Court Opinion

ID: 3995830
Source: CourtListenerOpinion
Date Created: 2016-07-06 10:54:14.409774+00
Date Added: 2024-06-11T14:18:42.650679
License: Public Domain

Stripped of argumentation and legal conclusions, the complaint sets forth only the following ultimate facts: Plaintiff is a California corporation, engaged in the operation of telephone systems in the states of California, Oregon, Washington, and Idaho. The system in Washington is connected with those of California, Oregon, and Idaho. Plaintiff handles a great number of interstate communications. Gross revenues of interstate service in this state are approximately one-fourth of the whole of the operating revenues within the state. The plant facilities are devoted indiscriminately to intrastate and interstate service. Plaintiff purchases outside this state a great amount of equipment, apparatus, material, and supplies, which are brought into the state and used in the operation, maintenance, and repair of its telephone and telegraph system. Some of the plant equipment is ordered for immediate use, and is installed without previous storage within the state. Some equipment is brought into the state and put in storage for future use, as necessity requires.
Unadorned by legal supplementation, the statute (Laws of 1935, chapter 180, title IV, p. 726, as amended by Laws of 1937, chapter 191, p. 943) simply provides that there shall be collected, for the privilege of "using within this state any article of tangible personal property," a tax of two per cent of the value of such property. The only limitations upon the collection of such *Page 579 
tax to be found in the statute are the following: (1) The incidence of the tax shall not fall upon property purchased, produced, or manufactured outside this state until the transportation of such article has finally ended or until such article has become commingled with the general mass of property of this state. (2) The tax shall not apply to the use of tangible property of a nonresident temporarily within the state. (3) The tax shall not apply to property which would be exempt from the sales tax (Laws 1935, chapter 180, title III, p. 721). (4) The tax shall not be collected on property if it has already been subjected to tax under title III, and such tax has been paid. (5) The tax shall not apply to the use of tangible personal property put to use during any bi-monthly period, the total value of which is less than fifty dollars. (6) The tax shall not apply to the use of rolling stock or aircraft or floating equipment of a common carrier, the first use of which within the state is actual use in conducting interstate or foreign commerce.
By its decision in this case, however, the court has supplemented the act with another proviso: If the property purchased outside the state is not manufactured or procurable in the open market in this state, the tax shall not apply. I think it is not open to dispute to say that there is nothing in the act itself which warrants such an inference of legislative intent. It is not in the mouth of plaintiff to assert that the tax commission has so construed the act, when plaintiff is here to enjoin the commission from collecting the tax on property falling within that category. Nor, assuming that the tax commission has promulgated regulations from which such interpretation can be deduced, should the court adopt that interpretation in face of the plain terms of the act. The general rule is that the court will not follow administrative interpretation of a statute *Page 580 
in contravention of its plain terms. Wendt v. Industrial Ins.Commission, 80 Wash. 111, 141 P. 311; State ex rel. Shermanv. Benson, 111 Wash. 124, 189 P. 1000; State v. Davies,176 Wash. 100, 28 P.2d 322.
Of course, if the supplementation of the statute by this decision is to be accepted as valid judicial interpretation and construction, the case ends right here. For the supreme court of the United States accepts as binding upon it the construction placed upon a state statute by the court of last resort of the state. Thus, the real question in this case will probably never be considered by that court. Nevertheless, I feel impelled to briefly discuss the question of whether or not the tax enjoined constitutes a direct burden on interstate commerce.
In approaching the question, we should bear in mind that it is a cardinal principle of statutory interpretation that the court will construe an act so as to render it valid and effective, unless it clearly offends some constitutional inhibition. The presumption is that a statute is valid. With Federal courts, the presumption is indulged primarily in favor of acts of Congress; with a state court, the presumption is accorded to the statute of the state. These rules are so well established that I would not mention them, did they not hold peculiar interest and significance for us in the decision of this case.
For the only decision of authoritative weight, involving the exact question here presented, was recently handed down by a three-judge United States district court. Southern Pac. Co. v.Corbett, 23 F. Supp. 193. The court in that case, upon facts similar to those set up in the complaint in this case, sustained a tax, in no essential respect different from our compensating *Page 581 
tax, holding that the tax did not constitute a direct burden upon interstate commerce.
In view of this decision, and in view of the decision of the supreme court of the United States holding our compensating tax a valid exercise of the state's power of taxation (Henneford v.Silas Mason Co., 300 U.S. 577, 81 L. Ed. 814, 57 S. Ct. 524), I think the statute should be accorded the presumption of validity by this court upon the facts set up in the complaint in this case.
I dissent.