Flaska v. State , 51 N.M. 13 ( 1946 )

The constitutional provision in question authorized the state to give annually to a veteran who has taxable property, an indefinite sum of money during his life, though he may never have risked his life in battle; but provides nothing for a poor soldier though he may have earned the Congressional Medal of Honor, or suffered wounds in the defense of his country. We have given to those that have, and have forgotten the needy and poor of our soldiers who "have not." The Federal Government has never discriminated against any of its soldiers by the selection of a favored and least needy class, for its largess. That the State has been defrauded of its taxes by relatives deeding their property to veterans is well known in this state. In a recent argument of a case in this court, it was admitted that a woman living in another state has had the benefit of this tax exemption for years, through holding the title to a valuable lot in Albuquerque in her son's name.

I hasten to say that the fact the law in question is unjust, discriminatory and has been, and is, a source of fraud against the state, does not authorize this court to limit its application upon constitutional grounds beyond the legislative intent. But it does not encourage me to strain the Constitution to the breaking point to include beneficiaries who least need the state's assistance, and who will eventually own a large part of the taxable property of a poor state.

This action was brought by the tax assessor of Bernalillo County against the State of New Mexico and its tax commission, praying for a declaratory judgment on the question of whether the soldiers, sailors, marines and army nurses of the Second World War are entitled to the tax exemption provided for in the statutes quoted in the majority opinion.

These statutes were enacted in pursuance of Sec. 5 of Art. 8 of the State Constitution as amended in 1921, which is as follows:

"The Legislature may exempt from taxation property of each head of a family to the amount of two hundred dollars, and the property of every honorably discharged soldier, sailor, marine and army nurse, and the widow of every such soldier, sailor, or marine, who served in the armed forces of the United States at any time during the period in which the United States was regularly and officially engaged in any war, in the sum of two thousand dollars. Provided, that in every case where exemption is claimed on the ground of the claimants having served with the military or naval forces of the United States as aforesaid, the burden of proving actual and bona fide ownership of such property, upon which exemption is claimed, shall be upon the claimant."

Section 5 originally read:

"The Legislature may exempt from taxation property of each head of a family to the amount of two hundred dollars."

Regarding liability to taxes and exemptions therefrom, the State Constitution provides:

"Taxes levied upon tangible property shall be in proportion to the value thereof, and taxes shall be equal and uniform upon subjects of taxation of the same class." Art. 8, Sec. 1.

"The property of the United States, the state and all counties, towns, cities and school districts, and other municipal corporations, public libraries, community ditches and all laterals thereof, all church property, all property used for educational or charitable purposes, all cemeteries not used or held for private or corporate profit, and all bonds of the state of New Mexico, and of the counties, municipalities and districts thereof shall be exempt from taxation." Art. 8, Sec. 3.

Regarding these constitutional provisions, we stated in State ex rel. Attorney General v. State Tax Commission, 40 N.M. 299,58 P.2d 1204, 1206:

"Section 1 of article 8 of the Constitution of New Mexico is as follows: ``Taxes levied upon tangible property shall be in proportion to the value thereof, and taxes shall be equal and uniform upon subjects of taxation of the same class.'

"By the terms of section 3 of article 8, certain specific property is exempt from taxation, and by section 5 thereof the Legislature is authorized to exempt from taxation certain other specific property; and no other property is or can be exempted. The Constitution, in effect, classes tangible property into that exempt from taxation, that which may be exempted, and that which must be taxed."

And in Sims v. Vosburg, 43 N.M. 255, 91 P.2d 434, 435:

"All tangible property in New Mexico is subject to taxation in proportion to value, and should be taxed, unless specifically exempted by the constitution or by its authority. Secs. 1, 3, and 5 of Article VIII, N.M. Constitution; Albuquerque Alumnae Ass'n v. Tierney, 37 N.M. 156, 20 P.2d 267; State v. State Tax Commission,40 N.M. 299, 58 P.2d 1204."

I call attention to Sec. 32 of Art. 4 of the State Constitution, which is as follows:

"No obligation or liability of any person, association or corporation, held or owned by or owing to the state, or any municipal corporation therein, shall ever be exchanged, transferred, remitted, released, postponed, or in any way diminished by the legislature, nor shall any such obligation or liability be extinguished except by the payment thereof into the proper treasury, or by proper proceeding in court." Art. 4, Sec. 32.

This court has held that taxes duly assessed and levied are debts owing to the state within the meaning of the last quoted provision of the state's Constitution. State v. Montoya, 32 N.M. 314, 255 P. 634. They have been held by this court to be constitutional insofar as they apply to soldiers, sailors, marines and army nurses of World War One. Asplund v. Alarid, Assessor, etc., 29 N.M. 129, 219 P. 786.

But for the amendment of 1921 (Sec. 5 of Art. 8 N.M. Const. supra) the exemption statutes would have been unconstitutional and therefore void. As stated in the Asplund Case, supra [29 N.M. 129, 219 P. 788]:

"The courts have had frequent occasion to construe the effect of a constitutional amendment which is inconsistent with some remaining provision of the original Constitution, and have uniformly, so far as our investigation discloses, given effect to the later provision as the latest expression of the sovereign will of the people, and as an implied modification pro tanto of the original provision of the Constitution in conflict therewith."

Stripped of verbiage unnecessary to construction, the words of the constitutional provision to be construed may be thus stated: "The Legislature may exempt from taxation * * * the property of every honorably discharged soldier, etc. * * * who served in the armed forces of the United States at any time during the period in which the United States was * * * engaged in anywar * * * in the sum of two thousand dollars. * * *". (My emphasis.)

Do the words "every * * * soldier, sailor, marine and army nurse" as used in the amended Sec. of Art. 8, adopted in 1921, include "each soldier, etc.," of World War Two; and if those of World War Two, obviously it includes those of World War Three, believed by many thinking people to be imminent, as well as all future wars. If this is answered in the negative I need not go further, as any legislative act is void that purports to grant an exemption from the payment of taxes not specifically authorized by some provision of the state constitution. State ex rel. Attorney General v. State Tax Commission, supra.

It is said that ordinarily that which is implied in the Constitution is as effectual as that which is expressed. Pine Grove Township v. Talcott, 19 Wall. 666, 86 U.S. 666,22 L. Ed. 227, but there is an exception to this which we recognized in Church of Holy Faith v. State Tax Commission, 39 N.M. 403,48 P.2d 777. The question involved was the construction of Art. 8, Sec. 3, supra, as to the meaning of "All church property." We quoted with approval from the Supreme Court of the United States, in Chicago Theological Seminary v. People of State of Illinois,188 U.S. 662, 23 S. Ct. 386, 387, 47 L. Ed. 641, affirming a decision of the Supreme Court of Illinois, in which the Supreme Court stated:

"The rule of construction followed by the supreme court of Illinois in construing this act exempting property from taxation is so well established by this and other courts as scarcely to need the citation of authorities. One or two, however, from this court may be given. Tucker v. Ferguson, 22 Wall. 527,22 L. Ed. 805; New Orleans City L.R. Co. v. New Orleans, 143 U.S. 192,195, 26 L. Ed. 121, 122, 12 S.Ct. Rep. 406; Bank of Commerce v. Tennessee [to] Use of [City of] Memphis, 161 U.S. 134,40 L. Ed. 645, 649, 16 S.Ct.Rep. 456.

"The rule is that, in claims for exemption from taxation under legislative authority, the exemption must be plainly and unmistakably granted; it cannot exist by implication only; a doubt is fatal to the claim."

It is the claim of appellee that the plain language of the constitutional provision limits the class which the legislature by its terms is authorized to exempt from taxation, to those of that class who had belonged to the armed forces of the United States prior to the adoption of the constitutional provision; that the language "who serve at any time during the period in which the United States was * * * engaged in any war," could only have reference to those who had so served at the time of the adoption of the amendment by the people.

The appellant counters with the contention that the words "any war," includes past, present and future wars; that if the people had intended such limitation the words to express the intent would have been "any past wars."

It is apparent that only a limited number of soldiers, sailors, marines and army nurses (hereafter collectively referred to as soldiers) are entitled to this bounty from the state. Besides being a soldier of the United States armed forces, he must have, (1) received an honorable discharge; (2) he must have served while the nation was regularly and officially engaged in war; (3) he must be the owner of property subject to taxation; and failing these, though he had been decorated with the Congressional Medal of Honor, he has no legal claim against the state.

We come now to the question of whether the phrase "soldiers, etc.," as contemplated by the amended constitutional provision here considered, is further limited by the exclusion of all soldiers of World War Two, owning property subject to taxation, for all others are excluded by its terms.

The intent of the framers of the amendment to the Constitution in question, and the people who adopted it, of course must control. If the language used is plain and unambiguous there is no room for construction. It was written to be understood by the people whose approval was required to constitute it the state's fundamental law; and its words, phrases and sentences should be assumed to have been used in their normal and usual meaning, in the absence of strong reasons that compel a different construction. A. Magnano Co. v. Hamilton, 292 U.S. 40, 46,54 S. Ct. 599, 78 L. Ed. 1109; Pocket Veto Case, 279 U.S. 655,49 S. Ct. 463, 73 L. Ed. 894, 64 A.L.R. 1434.

"The first resort, in all cases, is to the natural signification of the words, in the order of grammatical arrangement in which the framers of the instrument have placed them. * * * The simplest and most obvious interpretation of a constitution, if in itself sensible, is the most likely to be that meant by the people in its adoption." Lake County v. Rollins, 130 U.S. 662, 9 S. Ct. 651, 652, 32 L. Ed. 1060.

See Wright v. United States, 302 U.S. 583, 58 S. Ct. 395,82 L. Ed. 439.

If we are unable to arrive at a satisfactory meaning by the assumption that the words of the amendment were used in their ordinary and usual meaning, as grammatically arranged, or if there is a doubt, tax exemption being its object, then resort should next be had to its historical setting at the time of its adoption. Maxwell v. Dow, 176 U.S. 581, 20 S. Ct. 448,44 L. Ed. 597; United States v. Classic, 313 U.S. 299, 61 S. Ct. 1031,85 L. Ed. 1368.

At the time the amended provision was adopted (1921) there were persons living who served as soldiers in one or more of a number of wars in which the United States had been engaged. The use of the past tense indicates a reference to soldiers who, previously to the adoption of the amendment, had served in the armed forces. The language used indicates that persons who might serve in the future were not included unless the phrase "in any war" necessarily includes wars past and future. Keeping in mind therule that a claim for exemption from taxation must be plainly andunmistakably granted, I conclude that the soldiers "who served" did not include those who might serve in the armed forces at some future time. The phrase "During the period in which the United States was * * * engaged in any war," has no reference to wars in which the United States might be engaged after the adoption of the amendment; but to any wars in which the United States was engaged before the amendment was adopted; or if it could be so construed, it was not clearly and unmistakably so phrased as that it is free from doubt.

One claiming an exemption from taxation is required to establish clearly and unmistakably that he comes within the favored class. Doubts are resolved in favor of the sovereign. There is more than a reasonable doubt that stands as a bar to appellants' claim that soldiers of World War Two are included among those entitled to this tax exemption, and this doubt I resolve in favor of the state. Church of Holy Faith v. State Tax Commission, supra; Theological Seminary v. Illinois, supra.

The appellee aptly states in his brief:

"What was obviously the common understanding of the people when they adopted the amendment? The question answers itself. They, the people, desired to reward the soldiers who had rendered services in the defense of their country in past wars, as all pertinent language of the amendment restricted its application to wars fought prior to its adoption. The intent of the people was to leave to the future the adjustment of other situations when they should arise. No one contemplated another war, and no provision was made for the soldiers of that war.

"No doubt public sentiment is on the side most favorable to extending the exemption to soldiers of World War II. But, in order to do that, the court must read into the amendment an intent on the part of the people not to be found in the language used, viz.: an intent to extend the tax exemption to all soldiers of all future wars, regardless of time and condition."

The historical setting, as well as the language used, if strictly construed in favor of the state, leads me to the conclusion that Sec. 5 of Art. 8 of the State Constitution, as amended, has no application to soldiers of World War Two, and the district court did not err in so holding. But by a three to three decision (including the learned trial judge) the opposite conclusion has been reached.

The conclusion of the district court was correct and its judgment should be affirmed.

LUJAN, J., concurs.