McCallum v. Associated Retail Credit Men

On Motion for Rehearing.

On motion for a rehearing, appellant insists that we erred in sustaining the departmental construction placed upon article 7094, Rev. St. 1925, as exempting appellee corporation from payment of the annual franchise tax of $10, imposed by article 7084, principally because there is no ambiguity or doubt with respect to the meaning of the language of article 7094, and because there is nothing to show that the Legislature knew of the departmental construction.

If there was any doubt with respect to our former conclusion as regards these conten-. tions, that has been removed by the acts of the Fifth Galled Session of the Forty-First Legislature by necessary implication. These acts we will discuss in their chronological order with respect to the interpretation placed upon the exemption statute by the Secretary of State as well as the Attorney General, and with legislative acquiescence.

Appellee was incorporated in 1919, under what is now article 1302, subd. 53, which reads as follows: “To organize cotton exchanges, chambers of commerce and boards of trade, with power to provide and maintain suitable rooms for the conduct of their business, and to establish and maintain uniformity in the commercial usages of cities and towns, to acquire, preserve and disseminate valuable business information, and to adopt rules, regulations and standards of classi-*717fieation, which shall govern all transactions connected with the cotton trade, and with other commodities where standards and classifications are required, and generally to promote the interests of trade and increase the facilities of commercial transactions.”

The exemption statute (article 7094) was enacted in 1907. After its enactment, corporations similar to appellee, as well as cotton exchanges and chambers of commerce corporations, continued to pay the franchise tax of $10 per annum imposed by article 7084, up to and for the year 1915. On March 3, 1916, First Assistant Attorney General O. M. Cure-ton gave the then Secretary of State an opinion which reads, in part, as follows: “4. Corporations as chartered under Subdivision 56 of Article 1121 (now Art. 1302, Sub. 53, supra) as commercial clubs or boards of trade are exempt from the payment of franchise taxes by Revised Statutes, Article 7403 (now Art. 7094).”

This opinion pertained specifically to whether the Chamber of Commerce of the city of Tyler was exempt under the statute from payment of the annual franchise tax. However, each succeeding Secretary of the state has exempted corporations organized under article 1302, subd. 53, supra, including chambers of commerce, cotton exchanges, and boards of trade corporations, of which latter class appellee is one, from the payment of the annual franchise tax imposed by article 7084, and this with apparent acquiescence of the Legislature, because, as said by Judge Cure-ton in Franklin Ins. Co. v. Hall, supra, the tax is “a source of revenue, the consideration of which is one of the primary duties of the Legislature.” The Legislature recodified the statutes in 1925, and article 7094 was brought forward without change, and the practice of exempting the corporations above mentioned was continued. In 1928, an opinion by First Assistant Attorney General D. A. Simmons advised appellant, as Secretary of State, that cotton exchange corporations were not exempt from payment of the annual franchise tax under article 7094; and on October 2, 1929, appellant, as Secretary of State, demanded the tax of appellee for each year since its incorporation.

These facts, as held in our original opinion, show legislative knowledge and acquiescence in this departmental construction of article 7094, as exempting at least the three classes of corporations above named and organized under article 1302, subd. 53; and we think that the state should not, after this continuous practice for 15 years, now assert the right to the tax. In the recent case of Oden v. Gates (Tex. Oom. App.) 24 S.W.(2d) 381, it was held that it would be presumed, absent' specific language in an act amending a doubtful statute which a department of the state government had construed in a certain manner for 25 years, to be the intention of the Legislature to continue the departmental construction of the statute. But if any question would be raised that the above facts do not show legislative knowledge of and acquiescence in the departmental construction of the statute, then we think recent acts of the Legislature conclusively show its knowledge and acquiescence therein. The one act in particular is House Bill 38, entitled, “Occupation Tax on Exchanges” (Forty-First Legislature, Fifth Galled Session). This act imposed an occupation tax of from $100 to $250 per an-num upon cotton exchange corporations organized under article 1302, subd. 53, supra; and, as reasons for its emergency clause, the act recites the “fact * * ⅜ persons and companies engaged in conducting such business pay only a.n ad valorem tax on the property they own creates an emergency,” etc.' It is therefore clear that, since the act recites that no tax is now being paid by cotton exchange corporations, one of the class which along with appellee’s class of corporations had been exempted by the department from payment of a franchise tax for fifteen years, the Legislature must have necessarily ascertained the facts recited in the emergency clause, and by necessary implication ascertained that corporations similar to appellee were also being exempted from payment of the tax.

We also call attention to the fact that, since this opinion was announced, the Forty-First Legislature, at its Fifth Called Session, has amended Article 7084, the statute which imposed the tax sought to be collected by this suit. The article formerly read, “provided, that such franchise tax shall not in any case be less than ten dollars.”’ It was amended so as to read, “provided, that such tax shall not be less than Ten Dollars ($10.00) in the case of any corporation, including those without capital stock.” We construed article 7084 to impose the tax as it formerly existéd, and call attention to the amendment as a matter of history of the statute and as ¾⅛-nificant of the fact that the Legislature has attempted to clarify the statute. . ■

We overrule the motion for a rehearing.

Overruled.