Court Opinion

ID: 9691007
Source: CourtListenerOpinion
Date Created: 2023-08-24 20:00:36.60209+00
Date Added: 2024-06-11T18:19:08.630186
License: Public Domain

Edwards, J.
(dissenting). My Brother has set out such facts as are before this Court in this matter.
We are required on petitioner’s application for writ of mandamus or prohibition to determine whether or not subdivision 14, § 9, PA 1956, No 206 (CL *941948, § 211.9, as amended [Stat Ann 1957 Cum Supp § 7.9]), is consistent with article 10, § 3, of the Constitution of 1908.
The statutory provision at issue is as follows:
“Fourteenth, Farm products processed or otherwise, the ultimate use of which is for human or animal consumption as food, but expressly excepting wine, beer and other alcoholic beverages, regularly placed in storage in a public warehouse, dock or port facility, as defined in the twelfth subdivision of this section, shall, while so in.storage be considered in transit and only temporarily at rest, and not subject to personal property taxation: Provided, That the assessing officer shall be the determining authority as to what constitutes, is defined as, or classified as, farm products as used in this subdivision: Provided, That all records, accounts and books of warehouses, docks or port facilities, individuals, copartner-ships, corporations, owners, or those in possession of any farm products shall be open to and available for inspection, examination and/or auditing by assessing officers.”
It appears that the plain intent of the legislature in the quoted language is to exempt from personal property taxation such farm products, as defined above, as are found in public warehouses in the State of Michigan on tax date, regardless of whether such products are destined for use inside or outside the State of Michigan, or whether such destination is unascertained at the time.
The constitutional provision previously quoted by my Brother in full reads, in part, as follows:
“The legislature shall provide by law a uniform rule of taxation, except on property paying specific taxes.”
Two questions of moment are presented by the taxation amendment currently under consideration. *95The first is whether or not it represents an exemption of a classification of property, which exemption is within the constitutional power of the legislature to grant. , The second question is whether or not the statute represents a proper general classification of property for purposes of exemption.
"We recognize, as my Brother suggests, that the legislature in Michigan has been held, since the early history of the State, to have the constitutional authority to grant exemptions to general classes of property or business where such exemptions are “discriminations which the best interests of society require.” Citizens’ Telephone Company of Grand Rapids v. Fuller, 229 US 322, 331 (33 S Ct 833, 57 L ed 1206); Board of Supervisors of Chippewa County v. Auditor General, 65 Mich 408. The writer does not, however, believe it is necessary for us to answer whether or not the present legislation would fit withip such power of exemption as has been previously defined in case law. The record before us does not disclose uniform treatment of any general classification of property. The property which it purports to exempt is neither all of the personal property stored in all public warehouses, nor all farm products as defined by the statute stored wherever they might be stored on tax date.
On the contrary, the statute plainly discriminates between farm products stored in public warehouses and other personal property likewise stored there, granting exemption to the former and not to the latter. It likewise discriminates between farm products held in privately-owned storage facilities and farm products stored in public warehouses.
Classification based upon location of property has repeatedly been held discriminatory. Teagan Transportation Co. v. Detroit Board of Assessors, 139 Mich 1.
*961 Cooley on Taxation (4th,ed),.p 594, has this .to say on our current point:
“Classification for exemption purposes may be 'based on the use to which property is devoted, as well as the nature of the property; but property cannot be exempted merely because of its ownership where the same kind of property owned by .others is taxed, nor according to its location.”-
Carolina National Bank of Columbia v. Spigner, 106 SC 185 (90 SE 748); Martin v. Reynolds, 125 Ark 163 (188 SW4).
On page 723 of the same work, Cooley continues:
“The rule allowing classification-for purposes of taxation is always coupled with the proviso ‘if all of the same class are taxed alike.’ Discrimination between persons or property in like situation cannot be effected by classification, since there can be no reason therefor. Omissions from a class, of subjects that clearly belong to such class, makes the classification invalid.”
In the case principally relied upon by my Brother, Citizens’ Telephone Company of Grand Rapids v. Fuller, supra, the legislature was held to have the power of prescribing the subjects of taxation and exemption, notwithstanding the constitutional uniformity rule. The classification involved in that case, however, was uniform.
On the point of uniformity of classification, petitioner relies primarily upon a New Jersey case, Schwartz v. Essex County Board of Taxation, 129 NJL 129 (28 A2d 482). This case construed and upheld the constitutionality of a statute designed to affect personal property in public warehouses. Two important distinctions, however, may be found between the situation presented to that court in that case and that with which we are here confronted. First, evidence was available that, in 2 States im*97.mediately neighboring, personal property, was exempt from taxation and, hence, such warehouses in New Jersey were operating at a great competitive disadvantage. No such fact is presented in the rec.ord- before us. Secondly, it is noteworthy that the :New Jersey statute* reads as follows:
“All personal property stored in a warehoiise of any person, copartnership or corporation engaged in the business of storing goods for hire shall be exempt from taxation under this chapter,”
thereby plainly exempting all of the class of personal property stored in any public warehouse on the tax date in question. As previously noted, the instant statute under consideration discriminates between classes of personal property stored in public warehouses and exempts only farm products as defined in the act.
My Brother concludes his opinion as follows:
. “We conclude that the act in question was passed by the legislature to encourage the flow of commerce into Michigan and that the act is constitutional.”
Nothing in this record supports this conclusion. If it could be held that such a conclusion might be presumed on the general rule that all reasonable presumptions favoring constitutionality of legislation may be made, Allen v. State Highway Commissioner, 338 Mich 407; Rohan v. Detroit Racing Association, 314 Mich 326 (166 ALK 1246), why then, on the general basis of encouraging flow of commerce into Michigan, discriminate against all other commerce, except farm products as defined, stored in public warehouses on the tax date Í
On the showing on the record before us, we hold that the classification contemplated would patently be discriminatory as between the owners of personal *98property in the classifications previously referred to and, hence, that the statute is unconstitutional because of its violation of the requirements of uniformity previously described.
Petition for writ of mandamus or prohibition should be denied, but without costs, a constitutional question being involved.
Yoelker and Black, JJ., concurred with Edwards,' J.

 NJSA, § 54:4-3.20. — Reportes.