Commonwealth v. Owensboro, Falls of Rough, R.

JUDGE HAZELR1GG

delivered the opinion of the court.

The principal questions involved on the foregoing appeals are common to all of them, and for that reason the cases are heard together.

On May 5, 1884, the General Assembly of the State adopted the following act:

. “ An act to encourage the building of railroads in the Commonwealth of Kentucky, and to exempt from taxation all railroads which may he hereafter built under existing charters, or under charters which may he hereafter granted for a period of five years from the date of the beginning or the construction of such new roads.

“ § 1. That all railroads which may hereafter be built within this Commonwealth under existing charters, or under charters which may he hereafter granted, shall he *66 exempt from all taxation under the laws of this Commonwealth for a period of five (5) years from the date of the beginning of the construction of such new roads.

“ § 2. Be it 'further enacted, That this act take effect from and after its passage.”

The appellees are railroad companies which began the construction of their respective roads after the adoption of this act; and on the faith of which act they are claiming an exemption from State taxation for five years from the time of such beginning.

The appellant by these suits, instituted in the Franklin Circuit Court, is seeking to collect taxes from the appellees, in spite of the act aforesaid, on the ground that in May, 1886, by an act taking effect September 14, 1886, the Legislature repealed the act relied on by the' appellees. This latter act is known as the “ Hewitt Eevenue Bill.” It is entitled “ An act to amend the revenue laws of the Commonwealth of Kentucky.” It is an elaborate general revenue statute, providing under separate articles (1) the rate of taxation, (2) stocks .in banks and other institutions, (8) railroads, (4) turnpike roads and other corporations, (5) license tax, (6) the assessor an4 his duties, (7) board of supervisors, (8) duties of clerks, (9) collection of the revenue, etc., etc.

Section 1 of article 1 provides tliat an annual tax of forty-seven cents upon each one hundred dollars of value of all the real and personal estate directed to be assessed for taxation, due and payable the fiscal year assessed, shall be paid by the owner or persons assessed. By section 8 it is provided that all property, real and personal, within the State “ not herein expressly exempt by law,” shall be assessed, as nearly as practicable, according to a uniform *67 rate and. in the manner provided in detail by the act. • And a succeeding section provides what property shall be exempt from taxation, namely: Property of the United States, property of the Commonwealth, cattle of certain value, etc., etc.

Article 2 provides for the taxation of “ stocks in banks and other institutions.”

Section 1 of article 3 provides that “ the president or chief officer of each railroad company, or other corporation owning a railroad, lying in whole or in part in this State, shcdl, on or before the first of September in each year, return to the Auditor of Public Accounts of the State, under oath, the total length of such railroad . . . with the average value per mile thereof; ” and by a succeeding section it is provided that the same rate of taxation for State purposes, which is or may be in any year levied on other real estate, shall be levied upon the value so reported and found of the railroad, rolling stock and real estate of each company.

After providing for the taxation of turnpike roads and other corporations, imposing license taxes and regulating the duties of assessors, boards of supervisors, clerks and sheriffs in relation to the revenue, the act concludes (section 5, article 12) as follows:

“ Chapter 92 of the General Statutes, the act of March 28, 1872, entitled ‘ An act to amend chapter 83 of the Revised Statutes, titled “Revenue and Taxation;” the amendment to said act of March 28,1872 entitled ‘ An act to amend an act, approved March 28, 1872, authorizing sheriffs to sell real estate to pay revenue tax,’ approved April 19, 1873, the act approved April 2, 1878, title ‘An act to amend section 6, article 6, chapter 92, General *68 Statutes/ ‘An act to amend article 2 of chapter 92 of the General Statutes, title “ Revenue and Taxation,” approved May 8, 1884, and all other acts, general and special, and parts of acts inconsistent herewith, or not in conformity herewith, are repealed; hut nothing in this act shall interfere with any existing local'option, or any special or prohibition law in any county, nor with any local or general law for creating or collecting county levy, or with chapter ;1315 of the Acts of 1879-80 — ‘Agricultural and Mechanical College Tax ’ — or with an act entitled ‘An act for the benefit of the branch penitentiary at Eddyville/ approved April 7, 1886.

“ § 6. Nothing in this act shall be held to repeal or in any way impair the force and effect of any local or special act, or any general law in force, or that may hereafter be passed, providing for the appointment of collectors of State revenue or county levy and poll tax, in any county of the State, nor shall anything herein be construed to repeal or impair the force of any special or local law giving to counties or towns, for road or street purposes, the fines collected for violations of the road and bridge laws of said county.”

In determining the force and effect of this latter act on prior legislation, general or special, regulating taxation in the Commonwealth, it is evident that its general purpose and intent should be given much weight.

Manifestly, the act of 1886 is intended to compass and reform the entire revenue law of the State — to constitute in itself a general and complete revenue system. As argued by counsel, “ it singles out no special defects here and there, but is aimed broadcast at the whole structure. *69 Else why should it have re-enacted, as it does, many old laws in identical and equivalent terms ? ”

This general purpose, to be made effective and uniforin, must sweep away a mass of special and class legislation adopted in pursuance of the system theretofore in practice.

We notice, first, that all property, real and personal, shall be assessed for taxation, save that expressly exempted in the act itself. Not content with this, the act proceeds to repeal all acts and parts of acts, general and special, inconsistent 'with itself or not in conformity to itself.

Can it be said that the act of 1884, providing by a general law for a tax • exemption, for a specified time, of the property of all newly built railroads in the State, the force of which was to continue the exemption forever ■ or indefinitely, is not inconsistent with an ac,t intended to embrace the whole tax law of the State, demanding the equal and uniform taxation of all property within the State, save the property of the United States, the Commonwealth of Kentucky, etc.? And demanding specifically and without exception or exemption, the taxation of all the property of each railroad company within the State? We think not.

Manifestly there is the most positive repugnancy between the two acts, and upon abundant authority, if any. were needed to sustain so evident a proposition, the latter act supersedes and repeals the former. “ An intention to supersede local and special acts (Endlich, sec. 231) may be gathered from the design of the act to regulate by one general system or provision the entire subject matter thereof, and to substitute for a number of detached and *70 varying enactments one universal and uniform rule applicable throughout the State.”

“ Ordinarily,” says Mr. Bishop in his work on Written Laws, section 152, “ if there are a general statute and one local or special on the same subject in conflicting terms, neither abrogates the other^ but both stand together, the former furnishing the Yule for the particular locality or case, the latter for the unexcepted places and instances. And it is immaterial which is of the later date. But when from anything cognizable by the judges, they are satisfied the general law was meant by the Legislature to supersede the local or special one, they will give it that effect.”

Here the repeal is gathered not merely because the acts are inconsistent, but because the latter in express terms repeals all acts and parts of acts, general and special, inconsistent therewith or not in conformity thereto. Sutherland on Stat. Const., page 214, says, that when a general act is passed “ and repeals all inconsistent legislation, it will have the effect to repeal all special acts which are in conflict with it.” And Endlich, section 206, says, that such a clause removes the chief objection to repeals by implication.

We may notice in this connection that the act of 1884, strictly speaking, is not a local one. Its operation is uniform and general on the class to be affected. As said by counsel, “ it was passed for no local purpose, nor with any individual instance in view, but as a general law, of whose benefits corporate persons not yet in being might avail themselves.”

It was engrafted into the General Statutes of the State and formed a part of the general revenue law of the *71 •State in existence when the general revenue act of 1886 was adopted. And the latter must be held to repeal the former.

In Louisville Water Co. v. Clark, 143 U. S., 1 , the Supreme Court held that the act of 1886 was a general revenue act, and considering the purpose of its enactment and the fact that it required the taxation of all property within the State, unless expressly exempted by its provisions, and repealed all inconsistent acts, general or special, it was held to repeal the special act of that company exempting it from taxation. Much stronger we think is the argument that repeals the quasi general act exempting newly built railroads.

On the other hand it is contended that as there is no reference to the act of 1884 in the alleged repealing act, its repeal would be one by implication, which is not favored. We have seen, however, that considering the general purpose of the act of 1886 and its express repeal of inconsistent acts, the Legislature must have intended the latter act to constitute in itself a complete system of taxation.

It is urged that there has been a legislative construction of this act of 1884 conclusive of the question.

In 1887 Messrs. Bullitt and Eeland collated and published the acts of the Kentucky Legislature regarded as in force and effect; and in 1888, the General Assembly, by an act of April of that year, adopted the edition of the General Statutes as thus prepared, from chapter 1 to 113a, inclusive. The act of 1884 relied on by the appellees as exempting them from taxation is found embodied in the edition of the statute named. So, however, is found later ;on in the same edition the act of 1886, repealing, as ap *72 pellant contends, tbe former act. We are left, therefore,, where we started — with the solution bf the question depending at last on the terms and provisions of the acts themselves and the circumstances and purposes of their' enactment.

It is insisted that there has been a contemporaneous interpretation of these statutes by the officers whose duties were to enforce them, favorable to the contention .that the one was not intended to repeal the other.

Thus, the Auditor, after 1886, continued to report these-roads as “ non-taxable roads.”

The Railroad Commissioners, in some of their reports,, incorporate the act of 1884 as if in full force and effect, and make report of the length and valuation of the roads-merely for statistical purposes. The Governor, in his message of December 30, 1889, says : “ Taxes were paid,, however, on only $34,174,272 valuation of property, as-the residue, amounting to $10,516,631, is at present exempt from taxation by the terms of their charters.”

“ So,” say counsel for the appellees, “ we have this act construed by the Legislature, the Governor, the Railroad Commissioners and the Auditor, and without the Commissioners and the Auditor it was impossible to execute the law.”

It may be admitted that the interpretation given the statute by these officers might be persuasive evidence of its meaning if the repealing act were uncertain, doubtful or ambiguous. In United States v. Graham, 110 U. S., 221 , it is said of a law considered unambiguous : “-Such being the case, it matters not what the practice of the department may have been, or how long continued, for it can only be resorted to in aid of interpretation, and it *73 is not allowable to interpret what has no need of interpretation. If there were ambiguity or doubt, then such a practice begun so early and continued so long, would be in the highest degree persuasive, if not absolutely controlling in its effects.”

So this court, in Collins v. Henderson, 11 Bush, 92 , says: “ Where the words of an act are obscure or doubtful, and where the sense of the Legislature can not with certainty be collected by interpreting the language of the statute according to reason and grammatical correctness^ considerable stress is laid upon the light in which it was received and held by contemporary members of the profession.”

If the language of an act be certain, its object can never be frustrated by any amount of contemporaneous interpretation, no' matter how consistent or how widely adopted it may have been. A construction against the plain meaning of the law as expressed by its terms, even in aid of justice or right, or to avoid an absurdity, is never permissible. (Endlich, p. 506.)

Considering, therefore, the question of repeal disposed of, the inquiry remains, what effect does the repeal of the act of 1884 have upon the rights of the appellees, some of whom began the construction of their roads prior to the repeal and some of them subsequently thereto ?

It results, of course, without further argument, that the property is subject to taxation of such of the appellees as commenced the construction of their roads after the repeal of the act on which they rely for exemption. Without this exemption act of 1884, their property is upon the same .footing as other property in the State. They can not say, after September, 1886, we relied on this exemption *74 act, expended our money in the construction of these roads on the strength of the act of 1884, and therefore have acquired certain rights which the Legislature can not take away! The exemption had been -withdrawn before they began the work or expended their money. Certainly the State takes away none of their property, and circumscribes none of their property rights. It simply treats their property as it does that of others, because subject to the same general law of taxation. The State, however, contends that the same is true of the property of those of the appellees who began the construction of their roads while the law of 1884 was in force, that is, at a time prior to September 14, 1886.

It is contended that the exemption act is a mere bounty which the State may!withdraw at pleasure; and more than that, that even if the act to encourage the appellees to construct their roads be regarded as forming a contract with the State of an obligatory character, yet the power reserved to the State by the law of 1856 authorized any change in the contract desirable by the State, or even its entire revocation. Quoting from Tomlinson v. Jessup, 15 Wallace, 454, a leading case on the subject under consideration, counsel contend that “immunity from taxation, constituting in these cases a part of the contract with the Government, is, by the reservation of the power such as is contained in the law of 1841 (here 1856), subject to be revoked, equally with any other provision of the charter, whenever the Legislature may doom it expedient for the public interest that the revocation shall be made.”

It is sufficient to say of this proposition, which even at first blush strikes one as extraordinary and unjust, if attempted to be applied to those of the appellees who *75 accepted the offer of the State, and expended their money on its exemption pledge, that the act of 1856, reserving the right to repeal or amend charter privileges granted by the Legislature to particular persons, has no application to the law of 1884, which, as said before, was a general law, and affected alike all who accepted its provisions or acted on the strength of them. No contract was made with any person, natural or artificial, upon the adoption of this act; though by accepting its terms certain rights might be secured under.the nature of contract rights. But no reservation, express or implied, can be said to have been made therein by virtue of the act of 1856. Being a general law it was revocable at pleasure; but it does not follow that it might be revoked so as to injuriously affect the citizen accepting its provisions, in violation of the pledge of the State and the common principles of justice.. The State, to promote the ends of development, to afford greater facilities for transportation, and to bring into its borders an increased volume of property, shortly to help bear the common tax-burden, says to the railroad people, build up your enterprises and expend your capital in our midst, and in consideration of the premises we will grant you a brief respite from the tax-gatherer! We think the State can not withdraw its pledge of immunity from those who acted upon the assurances of this act, and that the property of the appellees beginning their work prior to the repealing act of September 14,1866, and thus accepting the provisions of the act of 1884 while it was in force, can not be subjected to the taxation sought to be imposed in these actions. The private exemption acts pleaded by some of the appellees come clearly within the principle decided in Louisville Water Company v. Clark, supra. *76 The immunity claimed was withdrawn by the act of 1886. A question of practice only remains for settlement.

The plaintiff alleged the facts with reference to each road constituting its cause of action, thus, that annual reports of the railroad authorities to the Auditor, of the length and valuation of their respective roads within the State, had been made; that these were annually, and before September 1, laid before the Railroad Commissioners, who proceeded to value and assess the property set forth in these reports'; that a statement of such was thereupon returned to the Auditor, who notified the defendants of the amount of the assessment, and the tax due, etc.

The defendants denied these allegations in detail, explaining, as to the report^ of their officers when made, that they were furnished for statistical purposes merely. In a separate paragraph the act of May, 1884, was pleaded as affording them immunity from the taxation sought to be imposed. A demurrer to this paragraph was overruled. This defense constituted a complete bar to recovery, and no matter what proof might be adduced by the State in support of the issues otherwise made by the answers, the end necessarily resulting from the ruling of the court in sustaining this plea of exemption was bound to be a dismissal of the petition.

The State, looking perhaps to the contemplated appeal, and with a view of having all the controverted facts established by proof, and having the cases ready for a final judgment should the legal question be determined in its favor in the appellate court, introduced the secretary of the State Railroad Commission and the Auditor’s clerk, who proved facts conducing to establish the allegations in the petitions. The defendants introduced no witness, but *77 had their witnesses to file certain additional reports as records. The court on final hearing dismissed the petitions, and the State appealed without having made a motion either for a new trial or for a separation of the law and facts. We do not think either was necessary. The petition seems to have presented a good cause of action. When the plea of exemption was erroneously sustained it really ended the - case, or at least put an end to the possibility of recovery by the plaintiff. The facts shown in proof appear to sustain the State’s right to recover. There was no contrariety of testimony — a few pamphlets and reports of officers only were filed; and when the case ivas finally dismissed, there was in fact nothing before the court save questions of lawn There was no disagreement as to what ivas shown in the books, though the legal effect of the facts so shown was a subject of difference of opinion. The court passed on nothing save legal questions, and these this court may review in the absence of the motions for a now trial and a separation of the law and facts. Upon a return of the cases, or such of them as ivill be indicated, the demurrer to the plea of exemption will be sustained, and then the facts of the alleged assessments, notices, etc, may be fully inquired into.

Erom the records before us the following appellees appear to have commenced the construction of their roads after September 14, 1886:

Owensboro, Ealls of Rough & Green River Railroad Company.

Louisville & Nashville Railroad Company, etc. (being the Cumberland Valley Branch and Extension; the Middle Division, Cumberland & Ohio, known as the Springfield *78 Branch, and the Clarksville '& Princeton Division. The' last-named division seems exempt for five years after jts commencement on October 81,1884).

The Burnside & Cumberland River Railroad Company,

Hodgenville & Elizabethtown Railroad Company.

Louisville, Hardinsburg & Western Railroad Company, etc.

Louisville, St. Louis & Texas Railway Company (No. 178), and Kentucky Midland. And the judgments therein' are therefore reversed.

The following appellees commenced the construction of their roads while the act Avas. in force, and are therefore entitled to the five years’ exemption from the date of said commencement, but frorn the record it appears the exemption expired,' and the State appears entitled to recover for a part of the time. The petitions Avere dismissed and the judgments are reversed for that reason :

Ohio Valley Railroad Company.

Louisville Southern Railroad Company, etc. (No. 180).

Kentucky & Indiana Bridge Company.

Kensee Coal Company.

The folloAAdng appellees commenced their roads while the act was in force, and are not sued for any year for which they are not exempt, and for that reason the judgments are affirmed as to them :

Elkton & Guthrie Railroad Company.

Mammoth Cave Railroad Company.

Louisville Southern, etc. (No. 175), and OAvensboro & Nashville, and Louisville & Nashville (No. 184).

The judgments in the cases indicated as erroneous are reversed, with instructions to proceed as herein indicated.