Court Opinion

ID: 8021606
Source: CourtListenerOpinion
Date Created: 2022-09-09 02:26:12.01099+00
Date Added: 2024-06-11T16:36:40.912934
License: Public Domain

MB. JUSTICE HOLLOWAY
delivered the opinion of the court.
In 1909 the assessor of Silver Bow county made an assessment of the property of the Western Union Telegraph Company, in form as follows:
Pole lines consisting of copper and iron.wires..........$10,445
Office furniture and instruments...................... 500
Franchise assessment............................... 2,000
*448The taxes upon this valuation amounted' to $249.57, and of that amount the telegraph company paid $204.57, but refused to pay the $45 representing the tax upon the assessment of $2,000 for “franchise.” This action was commenced by the state to enforce the payment of the tax of $45. The cause was tried upon an agreed statement of facts, and resulted in a judgment for the defendant company. From that judgment the state appealed.
The facts agreed upon, so far as material here, are: (a) The Western Union Telegraph Company is a New York corporation which has been engaged in business in the territory and state of Montana for many years; (b) that on June 5, 1867, defendant company accepted the provisions of an Act of the Congress of the United States entitled “An Act to aid in the construction of telegraph lines and to secure to the government the use of the same for postal, military and other purposes,” approved July 24, 1866, Chapter 230, 14 Statutes at Large, 221; (c) that the business of the. telegraph company consists in transmitting messages by electric telegraph between points wholly within this state and between points within and without the state, and between the officers, agents and departments of the federal government ; (d) that the assessment of $2,000 “represents the valuation by said assessor upon the right or privilege of carrying on the said telegraph business within the said county of Silver Bow.”
The only question in dispute here is the right of the revenue officers of this state to collect a tax upon the “franchise” of this company. There is not any disagreement as to the meaning of the term “franchise,” as used in the assessment or as used in the Constitution and statutes of this state.
By the Act of the Congress to which reference is made, the general government granted to telegraph companies, which should accept the provisions of the Act, rights of way over the public domain, along military or post roads, and over, under, or across navigable streams, and also granted the right to take and use public land for stations, and stone, timber, and other materials for construction work. As a consideration for the grant thus made, the government exacted (1) that government *449communications should be given priority in transmission; (2) that the rates for government business should be fixed by the postmaster-general; and (3) that the government might purchase all the lines and property of any consenting company. [1] The Western Union company, having accepted the benefits and burdens of this Act, thereby became an agency of the federal government for the transaction of its postal business, and an instrumentality of interstate and foreign commerce. (City Council of Charleston v. Postal Tel. Co., 3 Am. Elect. Cas. 56; Western Union Tel. Co. v. Mayor (C. C.), 38 Fed. 552, 3 L. R. A. 449; Pensacola Tel. Co. v. Western Union Tel. Co., 96 U. S. 1, 24 L. Ed. 708; Telegraph Co. v. Texas, 105 U. S. 460, 26 L. Ed. 1067.)
That the state may not tax the right to carry on interstate [2] commerce or to conduct the business of the government is too well settled to be open to argument. (Telegraph Co. v. Texas, above; California v. Pacific Railroad Co., 127 U. S. 1, 8 Sup. Ct. 1073, 32 L. Ed. 150; Philadelphia & So. Mail S. S. Co. v. Pennsylvania, 122 U. S. 326, 7 Sup. Ct. 1118, 30 L. Ed. 1200.)
The business of this company consists in transmitting three distinct classes of messages: (1) Interstate private messages; (2) intrastate private messages; and (3) government messages, interstate and intrastate. It is suggested by the attorney general that it will not be presumed that the assessor attempted to assess the right to do interstate or governmental business, but rather the presumption should be indulged that he intended to assess only the right of the company to do purely local or intrastate private business. If we had before us only the entry on the assessment-roll as indicated above, we might feel somewhat uncertain; but in the agreed statement we are told that the assessment of $2,000 on “franchise ” “represented the valuation by said assessor upon the right or privilege of carrying on the said telegraph business within the said county of Silver Bow.” The words “said telegraph business” refer bach to the description of the business of the defendant company as given in paragraph 1 of the agreed statement, to-wit: “That for more than *450twenty-five years last past said defendant has been and is doing what' is commonly called a general telegraph business in all the states and territories of the United States, and among others, particularly the state of Montana and especially the county of Silver Bow therein, and transmitting on its said lines and in the course of the conduct of said business telegraph messages for the public generally as well as those sent from point to point within said state of Montana as those from points without to points within, and from points within to points without' said last-named state”; and the further description of the business contained in paragraph 4 of the agreed statement, to-wit: ‘ ‘ That all of the telegraph lines of said defendant corporation within the territory that is now included in the state of Montana were constructed and ever since have been maintained and operated by said defendant under and pursuant to the provisions of the said Act of Congress above set forth, and defendant has at all times since said construction and during such maintenance and operation transmitted telegraph messages between the several departments of the governments of the United States and their officers and agents, for the government of the United States and relating to the civil, military, postal, and general administration thereof, all as in said Act provided. ’ ’
The right to carry on the telegraph business, then, includes any and all of the business. The words “within the said county of Silver Bow ’ ’ must refer to business originating or terminating in, or passing through, the offices in Silver Bow county. They cannot be construed to refer to business conducted wholly between points within that county, but even if they did they would still include governmental messages; and, as thus construed, they indicate that the assessor was attempting to fix a valuation on the right or privilege of the company to transact any business [3] whatever within Silver Bow county, and having made his assessment in a lump sum, and not having fixed a separate-valuation upon the right of the company to do intrastate private business only, the entire assessment on the franchise becomes void and the tax illegal.
*451In considering a like question, the supreme court in California v. Pacific R. R. Co., above, said: “It follows that, in each one of the cases now before us, the assessment made by the state board of equalization comprised the value of franchises or property which the board was prohibited by the Constitution of the state or of the United States from including therein; and that these values are so blended with the other items of which the assessment is composed that they cannot be separated therefrom. The assessments are, therefore, void.”
It is not necessary to determine whether the state may lawfully tax the franchise of this company or its right to transact intrastate private business only, but that such right exists appears [4] to be recognized by expressions found in each of the following eases: Telegraph Co. v. Texas, above; Ratterman v. Western Union Tel. Co., 127 U. S. 411, 8 Sup. Ct. 1127, 32 L. Ed. 229; Leloup v. Port of Mobile, 127 U. S. 640, 8 Sup. Ct. 1383, 32 L. Ed. 311; Osborne v. Florida, 164 U. S. 650, 17 Sup. Ct. 214, 41 L. Ed. 586. For the reason given, the judgment is affirmed.

Affirmed.

Mr. Chief Justice Brantly and Mr. Justice Smith concur.