People v. Gold & Stock Telegraph Co.

The complaint alleges that the defendant is a corporation organized under the laws of this State, and as such liable to be taxed on its corporate franchise or business, under the provisions of chapter 361, Session Laws of 1881, which provides for raising taxes for the use of the State “upon certain corporations, joint-stock companies and associations that its treasurer reported to the comptroller the amount of capital as $5,000,000, and dividends made or declared thereon during the year ending "November • 1, 1882, amounting to six per cent upon the par value of such capital stock; that there was imposed upon the defendant a tax which, estimated at the statutory rate, amounted to $7,500; that it became due within fifteen days from the 1st of January, 1883, but has not been paid. Judgment therefor was demanded for the above sum, with interest, and by way of penalty an addition of ten per centum.

The defendant answered, admitting the material allegations of the complaint, but sought to avoid the plaintiffs claim by setting up the act of 1853 (Chap. 471), and saying that it “ has ever since its organization owned and used a line of electric telegraph partly within and partly beyond the limits of this State, and that it has for many years past, and up to the present time rendered its report to the proper officer, as required by said law of 1853, and paid its taxes to the amount required by said last-mentioned law; that it is subject to taxation under the provisions of the law of 1881, mentioned in said complaint only

The defendant then offered to prove the facts stated in its answer, but the court ruled that if proven they constituted no defense, and rejected the offer. It then asked the court to direct the jury that their verdict should not include any sum for interest, on the ground that the penalty of ten per cent, given by the statute as damages, was a substitute for interest. The court declined to do so, and a verdict under its direction was rendered for the plaintiffs for the sum of $8,250, the amount of tax and penalty, and $337.50 interest, amounting in all to the sum of $8,587.50. Judgment upon the verdict was affirmed at General Term, and this appeal is from the judgment of affirmance.

Exceptions duly taken to these rulings of the court indicate the questions presented to us. They all, except the first, depend upon the true construction of the statutes above referred to, viz.: the act of 1853 (Chap. 471), and that of 1881 (Chap. 361).

The first question has already been answered adversely to the defendant’s contention (People v. Home Ins. Co., 92 N. Y. 328 ; People v. Equitable Trust Co. of New London, 96 id. 387 ), and in this court it must be deemed settled that the statute of 1881 does not violate any provision of the Constitution of the United States. The argument of the learned counsel for the appellant has been mainly placed upon the act of 1853. He concedes, as does the answer, that the act of 1881 applies to telegraph companies, but also contends that as to them it is subject to the limitation prescribed by the former act. The purpose of that act (Laws of 1853, chap. 471, p. 931), as declared

With the act of 1881 (supra) it is quite otherwise. It deals, as its title declares, with the subject of taxation of corporations and no other matter. It is “ An act to provide for raising taxes for the use of the State upon certain corporations, joint-stoclc companies and associations.” What these terms include is declared by section 3 in language so comprehensive and clear as to leave little room for interpretation. It reads as follows : “ Every corporation, joint-stock company or association whatever, now or hereafter incorporated or organized under any law of this State, or now or hereafter incorporated or organized by or under the laws of any other State or country, and doing business in this State, except savings banks,” and some other institutions, corporations and companies, among which “ telegraph companies ” are not named, “ shall be subject to and pay a tax, as a tax upon its corporate franchise or business, into the treasury of the State annually, to be computed as follows: If the dividend or dividends made or declared by such corporation, joint-stock company or association, during any year ending with the first day of N ovember, amount to six or more than six per centum upon the par value of its capital stock, then the tax to be at the rate of one-quarter mill upon the capital stock for each one per centum of dividend so made or declared; or if no dividend be made or declared, or if the dividend or dividends made or declared do not amount to six per centum upon the par value of said capital stock, then the tax to be at the rate of one and one-half mills upon each dollar of a valuation of the said capital stock made in accordance with the provisions of the first section of this act,” and other provisions intended to meet cases not before provided for. Section 1 requires a report from each of these organizations, and section é requires the amount estimated under the provisions of the act to be transmitted to the treasury of the State within fifteen days after the first day of January in each year. Notwithstanding the ex

Undoubtedly the section (3) referred to relates to a special matter and to the special class of corporations to which the defendant belongs, and the argument for the appellant is put upon a series of authorities — text writers and the decisions of courts, which determine that an act directed toward a special object, or a particular class of persons, will not be repealed by a subsequent act embracing in general terms these particular objects or persons, unless some reference be made directly or by necessary inference to the special act. This rule, however, is only one of many by which courts seek the intent of the legislature, which it is said they have always taken “ according to the necessity of the matter, and according to that which is consonant to reason and good discretion.” (Stradling v. Morgan, 1 Plowden, 199, 204.) I should, therefore, be prepared to agree with the appellant that the act of 1881 did not repeal the provision of 1853 in the respect referred to, if I did not find in the later act both affirmative and negative provisions so in conflict with those of the former special act, that the legislature could not have intended the two should stand together. We find in section 6 of the act of 1881 {supra) telegraph companies named with railroad and other corporations, and concerning them an enactment that, “ in addition ” to the taxes above provided for, they shall pay “ as a tax upon corporate franchise or business ” at the rate of five-tenths of one per cent upon gross earnings for telegraph business “ transacted in this State.” Thus every six per cent dividend-paying corporation (not excepted in terms) is subject to a tax “ upon its corporate franchise oi business,” limited only by relation to the

It would greatly diminish the scope of the provisions by which the first is imposed, and defeat the apparent intent of the legislature, for a court to say that a corporation which ■within the letter of the law owed a tax to the State upon $5,000,000 of capital, eo nomine, could be discharged upon payment of a tax estimated on a certain proportion only of the cost of its works. ISTor could it be said, without disregarding the rule which in the construction of a statute requires the differing language of the legislature to be observed. In the first ease the entire" capital, whether expended within or without the State, is made the basis of taxation, and in the second such earnings only as are made within the State. And in view of the express language of the statute, to make the implication required by the appellant would amount to an act of judicial legislation, and sanction the omission of a duty imposed in terms upon every corporation, whenever or howsoever organized. It would relieve one from a liability to which all are declared subject, and introduce confusion into a scheme which was intended to be equal and harmonious. We find no reason in the nature of things, nor authority for doing it. The act of 1881 was not in furtherance of an existing system, but introduced anew method of regulating the amount of corporate contribution to the payment of State expenses, by assessments, not upon property, but upon privilege and business. To that end the scheme is a complete and independent one. It is made just and perfect in this respect by declaring (§ 8) that the corporations, joint-stock companies and associations mentioned in it as taxable shall thereafter he exempt from assessment and taxation for State purposes, except upon them real estate, and as therein provided; but shall in other respects be liable to assessment and taxation as theretofore.

So far, therefore, as those purposes are provided for by the act of 1853 (§ 3, supra), the latter is, by necessary implication,

We have not overlooked the various cases and citations brought together by the learned counsel for the appellant, but find none which permits us to imply words into a statute whose meaning is already plain. The argument if yielded to would require an alteration of the statute, rather than a difference of construction. In other respects also the two statutes are so entirely inconsistent that they cannot be enforced together. By that of 1853 the defendant would fail in its duty if it did not report to the assessors, by that of 1881 if it did not report to the comptroller. By the law of 1853 and the acts there referred to, payment is to be made to the collector; by that of 1881, to the treasury of the State ; by that of 1853, the corporation would be subject on default to general penalties imposed; by that of 1881, to a forfeiture of its charter and privileges ; and finally by the law of 1853, it would be liable to taxation upon a portion of its property, while, by that of 1881, it is expressly exempt from all taxation for State purposes, except upon its real estate and as provided by that act. It should be observed also that at the same session (Laws of 1881, chap. 597), the legislature

But upon the last point raised by the defendant we think the appeal should succeed. The .State at its pleasure created the charge or tax, and prescribed the penalty for default in payment. No other can be collected. In this case the comptroller is directed to add “ten per centum to the tax.of said corporation or company * * * for each and every year for which such tax shall not have been paid ” (§ 2), and by section nine an action is given to the people for the tax imposed.

All concur, except Bdg-eb, Ch. J.. not sitting.

Judgment accordingly.

A motion was subsequently made, based irpon the-act (Chap. 151, Laws of 1882), for a reargument, or for an amendment of the remittitur so that the judgment should be without prejudice to any application on the part of defendant to the Supreme Court for leave to apply to the comptroller for relief under said act.

The following mem. was handed down:

The act to which we are now referred (Laws of 1882, chap. 151) seems to have no relation to any issue in this action, and neither its existence nor the practice of the comptroller tinder it could affect the determination of the case. Whether through its provisions and without litigation a way is open to a corporation situated as is the one before us to have the basis for taxation fixed at a point below its capital, we do not inquire. For certain purposes the comptroller’s estimate is conclusive, unless appeal is taken to the tribunal created by the act, and that appeal stays no proceeding until the sum fixed by him, whether taxes, penalties, or interest, is actually deposited with the treasurer. Moreover, the decision of the

The motion should, therefore, be denied.

All concur.

Motion denied.