Opinion
(June Term, 1879.)
Taxes — Railroad — Exemption in Charter.
The Revenue Act of 1874-'75 does not authorize the collection of a tax against a railroad company whose charter exempts its property from taxation, and where the reserved power to alter such charter has not been exercised by the legislature.
CONTROVERSY submitted without action under C. C. P., Sec. (488) 315, and heard at Chambers, in Jackson, Northampton County, on 25 January, 1877, before, Watts, J.
Mr. R. B. Peebles for plaintiff.
No counsel in this Court for defendants.
The plaintiff company claimed exemption from taxation by reason of the provisions of its charter, and applied for an order restraining the defendant Commissioners from collecting a tax assessed under the revenue law of 1875. The Court held that the levying and collecting of said tax was in violation of the right conferred by the plaintiff's charter and the several amendments thereto, and granted the order as applied for, perpetually restraining the defendants, or their agents, from collecting the same. From this judgment the defendants appealed.
This was a controversy submitted without action, and the question presented for the consideration of the Court is, was the Petersburg Railroad Company liable to a tax to the State for that part of the road lying in the county of Northampton under the revenue law of 1874-'75?
The Petersburg Railroad Company was incorporated by an act of the Legislature of this State, ratified on the .. day of ......, 1830, entitled an act to enact, with sundry alterations and additions an act entitled an act to incorporate the Petersburg Railroad Company, passed by the Legislature of Virginia on the 10th day of February, A.D. 1830, and an act passed by the Legislature of this State in the year 1832, supplementary to an act passed by the Legislature of this State in 1830, entitled an act to enact, with sundry alterations and additions, an act entitled an act to incorporate the Petersburg Railroad Company, passed by the Legislature of Virginia on 10 February, 1830.
By said acts the plaintiff was authorized to construct, and did construct a railroad from Petersburg, in the State of Virginia, to a (489) point near Weldon, in the county of Halifax, in this State; and the said road was furnished with the usual works, buildings and appliances on railroads, such as engines, coaches, cars, machines, vehicles, depots, warehouses, etc. About eleven miles of the road lies in the county of Northampton, and the company owns no land in said county but such as is used for warehouses, depots, etc.
The seventeenth section of the original act of incorporation, assented to and adopted by the Legislature of this State, reads: "And all machines, wagons, vehicles and carriages, purchased with the funds of the company, and all their works constructed under the authority of this act, and all profits which shall accrue from the same, shall be vested in the respective shareholders of the company forever, in proportion to their respective shares, and the same, shall be deemed personal estate, and shall be exempt from all public charge or tax whatsoever."
In 1876, the defendants caused the entire property of the company lying within the limits of the county of Northampton, including roadbed, iron rails, cross-ties, fixtures, franchise, engines, carriages, land upon which depots and warehouses were built, and all other property of every description belonging to said company, to be assessed, and an ad valorem tax for county and State purposes to be levied thereon, and the Sheriff of said county had taken stops to collect the same when his action in the matter was restrained by the order in this case.
The order of restraint was properly granted. We are of the opinion that the Legislature, by the provisions of the seventeenth section of the above-recited act, intended to exempt from taxation not only machines, wagons, vehicles, carriages, etc., but under the terms "all their works constructed under the authority of this act," the roadbed with its superstructure and all the depots, warehouses and other structures (490) and buildings, with the lands covered by them, which are necessary to the operation of the said road.
It is true, the Legislature of this State in the above-cited act assenting to the Virginia act of incorporation with sundry alterations and additions thereto, did reserve in the eighth section of said act the right to alter, amend or modify the act of incorporation so far as it applied to the road in this State; but the counsel for the defendant has failed to cite any act of the Legislature of this State, and we have been unable to find any, which has amended, altered or modified the provisions of the seventeenth section of the charter. The plaintiff's property was assessed for taxation by the defendants under the Acts of 1874-'75, Chapters 184, 185; but we are unable to see how they could have supposed their authority to do so was derived from any provisions of either of those acts. So far from warranting any such construction, we think the Legislature, by the provisions of those acts, clearly manifested an intention not to disturb the exemption from taxation which had been granted the plaintiff in the original charter of incorporation. For, in the eleventh section of Chapter 184 (the act known as the Machinery Act), it is provided that "the value of the franchise of every railroad, canal, turnpike, plank road and transportation company, whether lying wholly or partly in this State, unless exempt by law from taxation, shall be given in by the president," etc. And again, in Section 2, Class II, Chapter 185 (being the act entitled an act to raise revenue), it is enacted: "That whenever, in any law or act of incorporation granted either under the general law or by special act, since the 4th of July, one thousand eight hundred and sixty-eight, there is any limitation of taxation, the same is hereby repealed, and all the property and effects of such corporations shall be liable to full taxation like property owned by individuals." From the provisions of Laws 1874-'75, Chapters 184 and 185, we think the purpose of the Legislature is clear that they did not mean to tax any railroad company chartered before (491) 4 July, 1868, whose charter contained any exemption or limitation of taxation.
Affirmed.
Cited: Worth v. R. R., 89 N.C. 306.