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the United States: People v. C. P. R. R., 43 Cal. 499; Huntington v. C. P. R. R. Co., 2 Saw. 503; Thomson v. Pacific R. R., 9 Wall. 579; Railroad Co. v. Peniston, 18 Id. 5; Western Union Telegraph Co. v. City of Richmond, 26 Gratt. 1; and see State Bank Tax Cases, 92 U. S. 595.

upon the injustice of duplicate taxation, and inveigh against the systems which result therein, it is a matter now too well recognized to admit of serious denial that a tax is not invalid simply for the reason that an individual who has directly contributed his proportion to the public revenue may be indirectly compelled to respond. Cooley, Taxation, p. 160, says that "the decisions are nearly if not quite unanimous in holding that taxation is not invalid because of any such unequal results." It is apparent that no one ought to be made to pay more than his proportion; an enactment which does this directly is to be censured. But in the very nature of human society, relations to possessions are so complex, the necessity for revenue so manifest, that statutes ought not to be set aside simply because the wisdom of man has been unable to devise means equally to distribute the burden of taxation. This spirit is everywhere prevalent, and appeals to the reason of all. Courts guard against the abuse of the taxing power as far as is possible. They refuse to believe that legislators intended to subject the same property twice to taxation, and they will adopt a construction most likely to guard against such an evil: Cooley on Taxation, 165; Burroughs on Taxation, sec. 87. It must not be overlooked, however, that the question of the justice of double taxation is very different from that of the power to impose it: See Cooley on Taxation, 161; Burroughs on Taxation, sec. 87. But a constitutional provision that "all property in the state not exempt under the laws of the United States shall be taxed in proportion to its value, to be ascertained as provided by law," is a limitation upon the power of double taxation. To tax a portion of a man's property more than once would not be taxing all of it in proportion to its value: Burke v. Badlam, 57 Cal. 594, where, in the counsel's argument, will be found an extensive collating of the authorities on this general subject. The taxing the property of a corporation, as well as the shares of the stock, is expressly declared to be double taxation: Sec. 3608.

Property of state, county, or municipal corporation. The state does not design to tax itself nor any subordinate portion of the government, as counties, towns, and cities: People v. Doe, 36 Cal. 220; Low v. Lewis, 46 Id. 549; Doyle v. Austin, 47 Id. 353.

The statement that all property must be taxed means all private property; the state will not be held to have intended to tax itself: People v. Doe, supra. Yet bonds of the state held by individuals are private property and are taxable: People v. Home Ins. Co., 29 Id. 533. As a general principle, the property of municipalities is exempted from taxation by clear implication: People v. Salomon, 51 Ill. 37; Directors of the Poor v. School Directors, 42 Pa. St. 21, 25; State v. Gaffney, 34 N. J. L. 133. It has been determined, however, that such property as a municipal corporation might own, not for carrying out its public functions, but which it uses and owns as a private corporation, would be subject to taxation under such general words of the statute as would embrace like property in a private corporation: Cooley on Taxation, 132, in note, citing Storrs v. Utica, 17 N. Y. 104; Lloyd v. New York, 5 Id. 369; Western Fund Savings Society v. Philadel phia, 31 Pa. St. 175; Commissioners v. Duckett, 20 Md. 468; Detroit v. Corey, 9 Mich. 165; and see post, sec. 3617, and note.

Double taxation is prohibited by this section, and by the constitution of the state: San Francisco v. Mackey, 3 West Coast Rep. 697 (C. Ct. Cal.); S. C., 4 Id. 407. The difficulty of escaping an unequal apportionment of the bur den of taxation necessitates a common-sense construction of this prohibition. All the books discuss this question; and while political economists and legal text-writers delight to dwell

3608. Shares of stock in corporations not taxable.

SEO. 3608. Shares of stock in corporations possess no intrinsic value over and above the actual value of the property of the corporation which they stand for and represent, and the assessment and taxation of such shares and also of the corporate property would be double taxation. Therefore all property belonging to corporations shall be assessed and taxed, but no assessment shall be made of shares of stock, nor shall any holder thereof be taxed therefor. [New section, approved March 7, 1881; Statutes and Amendments 1881, 56; took effect from passage.]

Shares of stock.-Section construed in connection with many other provisions of this code relating to corporations, in Spring Valley Water Works v. Schottler, 62 Cal. 68. See the note to section 3640. The rule as defined in the above section is the one independently thereof declared to be the law in San Francisco v. Mackey, 3 West Coast Rep. 697 (C. Ct. Cal.). To assess all the corporate property to the


corporation and the shares of stock to the holders thereof is double taxation, and is prohibited: Burke v. Ballam, 57 Cal. 594. "Capital," eo nomine, was held taxable in San Francisco v. Spring Valley Water Works, 54 Id. 571, but a corporation cannot be taxed on capital stock which it does not hold: People v. National Gold Bank, 51 Id. 508.

Double taxation: See note to sec. 3607.



3617. Definition of terms.

SEC. 3617. Whenever the terms mentioned in this section are employed in this act they are employed in the sense hereafter affixed to them:

First-The term "property" includes moneys, credits, bonds, stocks, dues, franchises, and all other matters and things, real, personal, and mixed, capable of private ownership.

Second-The term "real estate" includes:

1. The possession of, claim to, ownership of, or right to, the possession of land;

2. All mines, minerals, and quarries in and under the land, all timber belonging to individuals or corporations growing or being on the lands of the United States, and all rights and privileges appertaining thereto;

3. A mortgage, deed of trust, contract, or other obligation by which a debt is secured, when land is pledged for the payment and discharge thereof, shall, for the purpose of assessment and taxation, be deemed and treated as an interest in the land so pledged;

4. Improvements.

Third-The term "improvements" includes:

1. All buildings, structures, fixtures, fences, and improvements erected upon or affixed to the land;

2. All fruit, nut-bearing, or ornamental trees and vines not of natural growth. Fourth-The term "personal property" includes everything which is the subject of ownership not included within the meaning of the term "real estate." Fifth-The terms "value" and "full cash value ' mean the amount at which the property would be taken in payment of a just debt due from a solvent



Sixth-The term "credits" means those solvent debts, not secured by mortgage or trust deed, owing to the person, firm, corporation, or association assessed. The term "debts" means those unsecured liabilities owing by the person, firm, corporation, or association assessed to bona fide residents of this state, or firms, associations, or corporations doing business therein; but credits, claims, debts, and demands due, owing, or accruing for or on account of money deposited with savings and loan corporations shall, for the purpose of taxation, be deemed and treated as an interest in the property of such corporation, and shall not be assessed to the creditor or owner thereof. [Amendment, approved March 7, 1881; Statutes and Amendments 1881, 56; took effect from passage.]

the deceased resided at the time of his death: San Francisco v. Lux, 64 Id. 481.

Credits.-The taxable character of "cred its" having vexed the courts of the state of California for a long period, happily is deter mined by the constitution adopted in 1879. For a period of years "credits "property ," in this state, and had been judicially declared to be within the taxing power

were considered

Property: See Const. Cal., art. 13, sec. 1. In determining what is property within the meaning of the revenue laws, the courts will not be limited by the definition thereof in the code, but may and ought to look to the constitution: People v. Hibernia Bank, 51 Cal. 243.

Money in the hands of a county treasurer pending the determination of a litigation may be assessed to the treasurer by name, and paid out of the fund: People v. Lardner, 30 Cal. 242. of the legislature under the former constitution: Money deposited savings-banks is to be as- People v. McCreery, 34 Cal. 432; People v. sessed to the banks, not to the depositors: Eddy, 43 Id. 331; Randall v. Austin, 46 Id. 54; Burke v. Badlam, 57 Id. 594. Money has no People v. Ashbury, Id. 523. But a re-examinasitus, and for the purpose of taxation money of a decedent is to be taxed in the county where

tion of the entire subject in People v. Hibernia Bank, 51 Id. 243, led the court to a different

conclusion, Judge Rhodes alone dissenting. They there decided that "credits" were not "property" subject to taxation within the meaning of the then existing constitution; and this determination was reaffirmed in a subsequent cause reported in the same volume of reports at page 369, viz., Bank of Mendocino v. Chalfant. In the new constitution, the view entertained by the earlier cases was adopted and made a portion of that instrument; and now "credits" are "property" liable to be taxed, the legislature being empowered to deduct from any man's credits the amount of indebtedness which he owes to a bona fide resident of the tate: Art. 13, sec. 1. For quite an interesting treatment of the taxation of credits, read Mr. Burroughs' forty-ninth section of Taxation. The author by no means accepts the views entertained in People v. Hibernia Savings Bank, 51 Cal. 243. For the purpose of taxing solvent credits, their situs is the residence of the creditor: San Francisco v. Mackey, 4 West Coast R. 407 (C. Ct. Cal.).

Diamond Co., 37 Id. 54; Barrett v. Amerein, 36 Id. 327. But the wording of the present statute, differing from that of the former one, probably warrants a different construction.

Mines, minerals, and quarries on public lands, timber rights, and privileges appertaining thereto, are taxable. This is but an application of the principle which makes possessory rights the subject of taxation. The objects here described are, moreover, legimately within the meaning of the word "property." Therefore they are subject to state taxation: State v. Moore, 12 Cal. 56; People v. Frisbie, 31 Id. 146; People v. Cohen, Id. 210; People v. Black Diamond Co., 37 Id. 54.

Subd. 3. Mortgages.-Whether mortgages could be taxed was a much mooted question under the former constitution of California: People v. Eastman, 25 Cal. 601; People v. McCreery, 34 Id. 432; People v. Whartenby, 38 Id. 461; People v. Kohl, 40 Id. 127; Lick v. Austin, 43 Id. 590; People v. Eddy, Id. 331; S. & L. Society v. Austin, 46 Id. 415; and see supra, note under "Credits;" but the matter was set at rest by the new constitution. By its provisions, all property is taxable. Article 13, section 4, expressly provides for mortgages, and in the above section the legislature has included mortgages within that term. With respect to mortgages, the law operates upon those created prior to the new constitution. Say the court, in McCoppin v. McCartney, 60 Cal. 367: "But a mortgagee, prior to the adoption of the new constitution, did not have a vested right of exemption from taxation which extended beyond the life

of the former constitution. Even if he had a contract with his mortgagor by which the latter agreed to pay all taxes, a change in the law which imposed upon him the duty to pay the tax on the mortgage interest in the first instance would not violate the obligation of the contract. Mortgagee might still enforce his contract against mortgagor. His relation to the debtor would not be changed, but only his relation to the state. The plain intent of the new constitution is to subject to taxation classes of property previously exempt. That one of the new classes consists of credits, secured or unsecured, no more violates any contract or vested right of the creditor than would a provision by which, for the first time, the owner of any tangible property should be taxed upon its value." And so also Mumford V. Sewell, 3 West Coast Rep. 712 (Or.).

How mortgages are to be assessed: See sec. 3627.

Stock: See sec. 3608. Bonds: See the note to section 3607, as to national bank stock. Bonds of the state are taxable: People v. Home Ins. Co., 29 Cal. 533. Franchises are taxable: San José Gas Co. v. January, 57 Cal. 614; Burke v. Badlam, Id. 594; Spring Valley Water Works v. Schottler, 62 Id. 72, where the subject is considered at length; San Francisco Gas Co. v. Schottler, Id. 448; The Freight Case, 15 Wall. 282; Railway Gross Receipts Case, Id. 296; State R. R. Tax Cases, 92 U. S. 603; Porter v. R. R. I. & St. L. R. R. Co., 76 Ill. 573; Monroe Savings Bank v. Rochester, 37 N. Y. 367.

Real estate. Possessory interests tax able: State v. Moore, 12 Cal. 56; People v. Shearer, 30 Id. 645; People v. Frisbie, 31 Id. 146; People v. Cohen, Id. 210; People v. Crockelt, 33 Id. 150; Reily v. Lancaster, 39 Id. 354; People v. Black Diamond Co., 37 Id. 54; Barrett v. Amerein, 36 Id. 327; and this although it may be a possessory interest in public lands: Hall v. Dowling, 18 Id. 621; People v. Morrison, 22 Id. 73; High v. Shoemaker, Id. 363; People v. Shearer, 30 Id. 645. It is certainly so where this possessory interest has been derived from the state itself, with respect to her domain: People v. Donelly, 58 Id. 144, and has been so asserted with respect to possession of and improvements upon, the land of the United States. See note to sec. 3607, under "Property Belonging to the United States."

"Claim to lands," under the former revenue laws of the state, meant not merely an assertion of title, but an actual possession of the land claimed: People v. Crockett, 33 Cal. 150; so also

Reily v. Lancaster, 39 Id. 354; People v. Black Spitzer, 3 West Coast Rep. 416.

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Subd. 4. Improvements.-Fruit-trees are

not growing crops within the exemption of arti cle 13, section 1, of the constitution: Cottle v.



3627. Property, how assessed.

SEO. 3627. All taxable property must be assessed at its full cash value. Land and improvements thereon shall be separately assessed. Cultivated and uncultivated land of the same quality, and similarly situated, shall be assessed at the same value. A mortgage, deed of trust, contract, or other obligation by which a debt is secured, shall, for the purposes of assessment and taxation, be



deemed and treated as an interest in the property affected thereby, except as to railroad and other quasi-public corporations. In case of debts so secured, the value of the property affected by such mortgage, deed of trust, contract, or obligation, less the value of such security, shall be assessed and taxed to the owner of the property, and the value of such security shall be assessed and taxed to the owner thereof, in the county, city, or district in which the property affected thereby is situated. The taxes so levied shall be a lien upon the property and security, and may be paid by either party to such security; if paid by the owner of the security, the tax so levied upon the property affected thereby shall become a part of the debt so secured. If the owner of the property shall pay the tax so levied on such security, it shall constitute a payment thereon, and, to the extent of such payment, a full discharge thereof. If any such security or indebtedness shall be paid by any such debtor or debtors after assessment and before the tax levy, the amount of such levy may likewise be retained by such debtor or debtors, and shall be computed according to the tax levy for the preceding year; and every contract by which a debtor is obliged to pay any tax or assessment on money loaned, or on any mortgage, deed of trust, or other lien, shall, as to any interest specified therein, and as to such tax or assessment, be null and void. [Amendment, approved March 7, 1881; Statutes and Amendments, March 7, 1881, 57; took effect from passage.]

"Improvements" defined: See sec. 3617,

subd. 4.

Mortgages: See note to sec. 3617, ante. That mortgage is taxable under the laws of Oregon, although the mortgagee is a non-resident, see Mumford v. Sewell, 3 West Coast Rep. 712.

Full cash value" is defined in the fifth

subdivision of section 3617. This value having once been determined upon by the assessor, the courts have not the power to alter it. The remedy for an erroneous valuation is an application to the board of equalization, and "the courts will not revise the judgments of these officers upon such question:" San José Gas Co. v. Junuary, 57 Cal. 614.

3628. Assessments, how and by whom made.

SEC. 3628. The franchise, roadway, road-bed, rails, and rolling stock of all railroads operated in more than one county in this state shall be assessed by the state board of equalization as hereinafter provided for. Other franchises, if granted by the authorities of a county, city, or city and county, must be assessed in the county, city, or city and county within which they were granted; if granted by any other authority, they must be assessed in the county in which the corporations, firms, or persons owning or holding them have their principal place of business. All other taxable property shall be assessed in the county, city, city and county, town, township, or district in which it is situ ated. Land shall be assessed in parcels or subdivisions not exceeding six hundred and forty acres each, and tracts of land containing more than six hundred and forty acres, which have been sectionized by the United States government. shall be assessed by sections or fractions of sections. The assessor must, between the first Mondays of March and July in each year, ascertain the names of all taxable inhabitants and all property in his county subject to taxation, except such as is required to be assessed by the state board of equalization, and must assess such property to the persons by whom it was owned or claimed, or in whose possession or control it was at twelve o'clock м, of the first Monday of March next preceding; but no mistake in the name of the owner or sup posed owner of real property, shall render the assessment thereof invalid. In assessing solvent credits not secured by mortgage or trust deed, a reduction therefrom shall be made of debts due to bona fide residents of this state. [Amendment, approved March 22, 1880; Amendments 1880, 7 (Ban. ed. 36).]

Assessing franchises: See note to sec. 3617, ante.

Railway property.-This provision of the code respecting the taxing of railroads conforms to article 13, section 10, of the constitution of California, which instrument in this particular is self-executing: People v. Sacramento Co., 59 Cal. 321; S. F. & N. P. R. R. Co. v. State Board of Equalization, 60 Id. 12. As to the manner of assessing railroads, see post, secs. 3664, 3665. And see the note thereto for further consideration of this subject.

them jointly: People v. McEwen, 23 Id. 54. But the better practice is to assess each particular person upon the interest which he claims in the land: People v. Shimmins, 42 Id. 123. And where interests therein are held in severalty, each particular parcel of the land should be assessed to its respective owner: Id.; People v. Hancock, 48 Id. 631; as where a portion has been sold and the entire tract is assessed without specifically describing the excepted portion: People v. Cane, 48 Id. 427; People v. Hyde, Id. 431. Where a man permits his land to be used and worked in the name of a mythical company, it will not do to assess the land under such company name; it must be assessed to the owner: Hearst v. Egglestone, 55 Id. 365. Several tracts belonging to the same owner ought to be separately valued: People v. Hollister, 47 Id. 617.

Corporation and firm names: See sec. 3641, post.


Description of land.-Subdivision 5 of the next section of this code provides for the description of land in the voluntary statement to be filed by the owner, and section 3634 prescribes the practice upon a refusal or omission of the owner to make the required statement. The description should be at least so definite inform the owner that it was his land to which the assessment attached. A description sufficiently certain to convey land between man and man, and which if contained in an agreement to convey would authorize a court of equity to decree a specific execution, has been declared, in California, insufficient in a proceeding to enforce the collection of a tax: People v. Mahoney, 55 Cal. 286; although Cooley, Taxation, pp. 282, 283, says that such a description would be generally sufficient. Describing land by a certain name, as "Clark's ranch," is insufficient: Lachman v. Clark, 14 Cal. 131; and omitting the metes and bounds, where the statute requires them, is fatal: Id.; Kelsey v. Abbott, 13 Id. 609. A mistake in a description so trivial as not to mislead the owner, and not prevent him from ascertaining that his is the land assessed, does


Place of assessment. The respective duties of the state board of equalization and of boards of supervisors with regard to the assessment of railroads operating in more than one county are discussed in People v. Supervisors of Sacramento County, 59 Cal. 321; and the design of the revenue laws, seemingly all apparent from the laws themselves, is there judicially declared to be that all other property than railroad property is to be assessed by the local assessors in the manner prescribed by law. The steamers of the Central Pacific Railroad plying on the bay of San Francisco are to be assessed by the local assessors, not by the state board: San Francisco v. C. P. R. R. Co., 63 Id. 467. The code prescribes that the situs of personal property is to govern in deterinining the place of its assessment. And before the code the law was the same: People v. Holladay, 25 Cal. 300; People v. Niles, 35 Id. 282; People v. Home Ins. Co., 29 Id. 533. For the purposes of taxation, personal property is to be considered like real estate, as having a situs of its own, independent of the domicile of the owner: People v. Niles, supra. But by thus assigning to personal property a situs for the purposes of taxation, it is not intended to authorize the listing or taxing out of the owner's county of such personal property as might casually, in the usual and ordinary course of busibe found therein: Id. Elsewhere, also, personalty is given a situs to enable taxation of it to be made: Huckins v. Boston, 4 543; Leonard v. New Bedford, 16 Gray, 292; although the general rule is to make the personalty, as in other cases, follow the domicile of its Owner: Burroughs on Taxation, sec. 97; a method of tax ing conceded by the California courts to be within the power of the legislature to adopt: People v. Townsend, 56 Cal. 633. Property of firms and of corporations has a situs of its own: Sec. 3641, post. Money

on deposit in bank is a loan, and is to be assessed on the depositor's death at his late place of residence, not in the county of deposit: San Francisco v. Lux, 1 West Coast Rep. 555.

Taxes are due and payable in the county where the property is first assessed; People v. Holladay, 25 Cal. 300. Assessment to the owners by name is required, under the present revenue system, where the owner is known: Gowtefend v. Ultz, 53 Cal. 666; the full name is required: Crawford v. Schmidt, 47 Id. 618. The method to be pursued where the owner is unknown is prescribed by sections 3634 and 3635, post. Forby blocks: People v. Morse, 43 Id. 534; People v. merly blocks of land in a city could be assessed

not avoid the assessment: Bosworth v. Danzien, 25 Id. 296. The books are full of cases where assessments are sought to be set aside for insufficient descriptions; many turning on the language of the statute, others involving peculiar facts. Attempts have been made to state some general rule upon the subject, but no complete satisfactory statement of the principle has yet been made. Cooley seems to approve of the rule as stated by Judge Thompson in Woodside v. Wilson, 32 Pa. St. 52, 55: "The designation of the land will be sufficient if it afford the

means of identification, and do not positively mislead the owner:" Cooley on Taxation, 286. A vague, indefinite, and uncertain description will render the assessment void: People v. Flint, 39 Cal. 670.

Assessment is the basis of a tax, and es

sential to the validity of all subsequent proceedings: Ferris v. Coover, 10 Cal. 589; Reily v. Lancaster, 39 Id. 29 Id. 449; People v. San Francisco Savings Union, 31 Id. 132; Miller v. Hale, 26 Pa. St. 432; Matter of Nichols, 54 N. Y. 62. It in



Culve cell, 44 Id. 620; and this without placing itiates the lien of the tax: Reeve v. Kennedy, erate valuation on the several lots into it was divided: Id. Land owned in common by two or more may be assessed to


43 Cal. 644; and if irregular, is beyond the power of the legislature to correct: McRey nolds v. Longenberger, 57 Pa. St. 13. The as

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