Case Name: Matter of Supplementary Proceedings for the Collection of a Tax of Union Trust Co.; Matter of Supplementary Proceedings for the Collection of a Tax of the Fidelity Trust Co.; Matter of Supplementary Proceedings for the Collection of a Tax of Union Trust Co.
Court: New York Supreme Court
Jurisdiction: New York
Decision Date: 1904-02
Citations: 42 Misc. 581
Docket Number: 
Parties: Matter of Supplementary Proceedings for the Collection of a Tax of the Rochester Trust & Safe Deposit Co. Matter of Supplementary Proceedings for the Collection of a Tax of the Fidelity Trust Co. Matter of Supplementary Proceedings for the Collection of a Tax of Union Trust Co.
Judges: 
Reporter: New York Miscellaneous Reports
Volume: 42
Pages: 581–584

Head Matter:
Matter of Supplementary Proceedings for the Collection of a Tax of the Rochester Trust & Safe Deposit Co. Matter of Supplementary Proceedings for the Collection of a Tax of the Fidelity Trust Co. Matter of Supplementary Proceedings for the Collection of a Tax of Union Trust Co.
(Supreme Court, Monroe Special Term,
February, 1904.)
Tax—Power of the Legislature to remedy an inadvertent repeal of am act granting trust companies an exemption from other taxation upon payment of a franchise tax.
Where the Legislature has through inadvertence repealed, by an amendment to the Tax Law, an exemption from certain taxes theretofore paid by trust companies, which companies by such act are made subject to the special franchise tax, it has power by a retrospective act to correct such unintentional repeal, in such wise as to relieve the trust companies from taxes, embraced within such former exemption, assessed upon them between the date of the repeal of the exemption and the passage of the act restoring it.
Motions for the dismissal of supplementary proceedings.
John P. Morse, for John B. Hamilton, county treasurer.
William FT. Cogswell, for Rochester Trust & Safe Company.
Foote, Perkins & Havens, for Fidelity Trust Company.
Elbridge L. Adams, for Union Trust Company.

Opinion:
Rich, J.
These are motions in behalf of delinquent tax debtors to dismiss supplementary proceedings to collect an unpaid county tax for the year 1901, which proceedings were instituted under section 259 of the Tax Law. The motions for the dismissal of the proceedings are made on the ground that the taxes levied against said trust companies under which the proceedings were instituted are illegal and void, and also that section 259 of the Tax Law under which proceedings are instituted is unconstitutional in that it does not provide for equal process of law.
Chapter 132 of the Laws of 1901 amends the General Tax Law of the State by adding a new section to be section 187a, which section provides for the franchise tax on trust companies payable to the State.
Section 2 of this act amends section 189 of the Tax Law by adding thereto a subdivision to be subdivision 7 thereof, which provides for the reports by trust companies to the State Comptroller.
Section 3 amends section 194 of the Tax Law by providing the time of payment of the tax upon trust companies.
Section 4 of this act amends section 202 of the Tax Law by providing for the exemption of trust companies from assessment and taxes for State and all other purposes except the organization tax, if all the taxes due and payable under this article have been paid.
Section 5 provides that this act shall take effect immediately.
This act became a law on March 21, 1901.
On April 25, 1901, chapter 535 of the Laws of 1901 became a law.
Section 1 of this act provides that chapter 132 of the Laws of 1901, entitled " An Act to amend the tax law in relation to the taxation of trust companies is hereby amended so as to read as follows:"— and provides for a franchise tax on trust companies payable to the State, but omits the exemption clause contained in chapter 132 of the Laws of 1901 which it amends.
Section 2 provides that this act shall take effect immediately.
On March 17, 1902, chapter 172 of the Laws of 1902 became a law. Section 1 of this act provides that sections 2, 4 and 5 of chapter 132 of the Laws of 1901, entitled "An act to amend the tax law, in relation to the taxation of trust companies," which were inadvertently repealed by chapter five hundred and thirty-five of the laws of nineteen hundrer and one, entitled "An act to amend the tax law, in relation to the taxation of trust companies " are revived and re-enacted and shall be deemed to be continued in force since the date when said sections originally took effect as follows:" — and then re-enacts subdivision 1 of section 189 of the Tax Lav? in regard to reports to State Comptroller, and also section 202 of the Tax Law in regard to exemption from other taxes.
The county taxes for the county of Monroe for wards within the city of Rochester are assessed pursuant to section S3 of the charter of the city of Rochester as amended by chapter 119 of the Laws of 1900.
This section provides that the city assessors shall assess the real and personal property within the city of Rochester by the fifteenth day of January in each year, and shall deliver the rolls to the clerk of the city on or before the fifteenth day of April in each year, and shall make and certify a copy of the assessment-books as they shall then exist, and deliver the same to the supervisors of the several wards respectively for use of the board of supervisors of Monroe county on or before the first day of October in each year. The section further provides that the said assessors are hereby directed and empowered to make such additional amendments and corrections in said assessment-rolls as to the names of the actual owners or occupants and values of real and personal estate therein assessed as they shall deem proper at any time before the first day of July in each year.
The personal property of a corporation is taxable unless exempt from taxation by law. Tax Law, § 3. It is conceded that chapter 132 of the Laws of 1901, which became a law on March 21, 1901, not only imposed a franchise tax on trust companies, but also exempted trust companies from taxation for State and other purposes except the organization tax, upon the condition that the franchise tax was paid. This act immediately became the law in regard to the taxation of trust companies within the State of Hew York, and it remained the law under which the assessors were bound to act until the 25th day of April, 1901, when chapter 535. of the Laws of 1901 became a law.
The trust companies paid the franchise tax imposed in August, 1901.
I think it must be held that chapter 535 of the Laws of 1901, by amending chapter 132 of the Laws of 1901 so as to-read as prescribed in the amended act, worked a repeal in so-•much of the former act as was not included in the original-act. People v. Wilmerding, 136 N. Y. 363.
It is at the same time perfectly apparent that it was not intended to have such an effect. If such were the effect the-provisions for ascertaining the amount of the franchise tax. are omitted, and the trust companies will be subject to a double taxation. The Legislature undertook to remedy this-inadvertence in 1902 by re-enacting the omitted sections in the amended law and providing that the sections revived and re-enacted should be deemed to be continued in force since-the date the said original sections took effect.
While it is true, as contended by counsel for both parties,, that the court and' not the Legislature is the proper tribunal to declare what is or has been the law, still the Legislature has power to cure, retrospectively, defective or irregular-proceedings to levy, assess or collect taxes, provided no injustice be inflicted thereby. Vandeventer v. Long Island City, 57 Hun, 590; People v. Turner, 145 N. Y. 451; Smith v. City of Buffalo, 90 Hun, 118; Wrought Iron B. Co. v. Town of Attica, 119 N. Y. 204.
The taxing power of the Legislature is practically absolute, except as restrained by constitutional limitations. People v. Fitch, 148 N. Y. 71; Genet v. City of Brooklyn, 99 id. 296.
It also has the power to exempt certain classes of property from taxation, even retrospectively. People ex rel. A. B. Society v. Commissioners, 142 N. Y. 348; State v. St. Louis, K. C. & N. R. Co., 79 Mo. 420; Cooley Const. Lim. (6th ed.), 454.
I am, therefore, of the opinion that chapter 172 of the-Laws of 1902 had the effect of exempting the property, of trust companies from the local taxes in question.
The order asked for by the trust companies should be? granted, without costs.
Motions by trust companies granted, without costs.