Case Name: NELSON MACHINERY COMPANY, an Arizona corporation, Appellant, v. YAVAPAI COUNTY, a body corporate and politic, Appellee
Court: Arizona Supreme Court
Jurisdiction: Arizona
Decision Date: 1971-12-14
Citations: 108 Ariz. 8
Docket Number: No. 10441
Parties: NELSON MACHINERY COMPANY, an Arizona corporation, Appellant, v. YAVAPAI COUNTY, a body corporate and politic, Appellee.
Judges: STRUCKMEYER, C. J., and LOCKWOOD, J., concur.
Reporter: Arizona Reports
Volume: 108
Pages: 8–12

Head Matter:
491 P.2d 1132
NELSON MACHINERY COMPANY, an Arizona corporation, Appellant, v. YAVAPAI COUNTY, a body corporate and politic, Appellee.
No. 10441.
Supreme Court of Arizona, In Banc.
Dec. 14, 1971.
Rehearing Denied Jan. 11, 1972.
Twitty, Sievwright & Mills by Howard A. Twitty, Phoenix, for appellant.
Thelton D. Beck, Yavapai County Atty., Prescott, for appellee.

Opinion:
CAMERON, Justice.
This is an appeal by the plaintiff, Nelson Machinery Company, from an order of the Superior Court granting defendant Yavapai County's motion to dismiss the complaint.
We are called upon to determine whether the legislature did require a person claiming a constitutional "self-executing" exemption from the payment of an inventory tax to file an affidavit before such exemption may be granted.
The facts are not in dispute and are briefly as follows. Nelson Machinery is a retailer and wholesaler engaged in the resale of used mining machinery and equipment. On 30 December 1968, Nelson Machinery purchased used mining equipment which was kept as inventory in the course of its business. There is no dispute that under Article 9, § 2 of the Arizona Constitution, A.R.S., this inventory was exempt from taxation.
The Assessor of Yavapai County, on 3 February 1969, determined the value of the property to be $847,276.00 and assessed taxes in the amount of $15,784.61. In October of 1969, the Sheriff of Yavapai County threatened to seize this inventory unless the tax was paid and on 20 October 1969, Nelson Machinery filed a merchan-dise exemption form claiming an exemption under Article 9, § 2 and on 26 November 1969 paid, under protest, the tax assessed plus interest and penalties. Nelson Machinery then sought to recover these amounts in the trial court action.
The question presented in this appeal is strictly one of law. There is no dispute as to whether the inventory was intended to be exempt under Article 9, § 2 of the Arizona Constitution. The sole question is whether the legislature by § 42-274 and § 42-275 A.R.S. required the plaintiff to file the necessary affidavits in order to take advantage of the inventory exemption.
Article 9, § 2 of the Arizona Constitution, as originally adopted in 1910, included several exemptions but did not, at that time, include the inventory exemption. In 1929, § 42-274 and 42-275 were enacted. These sections read as follows:
Ҥ 42-274. Affidavit
"A. A person claiming exemption from taxation under the provisions of § 2, article 9, constitution of Arizona, shall ap pear before the county assessor and make affidavit as to his eligibility, answering fully all questions appearing on a form provided by the county assessor for such purpose or otherwise propounded, but a person in the military service of the.United States who is absent from the-state, or who is confined in a veterans' hospital or in any licensed hospital, may make the required affidavit in the presence of any officer authorized to administer oaths upon a form obtained from the county assessor.
"B. . A false statement made or sworn to in the affidavit shall constitute and be punishable as perjury.
"§ 42-275. Proof of exemption "The assessor may, in his discretion, require additional proof of the facts stated by the affiant before allowing an exemption. Failure upon the part of a person entitled to exemption to make affidavit or furnish evidence as required by this article between the first Monday in January and April 30 each year shall be deemed a waiver of such exemption."
Later, in 1964, the inventory exemption was added to Article 9, § 2 of the Arizona Constitution. In 1967, the legislature reenacted § 42-275 A.R.S., and in 1970, the legislature re-enacted § 42-274 A.R.S. We are concerned with the year 1969, so the 1970 re-enactment of § 42-274 A.R.S. is irrelevant for our purposes.
It is appellant's contention that § 42-274 A.R.S., first enacted in 1929 and last amended in 1951, referred to the exemption clause of Article 9, § 2, as it existed at that time and not as it was later amended. Appellant contends that when statute "A" adopts a part or all of statute (or constitutional clause) "B" by a specific reference, such adoption takes statute or clause "B" as it exists at the time of the enactment or re-enactment of statute "A" and does not include subsequent additions or modifications of statute or constitutional clause "B". Applied to the instant case, § 42-274 A.R.S. would apply only to' those exemptions allowed by Article 9, § 2 of the Arizona Constitution, in existence in 1929 or at the time the statute (§ 42-274 A.R.S.) was amended in 1951:
" [Wjhen a statute adopts a part or all of another statute by a specific and descriptive reference thereto, such adoption takes the statute as it exists at the time of adoption and does not include subsequent additions or modifications of the statute unless it does so by express intent." 168 A.L.R. at 631.
However persuasive this argument might be, Clements v. Hall, 23 Ariz. 2, 201 P. 87 (1921); Dairy and Consumers Co-op Ass'n v. Arizona Tax Commission, 74 Ariz. 35, 243 P.2d 465 (1952); Maricopa County v. Osborn, 60 Ariz. 290, 136 P.2d 270 (1943), the primary purpose of all statutory construction is to determine legislative intent and in the case of a constitutional clause to give effect to the intent and purpose of the framers (here the legislature) and of the people who adopted it. Apache County v. Southwest Lumber Mills, Inc., 92 Ariz. 323, 376 P.2d 854 (1962). There is nothing in Article 9, § 2 to indicate that the legislature or the people intended that the exemptions granted by that section should not be subject to reasonable legislation to provide for an orderly process by which a person claiming an exemption could obtain one. Indeed, quite the opposite appears when the exemption clause as to household furniture, also in Article 9, § 2, is read:
" All household goods owned by the user thereof and used solely for noncommercial purposes shall be exempt from taxation, and such person entitled to such exemption shall not be required to take any affirmative action to receive the benefit of such exemption. »
Had the legislators in drafting the inventory clause wanted to dispense with the affidavit requirement, as they did in' the household goods exemption clause, they would have included such language in the provision for inventory exemption. The reason for treating household goods differently from inventory is certainly reason able. Household goods are easily identifiable and the assessor is directed to ignore this type of property exempt by the Arizona Constitution. This is not so with a business inventory which at times may not be so easily identified as inventory.
The re-enactment of § 42-275 A.R.S., after the inventory provision had been approved by the voters, indicates the intent .of the legislature that an affidavit (as provided in § 42-274 A.R.S.)- be required before a person might claim his exemption as provided in the Arizona Constitution.
There is another reason why the appellant cannot prevail. § 42-274 A.R.S. is a procedural statute. It does not affect the rights provided for under Article 9, § 2 of the Arizona Constitution. Rather, it provides a procedure whereby these rights can be exercised. Such a statute is not only reasonable, but necessary. As this court stated in reference to the veteran's exemption:
" -[I]t appears to us reasonable and proper that some method should be provided by the legislature, for the deter-ruination of those who may be entitled to .the exemption provided for in the Constitution." State v. Allred, 67 Ariz. 320, 327, 195 P.2d 163,168 (1948).
.'Furthermore, our ' Court of Appeals has stated:
" [W]hen the constitutional amendment was enacted by the electors of this state, without expression of a contrary intent,' they were aware of the existence of A.R.S. § 42-274." Fry v. Mayor and City Council of Sierra Vista, 11 Ariz.App. 490, 494, 466 P.2d 41, 45 (1970).
We hold that the legislature could provide a reasonable method for claiming the exemption, pursuant to Article 9, § 2 of the Arizona Constitution, and has in fact done so,- by § 42-274 and § 42-275 A.R.S. Nelson^Machinery, having failed to comply with this reasonable..regulatipn, waived its right to claim this inventory .exemption and is not entitled to the exemption for the year in question.
Judgment affirmed.
STRUCKMEYER, C. J., and LOCKWOOD, J., concur.
NOTE: HAYS, V. C. J., having disqualified himself, did not participate in the determination of this matter.