This case was brought to the Court of Civil Appeals of the Fifth Supreme Judicial District by a writ of error, and was transferred to the Court of Civil Appeals for the Fourth District. The opinion of the latter court gives a clear and succinct statement of the case, which we adopt, and which is as follows:
"Plaintiff in error, the Dallas Consolidated Electric Street Railway Company, instituted this suit to enjoin the city of Dallas and Ford House, its tax collector, from collecting a certain tax imposed by said city on its franchise as a street railway. The cause was tried by the court and resulted in a judgment dissolving the temporary injunction *Page 274 theretofore granted and in favor of the city on its plea in reconvention for the sum of $2865.50.
"There being no statement of facts in the record, the findings of fact made by the trial judge must necessarily be adopted by this court as the facts proven on the trial.
"Plaintiff in error is a private corporation chartered by the laws of Texas and permitted by the ordinances of the city of Dallas to operate its line of railway on certain streets. In the ordinances granting that right, the street railway company was required to pay annually to the city certain fixed sums, designated in some of the ordinances as a franchise tax and in others as a bonus, and in others it is not given any specific name. The aggregate of the sums fixed in the ordinances amount to $2600 or $2700 annually. These sums were fixed regardless of the value of the property. It was also provided in the ordinances that all policemen and firemen of the city, while on duty, should be carried free of charge, and plaintiff in error has also been compelled by the city to pave and repair the pavement on the streets on which its cars are operated, the expense for such work to plaintiff in error during the years 1898 and 1899 amounting to $8000. An ad valorem tax was levied on the property, of every description, of plaintiffs in error for the years 1898 and 1899, and it rendered for taxation all of its property, except the franchise, and the franchise was added to the list of property by the city assessor. The property rendered by plaintiff in error consisted of its real estate and all its tangible personal property. The contest in this case is over the sum of $2865 imposed by the city on what is denominated the `franchise to operate and maintain lines of street railway' over certain streets."
The trial court held that plaintiff (the Dallas Consolidated Electric Street Railway Company) was liable for the tax, and dissolved the injunction. The Court of Civil Appeals reversed this judgment and rendered judgment for the plaintiff, making the injunction perpetual.
The leading question in the case is: Did the charter of the city of Dallas authorize the assessment of the franchise of a street railway company as a separate item in the rendition of its property for taxation? Construing our general laws in reference to the method of rendering the property of railroad companies for taxation for State purposes, we held in the case of The State v. Austin Northwestern Railroad Company, 94 Tex. 530, that the franchise of a railroad was not assessable as a separate distinct entity from its physical property. But we neither held that such franchise was nonassessable, nor that, under the statutes then in question, its value was not to be estimated in determining the valuation of the property of the company for the purposes of taxation. Here we have a different question. The city of Dallas is incorporated by special law, and the question is, whether the charter of the city authorizes the tax upon the company's franchise and its assessment as a separate item of property. The provisions of the charter which, we think, bear upon the question are as follows: *Page 275
"Sec. 118. The city council shall have power to levy and collect the ordinary municipal taxes upon the roadbed, rights, franchises, and all other property of street railroads of every kind, whether their motive power be steam, horse, mule, electricity, or otherwise." * * *
"Sec. 134. The city council shall have power to assess the property and shares of corporations, companies, banks, and such other institutions as the same are now or may be assessed by the State law in such cases made and provided, and shall have full power to enforce the collection of such taxes in such manner as by said council may be deemed necessary.
"Sec. 135. The city council shall have power by ordinance to regulate the manner and mode of making out tax lists, inventories, and appraisements of property therein, and to prescribe the oath that shall be administered to each person on rendition of his property, and prescribe how, when, and where property shall be rendered, and prescribe the number and form of assessment rolls, and fix the duties and define the powers of city assessor, and adopt such measures as the council may deem advisable to secure the assessment of all property within the city limits, and collect the tax thereupon, and may provide a fine and imprisonment, or either, for all persons neglecting, failing, or refusing to render their property for taxation."
It is clear that the part of section 118 just quoted authorizes a tax upon the franchise of a street railway company. If section 135 be detached from its context, it is equally clear, as we think, that its only proper construction should be that the city council were empowered to require the assessment of such franchise to be made either as a part of the tangible property of the corporation and to be estimated in assessing the value of the whole or to be separately assessed and valued as a distinct article of property. The language, "to regulate the manner and mode of making out tax lists, inventories, and appraisements of property therein, * * * and prescribe how, when, and where property shall be rendered," of itself hardly admits of any other construction. But it is contended on behalf of the defendant in error that section 134 shows that such was not the meaning, — that it makes manifest that the purpose was to require the assessment to be made in conformity to the law for assessing State taxes. If this contention could be sustained, and if a street railway be real property and its franchise of a use of the streets a part of the realty, the present case should be determined by the ruling in the case of the State v. Austin Northwestern Railroad, supra. But we are of the opinion that such was not the purpose of the Legislature. The terms of the section literally construed are not mandatory. The language is, "the city council shall have the power to assess," etc., not that they shall assess. It has been held, however, that the word "may," which is ordinarily a word of permission and not of command, when used with reference to the functions of a public officer, may imply a duty and may make the law mandatory; and the thought suggests itself that the same rule should apply in a case like the present, *Page 276 where, instead of using the words "shall" or "may," the language is "shall have the power to" do a certain act. But if the rule be applicable in such a case, the construction must ultimately depend upon what was the intent of the Legislature as deducible from the nature and subject matter of the statute, its context and other laws referred to therein. That the section is not mandatory is shown by the next section (135), which, as we have seen, confers the power upon the council to prescribe the manner of rendering and assessing property for the purpose of taxation by the city. This is made the more apparent when we consider the statutes of the State then in force for assessing the property of certain corporations, together with the history of the legislation upon that subject. Under the Revised Statutes of 1879, the property of a corporation, as a general rule, was assessed in the name of the corporation and the corporation paid the taxes thereon in the same manner as an individual. Art. 4688. This applied to banking corporations. In 1885, presumably for the reason that such corporations were evading the law or had some undue advantage under it, the statute was amended as to companies incorporated for banking purposes and it was provided in effect that such corporations should render for taxation their real estate only and that the shareholders should render their respective shares in the corporations and should pay the taxes thereon. The shareholder, in estimating the value of his shares for taxation, was allowed a proportionate deduction for the value of real estate rendered by such corporation itself. Laws 1885, p. 106. This law has ever since been continued in force. Rev. Stats. 1895, art. 5080. Besides, under the Revised Statutes of 1879, article 4684, every banker, broker, dealer in exchange, and stock jobber was required, in listing his property, to furnish a more specific statement as to its money, credits, and liabilities than was required of the ordinary taxpayer. The same law, with some amendments relating especially to national banks, exists to-day. Laws 1895, p. 37. In the light of these laws, let us carefully note the language of section 134. "The city council shall have power to assess the property and shares of corporations, companies, banks, and such other institutions as the same are or may be assessed by the State laws," etc. It being the general rule under the State law that a corporation should render for taxation and should pay the taxes upon all its property subject to taxation, and exception having been made in case of banking corporations requiring them to render only their real estate and the shareholders to render their shares, it is evident that in conferring power upon the city council "to assess the property and shares of corporations" the Legislature had in mind the exception as to banking corporations and that it was their purpose to authorize the assessment of the shares of such corporations in the manner of assessments under the State law. The words "are or may be" also indicate that it was the intention to confer the power to follow the State law in case an exception should thereafter be made as to any other class of corporations. The mention of "banks and such other institutions" (meaning, as we think, such other institutions *Page 277 of a like character) also tends to show that the purpose was to authorize the council to require such institutions to make the same character of statement as to their assets and liabilities as was required of such institutions under the statutes we have previously cited. The purpose of these statutes was not to confer special privileges upon banking corporations, bankers and the like, but was to impose duties upon them so as to prevent evasions of the law and to secure that equality and uniformity of taxation which the Constitution enjoins. Hence, in our opinion, the Legislature, in enacting section 134 of the charter of the city, did not intend to make it obligatory but to grant a discretionary power. But we also think that the section does not apply to any other corporations, except such as were made by the State law subject to especial requirements as to the mode of assessing their assets.
Our conclusion upon this branch of the case is that the city council had the power to require the franchise of a street railway company to be assessed separately from its tangible property.
But it is insisted on behalf of defendant in error that since under the ordinances by which defendant in error acquired the right to operate its line over the streets of the city, it is required to pay an annual sum for the privilege, it can not be held liable to pay a tax for the franchise. In other words, the contention seems to be that the sums required to be paid annually are a franchise tax or are in lieu of such tax, and that the exaction of the tax now in question is double taxation. As to that matter, the findings of the trial court are as follows:
"2. Its (meaning the plaintiff's) right so to operate over the streets upon which its cars were being run in the years 1898 and 1899 was secured to it by its charter and by certain ordinances of the city of Dallas and of the city of East Dallas, a municipal corporation which was annexed to the city of Dallas in the year 1889, each of said ordinances granting the right only as to the street or streets or parts of streets named in such ordinances.
"3. By the terms of some of said ordinances, the street railway company is required to pay annually to the city a certain fixed sum of money for the privilege therein granted; and in some of these ordinances, the fixed annual charge so imposed is called a franchise tax; in others it is called a bonus, and in still others it is simply imposed without being called by any name. It is not stipulated in any of these ordinances that the said annual charge therein imposed shall be in bar of nor in lieu of an ad valorem tax on plaintiff's property or any part thereof. The aggregate of these fixed annual charges is between $2600 and $2700 per annum."
It is clear that the ordinances which simply impose the annual payment as a condition of the grant and those which call such payment a bonus do not import a contract for exemption from taxation of the franchises granted. As to those in which the annual payments are called a franchise tax, the construction is not so clear. But we hardly think that such designation of itself is sufficient to show such clear and unmistakable *Page 278 purpose to contract for an exemption from taxation as the authorities hold necessary to show a contract for such exemption. Railway v. Pennsylvania, 21 Wall., 492. But we are not called upon to decide that question in this case. It was held by this court in the case of the City of Austin v. The Austin Gas Company, 69 Tex. 180, that in the absence of legislative authority, a city had no power either to exempt property from taxation or to contract for a commutation of taxes legally assessable upon it. We have been referred to no provision in the charter of the city of Dallas or that of East Dallas which gives such authority, and we take it for granted that none exists. It would seem, however, that the fact that the defendant in error is required to pay a sum annually for the use of the street is an important matter to be considered in assessing the value of its franchise. It is evident that a franchise burdened with such an exaction is not as valuable as it would be did no such burden exist. But the question of the correctness of the valuation is not before us in this case.
But the point is also made that the assessment in this case is also illegal for the reason that, as the court finds, the franchises were not assessed in the name of the plaintiff company but in that of the companies to whose rights it has succeeded. But the defendant in error was the appellant in the Court of Civil Appeals and failed to assign the ruling upon that question in that court. Therefore, the error, if eror it were, was waived and the question is not before us for determination.
For the reasons given, we are of the opinion that the judgment of the Court of Civil Appeals should be reversed and that of the District Court should be affirmed, and it is accordingly so ordered.
Reversed and judgment of District Court affirmed.