Atlantic & N. C. R. R. Co. v. Board of Commissioners of Carteret County

1. The Constitution, Art. V, sec. 3, provides that all property, real and personal, shall be taxed by a "uniform rule," according to its "true value in money."

The statute (1874-'75, chap. 184, sec. 11, subsec. 3) provides that railroad beds shall be given in the counties where they lie, and that they shall not be valued at less than $8,000 per mile.

Now, if the Legislature were to enact that every man's land shall be valued at eight dollars per acre, without regard to its real, value, its conflict with the Constitution would be manifest. And so, if it provided that no man's land should be valued at less than eight dollars per acre, although it be worth much less.

We have to declare, therefore, that the aforesaid statute under which the defendants made the valuation of the road bed, as we infer from their letter to the plaintiff, is unconstitutional.

2. The State owns two-thirds of the capital stock of the road, and yet the defendants valued the road as if the State had no property in it.

The plaintiff complains of this because the Constitution, Art. V, sec. 6, provides that "property belonging to the State shall (476) be exempt from taxation."

Although this language is general, yet we do not think it was intended to embrace this case. The Capitol is not taxed because the State would be paying out money just to receive it back again, less the expenses of handling it. And if taxed for local purposes it would to that extent embarrass the State government.

Nor is it any hardship upon the locality to have the property exempt, as the advantages from it are supposed to compensate for the exemption. And, as with the Capitol, so with other State property.

But where the State steps down from her sovereignty and embarks with individuals in business enterprises, the same considerations do not prevail. The State does not engage in such enterprises for the benefit of the State as a State, but for the benefit of individuals or communities — at least this is generally so — and if the State gets no taxes she may get nothing. Suppose, for illustration, that the plaintiff should declare no dividends and consume the whole earnings in current expenses; in that case the State as a State would never derive anything from the road except the taxes.

At any rate, we do not think the exemption in the Constitution embraces the interest of the State in business enterprises, but applies to the property of the State held for State purposes.

The property may be valued upon the basis of this opinion, and that such valuation may be collected, and the excess, if any, restrained.

PER CURIAM. Error.

(477)