Binghamton Trust Co. v. City of Binghamton

Smith, J.:

Plaintiff here seeks to recover from defendant the sum of $1,702.40 paid as the city tax for 1901, with interest thereupon from November 21, 1901. It is agreed that this tax was paid under duress, and that plaintiff is entitled to the judgment asked provided the exaction of the tax was unwarranted by law. Plaintiff claims exemption from said tax under chapter 132, Laws of 1901. This act amends the General Tax Law of the State (Laws of 1896, chap. 908, §§ 187a, 189, subd. 7, 194, 202), and requires every trust company organized under the laws of the State to pay to the State annually “ for the privilege of exercising its corporate franchise or carrying on its business in such corporate or organized capacity an annual tax which shall be equal to one per centum on the amount of its capital stock, surplus and undivided profits.” This tax is made *342payable on or before the first day of September of each year, and it is further provided that the personal property of such trust companies “ shall be exempt from assessment and taxation for all other purposes.” This exemption is conditioned upon payment of cer- * tain other taxes which it is agreed have been paid. The act by its terms took effect immediately and became a law iipon the 21st day of March, 1901. . The city tax of Binghamton is levied and collected under the city charter. Examining that charter, we find the following provisions material to this question: “The annual assessment of property in said city shall be made during the months of May, June, July and August, and shall be completed by the assessors thereof on or before the first day of September in each year; ” thereafter for ten days the assessors shall meet to hear all 'allegations and objections of all persons interested, and to review and correct said roll; on or before the first day of October the assessors shall make and file in the office of the clerk a “ correct and complete assessment roll ” of which the supervisors of said city shall make a correct copy for the use of the board of supervisors of Broome county, as the assessment roll of said city (Laws of 1888, chap. 214, tit. 4, § 18, as amd. by Laws of 1901, chap. 198); upon such roll as completed the State and county tax shall be paid in December of each year; for ten days after the first Tuesday in April of each year the said assessors shall meet for the purpose of transferring the assessment of .any property that has been sold and adding to the assessment roll any property liable to taxation and assessment which may have been omitted therefrom ; after having made such transfers and such additions they are to deliver the samé tnthe city clerk and “ such roll so revised shall be the assessment roll for the city tax” (Laws of 1888, chap. 214, tit. 4, § 19, as amd. by Laws of 1901, chap. 198); “all sums to be raised by a general tax in pursuance of this act shall, except as herein otherwise provided, be assessed and rated upon and among the owners of real and personal estate, incorporated, companies and associations named m the revised assessment roll in proportion to the valuation therein stated in the same manner and proportion as near as may be as taxes in and for the county of Broome are rated and assessed ” (Tit. 6, § 1, as amd. by Laws of 1900, chap. 187); “ the sum rated and assessed on the estate of *343each person, company, corporation or association shall be set opposite the name of such person, company, corporation or association respectively, in the last column of the tax-roll, which roll shall be a copy ' of the revised assessment-roll, and shall be corrected, completed and filed with the city clerk on or before the first day of July in each year, and which when so corrected, completed arid filed shall be a lien on the real estate described therein.” (Tit. 6, § 2, as amd. by Laws of 1895, chap. 858.)

In People ex rel. American Bible Society v. Commissioners (142 N. Y. 348) the Legislature had released relator’s property from taxation by a law which took effect April 29, 1893 (Chap. 498). By the procedure for the assessment and collection of taxes made applicable to the city of New York (Laws of 1882, chap. 410, § 817), the books from which the assessment roll was prepared were not closed until the first day of May, until which time the assessments were subject to correction by the commissioners. The court there decided that inasmuch as the act became a law two days before the assessment roll became complete it operated to relieve the relator from the taxes levied for that year. Judge Gray in writing for a unanimous court (at p. 351) says: “ The judicial functions of the tax commissioners terminate upon the first day of May, and thereafter the duties are of a clerical nature. But it is indisputable that the Legislature may release property which has been assessed for taxation. The power over the subject is unlimited and can be exercised in any way and at any time during the proceedings for taxation. If it is claimed ■ that a legislative enactment has arrested those proceedings at a stage when, by the general law, the tax books are closed and the assessable character of the property has been fixed beyond the power of the taxing officers to alter, the language must be very explicit to warrant them in thereafter remitting the tax. In the Colored Orpham Asylum Case (104 N. Y. 581) the property for which exemption was claimed was acquired on July 31st and its claim was refused upon" the ground that, as with the closing of the record on the first day of May the power of amendment or alteration had ended, the exemption given in the Revised Statutes* must be regarded as pro*344spective in its operation. In the present case, however, we have the command of the Legislature to exempt the relator, given at a time when the records, or tax books, are recognized by the general law to be open for correction. The implication, from the statutory direction that they shall be open, is that up to the date for their closing no basis is absolutely fixed for the subsequent proceedings for extending the amownt of the tax upon the assessment rolls. We feel constrained to hold that the act having been given immediate operation, at a time when the tax books were directed by.law to be open, the effect was to withdraw the property affected from all liability to taxation, and that the tax commissioners actually had a warrant in law for the correction of the tax books by removing therefrom the entry of the property in question.”

In the case cited it will be borne in mind that the statute construed was a statute of exemption purely. Such statutes' receive strict construction. In Sutherland on Statutory Construction (§ 364) the rule is thus stated: “ Legislation which is claimed to relieve any species of property from its due proportion of the general burdens of government should be so clear that there can be neither reasonable doubt nor controversy about its terms. The language must he such as leaves no room for. discussion. Doubts must be resolved against the exemption.” The case cited recognizes, however, the power of the Legislature to relieve property even brom a, tax assessed if the intent be manifest. The power to strike from the roll was there found not merely because of the power left in the commissioners to correct the roll, but also because, at the time of the passage of the act, the assessment was incomplete and “ no basis (was) absolutely fixed for the subsequent proceedings for extending the amount of the tax upon the assessment rolls.”

The statute here for construction is not a statute of exemption as such. No property is here seeking to be relieved “from its due proportion of • the general burdens of government.” The rule of taxation simply is changed. Moreover, if defendant’s contention prevail, the plaintiff will be subject to double tax for the year 1901 — will be forced to make double contribution to the expenses of government. Against such an intent the law most strongly presumes. In People v. Home Ins. Co. (92 N. Y. 347) it is said: “ In the consideration of the effect and meaning of laws imposing taxes *345it would undoubtedly be the duty of the court to so construe them, if possible, as to avoid Unequal and double taxation.” In People ex rel. Savings Bank v. Coleman (135 N. Y. 235) the opinion reads: “ The Revised Statutes* neither exempted the bank nor the depositors therein. But there could not be double taxation. If that had been attempted, some. way would have been found to defeat it, as that would be against public policy, the purpose of the laws and natural justice. While the Legislature may constitutionally impose double taxation, its purpose to do so can never be inferred, but must plainly appear.” In Matter of Swift (137 N. Y. 87) the court says: “We should incline against a construction which might lead to double taxation.”

Can there be found then any indication of an intent to exempt the plaintiff from the city tax for 1901 ? The act became a law upon March 21, of 1901. By its terms it is provided that it shall take effect immediately, and trust companies are thereby exempted from assessment and taxation on personal property for all other purposes. The creation of a new liability is presumably in lieu of the old liability. At the time when the act became effective the revised assessment roll was not completed. At the April meeting of the assessors power was given them to transfer property upon the roll and to add to the roll property which had been omitted. The ratio of tax which each taxpayer was to pay could be and was at that meeting changed. Until after that meeting the revised roll upon which the city tax is laid was subject to correction. Until then “ no basis is absolutely fixed for the subsequent proceedings for extending the amount of the tax upon the assessment rolls.” Having in mind the distinction between the rule of construction of a statute purely of exemption and the rule of construction of a statute not of exemption but which is claimed to impose upon the taxpayer a double burden, we think there is clearly manifest an intent in the Legislature to make the act effective as of the date of its passage and to relieve the relator from payment of all taxes thereafter save those provided in the act itself. The statute itself gave to the assessors their warrant to strike this property from the revised roll upon which the city *346tax was laid and such city tax for the year 1901 was unlawfully exacted of plaintiff.

I am referred to no authority which to my mind holds a contrary rule of law. All of the cases cited in defendant’s brief are, with one exception, cases in which are construed statutes of exemption as such. In the case of Ætna, Insurance Co. v. Mayor (153 N. Y. 332) the statute was not purely a statute of exemption, but the act (Laws of 1886, chap. 679) did not take effect until June fifteenth, more than forty-five days after the assessment roll had become completed, with no power whatever left in the commissioners to vary the same.

The plaintiff should have judgment.

All concurred, except Parker, P. J., dissenting in an opinion.

1 E. S. 388, § 4, subd. 4, as amd. by Laws of 1866, chap. 136.— [Rep.

1 R. S. 388, § 4, subd. 7'.— [Rei