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certain reports ordered by him, that it permit him to examine and investigate its affairs, and that it pay into the state examiner's fund the sum of $100. Every one of these demands was refused. Like demands were made during the year ending November 1, 1905, with the same result; and these refusals gave rise to this controversy. The state contends (1) that it is entitled to collect the penalties mentioned in section 198 (chapter 100, p. 188, Laws 1903) on account of the refusal of this respondent to comply with the demands made in 1904; (2) that it may recover the penalties provided by chapter 104, p. 232, Laws 1905, on account of the failure of the respondent to comply with the demands made in 1905.
1. Chapter 100, p. 184, Laws 1903, is entitled "An act to amend an act approved March 4, 1897, entitled 'An act to amend Sections 490 and 506 inclusive, being all of article 11, chapter 3, title 1, part 3, Political Code of Montana, providing for the appointment of a state examiner and defining his duties and powers.'” Section 491 of the chapter defines the duties of the state examiner, and certain penalties are provided for offenses committed by officers or agents of the concerns mentioned; but these provisions have no application here, where the corporation itself is a party to a civil action. This is not a criminal prosecution against the officers of this respondent. The chapter also fixes the salary of the state examiner and his deputy, and then, in section 197, creates the "state examiner's fund," and provides for the payment into this fund of certain amounts from the counties of the state according to classification, also for the payment into this fund by "each bank, banking corporation, savings bank, investment and loan company, incorporated under the laws of this state," of certain fees according to the capital stock of the concern. A concern with a capital stock of $100,000 is required to pay $100. Each building and loan association, whether foreign or domestic, doing business in this state, is required to pay into this fund one-twentieth of 1 per cent. of its assets as shown by its last annual statement. tion 497 then provides: "Any excess of the expenses of such examination incurred in pursuance of this title, over and above the fee herein provided for shall be paid by the state from any money in the general fund not otherwise appropriated.” Section 498 of this chapter provides: “Any banks, banking corporation, savings bank, building and loan association, investment and loan company, incorporated under the laws of this state or doing business under any law of this state concerning corporations, that shall fail or neglect to pay the state treasury within ten days after the first day of November each year the sum due as specified in the section next preceding shall forfeit to the state, ten dollars ($10.00) for every day it shall so fail,” etc.
In order for the state to prevail as to its
first contention, it must show that this respondent is liable to pay the fee mentioned in section 197 above. This respondent is a corporation organized under the laws of the state of West Virginia and doing business in Montana. It is conceded that section 497 above does not in terms apply to such a concern. That section only mentions banks, banking corporations, etc., incorporated under the laws of this state, and foreign and domestic building and loan associations. But the Attorney General insists that the phrase "or doing business under any law of this state concerning corporations,” found in section 498, should be read into section 497, immediately after the phrase "incorporated under the laws of this state," and, if this be done, then the right of the state to prevail as to its first contention is clear.
We need not consider what rule of statutory construction applies to statutes not penal in character. Chapter 100 of the Laws of 1903 is a highly penal staťute, and the rule, universally recognized, is that a statute of this character must be strictly construed. The rule is founded upon the principle that the power of punishment vests in the Legislature, not in the courts. "Strict construction, as applied to statutes, means that they are not to be so extended by implication beyond the legitimate import of the words used in them as to embrace cases or acts not clearly described by such words, and to bring them within the prohibition or penalty of such statutes. It does not mean that words shall be so restricted as not to have their full meaning, but that everything shall be excluded from the operation of statutes so construed which does not clearly come within the meaning of the language used."
26 Am. & Eng. Enc. Law, 657. It is not sufficient to say that there is no good reason for the omission from section 497 above of the plirase we are now asked to supply. “Where the language of a statute is clear, it is not for the court to say that it shall be so construed as to embrace cases, because no good reason can be assigned why they were excluded from its provisions.” 26 Am. & Eng. Enc. Law, 601. "It is, however, the object of the construction of penal as of all other statutes to ascertain the true legislative intent; and while the courts will not, on the one hand, apply such statutes to cases which are not within the obvious meaning of the language employed by the Legislature, even though they be within the mischief intended to be remedied, they will not, on the other hand, apply the rule of strict construction with such technicality as to defeat the purpose of ascertaining the true meaning and intent of the statute." 26 Am. & Eng. Enc. Law, 659. If the intention of the Legislature is made manifest by the language employed in the act, then there is no occasion for resorting to rules of construction or interpretation. If the language is plain, it will be construed as it reads and the words employed given their full meaning.
In order to determine, if possible, just this is so notwithstanding the act declares : what institutions the Legislature intended in section 504 that the purpose of creating to burden with the fees mentioned in sec- the state examiner's fund was "the just distion 497 above, resort may profitably be tribution of the expenses incurred in purhad to the history of the legislation upon suance of this title." Mention is not made the subject. The first statute dealing with in this act of either foreign or domestic the subject of bank examination was re- building and loan associations. ported by the Code commission, and adopted Notwithstanding the Code provisions had as a part of the Political Code (sections | been superseded by the act of March 18, 490-496). Provision was made for the ap- 1895, all of the provisions of article 11, c. pointment of a state examiner, his salary 3, tit. 1, part 3, Pol. Code, embracing secfixed, and his duties defined. But no fees tions 490-506, were repealed by an act of were required to be paid by the concerns March 4, 1897 (Laws 1897, p. 105), and in examined by him, and there is not any refer- lieu of the provisions found in the Code ence in the act to foreign banking corpor- there was substituted the act of 1897 above, ations doing business in the state, or to containing sections numbered 490-499; but, foreign or domestic building and loan as- so far as this case is concerned, no masociations. Apparently the purpose in the terial difference is found between the act of beginning was to subject to the supervision of 1895 and the act of 1897. The duties of the the state examiner only domestic corpora- state examiner were enlarged somewhat tions and private persons doing a banking and the amounts required to be paid into the and loaning business. This statute was state examiner's fund by the several counimmediately superseded by the act of March ties changed to a certain extent. Build18, 1895 (Pol. Code, $$ 497-506). By sec- ing and loan associations, both foreign and tion 498 of this act the duties of the state domestic, were brought under the superexaminer are defined to be, among other vision of the state examiner by the prothings, "to visit each year without previous visions of Senate Bill 64 (Laws 1897, p. 231); notice each of the banks, banking corpora- and by the provisions of section 497 (page tions and saving banks, investment and loan 107) of this act of 1897 these associations companies, incorporated under the laws of are required to contribute to the state examthis state, or doing business under any law iner's fund. However, in the penalty clause of the state concerning corporations, and to the act, no provision is made for enforcto examine into their affairs," etc. For- ing the contributions from foreign building eign banking institutions doing business in and loan associations. They are required this state were then, for the first time, to contribute to the fund, but only "banks, made subject to the supervision of the state banking corporations, savings banks, buildexaminer. By section 504 of the act above, ing and loan associations, investment or there was created the “state examiner's loan companies incorporated under the laws fund," and the state sought to provide for of this state are made subject to the penthe expenses of the state examiner's office alty, which is provided in section 498 of by requiring every county to pay an amount the act." While from March 18, 1895, forbased upon the classification of the coun- eign banking institutions doing business in ties, and "each bank, banking corporation, this state were subject to supervision by savings bank, investment or loan company the state examiner, certainly no one would incorporated under the laws of this state" contend that prior to 1903, at least, they was required to pay the sum of $50, and were required to contribute to the state the balance of the expenses incurred was to be examiner's fund or were subject to the paid by the state from the general fund. penalties prescribed for failure to pay the In order to secure the payment of the fees required from domestic banking conamounts apportioned among the banking in- cerns. The act of 1897 above was amended stitutions mentioned, there was a penalty by an act approved March 6, 1903 (Laws 1903, clause added in section 505 of the act as p. 184, c. 100). This later act apportioned follows: "Any bank, banking corporation, the amounts to be paid into the state exsavings bank, investment or loan company, aminer's fund by the banking institutions incorporated under the laws of this state mentioned according to the amount of capithat shall fail or neglect to pay into the tal stock, but again restricted the contribustate treasury within ten days from and tors to the fund to banks, banking corpoafter the first day of January of each year, rations, savings banks, investment, and loan the sum mentioned in the section next pre- companies incorporated under the laws of ceding shall forfeit to the state ten dollars ; this state, and to foreign and domestic for every day it shall so fail and neglect,” building and loan associations; and now,. etc. It is worthy of note that, while foreign as if to correct the oversight in the penalty as well as domestic banking institutions were clause of the act of 1897 above, this act conmade subject to the supervision of the stat tains a penalty clause sufficiently broad in its examiner by this act, foreign banking in- terms to compel contributions from every institutions were not required to pay any fee stitution which was required to make the into the state examiner's fund, and were not same, and banks, banking corporations, savsubject to the penalty clause of the act; and ings banks, building and loan associations, in
STATE v. ÆTNA BANKING & TRUST CO.
vestment and loan companies, incorporated that no useful purpose would be served in under the laws of this state, or doing business determining whether or not this exemption under any law of this state concerning cor- of foreign banking concerns from the operaporations, are made subject to the penalties tion of the law invalidates the entire act: prescribed. The phrase "or doing business and following a rule universally recognized under any law of this state concerning corpo- by courts we will not decide the constiturations" is inserted in the penalty clause for tionality of a statute unless such decision the first time. But to whom does it refer? is necessary to a determination of the case. To all foreign corporations doing business un- 2. The state's second contention is that der the laws of this state? By express terms this respondent is subject to the provisions its operation is limited to only such as of the act of the Ninth Legislative Assemfail or neglect to pay the sums due as speci- bly, approved March 7, 1905 (chapter 104, fied in the section of the act preceding the p. 232, Laws 1905). This act is entitled penalty clause. From whom were the sums "An act regulating foreign corporations and mentioned in the preceding section due? joint stock companies doing a banking busiFrom "each bank, banking corporation, sav- ness within the state of Montana, and preings bank, investment and loan company, in- scribing penalties and punishments for viocorporated under the laws of this state." lations of the provisions thereof." The purand from foreign and domestic building and pose of this act is to regulate foreign bankloan associations, and from no one else. It ing concerns doing business in this state. would seem perfectly clear, then, that the Their affairs are made subject to examinaonly purpose of inserting the phrase above tion by the state examiner. They are rein the penalty clause of this act was to en- quired to make certain reports and to pay force contributions from foreign building certain fees into the state examiner's fund. and loan associations which were likely to Severe penalties are prescribed for the vioescape by reason of the absence of this lation of the provisions of the act. After phrase from the penalty clause of the act defining foreign banking concerns as underof 1897 above. When we consider that the stood in the act, section 15 contains this Legislature by the provisions of the act of proviso: "Provided, that this act shall not March 18, 1895, made both foreign and apply to any corporation which at the time domestic banking institutions subject to the of its approval may be openly and lawfully supervisions of the state examiner, but only engaged in banking at a known and fixed required domestic banking concerns to con- place of business within this state." It is tribute to the expense of such supervision, conceded that this respondent was at the and these provisions were considered by the time of the approval of this act a foreign Legislature of 1897 and the same plan follow- banking corporation, openly and lawfully ed, foreign banking institutions being still ex- engaged in banking at a known and fixed empt from the payment of the fees required place of business within this state. But the of domestic banking concerns, and that these attorney general insists that this proviso is provisions of the law were again considered invalid as in direct conflict with section 11, in 1903 and the same general plan retained, art. 15, of the Constitution; and Criswell and the Legislature, as if to emphasize its V. Montana Central Ry. Co., 18 Mont. 167, intention in the matter, declared again that 44 Pac. 525, 33 L. R. A. 554, is cited in supcontributions to the fund should be made port of this contention. For the purpose of by "each bank, banking corporation, sav- this argument only, we may assume, withings bank, investment and loan company, in- out deciding, that this contention made by corporated under the laws of this state," and the Attorney General is correct. This, then, foreign and domestic building and loan as- leads to a consideration of the question: sociations doing business in this state, it May that proviso, if invalid, be eliminated seems impossible to reach any other con- and the remainder of the act premitted to clusion than that foreign banking concerns stand in full force and effect? The result doing business in this state were not in- of such a holding would be to include withtended to be included within the provisions in the provisions of the act this respondent, of section 497 of the act of 1903; and this which is not subject to such provisions as respondent cannot, therefore, be held liable
the act was passed and approved. for the penalties mentioned in section 498 In Northwestern M. Life Ins. Co. v. Lewis of that act.
& Clarke County, 28 Mont. 484, 72 Pac. 982, But the Attorney General insists that the 98 Am. St. Rep. 572, this court quoted with exemption of foreign banking concerns from approval and designated it as an elementary the operation of the provisions of section rule of law, the canon of construction in a 497 above renders the entire act of 1903 case of this character, as follows: "When void. Whether this result follows need not the valid and invalid portions of the legisbe determined. We have held that this re- lative enactment are capable of being sepaspondent is not liable to pay the fee men- rated, and the valid part is a complete act, tioned in section 497 above, and therefore the and not dependent upon that which is void, state cannot maintain its first contention. the latter alone will be rejected, and the If the entire act is void, the state could not rest sustained, if it is manifest that the void collect the fee from this respondent, so part was not an inducement to the Legisla
ture to pass the part which is valid; but, if it is manifest from an inspection of the law itself that the invalid portion formed an inducement to its passage, the entire act will fall." And in that case it was held that the invalid portion might be eliminated from section 681 of the Civil Code and the remaining portion of the section be operative, and this for the reason that it could not possibly be said that the invalid portion in any sense formed an inducement or compensation for the enactment into law of the provisions of the section, since the section was merely the legislative response to a constitutional mandate. But the decision in that case has no application here. The Legislature in this instance was not responding to any demand of the Constitution in enacting chapter 104 above. May we say, then, that the Legislature would have enacted the provisions of chapter 104 without the proviso in section 15? In language too plain to be misunderstood the Legislature in effect said: “We intend to form into one class foreign banking institutions which commence business after the approval of this act, and every one in that class shall be subject to the provisions of this act; and we intend to form another class of foreign banking corporations, composed of those which are already in this state doing business at a known and fixed place of business at the time this act is approved, and no one of that class shall be subject to these provisions.” The legislative intention is expressed in unmistakable language, but we are aski il now to eliminate the proviso from section 15 above, and thereby make all the other provisions of the act applicable alike to both classes. Severe penalties are prescribed for a violation of the provisions of chapter 104. The direct and immediate effect of sustaining this contention made by the Attorney General, then, is to subject this respondent and other foreign banking concerns similarly situated to the penalties prescribed by the act, a result which the Legislature particularly declares was not contemplated or desired. We certainly cannot say that it is manifest that the proviso was not an inducement to the Legislature to pass the act. We cannot substitute the judgment of the court for that of the Legislature as to its policy or as to the wisdom of the legislation. Speaking of the principle for which the Attorney General now contends, the Supreme Court of the United States, in Spraigue v. Thompson, 118 U. S. 90, 6 Sup. Ct. 988, 30 L. Ed. 115, said: "But the insuperable difficulty with the application of that principle of construction to the present instance is that by rejecting the exceptions intended by the Legislature of Georgia the statute is made to enact what confessedly the Legislature never meant. It confers upon the statute a positive operation beyond the legislative intent, and beyond what any one can say it would have enacted in view of the illegality of the exceptions."
In Connolly & Dee v. Union Sewer Pipe Co., 184 U. S. 540, 22 Sup. Ct. 431, 46 L. Ed. 679, the Supreme Court of the United States announced the rule of construction applicable here as follows: "If different sections of a statute are independent of each other, that which is unconstitutional may be disregarded, and valid sections may stand and be enforced. But, if an obnoxious section is of such import that the other sections without it would cause results not contemplated or desired by the Legislature, then the entire act must be held inoperative." These decisions were cited with approval by this court in State v. Cudahy Packing Co., 33 Mont., 82 Pac. 833, where it is said: "Courts may not by process of interpolation or elimination make statutory provisions apply or extend to subjects not falling clearly within their terms; for, by so doing, they would to this extent usurp the functions of the law-making department of the government."
This court may not, then, by arbitrarily striking out the proviso from section. 15, so enlarge the scope of chapter 104 above as to make this respondent amenable to its provisions, for such a result was plainly never contemplated by the Legislature. If the proviso in section 15 is invalid, the whole of chapter 104 must fall with it. But, in any event, the state cannot maintain its second contention, for this respondent by the terms of the proviso is exempt from the provisions of the act, while, if the act itself is invalid, it would not be called upon to contribute anything to the state examiner's fund.
We find no error in the record. The judgment is affirined.
BRANTLY, C. J., concurs.
MILBURN, J., not having heard the argument, takes no part in this decision.
(34 Mont. 391) CLARK et al. v. MAHER, County Treasurer,
et al. (Supreme Court of Montana. Oct. 22, 1906.) 1. TAXATION ASSESSMENT DEDUCTION OF DEBTS-STATUTORY PROVISION.
Pol. Code, $ 3695, subd. 8, relating to assessment for taxation, providing for a deduction of deposits in the hands of private bankers from moneys on hand and in transit, and providing that only deposits other than current deposits may be deducted from bills and accounts receivable and other credits, and section 3701, authorizing any taxpayer to deduct from his credits all debts then owing to him, being in direct conflict, the latter section prevails, under section 5165, providing that if conflicting provisions are found in different sections of the same chapter or article, the last in numerical order must prevail, unless such construction is inconsistent with the meaning of such chapter or article. 2. SAME-CONSTITUTIONAL LAW.
Pol. Code, $ 3695, subd. 8, relating to assessment for taxation, authorizing private bankers to deduct deposits from moneys on hand, is violative of Const. art. 12, § 11, requiring taxes on the same class of subjects to be uniform,
and section 16, providing that all property shall | by the assessor attached thereto, that under be assessed in the manner prescribed by law, the law the only deductions which could be except as otherwise provided in the Constitution.
made from bills and accounts receivable are 3. SAME-DEMAND FOR DEDUCTION. That a bank demanded that in assessing its
accounts payable other than current deposits, property for taxation its deposits be deducted and, as no such accounts had been returned, from the amount of moneys on hand and in tran- he, the assessor, had assessed to them the sit as provided in Pol. Code, $ 3695, subd. 8,
amount of bills and accounts receivable, does not affect its right to have its indebtedness deducted from its credits, as authorized by sec
$1,657,550, less the value of real estate re tion 3701.
turned, $127,610, leaving the net value of per[Ed. Note.-For cases in point, see vol. 45, sonal property assessed to them, $1,529,9-10. Cent. Dig. Taxation, $8 641-642.]
Application was made to the board of equali4. SAME-WHAT ARE CREDITS.
zation for relief, which was denied. The Moneys due a bank from other banks are credits within Pol. Code, 8 3680, defining cred
taxes levied upon the real estate were paid its as solvent debts, secured or insecured, owing
before November 30, 1904; but the taxes to a person.
levied upon the solvent credits—$1,529,910— 5. SAME.
were not paid, and, on December 19, 1904, That a bank possessed money and real es- the county treasurer published the delinquent tate subject to taxation, but which was not assessed because of the mistaken deduction of
tax list, including therein this item: "Clark, debts, does not affect tbe question of its lia- W. A. & Bro., Bankers-North 2214 feet, lot bility under an assessment of credits from which 1, block 29, Butte Townsite, sold for taxes they were entitled to have the debts deducted.
on solvent credits, including deposits in 6. SAME-INJUNCTION AGAINST ENFORCEMENT OF Tax.
bank, $27,937.20." To this delinquent tax That a bank failed to pay or tender the
list was attached the usual notice by the taxes on property it held subject to taxation, treasurer that, unless the taxes were paid, but which had not been assessed, was not a fail
the real estate upon which such taxes were ure to do equity depriving it of its right to injunction against the enforcement of an illegal
a lien would be sold to satisfy the same on tax, since no tax was due on the property not January 9, 1905. Prior to the last date this assessed.
action was commenced. An amended com[Ed. Note.--For cases in point, see vol. 45,
plaint was filed setting forth the facts herein Cent. Dig. Taxation, 88 1243, 1244.]
mentioned and asking that the county treasAppeal from District Court, Silver Bow urer be restrained from selling the real esCounty; Geo. M. Bourquin, Judge.
tate mentioned above. To this amended comAction by W. A. Clark and another for plaint the defendant county treasurer interinjunction against James Maher, treasurer of posed a general demurrer, which was susSilver Bow county, and another. From a tained by the court, and, the plaintiffs havjudgment in favor of defendants, plaintiffs ing elected to stand on their amended comappeal. Reversed and remanded.
plaint, judgment was entered in favor of the
defendant, from which judgment the plainW. M. Bickford and Geo. F. Shelton, for
tiffs appealed. appellants. Albert J. Galen, Atty. Gen., and
Apparently W. A. Clark & Bro, in returnE. M. Hall, Asst. Atty. Gen., for respondents.
ing their list to the assessor proceeded upon
the theory that they could deduct their debts. HOLLOWAY, J. Between the first Mon- from moneys on hand under those provisions day in March, 1904, and the 1st of July fol- of subdivision 8, section 3695, above, allowlowing, the assessor of Silver Bow county ing such deduction to be made, and the rerequired from W. A. Clark & Bro., copartners mainder of their debts they could deduct engaged in business as private bankers in from their solvent credits under the proviSilver Bow county, a statement showing all sions of section 3701 of the same Code, and their real and personal property subject to thereby eliminate for the purpose of assesstaxes for that year. They returned the list ment all their personal property. The asof property which showed real estate of the sessor and board of equalization apparently value of $127,610, which valuation was sub- proceeded upon the theory that those provisequently raised by the board of equaliza- sions of subdivision 8, section 3695 above, ontion to $132,610, and personal property listed ly, were applicable to appellants' case, and, substantially as follows: Moneys on hand or therefore, their solvent credits were liable in transit, $103,869.27; due from other banks, for taxation without allowing any deduction bankers, etc., subject to draft, $1,203,039.47; for debts due by them. In this court, howbills and accounts receivable and other cred- ever, appellants practically concede that the its, $1,657,533.52; deposits made by other per- provisions of section 3701 only are applicable sons, $3,686,397.89. They asked that the to tbis case. This action was commenced amount of debts (deposits) be deducted from prior to the enactment of the amendment to the aggregate amount of moneys and credits, section 3693. Sess. Laws 1905, p. 54, c. 25. including money due from other banks, bank- It is to be observed that there is a direct con. ers, etc., and stated that the list was fur- flict between the provisions of section 3701, nished pursuant to section 3695 of the Polit. above, and that portion of subdivision 8 of ical Code. On July 9th following, Clark & section 3695, which provides for a deduction Bro, rereived from the assessor a copy of the of debts (deposits) from money on hand and list so furnished by them, with a statement in transit, and which further provides that