Catawissa Railroad v. Philadelphia & Reading Railway Co.

Opinion by Mr. Chief Justice Brown, This action, brought on a lease between the appellee and appellant, executed December 7,1896, is for the recovery of income tax paid by the lessor to the United States government. The following is the clause iu the lease under which the court below entered judgment against the lessee: “The Railway Company shall and will also punctually and faithfully pay all taxes, charges, and assessments which, during the continuance of the term hereby demised, shall be assessed or imposed under [271] any existing or future law on the demised premises or any part thereof, or on the business there carried on, or on the receipts, gross or net, derived therefrom, or upon the said several issues of bonds or the interest thereon, or .upon the capital stock of the Catawissa company or the dividends thereon, or upon the franchises of the said company, for the payment or collection of any of which said taxes the Catawissa Company may otherwise be or become liable or accountable under any lawful authority whatever.” Nothing in the foregoing justifies the judgment from which the Philadelphia and Reading Railway Company has appealed. The lease provides specifically what taxes it is to pay, and expressio unius est exclusio alterius. The income tax was not imposed by the government upon “the demised premises or any part thereof,” nor “on the business there carried on,” nor “on the receipts, gross or net, derived therefrom,” nor upon the “issues of bonds or the interest thereon,” nor “upon the capital stock of the Catawissa company, or the dividends thereon,” nor “upon the franchises of the said company.” It was imposed upon rental received by the lessor from the ^lessee; but what is to be found in the lease from which it is to be inferred that the intention of the parties to it was that the lessee was to pay any taxes that might be assessed on what it paid as rent? . In North Pennsylvania Railroad Company v. Philadelphia and Reading Ry. Company, 249 Pa. 326, relied upon by learned counsel for appellee in support of the judgment in its favor, the express covenant in the lease was that the lessee was to pay “all taxes......upon the yearly payments herein agreed to be made by the party of the second part to the party of the first part.” It is well contended for appellant that the terms of the present lease are radically different. The judgment in favor of the plaintiff below imposed upon the defendant a burden which is not within the clear and specific terms of the lease, and is not, therefore, to be regarded as having been cpntemplatéd by the parties to it at the time of its execution. [272] The judgment is reversed, the rule to show cause why it should not be entered for want of a sufficient affidavit of defense is discharged and the record is remitted with leave to the defendant to move for judgment under the Act of May 14,1915, P. L. 483. .