Florida Central & Peninsular R. R. v. City of Columbia

The opinion of the Court was delivered by Mr. Chief Justice McIver. This was an action to re — 274 — cover the sum of $200, paid by plaintiff to the treasurer of the city of Columbia, under protest, as a license tax, illegally, as it is claimed, exacted of plaintiff company. The defendant interposed a demurrer to the complaint upon the ground that the complaint fails to state facts sufficient to constitute a cause of action; and, in accordance with the rule of Court, specified in writing two grounds upon which the demurrer should be sustained substantially as follows: 1st. Because the facts stated in the complaint show that the city authorities of Columbia were duly authorized to impose the tax complained of. 2d. Because the allegations contained in the complaint do not show that the tax was paid under such circumstances of coercion or duress as entitles the plaintiff to recover the amount paid. The Circuit Judge, without passing upon the second ground, sustained the demurrer upon the first ground, and dismissed the complaint. From this judgment plaintiff appeals upon the several grounds set out in the record, which substantially raise the single question whether the tax in question was lawfully imposed. The defendants have also, in accordance with the proper practice, given notice that they would ask this Court to sustain the demurrer upon the second ground also. Inasmuch as the questions turn solely upon the sufficiency of the allegations of the complaint, it will be proper for the Reporter to set out in his report of the case a copy of the complaint, as well as a copy of the grounds upon which the demurrer is based. We will first consider those allegations in the complaint which relate to the first ground upon which the demurrer is rested, with a view to ascertain whether such allegations show that the tax in question was lawfully imposed. These allegations are, substantially, as follows: 1st. That the city of Columbia is a municipal corporation. 2d. Thattheplaintiff is a corporation duly organized under the laws of the State of Florida, and as such is the lessee of a certain railroad, commencing at Cayce’s Junction, in the county of Lexington, South Carolina, and extending thence to the city of Savannah, in the State of Georgia, but owns no tracks, struc — 275 — tures or other property in the city of Columbia. 3d. That the plaintiff, as such lessee, is engaged in operating the said line of railroad between the two termini above mentioned, and, under a traffic arrangement with the Southern Railway Company, runs its trains into the city of Columbia over the tracks of said Southern Railway Company, using the yards, switches and other appliances of said last mentioned company, and delivers to and receives from the agent of said Southern Railway Company, to whose compensation the plaintiff contributes its proper proportion, freight from 'points outside of the city of Columbia to consignees within said city, as well'as freight from consignors in the said city of Columbia to be delivered to consignees outside of said city, and also receives and transfers passengers to and from the said city to and from points outside of said city; but plaintiff avers that it does no business whatever wholly and exclusively within the city of Columbia, and does no business, except interstate business, other than such, as a common carrier, it is compelled to do-. 4th. That by the charter of the city of Columbia, the General Assembly of the State of South Carolina conferred upon the mayor and aldermen of said city the power to require all persons, companies and corporations engaged in any business or avocation of any kind whatever within the limits of the city of Columbia, to take out a license from the mayor and aldermen of said city, who are authorized to impose a reasonable charge or tax for the conduct of the same. 5th. That on the 22d of December, 1896, the city council of Columbia passed an ordinance entitled “An ordinance to regulate licenses for the year 1897,” certain sections of which are set out in the complaint, which, however, are too long to be inserted here, but which may be seen by reference to the copy of the complaint, which will be incorporated in the report of this case. It is sufficient to say here that by one of the provisions of said ordinance, every person, firm, company or corporation required by the ordinances of said city to obtain a license to engage in any trade, business or profession for which a license is re — 276 — quired, shall, before the 15th day of January in each year, register with the city assessor and auditor the name of the person or corporation, &c.; and by another provision of said ordinance a license tax is imposed upon various classes of persons, amongst others railroad corporations, in the following language: “Railroads — steam—for business done exclusively within the city of Columbia, and not including any business done to or from points without the State, and not including any business done for the government of the United States, its officers or agents, $200.” 6th. That the plaintiff failed and refused to register as required, claiming that said ordinance had no application to and did not include in its terms the plaintiff company; and even if it did, said ordinance is invalid and contrary to law. 1 2 Taking these allegations in the complaint, thus stated in brief, to be true, it seems to us clear that the license tax in question was imposed by lawful authority. For they show that the plaintiff is a railroad corporation, doing a portion, at least, of its business within the city of Columbia, with the residents of that city; that the municipal corporation of Columbia has been authorized by the General Assembly of this State to impose a license tax upon all persons, companies or corporations engaged in any business or avocation of any kind whatever within the limits of the city of Columbia; and that such tax has been imposed by an ordinance passed by the proper authorities of said city. If, then, the legislation mentioned in the complaint, both State and municipal, be a valid exercise of the law-making (power, we do not see how there can be a doubt as to the legality of the tax in question. It is not and cannot be denied that, under the Constitution of 1868, the General Assembly may, either itself impose a license tax (State vs. Hayne, 4 S. C., 403,) or may empower a municipal corporation to impose such a tax—State vs. Columbia, 6 S. C., 1; Charleston vs. Oliver, 16 S. C., 51; Information vs. Jager, 29 S. C., 438. Nor, as we understand it, is it denied that such a power may be exercised under the present Constitu — 277 — tion. But the contention is that, at the time the ordinance imposing this tax was passed, the city authorities were not empowered to impose a license tax, because the act of 1871, 14 Stat., 569, or at least section 8 thereof conferring such power, had been repealed — first, by the Constitution of 1895, and next by the act of 1897, 22 Stat., 409. The Constitution of 1895, in subdivision 1, of sec. 11, of art. XVII., expressly declares: “That all laws in force in this State, at the time of the adoption of this Constitution, not inconsistent therewith and constitutional when enacted, shall remain in full force until altered or repealed by the General Assembly, or expire by their own limitation;” and in the third subdivision of the same section it is declared that: “The provisions of all laws which are inconsistent with this section shall cease upon its adoption” — the exception stated not being material to this inquiry. So that all laws of force.at the time of the adoption of the present Constitution remained in force, unless they were unconstitutional when enacted, or were inconsistent with the provisions of the Constitution of 1895. Now, the provisions of sec. 8 of the act of 1871, above referred to, were certainly not unconstitutional when enacted, for it was expressly held otherwise in State vs. Columbia, supra. Nor do we think there is any inconsistency between the act of 1871 and the provisions of the present Constitution. On the contrary, the right to impose license taxes by a municipal corporation is expressly recognized by sec. 6 of art. VIII. of the present Constitution. “The corporate authorities of 'cities and towns in this State shall be vested with power to assess and collect taxes for corporate purposes * * * license * * * taxes imposed shall be graduated so as to secure a just imposition of such tax upon the classes subject thereto.” It is contended, however, that the act of 1871 is inconsistent with sec. 3 of art. VIII., which declares that: “The General Assembly shall restrict the powers of cities and towns to levy taxes and 'assessments,” and-it is claimed that there is no such restriction in the act of 1871. It will be observed, in the first place, that the Consti — 278 — tution of 1868, in sec. g of art. IX., contained a similar provision, and yet in State vs. Columbia, supra, which arose and was decided under the Constitution of 1868, such a provision was not found to be any obstacle to declaring the act constitutional. But, in the next place, it is a mistake to say that the act of 1871 contains no provision restricting the powers of taxation on the part of the municipal corporation, for in section 5 of that act, the power to impose a tax for the support of the poor is expressly restricted, and in section 12 the power of taxation is still further restricted. And in addition to this, the act of 1854, 12 Stat., 333, of which the act of 1871 is.an amendment, and must, therefore, be read with it, in its eighth, ninth and tenth sections imposes restrictions upon the general powers of taxation conferred upon the mayor and aldermen of the city of Columbia. It is clear, therefore, that the power conferred upon the city of Columbia to impose license taxes has not been repealed or abrogated by the present Constitution. Next, it is .contended that so much of the act of 1871 as empowers the mayor and aldermen to impose a license tax upon persons engaged in any business or avocation, is repealed by the act of 1897, 22 Stat., 409. It is well known, as a matter of legislative history, that prior to the passage of that act, some municipal corporations in this State were only invested with power to impose taxes upon real property, while others were empowered to impose taxes upon personal as well as real property, and the sole object of that act was to- bring about uniformity in the taxation of property, as required by sec. 6 of art. VIII. of the present Constitution, and not to deal in any respect with taxation imposed upon persons. The act is entitled “an act to render uniform the mode of taxation in towns and cities, in accordance with sec. 6, art. VIII., of the Constitution of 1895.” In its first section the requirement is that “all municipal taxes levied by cities and towns in this State shall be levied on all property, real and personal, not exempt by law,” &c. The second section reads as follows: “That the clauses of the charters of any — 279 — town or cities restricting taxation in said towns to real estate only, are hereby repealed.” And the third section contains a general repealing clause of all acts or parts of acts inconsistent with this act. This act cannot be regarded as a repeal of any previous act empowering any municipal corporation to impose a license tax, as that would be in conflict with the provisions of the Constitution above cited, expressly recognizing and requiring that the corporate authorities of cities and towns shall be vested with power to impose taxes upon both persons and property — expressly mentioning license taxes; and, besides, the whole tenor of the act shows that it was passed for the purpose of securing uniformity in the mode of taxation of property, and has no reference to the taxation of persons. 3 Again, it is contended that in the act of 1871, conferring the power to impose taxes on a person carrying on any business or avocation within the city of Columbia, the term “business” was used in the sense of the word “avocation,” and does not authorize the imposition of such a tax upon a railroad company which does only a portion of its business' within the city of Columbia. It does not seem to us that the act requires, or even justifies, any such construction. Both terms are used in the act— the language of the act being that power is conferred “to require all persons, companies and corporations engaged in an)'- business or avocation of any kind whatever within the limits of the city of Columbia,” to take out a license and pay a reasonable charge or tax therefor. If, therefore, a person or corporation is engaged in business of any kind whatever within the limits of the city, such a tax may be imposed ; and the complaint shows on its face that the plaintiff is a corporation engaged in business within the limits of the city of Columbia; that the fact that it is also engaged in business of a similar character outside the city limits, cannot affect' the question. It has an agent, regularly employed, in the city of Columbia to attend to its business in that city; for the fact that such agent is also the agent of the South — 280 — ern Railway Company does not forbid his being also the agent of the plaintiff company; and is doing business in the city of Columbia in the same manner, though possibly not to the same extent, as any other railroad company having a terminus in said city. Indeed, the construction contended for would lead to the conclusion that while all persons or corporations doing business in the city of Columbia may be required to pay a license tax, a railroad company, though enjoying all the advantages of police protection and any other advantages afforded by the city government, is not so liable, for we suppose that it rarely, if ever, happens that a railroad company does all of its business within the corporate limits of any city or town. Such a construction cannot be accepted. 4 Reliance is also placed upon the word “exclusively” as used in the ordinance — the language being: “Railroads— steam — for business done exclusively within the city of Columbia,”. &c. But this manifestly does not mean that only those doing business exclusively within the corporate limits of the city are liable to the tax, but the meaning clearly is that the railroad company is taxed only for the privilege of doing such of its business as is done -exclusively within the city limits, and not for the privilege of doing any of the other business. 5 Again, it is contended that where the General Assembly has prescribed a particular method of taxation, no other mode can be adopted; and reference.is made to the several sections of the Revised Statutes, providing the mode by which the railroads must be taxed, which does not include a license tax. But it is very obvious that these provisions are only intended to prescribe the mode in which the value of railroad property may be ascertained for the purpose of taxation of such property, and do not in any way relate to the taxation of a railroad corporation as a person. This is shown by one of the sections (739), cited by .apepllant from 2 Elliott on Railroads, in which it is said: “Where the statute prescribes a specific method for assessing — 281 — or valuing the property of railroad companies, the method prescribed excludes all others, and must be pursued. The legislative method is always exclusive. The rule is settled that where the legislature classifies property, and prescribes the mode in which it shall be taxed, neither the taxing officers nor the Courts can prescribe any other.” We have italicized such of the language in the foregoing quotation as seems to us to point directly to the view which we take. In addition to this, in sec. 759 of the same volume, the author, in express terms, recognizes the doctrine that a license tax is not a tax upon property, for he says: “Such a tax is not a tax upon property.” The position taken by counsel for appellant cannot, therefore, be sustained. 6 Again, it is contended that the license tax here in question was not graduated, as required by sec. 6, of art. VIII., of the present Constitution. It is sufficient to say, in answer to this position, that there is no allegation in the complaint upon which such a point can be raised. This Court, certainly, will not assume, in the absence of any allegations to that effect, that the municipal authorities of the city of Columbia have failed to observe the requirements of the Constitution. 7 Finally, it is contended by appellant that inasmuch as the plaintiff company is a corporation, compelled by its charter, as a common carrier, to do such business as it does in the city of Columbia, it cannot be required to take out a license for doing such business, and pay a tax therefor, as the imposition of such a tax is equivalent to the power to prohibit plaintiff from doing that which, by the law of the land, it is .required to do. It is sufficient to say that this point is disposed of by the case of The State vs. Columbia, supra, when the point was decided adversely to the view contended for by the appellant. We are of opinion, therefore, that there was no error upon the part of the Circuit Judge in sustaining the demurrer upon the first ground above stated. Under this view, the question presented by the additional ground upon which de — 282 — fendants have given notice that they would ask this Court to sustain the demurrer does not arise, and need not be considered. The judgment of this Court is, that the judgment of the Circuit Court be affirmed.