Utah-Idaho Sugar Co. v. Salt Lake County

210 P. 106, 60 Utah 491, 27 A.L.R. 874, 1922 Utah LEXIS 57

• Court: Utah Supreme Court
• Decided: September 16, 1922
• Docket: No. 3694
• Status: Published

Opinions

FRICK, J.

The Utah-Idaho Sugar Company, a corporation, hereinafter called plaintiff, brought this action in the district court of Salt Lake county against Salt Lake county and the individuals named as treasurer, assessor, auditor, and the three county commissioners of said county hereinafter designated defendants, to enjoin them from collecting a certain tax, which was assessed against the plaintiff and which plaintiff alleged was illegal and void. The district court enjoined the defendants from collecting a portion of the alleged illegal tax, and refused to enjoin the collection of a certain portion as will hereinafter more fully appear. The defendants appealed to this court from that part of the judgment which enjoins them from collecting the tax as aforesaid, while the plaintiff appealed-from that part on which an injunction was denied. The appeal was duly submitted to this court and a decision was handed down, in which by a divided court (Mr. Justice Thurman dissenting) it was held that, while the whole of that part of the tax which the district court enjoined was a legal tax, yet that only a part thereof was legally collectible by Salt Lake county, and that that part which the court had refused to enjoin was legally collectible by said county. As to the first part, therefore, the judgment was in part reversed by this court, while as to the second part it was affirmed. The plaintiff in due time filed an elaborate petition for a rehearing. Defendants joined issue thereon, and also prayed that they be given a rehearing on the proposition that the whole tax was collectible by Salt Lake county. The different members of the court entertained serious doubts respecting the correctness of the decision as handed down, and therefore a rehearing was granted, and tbe whole ease was reopened for argument. The case was most elaborately argued by both sides in oral arguments, and by additional briefs, and was again submitted. A majority of the court being now of the opinion that the former decision should not be adhered to, this decision is substituted therefor.

In view that the findings of the district court fully reflect the pleadings and issues, together with the evidence, we have deemed it more convenient to merely set forth the findings somewhat in detail, instead of referring to the pleadings. The assignments which assail the findings will be referred to in the course of the opinion wherever deemed necessary. In view that the findings are very lengthy and go into great detail, we shall state them in condensed form only. For more convenient reference we shall retain the original numbering of1 the paragraphs of the findings. The court found:

(1) That plaintiff is a corporation of the state of Utah, and that it was also doing business in the states of Idaho, Oregon, Washington, and Nevada in the production, manufacture, and sale of beet sugar, and that it maintained its general office at Salt Lake City, Utah.

(2) That at all times stated in the complaint and on the 1st day of January, 1918, and prior thereto, plaintiff owned and operated sugar factories at the following places: Lehi, Payson, and Spanish Fork in Utah county; Garland, in Box Elder county; Elsinore, in Sevier county, and West Jordan, Salt Lake county, all in the state of Utah; that it also owned and operated factories at Idaho Falls, Sugar City, Blackfoot, and Shelley in the state of Idaho; also one at Grant’s Pass, Or., one at Sunnyside and another at North Yakima, state of Washington. The only factory owned and operated by the plaintiff in Salt Lake county was the one at West Jordan.

(3) That at all times stated plaintiff maintained offices in all of the counties aforesaid in the state of Utah in connection with its said factories, and, also maintained offices in connection with its plants in the states of Idaho, Oregon, and Washington; that comparatively only a small part of its business and operations was carried on in Salt Lake county, and. that by far the greater part of plaintiff’s assets and property was in counties of the state of Utah other than Salt Labe county and in states other than the state of Utah.

(4) That on the 1st day of January, 1918, plaintiff owned real estate and improvements thereon in Salt Lake county; that plaintiff’s said real estate and improvements in said county were assessed at the value of $271,575, and valuation notices of said assessment were given plaintiff, in which notices the valuation was given as stated above; that said valuation and assessment, including the real estate and plant at West Jordan, did not include the machinery, which was valued and assessed separately from the real estate and improvements; that plaintiff, for the year 1918, was also assessed for personal property in Salt Labe county, including the machinery aforesaid at West Jordan plant, at the total valuation of $420,505; that notices of said assessment and valuation were duly given to the plaintiff; that prior to the commencement of this action plaintiff had paid all of the taxes on the valuations and assessments aforesaid, amounting to $8,381.36.

(5) That after giving the valuation notices aforesaid .and between the 1st day of May and the 1st day of June, 1918, the defendants, county assessor and county treasurer, gave or caused to be given the plaintiff two additional valuation notices, one for $10,000,000, in which the property valued and assessed was described only as “$10,000,000.00 personal property,” and the other in the sum of $167,180, in which the property was described only as “intangible property at West Jordan factory”; that “no other description, enumeration or specification of property, either as to kind, character, or quality, was made or given; that upon inquiry by plaintiff of said assessor respecting, said property he refused, or was unable, to give any further description except that said assessments were for “intangible property,” but refused, or was unable “to give the nature or character of said intangible property.”

(6) In this paragraph of the findings the facts are fully set forth with respect to the proceedings had before the Salt Lake county board of equalization. Among other things the court found that plaintiff had made timely and repeated protests to said valuations and of said $10,000,000 and said $167,180 assessments, and demanded a cancellation thereof; that the plaintiff had no such property as was thus attempted to be valued or assessed either real or personal, in Salt Lake county, and that it had no other than the two items that were valued and assessed by the county assessor, to wit, real estate and improvements, $271,575 and personal property, including the machinery of the value of $420,505, making a total in said Salt Lake county of $692,080, and, specifically, that plaintiff had “no such property in Salt Lake county as was sought to be assessed for $167,180, or any part thereof, or for said $10,000,000 or any part thereof.”

(7) The court then found in detail the facts respecting the controversy between the parties with regard to the said two items of property and found that: The plaintiff proved before said board that it had “no tangible or intangible property of any kind in Salt Lake county on January 1, 1918, or for that taxing year,” except what was contained and described in said valuation of $692,080, and that such was all the property plaintiff had in Salt Lake county. That the only claim upon which the defendants based the right to assess said $10,000,000 was “a printed annual statement of the plaintiff, which was a statement showing the financial condition of the plaintiff on the 28th day of February, 1918, and which was substantially the financial condition of the plaintiff on January 1,1918. That a copy of said statement was admitted in evidence upon the trial, and reads as follows: ■

Assets.

Real estate, plants, canals, etc., less depreciation.$16,562,477 43

Railroad spurs . 89,306 30

Irrigation stocks . 3,255 00

Autos, horses, harness and farm equipment. 98,285 58

Furniture and fixtures. 27,515 84

Advance charges to operations. 101,238 67

Advances on contracts and new operations. 85,225 34

Cash and convertible assets:

Cash .$ 112,135 10

Bills receivable . 2,106,859 08

Accounts receivable . 1,221,690 76

Stocks and bonds. 476,366 97

Mortgage loans . 536,.513 49

Unpaid contracts and agreements 538,997 44

Accrued interest receivable.. 32,003 47

Sugar, molasses, and pulp. 3,429,860 30

Beet seed .. 557,515 38

Prepaid on beet seed. 16,679 77

Supplies . 803,329 13 9,831,950 88

$26,799,255 04

Liabilities.

Capital stock:

Authorized . $30,000,000 00

Unissued . 6,373,650 00 23,626,350 00

Reserve for doubtful accounts. . 90,000 00

Current liabilities:

Bills payable . . 1,042,685 32

Accounts payable . . 151,312 70

Income taxes payable... . 367,823 90

Accrued interest payable. 4,852 20

Unpaid pay roll. 79,159 26

Freight and discount on sugar. 59,949 31

Sundries . 3,267 73

Total current liabilities. . 1,709,050 42

Surplus . . 1,373,824 62

Total liabilities .$26,799,225 04

That the assessor “through correspondence with various taxing authorities * * * had been informed and learned that the plaintiff in all the counties of the state of Utah, including Salt hake county, and in all the states where it had real estate and plants and other property and did business, and in all the world for the year 1917 paid taxes on an assessed valuation of about $9,000,000, but inasmuch as it had in all the world total assets as shown by the said statement of over $26,000,000, the plaintiff was not paying a just proportion of taxes and hence the assessor and the said board claimed the right to assess the plaintiff as and for intangible property the difference between the said assessed value of $9,000,000 and the said total assets of over $26,000,000 which was more than $10,000,000.” ,

(8) That nothing was made to appear that the plaintiff on January 1, 1918, or for that taxing year, in Salt Lake county “had property of any kind or description, either personal or real, or tangible or intangible in addition to the said $692,080.”

(9) That in due time the treasurer of Salt Lake county “sent or caused to be sent to the plaintiff a tax notice of said assessments for $10,000,000, and demanded a total general tax thereon in the sum of $198,000; that the only description or enumeration, or specification of property with respect thereto was ‘P. P. $10,000,000.00,’ ” and that about the same time a tax notice was given plaintiff respecting said assessed valuation of $167,180 for “intangible property at West Jordan,” and demanded a tax thereon in the sum of $1,989.44.

(10) The court then found that: The assessor was provided with an assessment roll, which was divided into columns. That there was one column in which to include the value of the real estate, another in which to state the value of the improvements thereon, another in which to state the value of live stock, and still others in which to state the value of merchandise, supplies, appliances, implements, tools, machinery, money, bonds, solvent credits, judgments, etc. That “neither of the said assessments for the said $167,180 or the said $10,000,000 was incorporated or placed in or under any of the said columns upon the assessment roll, but on the assessor’s blotter both were placed in the column of ‘Other Taxable Property’ and on the assessment roll in the treasurer’s office both in the column of ‘ Personal Property Not Otherwise Enumerated.’ ” That the West Jordan plant or factory in Salt Lake county on the assessment roll was described as follows:

“Value of real estate, $8,820.00; value of improvements, $237,000.00; supplies, $55,590.00; sugar, $107,200.00; raw material, $1,570.00; value of machinery, $237,000.00; office furniture, $2,000.00; value of other taxable property $167,080.00.”

That on the assessment roll in the treasurer’s office the same property was described as follows:

“Value of real estate, $8,820.00; value of improvements, $237,000.00; merchandise, $164,360.00; machinery, $237,000.00; personal property not otherwise enumerated, $167,180.00; total value of personal property, $570,540.00; total value of all property assessed, $816,360.00.”

(11) The court further found that said $10,000,000 assessment was not made upon any real estate, or upon any other kind or character of property whatever situate and being in Salt Lake county, and that the assessment of $167,180 was not made upon any property “except on the machinery or plant at said West Jordan”; that the plaintiff, on the 1st day of January, 1918, or for said taxing year, “had no property in Salt Lake county, either real or personal, except the property mentioned and described in said valuation notices,” amounting to $692,080, “and the plaintiff had no property in Salt Lake county of any kind in addition, thereto or for which the said assessment of $10,000,000, or any part thereof, was made.”

(12) That “the total assets of the plaintiff in all the world for the year 1918 were shown to be over $26,000,000; the-assessed value of its property in all the world,'about $9,000,000; the authorized capital stock of the plaintiff $30,000,000; the issued par value of the capital stock, $23,626,350; the unissued par value of the capital stock, $6,373,650; the market value of the capital stock about $8.50 per share; the par value $10 a share; and thus the total value of the physical assets of the plaintiff for the year 1918 exceeded the market value of the issued stock by between $4,000,000 and $5,000,000.”

(13) That of all the propérty mentioned in the financial statement aforesaid none was in Salt Lake county except said $692,080; that of the stocks and bonds valued at $476,366.97, $400,000 were corporate .stocks of the Layton Sugar Company at Layton, Utah, a Utah corporation, which stocks were not taxable; that of the property mentioned in said financial statement $52,339 was nontaxable governmental bonds and stamps; that $17,004 consisted of nontaxable stock of the United States Beet Seed Company, having its office in Salt Lake county; $2,500 was nontaxable stock in the Industrial Company, a Utah corporation; $1,807 was nontaxable stock in the Utah Conservation Company, a Utah corporation; $150 was nontaxable stock in another Utah corporation; that of the item $536,513.49 in said financial statement $443,794 constituted mortgage loans in tbe state o£ Utab and not taxable in this state; that the remainder of said loans, something over $100,000, represented loans upon lands elsewhere, chiefly in-the state of Idaho, but no claim was made by any of the defendants that either of the items mentioned was assessed as mortgage loans, and neither of the assessments in dispute was in fact made for mortgage or other loans; that the item of $90,000 mentioned in said financial statement was worthless; that the plaintiff had listed all of its property with the assessor prior to said additional statements of $10,000,000 and $167,180, which list was duly verified, and showed that the accounts payable exceeded the accounts receivable, which fact was not disputed by the defendants or any of them.

(14) The court further found that—

The item of $167,180 which was assessed by the assessor subsequent to the original assessment, “was intended by said assessor * * * should be for and upon some property at the West Jordan plant, and to be a part of the value of the machinery at said plant, and though it was on the assessment roll placed in the column of ‘Other Taxable Property’ and ‘Personal Property Not Otherwise Enumerated,’ and though it was designated or asserted to be for intangible property, nevertheless it was intended to be a part or an additional valuation of the machinery at the said West Jordan plant. And the court especially finds that by adding the said amount of $167,180 to the value of the machinery at said plant, valued at $237,000 or otherwise added to the value of the said plant, the sum after malcing such addition is a fair and reasonable value of the said machinery or of the said plant, and is not in excess of the actual cash value of the said machinery or of the said plant; and the court thus, upon all the evidence, finds that the said assessment of $167,180 was in fact made as a part valuation of the said machinery or plant.”

(15) The court found that plaintiff paid all of the taxes assessed upon the valuation of said $692,080 and that it refused to pay the taxes upon said $10,000,000 and upon said $167,180 assessments, and that plaintiff claimed that the taxes upon the said two items last mentioned were “wrongful, unlawful, and void”; that unless defendants were enjoined from collecting the taxes on said two items last mentioned they would have sold plaintiffs property, or sufficient thereof to pay the same.

(16) The court further found that the averment of the defendants that the plaintiff owned $10,000,000 of personal property in Salt Lake county is not supported by the evidence, and that plaintiff did not own any personal property in said county at the times stated herein in excess of $420,505.

(17) The court further found that—

The business “conducted at the said West Jordan plant in Salt Lake county, and the operations there carried on, were separate and distinct and apart from the operations of any and all other factories or plants, and while there was a unity of ownership of the plaintiff of all of the plants or factories, still there was no unity of plant, or of system, or of business, or of operation, nor was there any unity of use, for each plant or factory was conducted and operated separately and apart from all other plants or factories.”

Finding 18 is omitted as not material for the reasons hereinafter appearing in this opinion.

(19) The court further found that—

It was not claimed or pretended by the defendants, or any of them, that the disputed assessments “were for any kind of franchise or privilege, * * * and that neither of said disputed assessments was founded or based upon any kind of a franchise or privilege in Salt Lake county other than its franchise to be a corporation.”

As conclusions of law the court found:

1. That the assessments for $167,180 was on property at the West Jordan plant, and that said “assessment and taxes thereon are lawful and valid,” and that plaintiff should be required to pay said taxes. •

2. That the assessment for $10,000,000 and the taxes sought to be collected thereon are unlawful and void.

Conclusion No. 3 is the same in legal effect as No. 2.

4. That the defendants pursued a wrongful and unlawful and unauthorized method in making said $10,000,000 assessment, and that they exceeded their jurisdiction and authority in making the same.

Conclusion No. 5 is the same in legal effect as No. 4, and No. 6 is in effect the same as No. 1.

7. That if the defendants had not been enjoined they would have sold plaintiff’s property to collect the taxes assessed upon said $10,000,000, and that plaintiff did not have a plain, speedy, and adequate remedy at law in the premises, and was entitled to have the temporary injunction theretofore granted made permanent.

A judgment or decree was entered in accordance with the findings of facts and conclusions of law by which the defendants were permanently enjoined from collecting the taxes upon said $10,000,000 assessment, and by which the assessment and taxes on said $167,180 were declared legal, and the plaintiff was ordered to pay said taxes.

Although it was necessary to devote much space to the statement of the foregoing findings of fact, yet, in view of the importance of the questions involved and the necessary effect and scope of the conclusions hereinafter reached, we deemed it best to state the findings somewhat in detail; and in order to be fair to both sides and to reflect, so far as possible, the true spirit of the findings we have given many of them in the language of the court.

The defendants have assigned a large number of errors. In those they assail findings numbered 8, 4, 6, 7, 8, 11, 12, 13, 16, 17, 18, and 19. They also assail conclusions of law numbered 2, 3, 4, 5, 6, and 7.

We shall first consider the defendants’ appeal, and shall refer to the findings that are assailed by plaintiff when we consider its cross-appeal.

We remark that, although the defendants have assailed numerous findings of fact, yet neither in their briefs nor in their oral arguments have they pointed out any specific finding that is not supported by the evidence, nor have they given any specific ground or reason wherein or why the evidence is insufficient to support any particular finding. Counsel for defendants, in their printed brief, merely state that they have “divided the discussion” into “subdivisions,” and, further:

“As the principal questions involved in the discussion run all through the case, we have not undertaken to present the assignments of error separately, but have grouped and discussed them under topical headings or subjects, and have intended to include therein all assignments and to waive none.”

"While it is not only permissible but often commendable for counsel to group their assignments and consider kindred subjects together, yet when the findings of fact are assailed, which, in the nature of things at least, cannot all, nor even a large portion thereof, be contrary to the evidence, counsel must point out in what particulars the findings are not supported by the evidence; and it is not sufficient merely to make the assignments specific, but if they are relied on they must be specifically referred to in the brief, so that we may know what points are relied on, and where we may look in the record for the evidence or the lack of evidence with respect thereto.

Counsel have argued the following propositions under the following heads or “subdivisions”: (1) “Total Value of Assets of Plaintiff as Determined by Assessor.” (2) “Value of Plaintiff’s Tangible Property as Determined by Assessor.” (3) “Value of Plaintiff’s Property Outside of Utah.” (4) “Value of Plaintiff’s Intangible Property.” (5) “Method of Ascertaining Value of Intangible Property.” (6) “How Intangible Property is Taxable.” (7) “Situs of Good Will and Other Intangible Property.” (8) “Intangible Property is Subject to Taxation.” (9) “Eights and Powers of Assessor and Board of Equalization.” (10) “The Taxing Officials Proceeded Under Utmost Good Faith.” (11) “Plaintiff was Not Discriminated Against.” (12) “The Description of Property.” (13) “The Injunction was Improperly Issued.”

It goes without saying that we cannot and shall not separately consider each one of the foregoing propositions. Nor is it necessary to do so. We shall consider them, however, so far as they have any material bearing upon the conclusions hereinafter reached. Neither shall we specifically discuss the court’s findings, but shall consider them in the course of the opinion, when it becomes necessary to do so.

We shall first consider the $10,000,000 assessment. Defendants’ counsel, with much vigor, have argued both in their briefs and orally at the hearing, that the $10,000,000 assessment represents what they term “intangible property” the situs of which they assert is at the principal office of plaintiff in Salt Lake county, and that the assessment thereof and the tax levied thereon is legal and valid. They base their argument upon the g-round that there was not only a unity of ownership of all of plaintiff’s factories and property con-, nected therewith, but that there was and is a unity of use. As supporting their contentions, among other eases they cite and rely upon the following: Adams Express Co. v. Ohio, 165 U. S. 194, 17 Sup. Ct. 305, 41 L. Ed. 683. In that case there is also an exhaustive opinion upon the application for a rehearing which is found in 166 U. S. 185, 17 Sup. Ct. 604, 41 L. Ed. 965; Henderson Bridge Co. v. Kentucky, 166 U. S. 150, 17 Sup. Ct. 532, 41 L. Ed. 953; State v. Wells Fargo & Co., 38 Nev. 505-540, 150 Pac. 836; State v. Duluth Gas & Water Co., 76 Minn. 96, 78 N. W. 1032, 57 L. R. A. 63; City of Los Angeles v. Western Union Oil Co., 161 Cal. 204, 118 Pac. 720; Crocker v. Scott, 149 Cal. 575, 87 Pac. 102; Louisville & Nashville R. Co. v. Greene, Auditor, etc., 244 U. S. 522, 37 Sup. Ct. 683, 61 L. Ed. 1291, Ann. Cas. 1917E, 97; Porter v. Rockford I. & St. L. R. Co., 76 Ill. 561; Union Refrigerator Transit Co. v. Kentucky, 199 U. S. 194, 26 Sup. Ct. 36, 50 L. Ed. 150, 4 Ann. Cas. 493; Hawley v. Malden, 232 U. S. 1, 34 Sup. Ct. 201, 58 L. Ed. 477, Ann. Cas. 1916C, 842; State v. Jones, Auditor, 51 Ohio St. 492, 37 N. E. 945; National Bank v. City Council, 136 Iowa, 203, 112 N. W. 829; Marshalltown, etc. Co. v. Welker, 185 Iowa, 165, 170 N. W. 384; Com. E. L. & P. Co. v. Judson, 21 Wash. 49, 56 Pac. 829, 57 L. R. A. 78; Miller & Lux, Inc. v. Richardson, 182 Cal. 115, 187 Pac. 410; Kern River Co. v. County of Los Angeles, 164 Cal. 751, 130 Pac. 714; Cream of Wheat Co. v. Grand Forks, 253 U. S. 325, 40 Sup. Ct. 558, 64 L. Ed. 931; San Francisco v. Pennie, 93 Cal. 465, 29 Pac. 66.

In view that many of the decisions in the foregoing cases are cited, and a few of them quoted from, in the opinion first handed down in this case, and in view that I, at least, did not fully grasp and appreciate the scope and legal effect of those decisions, I shall more fully consider at least some of them than I otherwise would.

Referring to the first case, Adams Express Co. v. Ohio, supra, in which the question of unity of ownership and unity of use is discussed and distinguished, the court, speaking through Mr. Chief Justice Fuller, in considering the nature of the use of the property owned by the Express Co., 165 U. S. at page 222, 17 Sup. Ct. at page 309 (41 L. Ed. 683) says:

“We repeat that while the unity which exists may not be a physical unity, it is something more than a mere unity of ownership. It is a unity of use, not simply for the convenience or pecuniary profit of the owner, but existing in the very necessities of the case — resulting from the very nature of the business.

“The same party may own a manufacturing establishment in one state and a store in another, and may make profit by operating the two, but the work of each is separate. The value of the factory in itself is not conditioned on that of the store or vice versa, nor is the value of the goods manufactured and sold affected thereby. The connection between the two is merely accidental 'and growing out of the unity of ownership. But the property of an express company distributed through different states is as an essential condition of the business united in a single specific use. It constitutes but a single plant, made so by the very character and necessities of the business.”

Tbe doctrine is again considered in the opinion on rehearing (166 U. S. 185, 17 Sup. Ct. 604, 41 L. Ed. 965), and the views of the Chief Justice, as I have stated them above, are reaffirmed.

In the case of Henderson Bridge Co. v. Kentucky, supra, the court lield that the franchise there in question was taxable as “intangible” property under the Kentucky statute. In the course of the opinion it is said:

“The company was chartered by the state of Kentucky to build and operate a bridge, and the state could properly include the franchises it had granted in the valuation of the company’s property for taxation.” (Italics mine.)

The Legislature of Kentucky, by an express statute, provided for the assessment of “intangible” property as such, something as I shall hereinafter show, the Legislature of this state has entirely omitted to do. Indeed, in this state the franchise to be a corporation — and it is not disputed that that is the only franchise that the plaintiff was granted by the state of Utah — it has been held by this court is not taxable property. Black Rock Copper M. & M. Co. v. Tingey, 34 Utah, 369, 98 Pac. 180, 28 L. R. A. (N. S.) 255, 131 Am. St. Rep. 850, and International Smelting Co. v. Tooele County, 54 Utah, 591, 182 Pac. 841.

The case of State v. Wells Fargo & Co., supra, merely follows the doctrine laid down by the United States Supreme Court in the Adams Express Co. Case, supra.

In the case of State v. Duluth Gas & Water Co., supra, the question of ascertaining the value and assessing the capital stock of a corporation under the Minnesota statute was before the court. It was there held that under the statute franchises and intangible property should be considered in determining the value of the capital stock for assessment purposes. It is, however, not held in that case, nor in any case, in the absence of a statute, that intangible property as such may be separately and independently valued and assessed for taxation. Moreover, in this state capital stock is not taxable as such, but the property it represents is taxable, and, as I hope to show later, the value of the capital stock may be considered in fixing the value of the property which is represented by' the stock.

The ease of City of Los Angeles v. Western Union Oil Co., supra, is a typical California case. Under the California statute franchises to be a corporation are taxable as property. It was therefore held, quoting from the headnote, which is a correct statement of the gist of the decision, that—

“A proper method for ascertaining the value of the franchise of a corporation to he a corporation is to deduct from the aggregate market value of its shares the value of its tangible property, taking the difference as the value of the franchise.”

I have already shown that such a franchise is not subject to taxation under our statute, but can only be reached by a license tax as is pointed out in the Black Bock Case, supra.

In the case of Crocker v. Scott, supra, the question before the court was the legality of the assessment of certain National Bank stock and how the value of such stock should be ascertained. While in that case the subjects of “good will” and “intangible property” are discussed, yet the decision, in view of our statute and tbe decisions to which. I shall hereinafter refer, has no application to the facts and conditions of the case at bar.

What is true of the Crocker Case and the Los Angeles Case, supra, is true of every other California Case cited, and therefore I shall not review the California cases further.

In the ease of Louisville & Nashville Ry. Co. v. Greene, Auditor, supra, the question decided was whether the method pursued in ascertaining and fixing- the value of the franchise of the appellant in that case was legal. Again much is said regarding what may be considered in determining the value of a taxable franchise. The decision has no controlling influence here.

In the case of Porter v. Rockford I. & St. L. R. Co., supra, the question again was how the value of a taxable franchise should be ascertained.

The case of Union Transit Co. v. Kentucky, supra, in principle supports the contentions of the plaintiff rather than those of the defendants. In that case, in speaking of what constituted intangibles, it was said that they consist of “stocks, bonds, notes, and other choses in action.” I speak of that merely because defendants’ counsel seemingly have confused intangible property of that nature which has a physical existence with the $10,000,000 assessment here in question and which they designate as intangible property subject to separate and independent valuation and taxation.

In Hawley v. Malden, supra, it is held that shares of stock in a corporation may be assessed against the owner at his domicile, although the shares are issued by a nonresident corporation.

State v. Jones, Auditor, supra, sustains plaintiff’s position. I shall again refer to the decision in that case later.

In National Bank v. City Council, supra, the Supreme Court of Iowa held that National Bank stock is “in and of itself” tangible property, and when assessed to the owner thereof its value is to be determined by having recourse to all matters that may “have the effect of enhancing or controlling its Value.” That no doubt is good law, but has no application here.

The decision in Marshalltown, etc., Co. v. Welker, supra, has no application to the case at bar.

In Com. E. L. & P. Co., supra, it is held that a franchise which authorizes the use of the streets for certain purposes is taxable. So do we hold.

In Miller & Lux, Inc., v. Richardson, supra, the court says that the action “is an action to recover taxes paid under protest by the plaintiff corporation upon alleged illegal and arbitrary assessments of its ‘franchise,’ ” etc. The Supreme Court quotes the California statutes as follows:

“All franchises, other than those of the companies mentioned in sections 2, 3 and 4 of this act [of which plaintiff is not one] shall be assessed at their actual cash value, after making due deduction for good will. * * *”

The Attorney General of California contended that the exception offended against the California Constitution, and the court so held; hence the tax on the good will was sustained. In other words, good will was considered in fixing the value of the'franchise.

It is not necessary to review other cases cited, as they contain nothing not already considered.

The foregoing decisions, therefore, do not hold that the property of an individual or of a private corporation like plaintiff which is situate and used in' one state may be assessed or taxed in a state other than where such property is situated and used. The question respecting the so-called unity of use as applied to corporations other than interstate railways was perhaps first considered in the case of Adams Express Co. v. Ohio, and followed in the case of Henderson Bridge Co. v. Kentucky, supra. It will be observed that in both of those cases the decision is by a divided court, five to four. The doctrine of the unity of use for the purposes of taxation, while now well settled by the decisions of the Supreme Court of the United States, has, nevertheless, never been carried or extended beyond the express company cases. As to interstate railways whose rolling stock is constantly moving and shifting from one state to another, it became necessary in order to establish a just and equitable system of taxation to assess such property in all of the states in which it was used by making a proper apportionment among or between such states, and therefore the doctrine of unity of usé was not only thoroughly practicable, but was just and equitable. The doctrine never has been applied, however, nor can it justly and equitably be applied, to manufacturing or other similar plants or industries which may be under common ownership but used or operated in different states.' Taking plaintiff’s numerous plants as an illustration, in the very nature of things they are, precisely as the court found, operated and used entirely independent of one another. The failure or even the destruction of one factory or plant has no effect upon any other one. Neither is the property used in connection with those plants, or any part of it, used at any time in one state and at another time shifted or moved to another state. But the plants and the property used in connection therewith are just as stationary and immovable as though each one was owned by a different individual or corporation. All there is, therefore, is a unity of ownership, which as a matter of course, cannot control either local or general taxation. In none of the cases above cited is there anything to the contrary. Indeed, the decisions clearly support the conclusions I have just stated. True, some of the cases hold that where franchises to be a corporation are taxable, then the value of such franchises may be ascertained by ascertaining the total value of the capital stock, and then deducting therefrom the total value of the tangible corporate property, and if there is a difference between the two, such difference should be taken as the value of the franchise; and that method may be pursued with other franchises, if there are any. It is, however, expressly found by the district court in the case at bar, which fact cannot well be disputed, that the plaintiff had no taxable franchise of any kind, and hence there was nothing upon which the foregoing method of fixing the $10,000,000 assessment could be applied. It is very clear to the writer that the .cases cited by defendants in no way justify tbe $10,000,000 assessment in tbe form of intagible property.

It is, however, also contended that under our constitutional provisions respecting taxation tbe $10,000,000 assessment should stand. Section 2 of article 13 of our Constitution, so far as material here, provides:

“All property in the state, not exempt under the laws of the United States, or under this Constitution, shall he taxed in proportion to its value, to he ascertained as provided by'law. The word property, as used in this article, is hereby declared to include moneys, credits, bonds, stocks, franchises and all matters and things (real, personal or mixed) capable of private ownership; but this shall not be so construed as to authorize the taxation of the stocks of any company or corporation, when the property of such company or corporation represented by such stocks, has been taxed.”

The following section in part provides:

“The Legislature shall provide by law a uniform and equal rate of assessment and taxation on all property in the state, according to its value in money, and shall prescribe by general law such regulations as shall secure a just valuation for taxation of all property, so that every person and corporation shall pay a tax in proportion to the value of his, her or its property: Provided, that a deduction of debits from credits may be authorized.”

It is not necessary now to refer to tbe provisions of our statutes since those necessarily follow tbe Constitution.

Tbe word “franchises,” as used in section 2 above, as already pointed out, was construed and applied in the Black Bock Case, -supra. It was there held that in view of other constitutional provisions that term bad no application to franchises to be a corporation, and thus cannot be taxed as other property is taxed.

It is contended, however, that good will, the earning capacity, the productiveness of the property and the actual earnings, together with all matters that may enhance or influence the value of tangible property, may be considered, and that the things just enumerated constitute intangible property, all of which is taxable under the constitutional provisions to which reference has just been made. It is cheerfully conceded — indeed no one disputes the contention — that all of the things last above enumerated which may influence or enhance the actual value of tangible property, not only may, but should, be considered by the assessing authorities in arriving at the actual value of property for taxation. The question, however, is, may those elements, in the absence of express statutory authority, be taxed or assessed under the designation of “intangible property,” or “other personal property,” as was done in the case at bar? Under the authorities, as I read them, but one answer is permissible, which is in the negative.

In Re Stevens, 46 Misc. Rep. 649, 95 N. Y. Supp. 313, good will is defined in these terms:

“* * * 'good will’ is the reputation of an established business. Both [the corporate franchise and good will] are intangible assets of the corporation. Neither is a part of its working capital. Both are represented by the share stock held by its stockholders. Both are dependent upon the corporate existence, and ‘good will’ can only exist in connection with an existing and going business. Both are appurtenant to the corporation as such, and have no independent existence apart from it. Both constitute elements of value in connection with, but not apart from, the corporation and its business.”

In Lindermann v. Rusk, 125 Wis. 210, at page 233, 104 N. W. 119, at page 126, the Supreme Court of 'Wisconsin says:

“Good will is the result of the employment of capital in some established business. It augments its value and is an incident to the conduct of the enterprise. It exists at the place where the business is carried on, and gives value to the enterprise because of the benefits that are likely to come to a successor and. which arise from being connected with its reputation.”

In Mitchell v. Read, 19 Hun (N. Y.) at page 422, the court says:

“Good will, however it may be defined generally, does not exist separate and independent of a substantive or principal subject. It always appertains to something else, and is as various as the subjects are to which it appertains.”

In 12 R. C. L. § 5, p. 981, the doctrine is admirably stated thus:

“It has frequently been held that good will is not a property right subject to taxation, yet, apparently as a consequence of the franchise tax, the tax on the corporate receipts, and the idea of taxing corporate property as a unit, all of which are largely of modern growth, it is now coming more to he recognized that in determining the value of corporate stock for purposes of taxation, according to statute, the value of the good will of the corporation must he considered in connection with the other assets in determining the value of the stock.”

Numerous similar statements from the decisions might be quoted, but the foregoing are quite sufficient to illustrate the principle now under consideration.

With respect to the right of the assessor to take into consideration the value of tangible property situate in one state to enhance the value of property within another state, the United States Supreme Court, in Delaware, L. & W. R. Co. v. Pennsylvania, 198 U. S., at page 356, 25 Sup. Ct. at page 674 (49 L. Ed. 1077), says:

“So, if the state cannot tax tangible property permanently outside of the state and having no situs within the state, it cannot attain the same end by taxing the enhanced valpe of the capital stock of the corporation which arises from the value of the property beyond the jurisdiction of the state.”

If we substitute the word “property” in the foregoing quotation for the words “capital stock,” it is quite clear that the $10,000,000 assessment is illegal and cannot stand. While it is quite true that in taxing the property of a foreign corporation which is in the taxing state the latter state may “look beyond its borders * # * that it may get the true value of the things within” the state, yet the “only reason” why that may be done is to obtain the true value of the property in the taxing state. Wallace v. Hines, 253 U. S. 69, 40 Sup. Ct. 435, 64 L. Ed. 782.

As a matter of course, where the legal situs of personal property such as notes, bonds, etc., is at the domicile of the owner, such property may be taxed to such owner in the state where he has his domicile. We are, however, not dealing with such property and with no such condition. We are here confronted with a condition outlined in the recent decision in Davis v. Wallace, 257 U. S. 478, at page 485, 42 Sup. Ct. 164, at page 166 (66 L. Ed. —), where, in concluding the opinion, it is said:

“From what has been said it ‘follows that to sustain the tax in question we should have to hold that the taxing officers, on finding that it could not constitutionally he assessed on the basis specially prescribed in the statute, were at liberty to assess it on another and different basis, which the statute shows was not to be applied to corporations of the class to which these railroad companies belong. Of course we cannot so hold.”

Again, in New Orleans v. Stempel, 175 U. S. 309, at page 312, 20 Sup. Ct. 110, at page 111 (44 L. Ed. 174) in speaking of tbe authority to tax property, the court says:

“Of course, there must be statutory warrant f.or such taxation, for if the Legislature omits any property from the list of taxables, the courts are not authorized to correct the omission and adjudge the omitted property to be subject to taxation.”

By the foregoing quotation is not meant, neither do we hold, that intangible property may not be taxed; but what we hold is that, unless there is statutory authority to do otherwise, intangible property of the kind and character here in question — that is, that included within the $10,000,000 assessment — must be considered merely as it may enhance or influence the value of the tangible property, and hence must be treated and taxed as tangible property and not separately or independently. The doctrine is clearly illustrated by the Supreme Court of Indiana in Hart v. Smith, 159 Ind. 182, 64 N. E. 661, 58 L. R. A. 949, 95 Am. St. Rep. 280. The provisions of the Indiana Constitution respecting the taxation of property are substantially like those hereinbefore quoted. In the case just referred to, however, the question before the court was the assessment or taxation of the good will of a newspaper plant separate and apart from the tangible property. In that ease, as here, the good will was placed at a value in excess of the value of the tangible property. The court enjoined the collection of the tax for the reason that without statutory warrant intangible property could not be separately assessed, but could be considered only in connection with and as enhancing or influencing the value of the tangible property. That case, it seems to me, standing alone, would be conclusive that the $10,000,000 assessment cannot prevail.

In the case of Street R. Co. v. Marrow, 87 Tenn. 406, 11 , in which state corporate franchises are considered as intangible property, it is said:

“Franchises of corporations are taxable property, and should be assessed, not separately, but with its tangible property.”

As bearing upon the question, see, also, State v. Austin & N. W. R. Co., 94 Tex. 530, 62 S. W. 1050; Southwestern T. & T. Co. v. Meerscheidt Tax Collector (Tex. Civ. App.) 65 S. W. 381. I refrain from citing other cases in which the decisions are to the same effect. In some states, however, notably in Kentucky, the statute provides for the taxation of intangible property separately. Such is also the case in some other states. See Western Union, etc., Co. v. City of Omaha, 73 Neb. 527, 103 N. W. 84; State v. Franklin County, etc., 74 Vt. 246, 52 Atl. 1069, and Rocheblave Market Co. v. City of New Orleans, 110 La. 529, 34 South. 665.

The conclusion is therefore irresistible, in so far as the $10,000,000 assessment was based upon plaintiff’s factories and the property used in connection therewith situate in states other than Utah, that that assessment must fail for the reason that the assessor and the county board of equalization clearly and manifestly exceeded their jurisdiction or authority in making it.

Having thus shown that neither the tangible nor the intangible property owned and used by plaintiff in states other than the state of Utah is taxable in Salt Lake county, where the principal office of plaintiff is situate, we now proceed to consider whether the so-called intangible property in question here, and which is situated in the several counties of this state, may be assessed and taxed at the home office of the plaintiff.

Section 10 of article 13 of our Constitution provides:

“All corporations or persons in this state, or doing business herein, shall be subject to taxation for state, county, school, municipal or other purposes, on the real and personal property owned or used by them within the territorial limits of the authority levying the tax.”

Our statute follows the Constitution, and therefore no special reference need be made thereto.

It will thus be seen that the Constitution provides that the property owned and used by all persons, including corporations, is subject to taxation “within tbe territorial limits of tbe authority levying the tax.’,’ That section was before this cqurt, and was construed and applied in the case of Murdock v. Murdock, 38 Utah, 373, 113 Pac. 330. It was there held that, regardless of the residence or domicile of the owner, all property must be taxed in the taxing districts where it is situated and used. If, therefore, defendants are right that under onr Constitution all intangible property is taxable the same as is tangible property, it nevertheless must follow that it is taxable only at the place where it is used in connection with the tangible property; and that would be so even though it were held that the so-called intangible property in question here could be assessed separately and independently and apart from the tangible property out of ■which it arises. If it were held, however, that the situs of the so-called intangible property here in question, so far as the same arises out of plaintiff’s property, which it owned and used in states other than Utah, were at its home office in Salt Lake county (which we have held it is not), yet, in view that that portion of the $10,000,000 assessment which arises out of plaintiff’s property owned .and used in counties other than Salt Lake may be legally assessed in such counties only, the $10,000,000 assessment would fail for the reason that that assessment is made in a lump sum, and could not be apportioned ; that is, there would be no method by which the value of the so-called intangible property arising out of plaintiff’s tangible property in other states could be segregated from that which is in the several counties in this state.

But there is still another insuperable obstacle in the way of the $10,000,000 assessment which cannot be overcome so long as the constitutional provision fixing the place where property is taxable remains in force. As pointed out, the Constitution provides that all property is taxable “within the territorial limits of the authority levying the tax”; that is, where the property is situated and used. From this it follows as a necessary corollary that all property, whether tangible or intangible, if subject to taxation, must be taxed by the authorities who have the power to levy the tax. If, therefore, a corporation owns factories, and property used in connection therewith, which are situated in different counties, no one would contend that the tangible property could be assessed in a lump sum and apportioned among the several counties. What is true of the tangible is likewise true of the intangible property. The Constitution in plain terms provides that the authorities of each county must assess the property for taxation. The authority to do that is therefore conferred upon them and upon no one else. It is their judgment respecting the value of the property within their county, and not that of the authorities of Salt Lake county, or of any other county, that the taxpayer is entitled to and which must control in determining the value of the property to be taxed. That, in view of constitutional provisions, is so palpably clear that argument seems entirely superfluous.

It is, however, also true that while the authorities consider the elements herein denominated intangible, such elements must be applied to all property alike. That is also made quite as imperative by our Constitution as is the duty that property must be taxed at its full value. If, therefore, the method which was adopted by the assessor in this case is followed, then it also follows that in view that the property of corporations only is represented by capital stock it is principally if not exclusively corporate property that will be assessed in the form of intangible property, since, as is demonstrated in this case, the supposed intangible property is easily ascertainable by merely deducting the estimated value of the tangible property from the total value of the capital stock, and then calling the difference, if any, intangible property and assess it as such. If, however, the property is not represented by capital stock, that method cannot be pursued, and, in view that it cannot be, corporate property only will be assessed in that way, and the so-called intangible property of the individual or of copartnerships will escape taxation because it cannot be reached by the method adopted by the assessor in this case. From, this it necessarily follows that if the provisions of our Constitution are to be followed in assessing property, then all the elements that enter into and tend to enhance or affect the value of property must be considered in estimating its value for taxation, and the property owned by an individual or by a co-partnership must be treated the same as that owned by a corporation. In view, therefore, that the so-called intangible property in this case consists merely of the elements aforesaid, and which enhance the value of the tangible property, the so-called intangible property should have been considered and taxed as a part of the tangible property and not as intangible.

If the method adopted by the assessor in this case is followed, it inevitably must result in taxing a large portion of the corporate stock indirectly which the Constitution provides may not be done directly. The only proper method, therefore, of taxing so-called intangible property all alike is by considering all the elements that in any way affect or enhance the value of property in determining its value for taxation.

But there is still a further reason why the taxes derived from the intangible property may not-be apportioned as suggested in the former opinion. Since all property is taxable where situated, each county is entitled to assess all property within its territorial limits at its actual value. The intangible property, which principally arises out of the productiveness of the tangible property, therefore depends upon the earning capacity and the actual earnings of the property in each county, including good will, and not upon the combined productiveness of all the property owned by a common owner in all of the counties. The factories, or some of them, situate in Utah county may produce much greater profits to the. owner than the factory in Salt Lake county, and vice versa. Indeed, the factory in Salt Lake county may operate at a loss. From this it necessarily follows that the actual value of the intangible property can only be ascertained by considering each factory or each plant separately, and not considering all of them as a unit. If the latter course is pursued, one county may suffer an appreciable loss, while another may obtain that to which it is not legally entitled. It is manifest, therefore, that in this state intangible property of the character in question here can only be considered and taxed ir connection with and as a part of the tangible property.

Then again, the $10,000,000 assessment must fail because all that the assessor of Salt Lake county did was to determine to his own satisfaction that the assessors in this as well as in other states did not assess plaintiff’s property at its full cash value; hence he-would do what in his judgment the other assessors omitted to do, namely, assess what they had failed to assess. While no doubt any assessor is to be commended and upheld in assessing taxable property at its true value, yet in doing that he may not exceed his authority and assess property which is entirely beyond his jurisdiction. To attempt that is usurpation pure and simple, which, in the long run, would be quite as pernicious as to undervalue some property. The latter evil may be cured by the boards of equalization, while the former, if once sanctioned by the courts, would be intolerable.

We have not discussed the findings of fact or conclusions of law specially because such was not necessary. ’ Nor have we discussed the description of the property with respect to the $10,000,000 assessment. We could subserve no good purpose in doing so, for the reason that that question, so far as that assessment is concerned, is not relevant to this controversy. As we have seen, that assessment must necessarily be held invalid regardless of any description that the assessor or the board of equalization might have given it. When once it is conceded that that assessment represented no part of the property described in plaintiff’s financial statement, and that it had no physical existence, but was in fact intangible because it arose out of the earning capacity, the actual earnings including good will, etc., of plaintiff’s tangible property wherever situated, it could not legally be assessed under any possible description. It is not necessary, therefore, to decide that question now.

Neither is it necessary to discuss plaintiff’s financial statement. While it is very clear that when the tangible property described in that statement is deducted from the total value of plaintiff’s property, wbieb is given as over $26,000,000, only a part of the $10,000,000 assessment will remain, yet in view of the conclusions reached that question likewise becomes wholly immaterial.

Neither is it necessary to consider the powers of the assessor and the board of equalization, which is argued by defendants, nor the legal presumptions pertaining to the performance of duties by those officers. In view that both the assessor and the board of equalization exceeded their authority, those questions are of no moment here.

Much is also said in defendants’ brief about dividends that were paid by plaintiff to its stockholders; that it was not pay. ing its just proportion of taxes in that much of its property escaped taxation, etc. No doubt it is the duty of the assessor to assess all taxable property at its value, and it is likewise the duty of every person and corporation having taxable property to list the same for taxation. Those matters, however, cannot make an assessment which is unauthorized legal. In,view of the facts as found, and as they undisputably exist, that question, while important under certain conditions, has absolutely no relevancy here, and hence will not be considered. We remark, however, that in this case the undisputed facts show, and the court so found, that the assessor of Salt Lake county-did his full duty, in that he assessed, all of plaintiff’s property situated within Salt Lake county at its full value. Moreover, it is also clear that the plaintiff furnished the assessor a full and complete’ statement of its assets, and also informed him where its property was situated. Indeed, the assessor testified that he was given full information. It therefore necessarily follqws that the defendants’ appeal cannot be sustained, and that as to that the judgment should be affirmed.

This brings us to plaintiff’s appeal, which involves the assessment of the $167,180. Plaintiff’s counsel assail findings numbered 14 and 15 wherein the court found that the property valued at said sum of $167,180 “was on the assessment roll placed in the columns, as ‘Other Taxable Property’ and ‘Personal Property Not Otherwise Enumerated/ and though it was designated or asserted to be for intangible property, nevertheless it was intended to be a part or an additional valuation of machinery at said "West Jordan plant,” and wherein the court further found that the amount added to the value of said machinery, to wit, said $167,180, “is a fair and reasonable value of said machinery or of said plant, and is not in excess of the actual cash value of the said machinery or of said plant; and the court thus, upon all the evidence, finds that the said assessment of $167,180 was, in fact made as a part valuation of said machinery or said plant. ’ ’ These findings,, as the writer reads the evidence, are supported thereby. The principal difficulty with the assessment is not so much the lack of evidence to support it as it is the irregular and peculiar manner in which it was made by the assessor and the method pursued by him and the board of equalization in assessing the machinery, etc., at the additional value before stated. While at least some of the irregularities were inexcusable and are here directly assailed, yet the writer, with some hesitation and after much reflection, has nevertheless arrived at the conclusion that the tax upon the assessment of the $167,180 should not be held illegal and invalid. Both plaintiff and its counsel knew of the irregularities, and presented the whole matter to the board of equalization, and asked that that assessment be canceled. Let it be assumed that the board erred in holding as it did, yet that, standing alone, would not make the tax illegal and subject to an injunction. Comp. Laws Utah 1917, § 6087, provides:

“No assessment or act relating to assessment or collection of taxes is illegal on account of informality or because the same was not completed within the time required by law.”

In section 6093 it is provided that no injunction shall be granted to restrain the collection of any tax or any part thereof ‘ ‘ except where the tax, or some part thereof * * * is illegal, or is not authorized by law, or the property is exempt from taxation.” As I construe the statutes of this state, and as in my judgment they should be applied to the facts found by the court, namely, that the assessment represents a fair and just valuation of the machinery embraced in said valuation, I am persuaded that the assessment of said $167,180 should not be held illegal, nor should it be held as not authorized by law. If my conclusions are sound in that respect, it necessarily follows that the judgment of the district court sustaining the assessment of said $167,180 is not vulnerable to the attack that is made upon it, and hence should be affirmed.

While the immediate effect of the result now reached differs but little from the immediate effect of the result reached in the former opinion, yet the difference in the effect upon the assessment and taxation of property generally between the result now reached as compared with that reached in the former opinion is irreconcilable and radical. After much consideration and reflection the writer became convinced that if the method herein outlined in determining the actual value of property is followed, all taxable property, wherever, and however owned, may be taxed at its full value and at the place where by the Constitution it is made taxable, while, if the method that was adopted by the assessor in this case, and which was approved in the former opinion, is followed, not only much injustice may result, but the provisions of the Constitution respecting taxation of property may be evaded, if not entirely annulled. It was therefore deemed of much greater importance that a correct result be reached than that a particular assessment be sustained.

From what has been said it follows that the judgment of the district court should be, and it accordingly is, affirmed on both appeals. It is ordered that each party pay its own ' costs' in this court.

CORFMAN, C. J., concurs.