State Ex Rel. Susquehanna Ore Co. v. Bjornson

We adhere to our former decision in this case. The attorney general and the tax commission have very earnestly and very ably presented the reasons which they feel should persuade us to depart from the decision already rendered, but to do so we should have to *Page 653 overrule the cases which this court has decided over a series of years. The tax commission contends that consideration received for the assignment of a mining lease is not royalty unless the relation of landlord and tenant continues to exist between assignor and assignee and that in order to be royalty such consideration must be in the nature of rent from a sublessee. Examination of the briefs discloses that that contention was squarely raised in State ex rel. Shenango Furnace Co. v. Armson, 172 Minn. 235, 242, 215 N.W. 74, and decided against the contention of the commission. That decision has stood for eight years. Under present provisions for deducting royalty taxes at the source, we see no disadvantage to the state in this holding. The state gets its tax either as royalty tax or as occupation tax. If efforts are made to evade the tax, such as feared by the commission, it may prevent such a result by appropriate investigation and findings.

The 1925 taxes had accrued and were by statute a lien on the premises although as between grantor and grantee they had not become so. We regard the situation as no different from what it would be if the assignee had paid or promised to pay in cash to the assignor an amount equal to the 1925 taxes. It was simply additional consideration for the right to remove ore. *Page 654