This appeal is to reverse an order and judgment of the district court of Logan county, granting a permanent injunction against the collection of taxes assessed against certain real estate, consisting of improved lots in the city of Guthrie, and held by the State Bank Commissioner through a sheriff's deed, for the purpose of reimbursing the depositors' guaranty fund for money expended by the Bank Commissioner in paying off depositors in an insolvent bank.
The material facts, in substance, are: That in October, 1921, the State Bank of Oklahoma, Guthrie, Okla., became insolvent and its affairs taken charge of and assets taken over by the State Bank Commissioner and certain amounts paid out of the depositors' guaranty fund to depositors by the Bank Commissioner. Among the assets of said bank, thus taken over, was a mortgage or mortgages on the real estate above mentioned. The Bank Commissioner foreclosed said mortgage and took sheriff's deed to the real estate covered thereby and held same for the purpose of reimbursing the depositors' guaranty fund.
The sheriff's deed was delivered on July 22, 1922. Prior thereto, viz., in January, 1922, said property was duly assessed for taxes for said year and was likewise assessed for the ensuing years, 1923, 1924, and 1925. In April, 1926, the alleged amount of delinquent taxes and penalties due on said real estate aggregated something over $17,000, and said real estate was advertised by the county treasurer of Logan county for sale for the amount of delinquent taxes and penalties due.
The Stare Bank Commissioner obtained a temporary restraining order and upon final hearing a permanent injunction against the collection of said taxes, and the county of Logan, through its county treasurer by its county attorney, has appealed from said order and judgment to this court for reversal.
The question involved is whether in fact and in law the title to said real estate thus held by the Bank Commissioner was really vested in the state as a sovereignty, to do with and dispose of as it saw fit, or whether it was merely vested in the State Bank Commissioner as a governmental agency of the state, and held in trust by him for the benefit of the depositors' guaranty fund.
If the absolute title to such property was actually vested in the state as a sovereignty with power to dispose of same for any purpose for which it saw fit, and the state would obviously have power to do with its own public property, then under section 6, art. 10, of the Constitution, such property would be exempt from taxation.
Said section 6 is as follows:
"All property used for free public libraries, free museums, public cemeteries, property used exclusively for schools, colleges, and all property used exclusively for religious and charitable purposes, and all property of the United States, and of this state and of counties and municipalities of this state; household goods of the heads of families, tools implements, and live stock employed in the support of the family, not exceeding $100 in value, and all growing crops, shall be exempt from taxation: Provided, that all property not herein specified now exempt from taxation under the laws of the territory of Oklahoma, shall be exempt from taxation until otherwise provided by law: And provided further, that there shall be exempt from taxation to all ex-Union and ex-Confederate soldiers, bona fide residents of this state, and to all widows of ex-Union and ex-Confederate soldiers, who are heads of families and bona fide residents of this state, personal property not exceeding $200 in value.
"All property owned by the Murrow Indian Orphan Home, located in Coal county, and all property owned by the Whitaker Orphan Home, located in Mayes county, so long as the same shall be used exclusively as free homes or schools for orphan children, and for poor and indigent persons, and all fraternal orphan homes, together with all their charitable funds shall be exempt from taxation, and such property as may be exempt by reason of treaty stipulations, existing between the Indians and the United States government or by federal laws, during the force and effect of such treaties or federal laws. The Legislature may authorize any incorporated city or town, by a majority vote of its electors voting thereon, to exempt manufacturing establishments and public utilities from municipal taxation, for a period not exceeding five years, as an inducement to their location."
Thus it is seen that all property of the *Page 275 state, that is, all property belonging to the state as such, is expressly exempt from taxation.
But in passing upon this question we must take into consideration that the State Bank Commissioner and the depositors' guaranty fund were not created by the Constitution, but that the Constitution, by section 1, art. 14, merely authorized the Legislature to create a Banking Department, a Banking Commissioner, and a fund for the protection of depositors and individual stockholders, as was held in Bynum v. Strain, 95 Okla. 45, 218 P. 883.
Said section 1 of art. 14 of the Constitution is as follows:
"General laws shall be enacted by the Legislature providing for the creation of a Banking Department to be under the control of a Bank Commissioner, who shall be appointed by the Governor for a term of four years, by and with the consent of the Senate, with sufficient power and authority to regulate and control all state banks, loan, trust and guaranty companies, under laws which shall provide for the protection of depositors and individual stockholders."
It will be observed from the foregoing constitutional provision that it does no more than to merely authorize and command the Legislature to do the things mentioned in said provision.
However, the Legislature, pursuant to authority granted in said section, by an act effective May 26, 1908, chap. 6, S. L. 1907-8, chap. 6. art. 2, R. L. 1910, created the State Banking Department, prescribing the manner of its regulation; also created the office of Bank Commissioner, prescribing his powers and duties, and created a depositors' guaranty fund, defining its purposes and providing how such fund is to be raised, and the manner of its handling. Said act, which is too lengthy to be set out in full herein, does not provide for raising such depositors' guaranty fund by general taxation upon all property within the state, but provides for a system of raising and maintaining such fund by special assessments levied by the banking board against each individual state bank, according to its average daily deposits. The system constitutes no part of the general revenue system of the state, nor does such fund constitute any part of the general revenues of the state. It is raised for the specific purpose of paying off depositors in insolvent state banks, and is raised specifically for the benefit of such depositors, and cannot be used nor appropriated by the state for general expenses of state government, nor for any other purpose, other than that for which it was specifically created.
And if there were an unexpended balance left in said fund after all purposes of same had been fully attained, such unexpended balance could not revert to the state to be used by it in defraying the general expenses of state government, but would revert to the individual banks from which it had been collected, and would be prorated to such banks according to the assessments paid into such funds by such bank.
It is in no sense whatever owned by the state in its sovereign capacity as public property of the state; it is in reality the private property of the banks, which by paying into such fund the assessments made against them made up the fund itself, but such fund is held under the law by the state through its constituted agents in the capacity and character of trustees for the benefit of depositors.
The title to such property being of this character, the property itself or property taken charge of, as was the property involved here, does not come within the exempting provisions of section 6, art. 10, of the Constitution, and is not exempt from taxation.
Besides, section 50, art. 5, of the Constitution provides:
"Sec. 50. The Legislature shall pass no law exempting any property within this state from taxation, except as otherwise provided in this Constitution."
And section 46, subdivision (U) of article 5, Id., provides:
"The Legislature shall not, except as otherwise provided in this Constitution, pass any local or special law, * * *
(U) "Exempting property from taxation."
The rule governing the claim of exemption from taxation is emphatically and clearly stated in Tulane Educational Funds v. Board of Assessors, 35 La. Ann. 668, as follows:
"Exemptions from taxation are always strictly construed against the exemption, nothing can be supplied by intendment or inference."
The rule is stated by this court in Oklahoma City v. Shields,22 Okla. 265, 100 P. 559, as follows:
"Claims of exemption * * * must be * * * by express grant."
See, also, 37 Cyc. 891; 26 R. C. L. pp. 302, 313.
The property in question not being mentioned in said section 6, art. 10, of the Constitution, *Page 276 and under said section 46 (U), art. 5, of the Constitution, and section 50, Id., the Legislature being without power to exempt property except as provided in the Constitution, and the recognized rule being that property is never exempted except by specific, definite provisions of law, it follows that the property involved herein is not exempt, but is subject to taxation, and that the honorable trial court erred in granting the order of injunction herein appealed from.
The judgment is therefore reversed, with directions to dissolve the injunction granted.
Reversed, with directions.
All the Justices concur.