Baughman v. Herwig , 145 Md. 580 ( 1924 )

Under the laws of Maryland, prior to the passage of chapter 521 of the Acts of 1922, known as the "One Cent Gasoline Tax Bill," motor vehicles were taxed for the privilege of using the public streets, roads and highways of this State in accordance with a schedule of fees based upon the horse power of the vehicle estimated under a prescribed formula, the use to which the vehicle was to be put, the character of the vehicle, or a combination of these elements. Under that schedule the license fees for different classes of vehicles differed, and that difference was roughly proportioned to the damage, wear and tear occasioned by the use of such roads and highways by the different classes of motor vehicles.

By the "One Cent Gasoline Tax Bill" a new method of taxation was introduced which imposed, in addition to the fees assessed by the schedule above referred to, a tax of one cent per gallon on all gasoline sold within the State for use in the operation of motor vehicles, and not intended for exportation from the State. Inasmuch as the amount of gasoline consumed in the operation of motor vehicles over the highways of the State would bear a direct ratio to the extent of such use, as well as to the weight of the vehicles and the speed at which they were driven, that tax was also proportion to the damage, wear and tear on those highways resulting from their use by such vehicles. That act did not contemplate that the scheme of taxation imposed by it should be permanent, but it was a temporary expedient enacted to raise funds to make good a deficit of $1,179,555.07 in the Maintenance and Reconstruction Fund of the State Roads Commission and under its provisions, when the fund collected under it equalled that sum, the tax would no longer be imposed, and in any event it would not be exacted later than January 1, 1924.

In connection with the "One Cent Gasoline Tax Bill" the Legislature enacted chapter 522 of the Acts of 1922, known as the "Two Cent Gasoline Tax Bill," which was designed to create a permanent scheme for the taxation of the privilege of operating motor vehicles over the public roads, streets and highways of the State, and that plan was intended to be in substitution for and not in addition to the then existing methods of taxation. That such was the intention of the Legislature we think is clear from the language of the title, the preamble, and the body of the statute.

So much of the act as need be considered here is thus described in its title:

"An act to provide a portion of the revenue necessary for the maintenance and reconstruction of the public highways of the State by imposing a tax on motor fuels as herein defined, to be paid by dealers as herein defined; with certain rights to refunds as herein set forth; regulating the sale of such fuels, providing for the report of sales of such motor fuels, for the collection of said tax by the Comptroller, and for the disposition of the revenue derived therefrom; providing also for the raising of another portion of the revenue necessary for the maintenance and reconstruction of the roads and public highways of the State by the charging of fees for markers and certificates of registration for motor vehicles, and providing a method of determining the charge per horse power which shall constitute the basis of such fees; providing for the license fees to be paid for solid tire vehicles."

In the preamble the intent and purpose of the act is set out in the following terms:

"Whereas, The present system of charging license fees for the registration of motor vehicles was designed in part to equalize the burden of maintaining and reconstructing the public roads and highways of the State of Maryland by imposing said burden upon those deriving special benefits therefrom; and

"Whereas, The method of raising revenue for said purpose as outlined in this act will more equitably and generally distribute such burden; and

"Whereas, It is deemed that there is a direct relation between the use of highways by a motor vehicle and the quantity of motor vehicle fuel consumed in furnishing the motive power thereof, as well as a direct relation between the weight of the motor vehicles using such highways and the distance which such motor vehicle will travel by such motive power per unit of weight; and

"Whereas, It is deemed that the weight of the motor vehicle and the distance traveled have a direct bearing on the damage to the highways and the wear thereof; and

"Whereas, It is deemed that the speed at which the motor vehicle is driven over the highways has a direct bearing on the damage to the highways and the wear thereof; and

"Whereas, Laws now in force or enacted have taken into consideration the effect of the weight of the motor vehicles and the speed they attain; and

"Whereas, It is deemed proper by the Legislature that the aforesaid burden of maintaining and reconstructing the public roads and highways of the State should be equitably and generally distributed among those who will be benefited more directly by the expenditure of the revenue derived from this act; and

"Whereas, Such a result in the judgment of the Legislature will be accomplished by levying a tax on the quantity of motor fuel purchased for use in propelling motor vehicles on the public roads and highways of the State as hereinafter provided, which said tax shall be deemed a substitute in part for the taxes and license fee now provided by law as more particularly set out in this act; and

"Whereas, It is considered and deemed that a tax levied upon each gallon of motor vehicle fuel purchased for use in motor vehicles is the equivalent of and in its practical effect a license fee and tax upon the motor vehicle itself, and the measure of the use of the highways is in direct relation to the amount of motor vehicle fuels consumed in furnishing the motive power of motor vehicles, and with the license fees and taxes provided by other laws of the State of Maryland, the tax herein provided more nearly renders perfect the proper compensation to be paid by the motor vehicles for the use of facilities provided at great cost for the class for whose needs they are essential and whose operation over the highways are peculiarly injurious."

The act itself provides, first, for the collection of a tax of two cents per gallon on all gasoline sold in the State for use in the operation of motor vehicles and not intended for exportation from the State, second, for the application of the fund collected under said tax to the reduction of the fees or taxes imposed by then existing schedules in such ratio as the fund thus collected would bear to the fund collected under such schedules; and third, for the imposition of certain fixed definite and additional fees for certain classes of motor vehicles, which are very carefully described.

In the body of the act, in the statement of these provisions, various expressions are used which tend to illustrate and interpret its intention as declared in its preamble, such as the following:

"If double the amount of net revenue computed as aforesaid derived from the one cent tax on motor fuels shall exceed the net receipts from the registration of gasoline propelled motor vehicles during the aforesaid period, the Governor shall promptly certify that fact to the Commissioner of Motor Vehicles, and from and after January 1, 1924, the registration fees imposed by article 56 of the Code of Public General Laws in the case of gasoline propelled vehicles equipped with pneumatic tires shall no longer be charged or collected, but in lieu thereof the Commissioner of Motor Vehicles shall charge and collect a registration fee of $1.00 in the case of a gasoline propelled motor vehicle equipped with pneumatic tires owned by a resident of this State and intended to be operated herein. But if twice the sum received from the one cent tax on motor fuels computed as aforesaid shall be less than the net receipts from the registration of gasoline propelled motor vehicles during the same period, then the Governor shall ascertain the ratio which the difference bears to such net receipts from registration, and shall apply such ratio to the 60 cent per horse power now charged in the case of the registration of a gasoline propelled motor vehicle equipped with pneumatic tires, and shall thereby determine the number of cents per horse power which would be necessary to make up such difference. If the result is a fraction of a cent per horse power, then the next nearest and greater whole cent shall be taken. The Governor shall, no later than November 1, 1923, certify the figures so ascertained to the Commissioner of Motor Vehicles, and from and after January 1, 1924, said figures shall be the sum per horse power to be charged and collected in the case of all gasoline propelled motor vehicles equipped with pneumatic tires required by law to be registered in this State in lieu of the rate per horse power now authorized by law. In either event all existing provisions of law relating to the collection, custody, remittance and use of fees charged for registration of motor vehicles shall be applicable to the new flat registration fee of $1.00 or the new rate per horse power. * * * Provided, however, that nothing herein shall change or alter the license fees now provided by law for vehicles using the public highways of the State and propelled by steam or electricity." Section 12. "Nothing in this act shall be construed to repeal or amend the existing law prescribing the fees to be paid by motor vehicles in the regular transportation of passengers or freight on fixed schedules." Section 13.

Considering the purpose which the Legislature had in view as expressed in the language which we have quoted, the scheme of taxation proposed by the act was, as it clearly states, intended to be a substitute for the entire scheme of taxation in force prior to its adoption, except as to such items as were in terms excepted from its operation. As has been noted, the "One Cent Gasoline Tax Bill" is an illustration of the imposition of an additional tax, for it provided for an additional tax dedicated to a specific purpose, applying equally to all vehicles, and abating as soon as the purpose for which it had been passed was accomplished, whereas the "Two Cent Gasoline Tax Bill" on the other hand exemplifies the imposition of substitutional taxation, for it is expressly declared in it that the tax which it imposes "shall be deemed a substitute in part for the taxes and license fees now provided by law as more particularly set out in this act." For the expression "in part for the taxes etc." can only have referred to such special fees as are by the act imposed in addition to the gasoline tax and to such part of the fees provided by the old schedules as should remain after the deduction of the fund accruing from the two cent tax as provided in section 12 of the act, since in the act specific provision is made for the imposition of additional taxes in the case of all classes of motor vehicles which by reason of their character will likely cause special damage, wear and tear to the roads of the State greater than that caused by ordinary vehicles, or which because of their motive power will not necessarily use gasoline in travelling over such highways.

And when the Legislature provided that, if the fund collected from the two cent tax should equal the fund collected under the then existing schedules, "the registration fees imposed by article 56 of the Code of Public General Laws in the case of gasoline propelled vehicles equipped with pneumatic tires shall no longer be charged or collected, but in lieu thereof the Commissioner of Motor Vehicles shall charge and collect a registration fee of one dollar," and that if the sum so collected should not be equal to that realized under the old schedules that the Governor should determine and certify the rate per horse power necessary to be charged in order to make up the difference, and that the figure so certified "shall be the sum per horse power to be charged and collected in the case of allgasoline propelled motor vehicles equipped with pneumatic tires required by law to be registered in this State in lieu of the rate per horse power now authorized by law," it used language too plain to be disregarded, or to require or admit extrinsic aid in its interpretation.

Philip Herwig, the petitioner in this case, is an undertaker engaged in business in the City of Baltimore. In connection with that business he owns and operates an automobile equipped with pneumatic tires rated at thirty-two horse power. The Governor of Maryland, acting under section 12 of the act above referred to, had certified to the Commissioner of Motor Vehicles thirty-two cents per horse-power as the rate to be charged for the registration of gasoline-propelled motor vehicles equipped with pneumatic tires not operated on a fixed schedule from and after January 1st, 1924.

Under what we have referred to as the old schedule, the petitioner's automobile was properly classified under Class F section 141, article 56 of the Code of Public General Laws of Maryland as a hiring car, and as such, under that schedule, subject to a registration tax of $1.20 per horse power. After the certification referred to, the petitioner applied to the Commissioner of Motor Vehicles for registration of the said automobile, and tendered to him ten dollars and twenty-four cents, the amount due under the new rate of thirty-two cents, in payment therefor, but the Commissioner of Motor Vehicles refused to accept such tender or to issue the proper markers and registration for anything less than the old rate of $1.20 per horse power. Thereupon the petitioner filed a petition for a writ of mandamus in the Superior Court of Baltimore City against the appellant, in which, after stating these facts, he asked that court to issue a writ of mandamus commanding the appellant to issue to him proper markers and certificates of registration for 1924 upon the payment of $10.24. The respondent in his answer asserted that the old schedule fixing the fees chargeable for the registration of automobiles classified under Class F, section 141, article 56, supra, was not affected by Chapter 522 of the Acts of 1922, and that under that schedule the proper fee for the registration of the petitioner's automobile was $38.40, computed at the rate of $1.20 per horse power, and he based that contention upon the theory that "there are, and always have been since the passage of section 141, Class A and Class F, of article 56 of the Code, two separate and distinct classifications for purposes of assessment of fees for markers and certificates of registration, viz.: (1) The ``pneumatic classification' (this term being applied to motor vehicles coming within the provisions of Class A), and (2) the ``hiring car classification' (this term being applied to motor vehicles coming within the provisions of Class F), and that the latter classification, namely, the ``hiring car classification,' has not been affected or changed in any manner by Section 12 of Chapter 522 of the Acts of 1922, but that section 141, Class F of article 56, is still in full force and effect in so far as said ``hiring car classification' is concerned." To that answer the petitioner demurred. The Court sustained the demurrer and ordered the writ to issue, and from that order this appeal was taken.

In support of its contention the State argues, first, that the language used in the act "does not manifest an intent upon the part of the Legislature to provide a reduction of the charge for markers and certificates of registration for hiring cars." In respect to that contention it is sufficient to say, in view of what has already been said, that the language employed refers to "all gasoline-propelled vehicles equipped with pneumatic tires required by law to be registered in this State," and that that phrase undoubtedly includes hiring cars which are equipped with pneumatic tires and which are required by law to be registered in this State, and in view of that language it is idle to discuss whether the Legislature did or did not intend to provide a reduction in the charge for the registration of such cars, since that was the necessary and inevitable consequence of its act.

It is next urged that "there is no legal impropriety in fixing license fees to be paid by ``hiring cars' irrespective of fees required for cars privately owned and operated." The answer to this contention is that whether it is or is not proper to require hiring cars to pay fees "irrespective of fees required for cars privately owned and occupied" is wholly immaterial, since in this case no such distinction has been made.

Again it is contended that "the revenue derived under the ``Two Cent Gasoline Tax Bill' was not intended as a substitute for the revenue derived under section 141 of article 56, but the Legislature intended by said later act to increase the State's revenue by imposing an increased or additional tax on all classes of motor vehicles.

For reason already stated in our opinion, that construction of the act is in direct conflict with its terms and cannot be sustained.

It is for these reasons that the per curiam order heretofore filed in this case affirming the order appealed from was passed, and it is in connection with that order that this opinion is filed.