The Hawaiian gazette., 1907-11-22
OPINION OF THE COURT BY
WILDER. J,

OPINION OF The COURI By
WILDER, J.
This is a reserved question from the
First Circuit Court to determine whether
under Sec 1923 of the Revised Laws
defendant s interest as lessor in a
piece of land is exempt from taxation
when the land is in actual use by the
lessee for the production of pineapples.
This section as originally passed was
Act 80 Of the Session Laws of 1908,
being entitled Gan Act to encourage
diversified industries" and reading as
follows:
''For the next five years all prop
erty, real and personal, actually in use
for the production of pine
apples shall be exempt from
taxation of any kind"
The proposition that exemptions from
taxation are strictly construed, in other
words. that taxation is the rule and
exemption the exception, is well set
tied Bishop VS.. Gulick, Haw. 627,
$50; o. L. L. Co. VS.. Shaw, u Haw.
76. As the United States Supreme
Court puts it, "a doubt is fatal to
the claim of exemption. Theological
Seminary vs. Illinois, ISS U. S. co., 672.
islature could do but what it did do
that Is, 1t is a question of construction.
This statute should be construed in
connection with the system of tax laws
IN existence at the time of its passage.
in Halstead VS.. Pratt, IA Haw. IS, SO,
1t is said that 1.-THE general rule is
that statute should be construed with
reference to the system of laws of
which II is a part unless contrary
intention clearly appears. If this were
not so. statutes would often have to be
given absurd constructions, for they
often do not contain express provisions
as TO the extent of their operation in
this Sespect."
The general system of taxation then
in existence is set out in Chapter 9S
of the Revised Laws. A specific amount
Is payable by certain male inhabitants
known as poll, school and road taxes.
Carriages, bicycles and dogs are taxed
u certain amount which is payable by
the owners thereof. Sec. 1912 r. L. |
reads that, Except as otherwise pro-
vided all real property and all per-
sonal property within the Territory
shall be subject to an annual tax of |
one per cent upon the full cash value |
OF the same The meanings of real
property and of personal property for
purposes OF taxation are set out. Under
See. 12l6 r. /. it is provided that "All
real and personal property and the in
terest Of any person in any real or per-
SOnal property shall be assessed sep
arately as to each item thereof for its
full cash value and in Sec. 1917 R. L.
that The interest of every person in
any property shall be separately as
sessed and every person shall
be liable to taxation in respect of the
full value of his interest in such prop
erty.o Certain exemptions as to prop
erty ana persons are allowed. In !
dividuals, corporations and companies {
are required to make returns of prop
erty owned by them or in their pos
session and assessments are made to or !
against them for their interests in prop I
erty, and in the case of persons un- $
known OF nonresident they are assess c
ed as such. There are provisions for '
appeals from assessments and for the q
collection of taxes. The system as t
whole IN theory and in practice. so n
far as real property is concerned, is I
10 tax persons for their interests in a
such property. 1t is very common to +
speak OF assessing and taxing prop II
erty, but under our system such an eX-
preston Is not exact. For instance, ini :,
Holt vs. Savidge, II Haw. 81, and in
Long vs. Holt. l. Haw. 19S, this court .
held that the assessment should be made =
10 some one ''whose duty it was to /
pay the taxes. 5"
To hold that this 1908 statute ex- =
ampted a lessor from taxation on his q
interest in land used by the lessee W
for the production of pineapples would u
be an implied repeal of the then ex-
sting laws as to assessing and taxing la
he separate interests of persons in such .
property, which under Sec. q R. L.
,niy follows ''when the new law con- ell
aims provisions contrary to. or ire W
,oncilable with, those of the former el
aw" is
There is no doubt but that one of ii
he purposes of the exemption was to as
encourage and promote the W
of pineapples. The actual til
ser OF property for that purpose is al
ireetly benefited by having no taxes Sc
o pay on his interest therein. That pr
he production of pineapples is not di- is
ectly encouraged by exempting lessor or
rom paying taxes on his interest in it
and so used, who, from all that APP m;
ears. gets as much rent as if the by
roperty was used for some other pur- no
ose, is substantially the line of rea- tn
oning in State VS.. Macgurn, 1877 Mo. les
80, holding that lessor s interest in tn,
md leased to the public for school ses
imposes is not exempt although the wa
institution exempted lots used exclu pr,
vely for schools. See also County of tn,
Lennepin VS. Bell, 43 MINI. 344. and wa
raveler's Insurance Co. VS.. Kent, so pre-
7. E. (Ind) 562, to the same effect. tai
ut 1t is suggested that the production pic
pineapples would be encouraged in ma
rectly by exempting the lessor of land fro
sed for that purpose because the les
'e IN any event either by covenant is {
the lease or by having to pay a on
CHER rental would have to pay the {
xes assessed to the lessor, and prob for
by that is so, although it does not 1
appear in this ease. bri