Title: Pacific States Marine Fisheries v. Dept. of Rev.
Citation: N/A
Docket Number: S055392
State: Oregon
Issuer: Oregon Supreme Court
Date: April 9, 2009

FILED: April 9, 2009
IN THE SUPREME COURT OF THE STATE OF OREGON
PACIFIC STATES MARINE FISHERIES COMMISSION,
Plaintiff-Appellant,
v.
DEPARTMENT OF REVENUE
and MULTNOMAH COUNTY ASSESSOR,
Defendants-Respondents.
(OTC 4771; SC S055392)
En Banc
On appeal from the Oregon Tax Court.*
Henry C. Breithaupt, Judge.
Argued and submitted December 9, 2008.
James E. Mountain, Jr., Harrang Long Gary
Rudnick PC, Portland, argued the cause and filed the briefs for appellant. 
With him on the briefs was Jona J. Maukonen.
Jed R. Tomkins, Assistant County Attorney,
Portland, argued the cause and filed the brief for respondents.  With him on
the brief was Agnes Sowle.
KISTLER, J.
The judgment of the Tax Court is affirmed.
*19 OTR 349 (2007).
KISTLER, J.
The question in this case is whether
the Pacific States Marine Fisheries Commission (Pacific Fisheries) is a
"public * * * corporatio[n] in this state" and thus entitled to a
property tax exemption under ORS 307.090.  The Tax Court held that, because
Pacific Fisheries is not a "public corporation," it is not entitled
to a tax exemption.  The court entered judgment accordingly.  Pacific States
Marine Fisheries v. Dept. of Rev., 19 OTR 349 (2007).  We affirm the Tax
Court's judgment but for a different reason.  We hold that, although Pacific
Fisheries is a "public corporation," it is not a public corporation
"in this state," as that phrase is used in ORS 307.090.
The facts are taken from
the stipulated facts submitted to the Magistrate Division and supplemented in
the Regular Division of the Oregon Tax Court.  In 1947, the States of
Washington, California, and Oregon entered into an interstate compact to create
a commission, Pacific Fisheries, to investigate and advise its member states
about "the conservation of the marine, shell, and anadromous fisheries in
all of those areas of the Pacific Ocean over which the signatory states * * *
have or may hereafter acquire jurisdiction."  ORS 507.040 art IV.(1) 
The commission is composed of representatives appointed by each state; each
representative serves a four-year term.  Id. art III.  Each state is
limited to one vote, and all actions taken by Pacific Fisheries must be
supported by an affirmative majority vote of the states present at the
meeting.  Id. art III, VI.  The compact directs Pacific Fisheries to
elect a chair and a vice chair and adopt rules and regulations for the conduct
of its business.  Id. art V.  The compact also authorizes Pacific
Fisheries to appoint officers, hire employees, and open offices.  Id. 
Finally, the compact continues in force, and the commission it creates
continues to exist, until the member states dissolve the compact by withdrawing
from it.  Id. art XI. 
In 2003, Pacific
Fisheries entered into a ten-year lease with a private company for office space
located in Multnomah County.  The lease provides that Pacific Fisheries' rent
will be reduced for any tax savings the lessor realizes as a result of any
property tax exemption Pacific Fisheries obtains.  Shortly after it entered the
lease, Pacific Fisheries applied to Multnomah County for a tax exemption under
ORS 307.112(1) and ORS 307.090.  On September 23, 2004, Multnomah County denied
the application based on its determination that Pacific Fisheries is not an
exempt organization under ORS 307.090.  Pacific Fisheries filed for relief in
the Magistrate Division of the Tax Court, which upheld the county's
determination.
Before the Regular
Division of the Tax Court, Pacific Fisheries and the county filed cross-motions
for summary judgment.  The Tax Court granted the county's motion and denied
Pacific Fisheries' motion.  Pacific States Marine Fisheries, 19 OTR at
356.  The court held that Pacific Fisheries is not a "public
corporation" within the meaning of ORS 307.090 and thus was not entitled
to an exemption.  Id. at 355.  The Tax Court entered judgment in favor
of the county, id. at 356, and Pacific Fisheries appealed to this court.
ORS 307.112(1) provides
that, if a property owner leases property to a public body (other than the State
of Oregon) and if the public body qualifies for a tax exemption under ORS
307.090, then the owner is not subject to property tax on the leased property.(2) 
ORS 307.090(1) identifies which public bodies are eligible for a tax
exemption.  It provides:
"Except as provided by law, all property of
the state and all public or corporate property used or intended for corporate
purposes of the several counties, cities, towns, school districts, irrigation
districts, drainage districts, ports, water districts, housing authorities and
all other public or municipal corporations in this state, is exempt from
taxation."
ORS 307.090(1).
In this case, the county does not
argue that the property Pacific Fisheries leased does not constitute
"public or corporate property used or intended for corporate
purposes."  Rather, it argues that Pacific Fisheries is not one of the
entities listed in the statute whose property is exempt from taxation. 
Specifically, it contends that Pacific Fisheries is not a "public * * *
corporatio[n] in this state."  Pacific Fisheries, for its part, does not
argue that it is one of the other listed entities, and the question in this
case accordingly reduces to two issues:  whether Pacific Fisheries is a
"public corporation" and, if it is, whether it is a public
corporation "in this state."
The Tax Court concluded that Pacific
Fisheries is not a public corporation.  Pacific States Marine Fisheries,
19 OTR at 355.  While noting that there is no "'unified field theory' on
this matter," the court reasoned that the interstate compact creating
Pacific Fisheries does not refer to it as a "corporation" but refers
to it instead as a "commission."  Id. at 354-55.  The court
noted that some statutes differentiate between incorporated and unincorporated
associations and observed that other regional compacts use the word
"corporation" in their authorizing statutes.  Id.  Relying on
the omission of the word "corporation" from the interstate compact
creating Pacific Fisheries, the Tax Court upheld the county's ruling denying
the exemption.  Id. at 355.
On appeal, the county
adopts the Tax Court's reasoning and argues that the interstate compact's
failure to designate Pacific Fisheries as either a corporation or a body
corporate precludes it from being a "public corporation."  Pacific
Fisheries responds that a public corporation does not need to be designated as
a "corporation" by statute to qualify as a public corporation within
the meaning of the exemption.  Pacific Fisheries proposes that the term
"public corporation," as used in ORS 307.090, is broader than the
narrow interpretation given to it by the Tax Court and includes any
"distinct legal and perpetual entity that was created for public or
governmental purposes."
In analyzing the parties'
arguments, we begin with the issue on which the Tax Court's decision turns and
that the county advances in support of that decision -- whether the interstate
compact's failure to refer to Pacific Fisheries as a corporation or body
corporate precludes it from being a public corporation.  The county's argument in
that regard is inconsistent with a long line of cases from this court.  In
1881, this court explained that, although such a designation is one indicia of
corporate existence, it is not dispositive.  Dunn v. State University, 9
Or 357, 361 (1881) ("It is true the legislature has not declared [the board
of directors of the University of Oregon] to be a corporation in express terms,
but this was not essential.").  The court made essentially the same point
more than 100 years later in State ex rel Eckles v. Woolley, 302 Or 37,
46, 49, 726 P2d 918 (1986), when it held that SAIF Corporation, although
denominated by statute as an "'independent' corporation," is not the
type of corporation to which Article XI, section 2, of the Oregon Constitution
applies.(3)
If, as this court has
held, the failure to designate an entity as a public corporation is not
dispositive, the question that remains is what are the attributes of a public
corporation.  On that point, the court explained in Eckles that
"[t]he concept of a 'public corporation' covers a wide variety of
institutions in this country as well as abroad."  302 Or at 47.  The court
also recognized in Eckles that our opinions characterizing or declining
to characterize various entities as public corporations have to be considered
in the specific legal context in which they arose.  Id. at 45.  As this
court explained, the question whether an entity is a corporation for the
purposes of one rule "says little about whether [it] is a 'corporation'
within the meaning of some unrelated rule."  Id.
In accord with Eckles,
we conclude that the phrase "public corporation," considered in the
abstract, is broad enough to include Pacific Fisheries.  However, considering
that phrase in the context in which the legislature used it in ORS 307.090, we
conclude that Pacific Fisheries is not the type of public corporation that the
legislature intended to exempt from taxation.  We begin with the question
whether Pacific Fisheries is a public corporation at all before turning to the
question whether it is the specific type of public corporation that is eligible
for a tax exemption under ORS 307.090.
The phrase "'public
corporation' was used as a generic term" in early Oregon statutes, Eckles,
302 Or at 40 n 2, and has been part of Oregon's tax law since 1910, see
Lord's Oregon Laws, title XXVIII, ch III, § 3554 (1910) (using that phrase).  A
contemporaneous legal dictionary defined a "corporation" as "[a]
body, consisting of one or more natural persons, established by law, usually
for some specific purpose, and continued by a succession of members." 
John Bouvier, 1 Law Dictionary 406 (15th ed 1890).  And it defined a
"public corporation" as "those [corporations] which are
exclusively instruments of the public interest."  Id.
The traditional
distinction between corporations and unincorporated bodies is that corporations
are independent legal entities; they can sue and be sued, enter into contracts,
and have a perpetual existence.  See, e.g., William Blackstone, 1 Commentaries
on the Laws of England 463 (1765) (including those powers of
corporations among others).  In Dunn, this court relied on those
attributes to conclude that the board of directors of the University of Oregon
was a public corporation even though the legislature had not designated it as
such.  See 9 Or at 361 (explaining that the board's authority to accept
title to land and "to transmit title to lands to their successors in
office in perpetual succession" could be exercised only by a corporate
entity, leading the court to conclude that the board was such an entity).(4) 
Corporations are not confined to "private" or profit-seeking
entities, and many of the early examples of corporations were governmental
entities.  Blackstone, 1 Commentaries at 458-59 ("The king * * * is
made a corporation to prevent in general the possibility of an interregnum
or vacancy of the throne, and to preserve the possessions of the crown entire *
* *.  Other lay corporations are erected for the good government of a town or particular
district, as a mayor and commonalty, bailiff and burgesses, or the like * *
*.").  Perhaps for that reason, the United States and its individual
states have been described as corporations.  See United States v.
Perkins, 163 US 625, 631, 16 S Ct 1073, 41 L Ed 287 (1896) (describing the
United States as "a purely political or governmental corporation"); Eugene
McQuillin, 1 The Law of Municipal Corporations § 2.03.30 (3d ed 1999)
("Indeed, the view has been expressed that it cannot be doubted that a
state is a corporation.").(5)
Applying those
principles, we conclude that Pacific Fisheries qualifies as a public
corporation.  There is no dispute that Pacific Fisheries serves a public,
rather than a private, profit-making purpose, and we conclude that Pacific
Fisheries possesses the attributes of a corporation.  It has an independent
legal existence:  Pacific Fisheries may enter into contracts, such as the lease
at issue in this case, and may sue and be sued in its own name.  See ORS
507.040 art V (authorizing Pacific Fisheries to establish and maintain
offices); Colbert v. Pacific Fisheries Marine Fisheries, 124 Wash
App 821, 104 P3d 17 (2004) (holding that Pacific Fisheries can be sued in state
court).  Moreover, Pacific Fisheries continues to exist until the states that
entered into the compact withdraw from it.  See ORS 507.040 art XI (so providing). 
Finally, no one state exercises control over Pacific Fisheries; each state is
simply one voice among others on the commission.  For those reasons, Pacific
Fisheries qualifies as a public corporation.
Our conclusion that
Pacific Fisheries is a public corporation does not end the inquiry, however. 
We also must determine whether Pacific Fisheries is the type of public
corporation that qualifies for a tax exemption.  The county argues that, even
if Pacific Fisheries "is a corporate entity for some purposes, it is not a
'public corporation' for purposes of ORS 307.090."  Relying on the
principle of ejusdem generis, the county argues that Pacific Fisheries
is not of the same general nature or class as the other entities listed in ORS
307.090 and thus does not fall within the meaning of "public
corporation" as used in the statute.  Specifically, the county argues that
all the entities listed in the statute are political subdivisions of the state,
have distinct boundaries within the state, are formed to assist local
government, and are subject to control by the State of Oregon.  Pacific
Fisheries, in contrast, is not a political subdivision of Oregon and is not
subject to the control of the State of Oregon.  
We begin our analysis of
that issue with the words of ORS 307.090.  As noted, that statute exempts
"all public or corporate property used or intended for corporate purposes
of the several counties, cities, towns, school districts, irrigation districts,
drainage districts, ports, water districts, housing authorities and all other
public or municipal corporations in this state."  ORS 307.090 contains two
limitations on the type of corporate entities that will qualify for a tax
exemption.  The first limitation is found in the participial phrase "in
this state."  Only "public * * * corporations in this state"
qualify for a tax exemption.(6)
The phrase "in this
state" dates back to the original version of ORS 307.090(1), which was part
of the Deady Code and which exempted from property taxation "[a]ll public
or corporate property of the several counties, cities, villages, towns and
school districts in this state."  General Laws of Oregon, ch LIII, title
I, § 4, p 894 (Deady 1845-1864).  As used initially, the phrase "in this
state" appears simply to have been synonymous with "Oregon"; for
example, "counties * * * in this state" referred to Oregon counties. 
What is telling, however, is that the phrase that the legislature has used in
ORS 307.090(1) and its predecessor statutes -- "in this state" --
relies on the geographic relationship between the listed entities and the state
to identify which entities were entitled to a tax exemption.
In 1945, the legislature
expanded the list of exempt entities to include "irrigation districts,
drainage districts, ports, water districts and all other public or municipal
corporations in this state."  Or Laws 1945, ch 296, § 1.  For the most part,
the entities that the legislature added in 1945 share the same characteristics
as the entities listed in the Deady Code.  Irrigation districts, drainage
districts, water districts, and municipal corporations in this state refer to
entities whose geographic boundaries are in Oregon and that serve geographic
areas primarily within the state.  They are, in a word, "Oregon"
entities.
The addition of
"public * * * corporations" to the list poses a slightly more complex
issue because some public corporations may not have distinct geographic
boundaries in the same way that a city, county, school district, or municipal
corporation does.  Cf. Eckles, 302 Or at 49 (holding that SAIF is a
public corporation).  The legislature, however, imposed the same "in this
state" limitation on public corporations that it imposed on the specific
entities listed in ORS 307.090, which suggests that the legislature intended to
impose a comparable limitation on public corporations.  It follows that, even
though public corporations may not have distinct geographic boundaries, the
phrase "in this state" appears to limit the tax exemption to public
corporations that serve geographic areas primarily within the state.
The second limitation
sheds light on the first.  A list of specific entities precedes the phrase
"all other public * * * corporations."  ORS 307.090 (emphasis added). 
Ordinarily, we assume that a nonspecific term in a series, such as "all
other public * * * corporations," shares the same qualities as the
specific terms that precede it.  See Liberty v. State Dept. of
Transportation, 342 Or 11, 20, 148 P3d 909 (2006) (describing ejusdem
generis rule).  The legislature's use of that drafting device suggests
that, at a minimum, the tax exemption extends only to those public corporations
that, like the entities that precede it, serve geographic areas primarily "in
this state."  There may be other shared characteristics inherent in the
specific entities that precede the phrase "all other public * * *
corporations" and that place further limits on the types of public
corporations that are entitled to a tax exemption, but we need go no further
than that one characteristic -- the geographic area that the entity serves --
to resolve this case.
As noted above, Pacific
Fisheries is the creature of an interstate compact.  It is not an Oregon public
corporation.  The geographic area it serves is not limited primarily to the
State of Oregon; rather, under the terms of the interstate compact, it
represents and serves a multistate area.  The interests and geographic area
served by Pacific Fisheries are regional, and Pacific Fisheries cannot be
considered to be confined geographically within the State of Oregon.  An
organization that was created by and includes other states, is controlled by a
board with equal representation from each state, and is charged with advising
the several governments on issues concerning the region as a whole, is not
"in this state" within the meaning of ORS 307.090(1).  It follows
that Pacific Fisheries is not entitled to a property tax exemption under ORS
307.090 and that the county correctly denied Pacific Fisheries' application for
a tax exemption.(7)
The judgment of the Tax
Court is affirmed.
1. ORS
507.040 sets out the terms of the interstate compact.  The compact became
effective on Congress' approval, US Const, Art I, § 10, which occurred in
1947.  Act of July 24, 1947, Pub L No 80-232, 61 Stat 419-422.  After Congress
approved the compact, Alaska and Idaho became members of Pacific Fisheries.
2. ORS
307.112(1) provides, in part:
"Real or personal property of a taxable
owner held under lease, sublease or lease-purchase agreement by an institution,
organization or public body, other than the State of Oregon, granted exemption
or the right to claim exemption for any of its property under ORS 307.090 * * *
is exempt from taxation * * *."
3. Article XI, section 2, provides, in part,
that "[c]orporations may be formed under general laws, but shall not be
created by the Legislative Assembly by special laws."
4. Later
decisions have divided over whether Dunn correctly decided that the
board of directors was a public corporation; more specifically, some decisions
questioned whether the board was a state agency rather than an independent
corporate entity.  See State ex rel Kleinsorge v. Reid, 221 Or 558,
566-70, 352 P2d 466 (1960) (summarizing cases).  There is no claim that Pacific
Fisheries is a state agency, and the concern that led some of this court's
later decisions to question the result in Dunn is absent here.
5. McQuillin explains that a state is a public
corporation largely because it operates as an independent entity:
"A
state does not come within the literal terms of any commonly employed
definition of the word 'corporation.'  But when viewed in the larger sense,
states have continuous existence, a name, may sue and, under certain
circumstances, may be sued.  They have political powers of legislation and
administration applying to the area of their jurisdiction, and they derive
their existence and all their powers from the people, from whom comes also the
authority of legislatures to create private and municipal corporations."
McQuillin, 1 Municipal
Corporations § 2.03.30.
6. Grammatically,
the phrase "in this state" could modify "property" or the
entities listed in the statute.  We conclude that the phrase modifies and thus
limits the listed entities for two reasons.  First, ORS 307.030(1) provides
that "[a]ll real property within this state * * * shall be subject
to assessment and taxation * * *[.]" (emphasis added).  If the phrase
"in this state" in ORS 307.090 modified "property," it
would add nothing to that statute and be mere surplusage.  See State v. K. P.,
324 Or 1, 8, 921 P2d 380 (1996) (noting that this court must attempt to give
meaning to all of the words of a statute).  Moreover, the phrase "in this
state" follows the list of entities eligible for a tax exemption, making
it likely that the phrase applies to those entities, not the word property,
which appears at the beginning of ORS 307.090.  See State v. Webb, 324
Or 380, 386, 927 P2d 79 (1996) (describing the rule of the last antecedent). 
7. The state could, of course, exempt Pacific Fisheries
from property tax if it chose to do so.  But, as the statutes are currently
written, Pacific Fisheries is not eligible for an exemption.