People ex rel. Mutual Life Insurance v. Board of Supervisors

By the Court, Roosevelt, J. This is a claim on the part of one of only two particular mutual life insurance companies, for the law, although seemingly general, applies to no others, to be in effect exempt from taxation. With a fund employed in their business amounting, as appears, to nearly three millions, they claim that by an act of the legislature, passed, we may presume, at their special instance, in June, 1853, they were to be taxed as if their capital was limited to the comparatively insignificant sum of $100,000. By the act referred to it was provided that any mutual life insurance company, incorporated before the adoption of the general insurance law of 1849, should be subject to taxation in the same manner as if it were incorporated under the general law with a capital of $100,000. Construing this act in connection with the previous legislation of the state, and harmonizing as far as practicable with the principles of equal justice, the courts, [87] and as I conceive very properly, held that the specially chartered companies created under the old monopoly system, were to be placed upon the same footing—and no better—as those organized under the general law: which, instead of limiting the taxation of the new associations to $100,000, merely limited their power to commence business until they had on hand a fund of at least $100,000. The $100,000 provision, it was held, had the same meaning both in the act of 1853, and in the general act of 1849, to which that of 1853 referred—and in the act of 1849 its object confess•edly and indisputably was to fix a minimum instead of a maximum —a minimum of capital and not a maximum of taxation. The act of June, 1853, was no doubt adroitly framed in the interest of the two companies in question. Its language, without being direct and striking, was, upon close consideration, susceptible of, if it did not grammatically require, the interpretation subsequently sought to be put upon it. Having failed, however, as we have seen in the courts, to establish that interpretation, another attempt, it would seem, by or on behalf of the companies, was made upon the legislative department in the form of a quasi appeal from the judiciary; and in March, 1855, an act was accordingly passed by the legislature of that year to declare the true intent and meaning.of their predecessors in the act of June, 1853 ; in other words, an act of the legislature to reverse the act of the court. The relators, however, are now met by a new difficulty. Before the act of June, 1853, went into operation, the legislature, it appears, overlooking, we may presume, what they had less than twenty days previously done—not an uncommon occurrence in the closing scenes of a legislative session—passed a new tax law applicable to all incorporated companies, chartered or general, liable to taxation, “ on their capital or otherwise.” By this act not only the capital stock proper of all such companies, but their “ surplus profits or reserved funds exceeding 10 per cent,” were expressly directed to be assessed and taxed in the same manner as the other personal or real estate of the county. Here, then, be the construction of the act of June what it may, was a palpable repeal in July of its only [88] provision, and a substitution of a more comprehensive enactment in its place—a circumstance wholly overlooked, it would seem, by the authors of the declaratory act of 1855. That act, declaring, as it did, “ the true intent and meaning” of the act of June, 1853, and of that act only, merely directing what construction should be given by the courts to an act which, in effect, had long since been repealed, and left the general law of July, 1853, untouched, to be applied to “ every company” alike, whether organized under the old system of special charters, or the new system of free trade. And why should any distinction be made between them ? Especially, why should the two particular companies in question be taxed only on $100,000 each, while every other company in the same city, and standing on the same footing, is assessed on its “ reserved funds ?” The constitutionality of such legislation—even if expressly intended and clearly expressed— might well be doubted. But the court will not presume that the legislature intended to violate either the spirit or letter of the constitution, and will not, therefore, give to their acts a construction which would imply such intention. Equality of taxation is a fundamental principle of our government, which no legislature, in the absence of the most explicit provisions, will be presumed to have intended to violate. The assessors, it seems, in the case of the present company, misled by the peculiar wording of the act of June, 1853, taxed them only on $100,000. But the tax commissioners, on reviewing the assessment roll, added $900,000, making the amount one million instead of one hundred thousand; and the board of supervisors subsequently, on the application of the company, refused to restore the original assessment, and confirmed the judgment of the commissioners ; upon which the company sued out a mandamus to compel the supervisors to reverse their action in the matter; and the case now comes up on a demurrer to the answer of the supervisors ; or rather, on an appeal to the general term of the court from the decision of the judge at special term, sustaining the supervisors. What, then, we are to inquire, are the powers of the tax commissioners ? Can they, in such cases, correct the errors of the [89] ward assessors ? They have power, it is said, to add to the assessment roll and assess any real or personal estate, liable to taxation, which may not have been assessed, but they cannot increase the valuation as made by the assessors. As to real estate, which is always specific, the rule may be so. Where the local officers, after inspecting a particular house and lot, put upon it a certain value, there may be some reason, though none of a very striking character, for not permitting the commissioners to raise such value. But what reason is there for such a restriction in the case of personalty? The assessors, in estimating the taxpayers’ personal property, do not value any particular stock of goods, or household furniture, or bonds and mortgages, but personal estate generally. When, therefore, in such cases, they put the amount too low, it is invariably, almost, an error not of undervaluation but of omission. And it is conceded the power of .the tax commissioners, however limited in other respects, extends at all events to supplying the omissions of the ward officers, whether the property omitted be personal or real, blow the supervisors in their answer allege—and the allegation is admitted by the demurrer—that in the assessment of the personal property of this company, there was an omission, among other items, of $2,343,681 in bonds and mortgages, which were “ part of the capital, surplus profits, or reserved fund of the company,” and which the assessors did not set down or estimate, in consequence of the erroneous impression they labored under, not as to the value of these securities, but as to the law of the state, applicable to them. They mistook the law, and under that mistake, inserted only the nominal capital of $100,000. In other words, they omitted the “ surplus reserved fundthey omitted it altogether. Was it not then both the right and the duty of the commissioners to supply the omission ? The only error of the commissioners, as it seems to me, an error, however, of which the relators have no reason to complain, was, not in adding, but in adding too little, in adding less than one million, instead of more than two. It has been said that if the commissioners are allowed to possess this power of raising the amounts set down by the assess [90] ors, great injustice may at times be done to particular individuals, as no provision, is made by- law for giving notice of the contemplated augmentation. And does not this objection apply with equal force to the addition of an omitted house, as to the addition of an omitted mortgage 1 Suppose a case in which the assessors should have omitted wholly the personal estate of a particular individual; may not the. commissioners insert it 1 Even the counsel of the company at first conceded that in such a case the commissioners might insert the personalty so omitted. And yet the argument, from want of a notice, is the same in both instances. All that can be said properly on this point is that the statute is defective, and that the defect, although remedied in actual practice by the commissioners, should be corrected as matter of right, by the legislature. [New York General Term, May 7, 1855. The relators, it appears, had notice. They argued before the commissioners, and they appealed to the supervisors. They were heard by both, and were not considered as wronged by either. And such, too, after full hearing, was the opinion of the special term. There is clearly no equity in the relators’ case. They seek to establish for themselves a special privilege, at the expense of the rest of the community, and incompatible with the equal rights of all other companies, but one, engaged in the same business. Such claims, to be available, must be clearly made out; and statutes passed to sustain them (if so passed at all) being at variance with common right, are to be strictly construed. So construing the statutes cited by the relators, the position taken by them is as untenable in law as in equity. Judgment of special term affirmed, with costs. Roosevelt, Clerke and Cowles, Justices.]