Case Name: Goldsmith, comptroller-general, vs. The Southwestern Railroad Company. The Southwestern Railroad Company vs. Goldsmith, comptroller-general
Court: Supreme Court of Georgia
Jurisdiction: Georgia
Decision Date: 1879-02
Citations: 62 Ga. 495
Docket Number: 
Parties: Goldsmith, comptroller-general, vs. The Southwestern Railroad Company. The Southwestern Railroad Company vs. Goldsmith, comptroller-general.
Judges: Bleckley, Justice, concurred.
Reporter: Georgia Reports
Volume: 62
Pages: 495–509

Head Matter:
Goldsmith, comptroller-general, vs. The Southwestern Railroad Company. The Southwestern Railroad Company vs. Goldsmith, comptroller-general.
[These cases were argued at the last term, and decision reserved.]
No proper return — such as is required by the act of 1874 as a condition precedent to the remedy by affidavit of illegality in Fulton superior court — having been made by the Southwestern Railroad Company — returning and itemizing the- property of said corporation— the remedy by such affidavit is not given to said company, and the superior court of Fulton county had no jurisdiction of the case, and the affidavits should have been dismissed. The complications of this case render a bill in equity the more appropriate remedy independent of the question of jurisdiction.
Warner, C. J., dissented.
Tax. Railroads. Jurisdiction.- Laws. Before Judge Grice. Fulton. Superior Court. April Term, 1S78.
The comptroller-general issued two tax y?, fas. against the Southwestern Railroadfor taxes for 1876 and 1877, and penalties for non-payment, assessing them “from the best information he could procure.” The defendant filed an affidavit of illegality to each f. fa., claiming exemption under its charter from any tax greater than one-half of one per cent, on its net annual income, and alleging that neither the tax nor penalty was due ; that it had made returns as required by the act of 1874, and paid the legal tax above stated ; and that the property tax now sought to be enforced was illegal and. illegally assessed. The two cases were tried together. The state demurred to the affidavits on the following, among other grounds:
(1.) Because if said limited rate of taxation ever was a valid contract between the state and said company, it applied to a railroad to be built from the city of Macon to some point intermediate between Albany and Fort Gaines, or to some point on the Flint or Chattahoochee rivers below Albany and Fort Gaines; that the termini of said road was Distinctly fixed in the charter, but in point of fact said road, meaning the main line thereof, was not built to either of said points, but to the city of Eufaula, without authority, and hence said company cannot legally claim the benefit of said limited rate of taxation, and that the roads taxed by the fi.fa. are not the roads subject only to limited taxation.
(2.) Because by the act of 1850, amending the act incorporating said Southwestern Railroad, authority was given by the legislature to build a branch of said road from some point on said road to some point on the Chattahoochee river below the town of Florence, that said branch road was built under said amendment. Said amendment did not confer said limited rate of taxation upon said branch, and hence the same is liable to taxation as other property in this state.
(3.) Because the said Southwestern Railroad Company, on the-day of-, 18 — , leased all of its roads and appurtenances, and all of its property, perpetually to the Central Railroad and Banking Company, of said state' of Georgia, and according to law said privilege of limited taxation, granted by the original charter of said Southwestern Railroad Company, did not pass to the Central Railroad Company and ceased, and determined by operation of said act of alienation and the stipulations of said lease that the Central Railroad should pay all taxes due, and to be due, the public by said Southwestern Railroad Company.
(4.) Because by the consolidation of the Southwestern Railroad and the Muscogee Railroad in 1868, the privilege of limited taxation secured to the Muscogee Railroad by its charter, did not pass to the Southwestern Railroad Company, except by the contract of consolidation in 1868, which was repealable, and was repealed, by the act of 1874, and the acts amendatory thereof, saia contract of consolidation being a sale of the Muscogee Railroad to the Southwestern Railroad, by which the exemption could not pass, except by virtue of the repealable act of the acts of 1855.
(5.) Because by the act incorporating said Southwestern Railroad, no limited rate of taxation was prescribed for the branches authorized to be built, and hence the branch road from Cuthbert to Fort Gaines is liable to taxation separate and apart from the main line of said road, and said company has never paid the property tax required by law on said branch.
(6.) Because the Southwestern Railroad has not paid the tax required by law upon its increased capital stock, authorized by the acts of the legislature of December 10,1860, and December 18, 1860, amounting to $445,900.00.
(7.) Because the Southwestern Railroad has no exemption upon that portion of said road from Fort Yálley to Butler, (called, in the act amending the charter, Wolfs Pen.)
By agreement, the cases were submitted to the court without a jury. Yaiious resolutions, reports, etc., relating to the extensions of the road, their cost, etc., were introduced in evidence, but are not material here.
The returns made by the comptroller-general, from which he issued said fl. fas., are as follows :
“ Annual tax returns of the Southwestern Railroad Company, of all property owned by said company on the 1st day of May, 1876, made to the comptroller-general by the president, by virtue of an act approved February 28,1874, without deducting the indebtedness of said company: No. acres of land, 5,000 ; value of land, $9,990.50. No. of bridges, 31; value of bridges, $260,000.00. No. of depots and other buildings, 75 ; value of depots and other buildings, $197,000.00. No. of engines, 31; value of engines, $250,-000.00. No. of cars, 417; value of cars, $275,000.00. Yalue of bonds owned, $6,900.00. No. of shares bank, railroad or other stock owned in other ompanies, 6,413 ; value of bank, railroad or other stock owned in other companies, $431,856.46. Yalue of property owned in steamships, ships and other craft — all other capital, $24,719.63. No. of miles of track, 306 ; value of track, including iron, ties, etc., $4,173,942.44. Notes, $11,250.41.
Total value of all property enumerated.... $5,640,659 99
Tax at-of one per cent..................$28,203 29
Credited by net income tax at one-half of one per cent, paid.......................... 1,561 19
$26,642 10
“ This return is made by the comptroller-gene ral according to law, from the best information he could procure.
(Signed) W. L. Goldsmith,
December, 1877. Coiwptroller-qeneralP
The return of May 31, 1877, was merely a duplicate of the preceding.
The defendants proved by W. L. Goldsmith, comptroller-general, that the taxes of these roads were duly given in for the years 1874, 1875 and 1876, both on the gross and net income, and on the value of their property, as required by the tax act of those years, and that they paid the taxes of one-half (§■) of one per cent, per annum, he, as comptroller-general, sending them printed forms on which to make their said annual returns; that for the year 1877, and after the decision of the supreme court of the United States was made, he only sent those roads printed forms applicable to taxes on their income, and they made, for that year, a return on such blank forms of the amount of gross receipts and net income, which was received without objection or protest, and the taxes returned were duly paid. That after these were so made and accepted, and the taxes paid, he, as comptroller-general, without notice to those railroad companies, or either, and without' calling on them for any further or other return, issued these executions, based solely on the returns made by these roads of the value of their property in 1874, under the act of that year. Neither of said roads have paid any taxes on their property for the years for which these fi.fas. were issued, excepting that on their net income.
In 1876 the president of the Central Railroad made the following return, in which wasGncluded the returns both for the Central and Southwestern Railroads :
Annual tax returns of the Central and Southwestern Railroads from the 1st day of September, 1875, to the 31et day of August, 1876, at one-half per cent, on net earnings ; made to. the comptroller-general, by the president: Name of the company, Central and Southwestern Railroads; state where chartered, Georgia; gross receipts, $2 041,-429.28 ; net earnings, $312,238.10 ; tax of one-half percent., $1,561.19. (Sworn to by president.)
The return for 1877 was similar in form, differing only in amounts.
The presiding judge rendered the following decision :
“ This case having been referred to me, by consent, for determination upon the law and facts, it is, after argument, considered and adjudged that the partial immunity from taxation granted in the charter to the Southwestern Railroad Company, as well as that to the Muscogee Railroad Company, in its charter, continues unaffected by merger or lease. I further hold that the extent of this immunity has not been decided by the supreme court, but is still an open question.
“ In my judgment, the Southwestern Railroad Company, with its appurtenances, is exempt from taxation, except as specified in the charter, upon the road and its branches built under the original charter, to-wit: the road from Macon to Americus, from Smithville to Cuthbert, and from Cuthbert to Fort Gaines. The branches built under amendments to the charter containing no express exemption, are subject to the tax of 1874, and such of them as have not paid the tax are liable for it under these executions. The company is also liable for that part of the Western Road of Alabama which is located in this state.
“Being unable to determine, from the proof, what taxes are still due on other property of the company, I make no further attempt at specification, and decide nothing as to its liability for taxes on other property, whether mentioned in the demurrer or not. The tax on the road from Americus to Albany has been paid, and the illegality is sustained as to that part of it.
“ I therefore overrule the demurrer as a whole, and sustain the affidavit of illegality as to all of said tax except that above specified, upon the sole ground that I eann.ot ascertain from the evidence what taxes are still due and what are not. It is further ordered that this is not to be held as an adjudication of the right of the state to proceed hereafter for taxes on such other property for the years 1876 and 1877.
“ Let the execution proceed for.$2,000.00 for each of the years 1876 and 1877, being the unpaid tax for each of said years on the branches of the road indicated above, and on that part of the Western Road of Alabama which is situated in Georgia; and let the illegality be sustained for the remaining part of said executions.”
Both parties excepted.
R. N. Ely, attorney-general; R. Toombs; D. M. DuBose, for the comptroller-general.
A. R. Lawton ; Lyon & Gresham, for the railroad.

Opinion:
Jackson, Justice.
The record in this case as in that of the The State vs. The Augusta and Savannah Railroad Company, and The State vs. The Georgia Railroad and Banking Company, and The State vs. The Central Railroad and Banking Company, shows no such returns made by this company for the years 1876 and 1877 as entitles the company to the remedy by affidavit of illegality in Fulton superior court. Those returns are required by the act of 1871, and modifications thereof in subsequent acts, as conditions precedent in order to entitle the company to this remedy. The affidavit of illegality should, therefore, have been dismissed for want of jurisdiction in the court to try it. The facts of the case are so complicated that more adequate relief can be afforded in equity, and that would seem to be the better forum independently of the question of jurisdiction. '
Judgment reversed.
Bleckley, Justice, concurred.