate constitutional base for classification in the thing itself.
Miller v. Lamar Life Ins. Co., 131 So. 282, 158 Miss. 753 ; Jackson v. Miss. Fire Ins. Co., 132 Miss. 415, 95 So. 855; Chicago, etc., R. Co. v. Robertson, 84 So. 480; Adams v. Kuykendall, 83 Miss. 583; Guano Co. v. Virginia, 253 U.S. 412, 64 L.Ed. 989; Railroad Co. v. Green, 216 U.S. 417; Gulf, etc., R. Co. v. Ellis, 165 U.S. 150, 165; Adams v. Tombigbee Mills, 78 Miss. 676; Adams v. Railroad Co., 77 Miss. 194; Adams v. Winona Cotton Mills, 92 Miss. 743.
The property exemption as to ad valorem taxes appertained, not to the person, but to the thing. It had naught to do with ownership, but looked solely to the res by legislative fiat.
Miller v. Ins. Co., 158 Miss. 753, 131 So. 282; City v. Insurance Co., 132 Miss. 415, 95 So. 847; City of Jackson v. Preston, 93 Miss. 375; Board of Supervisors v. Academy, 89 So. 617, 126 Miss. 729.
Unless all property of this type was similarly exempted, there could be no exemption at all and full compliance with the procedural portions is certified by the Attorney-General under a general form in use for years without question.
Miss. Mills v. Cook, 56 Miss. 50; Capital National Bank v. City, 139 So. 163; Panola County v. Carrier, 89 Miss. 284, 42 So. 347; Warehouse Co. v. Yazoo City, 52 So. 481, 97 Miss. 500; Adams v. Bullock, 94 Miss. 33; Smith v. Myatt, 111 So. 590; Enochs v. City, 109 So. 684; Jackson v. Hospital, 107 So. 1; Millsaps College v. Jackson, 101 So. 574, 136 Miss. 795; State v. Dutton, 78 So. 147.
This exemption statute is express and explicit and being so, must be so construed, for within its very terms are all the properties therein sought to be taxed and they and each of them under the word "all" are immune and being immune, the failure to comply, if that would tax one, is, with deference, not operative to take away from the property the status legislatively fixed for each parcel falling within this category.
Our position is that the Legislature with plenary power thus to do under a general law, has exempted this property as property, irrespective of its ownership, and that when property is thus exempt, the character of an owner is not adequate for a basis of classification.
Ballard v. Miss. Cotton Oil Co., 81 Miss. 507, 34 So. 533; Chalker v. Birmingham, etc., Ry. Co., 249 U.S. 522; Guano Co. v. Virginia, 253 U.S. 412; Ins. Co. v. Connecticut, 185 U.S. 366; Dist. v. Brooke, 214 U.S. 151; Ry. Co. v. Ellis, 165 U.S. 150, 165; Ex parte McReady, 1 Hughes 600; State v. Comr., 37 Fla. 578; McGuire v. Fisher, 32 La. Ann. 853; Harrison County v. Academy, 89 So. 617, 126 Miss. 729; Tombigbee Mills case, 78 Miss. 676; City v. Miss. Fire Ins. Co., 132 Miss. 415, 95 So. 845; City v. Bank, 133 So. 195, 160 Miss. 752.
The Legislature is to be the judge of the advantages to the public welfare to be secured by an exemption of property from taxation.
Miller v. Lamar Life Ins. Co., 158 Miss. 753; Horne v. Green, 52 Miss. 452; Railroad Co. v. Adams, 81 Miss. 100; Meridian v. Ragsdale, 67 Miss. 86; Ball v. Meridian, 67 Miss. 93; Chandler v. Executive Committee, 146 So. 597.
The cause of action for taxes for each separate year is absolutely separate and distinct and an adjudication even by a court for one year does not bind the party for a subsequent year.
Homochitto, etc., Co. v. Jones, 154 So. 721; Adams, State Revenue Agent, v. Y. M.V.R.R. Co., 77 Miss. 194, 24 So. 200, 317, 28 So. 956, 60 L.R.A. 33.
The county, speaking by the supervisors, in August, 1933, absolutely recognized appellee's exemption and as at that date made it operative, and counties may sometimes be estopped.
Carruth v. Gillespie, 109 Miss. 677, 68 So. 929; AEtna Ins. Co. v. Robertson, 131 Miss. 343, 94 So. 9; State v. Mayor, 157 Miss. 936, 127 So. 704; City v. Railway Co., 160 So. 602.
The supervisors, with full power to pass on this claim, so did, and having so done, the tax collector may not upset.
Appellee complied with the law.
Everything required under section 3111, Code of 1930, was done.
Counsel contends that section 100 is violated, but section 100 must be construed with sections 112, 181 and 182. Taxation is to be equal and uniform.
State v. Fragiacomo, 71 Miss. 417; Bradstreet v. Jackson, 81 Miss. 233, 32 So. 999; Crow v. Cartledge, 99 Miss. 277, 54 So. 947; Durant v. Attala County, 101 Miss. 290, 57 So. 916.
Counsel is in error in stating that as on August 11, 1933, the taxes had accrued in accordance with the requirement of section 100. The levy was not then made and before there had been a completed imposition against this property, the supervisors with plenary power fixed the exemption, and in this suit no taxes other than for 1933 and 1934 are asked to be exempted.
Robertson v. Packing Co., 134 Miss. 837, 98 So. 539; Adams County v. Box Co., 125 Miss. 598, 88 So. 168; Hollandale Ice Co. v. Board of Supervisors, 171 Miss. 515, 157 So. 689.
The supervisors having fixed this exemption, the appellee having paid all state taxes, the judgment should be affirmed. It is not just to permit the tax collector to subvert that which the chosen representatives of the county have contractually fixed, being thereunto by law duly authorized.
Argued orally by E.C. Fishel, for appellant, and by Garner W. Green, for appellee.
Appellant brought this action in the circuit court of Forrest county against appellee to recover for the county of Forrest and certain taxing districts therein the ad valorem taxes on appellee's property situated in said county and taxing districts for the years 1933 and 1934. The cause was tried by agreement before the circuit judge, sitting as judge and jury, on the pleadings and agreed facts. There was a final judgment in appellee's favor, from which judgment the appellant prosecutes this appeal.
Appellee's property sought to be taxed consists of conduits and pipe lines and other property and equipment and appliances used in the transportation and distribution of natural and artificial gas. The question is whether under section 182 of the Constitution and sections 3109-3112, inclusive, of the Code of 1930, adopted in pursuance of that constitutional provision, and the orders and resolutions of the board of supervisors of Forrest county, adopted under the authority of those statutes, the appellee was entitled to the exemption from ad valorem taxes claimed for the years 1933 and 1934.
Section 182 of the Constitution provides that the power to tax corporations and their property shall never be surrendered or abridged by any contract or grant to which the state or any political subdivision thereof may be a party, except that the Legislature may grant exemption from taxation in the encouragement of manufactures and other new enterprises of public utility for a period of five years, the exemption to commence from date of charter, if a corporation, and if an individual enterprise, from the commencement of work; but such exemptions shall be by general laws which shall distinctly enumerate the classes of manufactures and other new enterprises to be exempt, and the mode and manner in which the right to the exemptions shall be determined. Section 3109, Code of 1930, provides that new factories and new enterprises of public utility shall be granted exemption from ad valorem taxation, except state ad valorem taxation, in the manner provided in the next three sections, on tangible property used in, or necessary to the operation of, the service or industry named, but not upon the products thereof, for a period of five years, the time of such exemption to commence from the date of the charter, if a corporation, and if an individual enterprise, from the commencement of work. The statute covers, among other things, all conduit and pipe lines and other property and equipment used in the transportation and distribution of natural and artificial gas.
Appellee's predecessor in title, the Public Service Corporation of Mississippi, was chartered on April 14, 1931, and completed its pipe line from the Jackson gas fields to the city of Hattiesburg in December of that year.
Sections 3110, 3111, and 3112 of the Code of 1930 follow:
"3110. Declaration by board of supervisors. — The board of supervisors of any county may enter an order on its minutes declaring it to be the intention of said board of supervisors to exempt from ad valorem taxation levied by the board of supervisors, except state ad valorem taxation, all new factories and new enterprises of public utility mentioned in the foregoing section which shall be hereafter constructed. Such order shall be spread on the minutes of the board of supervisors and shall thereafter be published in two issues of some weekly newspaper having a general circulation in said county. The board of supervisors shall also give notice by publication in two issues of some newspaper published in the county and having a general circulation therein, that said order will become final and effective within sixty days after its passage unless within thirty days after the publication of notice ten per cent of the qualified electors of the county petition the board of supervisors for an election to determine whether or not the adoption of such order should become effective or should be annulled. If no petition is presented within said time, the order shall be valid and effective sixty days after its passage. If a petition is presented and an election is called, and the adoption of such order is favored by a majority of those voting in the election, then the order shall become valid and effective. If less than a majority favor said order, then it shall be annulled."
"3111. Application for. — Any person, firm or corporation claiming exemption from county ad valorem taxation as a new factory or new enterprise of public utility shall first file an application therefor in triplicate with the board of supervisors. Each copy shall be subscribed and sworn to by the individual making the application, or if a firm or corporation, by an officer or person duly authorized so to do. In the application, full information shall be given as to the property proposed to be exempted, the kind of articles to be manufactured, and the date from which exemption is claimed. Each application shall also show the actual true value of all such property sought to be exempted, whether the same is in existence at the time of the filing of the application, or is proposed to be subsequently built, purchased, owned, or in any manner acquired by applicant."
"3112. Hearing on application. — At its next meeting after the filing of said application, the board of supervisors shall proceed to investigate the matter and determine whether the property is exempt. If the property is exempt, the board shall approve the application by order duly entered on its minutes fully describing the property to be exempted and the date when such exemption begins and expires, and the chancery clerk shall record the application, together with the order approving same, in a book kept in his office for the purpose, and shall file one copy of the application with the chairman of the state tax commission, and one copy with the state auditor of public accounts."
At its May, 1931, meeting the board of supervisors of Forrest county passed an order exempting from county and county district ad valorem taxes certain named enterprises of public utility, one of which was all conduit and pipe lines and other property and equipment used in the transportation and distribution of natural and artificial gas. Later appellee acquired by foreclosure the property and franchises of the Public Service Corporation of Mississippi. The board of supervisors, in passing the order, complied in all substantial respects with sections 3109 and 3110. Appellee paid all ad valorem taxes on its property, state, county, and county district, for the year 1932. It did not claim the benefit of the exemption, as provided in section 3111, until August, 1933. At the August 1933, meeting of the board appellee filed a petition under section 3112 asking the benefit of the exemption, and the petition was granted. Both the petition and the order of the board granting it complied strictly with the provisions of the statute. The order granted appellee exemption from all county and county district taxes on its property for the balance of the five-year term. As above stated, the years involved are 1933 and 1934.
Appellant contends that the general order of exemption made by the board at its 1931 meeting under the authority of section 3110 was incomplete — was not final. To sustain that position, appellant lays stress on the language of the statute, "declaring it to be the intention of said board." That language must be construed in connection with what follows. The statute in unmistakable language provides that if no petition for an election is presented, "the order shall be valid and effective sixty days after its passage." No petition for an election was presented; there was no necessity for any other action by the board, therefore the order was complete and final.
Appellant also contends that under section 3111 appellee should have claimed the exemption within sixty days after the general order was made, otherwise it would not be entitled to it. This contention is without merit. Section 3111, providing for the method of claiming the exemption, fixes no time for the making of the application, except by implication it must be made during the five-year period of exemption. We see no good reason why a delay in claiming the exemption should be treated as a waiver of the right to it for any part of the five-year period. To illustrate: The exemption may be claimed for the last year of the period alone. Payment of the taxes for the previous four years would not be a waiver of the right for the remaining year.
Appellant argues that appellee is not entitled to the exemption granted its predecessor in title; that by appellee's purchase of the property and franchises of the Public Service Corporation of Mississippi at the foreclosure sale it did not acquire therewith the right of exemption belonging to the predecessor. This question was answered in the affirmative by Robertson v. Mississippi Packing Company, 134 Miss. 837, 98 So. 539.
Appellant contends that the power granted to the board of supervisors by these statutes is legislative power and violates section 33 of the Constitution, which vests all legislative authority in the Legislature, consisting of a Senate and a House of Representatives. It was held in Ormand v. White, 85 Miss. 276, 37 So. 834, that the operation of a statute may be dependent upon a future contingency without being unconstitutional; that the statute providing for the establishment of stock law districts by the boards of supervisors by petition and vote did not violate section 33 of the Constitution, vesting the lawmaking power in the Legislature.
The other questions argued are of so little merit as not to call for a discussion.
Affirmed.