(108 A.) 3 Pa. Super. Ct. 137. The commonwealth in |ing of grades" are inserted, which indicates the construction of public highways is in that when the Legislature intends to impose exercise of its sovereign authority and never liability therefor it does so in express lanliable for damages unless made so by express guage. enactment. [3] Section 16 of the State Highway Act of May 1, 1905 (P. L. 324, 325), provided for compensation, "in case any person or persons, or corporations, shall sustain damage by any change in grade, or by the taking of land to alter the location of any highway which may be improved under this act"; but by the Act of June 8, 1907 (P. L. 510), § 3, this section was amended by striking out the words, "by any change in grade." And under the latter no liability is incurred for damages resulting from the change of grade of state highways. Jamison v. Cumberland County, 234 Pa. 621; Id., 48 Pa. Super. Ct. 32; Id., 39 Pa. Super. Ct. 335. See, also, Saeger v. Commonwealth, 258 Pa. 239, 101 Atl. 999. Section 16 of the said act of 1911 (P. L. 519) provides that "Before the commissioner shall undertake the construction, reconstruction, or improvement of any state highway on the plan of the state highways, wherein a change of existing lines and location is necessary and damage is likely to result to abutting property, * * * the owner or owners of said property, damaged thereby, may present their petition to the court of quarter sessions for the appointment of viewers to ascertain and assess such damages. The proceedings upon said petition and by the viewers shall be governed by existing laws relating to the ascertainment and assessment of damages for opening public highways," with a further provision that the damages when ascertained shall be paid by the commonwealth. [5] The provisions above quoted from the Act of 1911, to the effect that the proceedings for the ascertainment and assessment of damages shall be governed by existing laws, etc., refers to the method of procedure for the collection of damages imposed upon the commonwealth by the earlier clause of the section, but creates no new liability. [6] The title of the Act of 1911 (P. L. 468), includes, inter alia, a clause, "providing for the payment of damages in taking of property, or otherwise, in the improvement thereof [of highways]." And appellants earnestly contend that the use of the words "or otherwise" in the title shows an intent to impose upon the commonwealth liability for all damages resulting from improvement of state highways, including change of grade, and that the act should be so construed. Such contention cannot be accepted. The liability is imposed by the enacting clause, not by the title. While the latter is regarded as a part of the statute and may properly be considered in its construction (Halderman's App., 104 Pa. 251, 259; Eby's App., 70 Pa. 311, 314; Pennsylvania R. R. Co. v. Riblet, 66 Pa. 164, 5 Am. Rep. 360; Yeager v. Weaver, 64 Pa. 425, 428; Brink v. Marsh, 53 Pa. Super. St. 293); yet the title cannot give vitality to a subject omitted from the body of the act, for while a statute cannot be broader than its title, the title may be broader than the statute, if so the latter must control. Neither the title nor body of the Act of 1911 refers to damage for change of grade, and it canThe real question here is whether a change not be written into the enacting clause mereof grade constitutes a change of existing ly because it might come within the general lines and location within the meaning of the provisions of the title. "It [the title] can section last above quoted. Notwithstanding never control the plain and unambiguous the able and ingenious argument on behalf of meaning of language of the statute." Endappellants, we are clearly satisfied it does lich on the Interpretation of Statutes, § 59. not. The lines of a highway as commonly To like effect, see opinion of the same eminent understood, and as generally used in our author and jurist in Commonwealth v. Moorstatutes, refer to center and side lines and not to grade lines, that is, to horizontal rather than vertical lines. Besides, to Besides, to come within the act, there must be a change of lines and location. A highway is located where it is laid out and established on the ground, and that is not changed by the elevation or depression of its surface any more than is the location of a building changed by raising the roof. head, 7 Pa. Co. Ct. R. 513. "The act may be valid although its title is broader than the act itself." 36 Cyc. 1032. In our view it is unnecessary to pass upon appellee's contention that the word "taking" applies to the acquisition of property by condemnation and the words "or otherwise" to its acquisition by agreement. [7, 8] The change of grade of an existing highway is not the taking or application of private property to public use within the inhibition of the clause of section 10 of article 1 of the Constitution, which says: [4] As the words "change in grade" were inserted in the Act of 1905 and omitted from the Acts of 1907 and 1911, we must assume that a change of meaning was thereby intended. Rich v. Keyser, 54 Pa. 86; Endlich "Nor shall private property be taken or apon the Interpretation of Statutes, & 384. In plied to public use, without authority of law. the Act of May 28, 1913 (P. L. 368), imposing and without just compensation being first made liability upon cities, etc., for damages caused or secured." by the construction and improvement of And, under the authorities, it is clear that highways, the words "grading" and "chang- section 8 of article 16 of the Constitution, re quiring corporations and individuals in- the Commonwealth, and defendant appeals. vested with the privilege of taking private Affirmed. property for public use to make or secure compensation for the property taken, injured, or destroyed, has no application to the commonwealth engaged in the improvement of state highways. In Allison v. Bigelow, 68 Pa. Super. Ct. 219, there was an actual taking of land by the commonwealth, which controlling fact distinguishes that case from the present. A full consideration of the present case will be found in State Highway Route No. 72, 71 Pa. Super. Ct. 85. As there is no constitutional or statutory liability upon the commonwealth for the injury complained of, the Superior Court properly rejected appellants' claim. The assignments of error are overruled, and the judgment of the Superior Court is affirmed, at the costs of appellants. (265 Pa. 376) COMMONWEALTH v. HANNIS DISTILL (Supreme Court of Pennsylvania. June 21, 1919.) The appeal is from a settlement by the auditor general and state treasurer of an account for capital stock tax of defendant for the year 1914. Judgment was entered by the court, without a jury, for the commonwealth against the defendant for $1,710.73, in the following opinion by M. Carrell, J., in the court of common pleas: This is an appeal from a settlement of capital stock tax for 1914. Trial by jury has been duly waived, and from the testimony submitted we find the following facts: der the laws of West Virginia for the purpose, The defendant is a corporation chartered uninter alia, "of distilling liquors and selling the same at wholesale." No part of its capital is employed in distilling in Pennsylvania. The distilling is done in West Virginia and Maryland. The product is brought into Pennsylvania, where it is blended and sold. It is doing business here as a foreign corporation. Its property employed in Pennsylvania is of the value of $281,881.39. The commonwealth claims a 10mill tax under the act of July 15, 1897 (P. L. 294), upon the value of the property employed here, and under it settled on August 5, 1915, tax for $2,818.81. The case is here upon defendant's appeal from this settlement. The taxing statute provides that "companies organized and incorporated for the purpose of dis 1. TAXATION 42(2)-STATUTE TAXING DIS-tilling liquors and selling the same at wholeTILLING COMPANIES AS A SEPARATE CLASS IS VALID. Act July 15, 1897 (P. L. 292) § 2, providing that distilling companies selling their liquors at wholesale shall constitute a separate class for the purpose of taxation, and imposing a tax on the capital stock is within the legislative power. 2. TAXATION 163-TAX IMPOSED ON DISTILLING COMPANY SELLING AT WHOLESALE APPLIES TO FOREIGN COMPANIES DISTILLING OUTSIDE THE STATE. Act July 15, 1897 (P. L. 292) § 2, imposing a tax on the capital stock of companies organized for the purpose of distilling liquors and selling them at wholesale, applies to a foreign corporation distilling liquors outside the state and selling them at wholesale within the state. 3. TAXATION 113-STATUTE IMPOSING TAX ON DISTILLING COMPANIES NOT MODIFIED OR REPEALED. sale shall constitute a separate class for the purpose of taxation, and every such corporation shall be subject to pay into the treasury of the commonwealth annually a tax at the rate of ten mills upon each dollar of the actual value of its whole capital stock of all kinds, including ant contends that, as it is not actually engaged common, special and preferred." The defendin distilling in Pennsylvania, it is not liable to taxation under the act of 1897, and that the act is repealed by the act of July 22, 1913 (P. L. 903). The defendant admits that it is liable to a five-mill tax upon the value of its property employed in the state, and it has paid that amount, $1,409.40. The commonwealth claims that it still owes $1,409.40, with interest from October 17, 1915. Discussion. the act of July 15, 1897, P. L. 292. It is en[1, 2] The tax in this case was settled under titled "An act to provide revenue by taxation." Section 2 provides as follows: "Companies orAct July 15, 1897 (P. L. 292) § 2, taxing ganized and incorporated for the purpose of disthe capital stock of distilling companies, is not tilling liquors and selling the same at wholemodified or repealed by Act July 30, 1897 (P. sale, shall constitute a separate class for the L. 464), regulating the sale of certain liquors purpose of taxation." The act then imposes an and prescribing the license fee to be paid by annual tax of 10 mills upon every dollar of the certain dealers, or by Act July 22, 1913 (P. L. actual value of the whole capital stock. By 903), amending Act June 1, 1889 (P. L. 429) 8 this act the corporation defendant was classi21, relative to the taxation of corporations re-fied, and a rate of taxation fixed upon the valquired to report under that act. ue of its capital stock. This is in exact accordance with the legislative power. It has the Appeal from Court of Common Pleas, right to classify all subjects of taxation and Dauphin County. Suit by the Commonwealth against the Hannis Distilling Company. Judgment for to fix the rate uniformly upon classes of the same kind. The corporation defendant is not actually engaged in distilling liquors in Pennsylvania, but distills them elsewhere and brings (108 A.) $1,409 40 219 87 them here, makes the desired blend, and sells | conclude, therefore, that the defendant company the product thus blended in Pennsylvania at is liable to pay the balance of the tax assessed. wholesale. It is not necessary that the corpo- It has paid one-half of the total tax, which reration should be actually engaged in distilling duces the amount now due to $1,409.40, upon to make it liable under this act of assembly. which the commonwealth is entitled to claim The act provides that companies organized for interest from October 17, 1915. The amount the purpose of distilling liquors and selling the now due the commonwealth is as follows: same at wholesale are taxable. This corpora- Balance of tax for 1914............... tion is admittedly organized for the purpose of Interest October 17, 1915, to May 23, 1918.... distilling liquors and selling the same. It carries out both the powers of its charter. The fact that the distilling is not done in Pennsyl- Attorney General's commission 5 per cent... vania is not of controlling importance. The character of the corporation subjects it to taxation because the Legislature has so declared. It is taxable because it is a member of the class which the Legislature has designated for the purpose of taxation. [3] The defendant company contends that the act of July 15, 1897 (P. L. 294) is modified or repealed by the act of July 30, 1897 (P. L. 464), and also by the act of July 22, 1913 (P. L. 903). The act of 1897 (P. L. 292), under which this tax is claimed, is a taxing act entitled "An act to provide revenue by taxation," and it makes distilling companies a special class for the purpose of taxation. The defendant company is organized as a distilling company, and is a member of the class upon which the Legislature imposes annually a 10-mill tax upon the value of its capital stock. It provides for the making of such reports as may be necessary to enable the auditor general to determine the actual value of its capital stock. The act of July 30, 1897 (P. L. 464), is entitled An act to provide revenue and regulate the sale of certain liquors and prescribing the amount of license fee to be paid by certain dealers. It does not in any way affect the act of July 15, 1897 (P. L. 292). The act of July 22, 1913 (P. L. 903), is entitled "An act to amend section 21 of an act approved the first day of June, 1889, entitled 'A further supplement of an act' entitled 'An act to provide revenue by taxation.'" The only change made in the section is the insertion of a proviso that the act shall not apply to corporations or associations organized for laundering or manufacturing purposes. This is manifest not only from the language of the amendment, but also from the printing in different type the change made in the section amended (the only words italicized being the words "laundering companies"), as required by the act of April 6, 1899 (P. L. 32). The act of 1913 applies only to corporations required to make reports under section 20 of the act of June 1, 1889 (P. L. 428), and not to the defendant company, which makes reports under the act of July 15, 1897. None of these acts of assembly in any way modify or change the act of July 15, 1897, classifying the defendant company and designating the tax to be paid by it. Total now due commonwealth..... $1,629 27 81 46 ... $1,710 73 We therefore direct that judgment be entered in favor of the commonwealth and against the defendant in the sum of $1,710.73, unless exceptions be filed within the time limited by law. Argued before BROWN, C. J., and STEW- Paxson Deeter and John A. Brown, both of (Supreme Court of Pennsylvania. June 21, 1. TAXATION 115-CORPORATION "ORGAN- A Delaware corporation, authorized "to manufacture, distill, brew, rectify, refine, blend and deal in beverages of all kinds, both alcoholic and nonalcoholic," registered in Pennsylvania and engaged only in the blending and selling of whisky at wholesale, is subject to a capital stock tax of 10 mills on the value of invested capital within the state under Act July 15, 1897 (P. L. 292), § 2, imposing such tax on "companies organized and incorporated for the purpose of distilling liquors and selling the same at wholesale," the test being, not the business conducted, but whether it is organized and incorporated for that purpose; and a company which has elected officers, adopted its by-laws, is "organized" and incorporated within the act (citing Words and Phrases, Organ We have carefully considered the briefs sub-ize). mitted upon both sides, and are satisfied that defendant company falls within the class created 2. TAXATION 112(1) CORPORATION TAX by the act of July 15, 1897, and is taxable at the rate of 10 mills upon the value of its capital stock. The settlement appears to have been made by the accounting officers in accordance with the act of assembly, which classifies defendant company and fixes the rate of taxation to be paid by all members of that class. CONSTRUED AS CAPITAL STOCK TAX AND NOT Act July 15, 1897 (P. L. 292) § 2, imposing a tax of 10 mills on capital stock of "companies organized and incorporated for the purpose of distilling liquors and selling the same We at wholesale," is not a tax on franchise value, For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes but a tax on as much of the whole capital stock | rate of 10 mills, upon the actual value of its of such corporation as is represented by actual invested capital within this jurisdiction. property invested in the state, according to The distilling company, claiming it should be the real value thereof. obliged to pay only at the rate of 5 mills, ap CATION 3. CONSTITUTIONAL LAW 70(1)-CLASSIFI- pealed from each assessment to the common A corporation may, in point of fact, be solely engaged in the pursuit of one business, yet if possessed of charter powers to carry on another, the Legislature has a right to classify it in the latter category; and, when this is plainly done, the course adopted is binding upon the courts. 4. TAXATION 115-EQUITY CANNOT AFFECT Where a corporation can be found to have been organized and incorporated "for the purpose of distilling liquors and selling the same at wholesale" within Act July 15, 1897 (P. L. 292), it is subject to a capital stock tax of ten mills on the value of invested capital within the state, though under its charter powers it is engaged solely in blending and selling of whisky at wholesale, as, while in some cases equity may control the apportionment of tax when duly assessed, it cannot in any manner affect the classification under a relevant statute. 5. TAXATION 113-CORPORATION STATUTE CONSTRUED AS INDEPENDENT AND AS PRO VIDING MACHINERY FOR ITS ENFORCEMENT. Act of July 15, 1897 (P. L. 292) § 2, imposing a tax of 10 mills on the capital stock of "corporations organized and incorporated for the purpose of distilling liquors and selling the same at wholesale," is an independent statute, which, without resort to other legislation, provides machinery to work out its purposes. Appeal from Court of Common Pleas, Dauphin County. pleas of Dauphin county. The three appeals were consolidated and tried as one. Judgment was entered in favor of the commonwealth, and this appeal followed. [1] The court below held appellant liable at the higher rate of 10 mills, under section 2 of the act of July 15, 1897 (P. L. 292, 294), which provides: "Companies organized and incorporated for the purpose of distilling liquors and selling the same at wholesale, shall constitute a separate class for the purpose of taxation; and every such corporation * shall be subject to pay ** * annually a tax at the rate of ten mills upon each dollar of the actual value of its whole capital stock." Prior to the legislation just quoted, companies engaged in distilling liquors were placed by our laws in the nonmanufacturing class, subject to capital stock tax, but at the rate of only five mills; and appellant's contention is that the "act of 1897 did not mean to create a new class, but, in imposing the 10-mill tax on 'companies organized and incorporated for the purpose of distilling liquors,' it meant companies actually engaged in distilling liquors"; that, since it is admitted the present corporation is not so engaged, either in Pennsylvania or elsewhere (its business being the blending and selling of whisky at wholesale), the act 1897 has no application, and the proper tax rate is 5 mills. Appellant was incorporated under the laws of Delaware with, inter alia, the following powers: "To manufacture, distill, brew, rectify, refine, blend, and deal in beverages of all kinds, both alcoholic and nonalcoholic, and all alco Proceeding by the Commonwealth of Pennsylvania against the John McGlinn Distill-holic liquors and products thereof." ing Company. Judgment for the Commonwealth and against defendant for $2,798.45 on accounts settled by auditor general and state treasurer for taxes on capital stock, and defendant appeals. Affirmed. Argued before BROWN, C. J., and STEW. ART, MOSCHZISKER, FRAZER, WALLING, SIMPSON, and KEPHART, JJ. W. S. Snyder, C. B. Miller, and J. T. Olmsted, all of Harrisburg, for appellant. Wm. M. Hargest, Deputy Atty. Gen., and Wm. I. Schaffer, Atty. Gen., for the Commonwealth. MOSCHZISKER, J. The commonwealth assessed the John McGlinn Distilling Company, a Delaware corporation, registered and doing business in Pennsylvania, a capital stock tax, for 1914, 1915, and 1916, at the In view of these powers, although appellant is also vested with others, it cannot be said the company was not "organized and incorporated for the purpose of distilling,” the classification test set by our legislation, which, it may be noted, does not require that a corporation within the class thereby creat ed shall be formed or chartered exclusively for the "purpose of distilling," or that when taxed it shall be actually engaged in such business or pursuit. Under the act of 1897, the test is not the business conducted, but whether the concern in question was "organized and incorporated for the purpose of distilling liquors and selling the same at wholesale"; and the rate there imposed, on companies thus classified, is not in any proper sense a tax on franchise value, as appellant urges, but a tax on as much of the "whole capital stock" of such (108 A.) o do Appellant contends, however, that it is not within the classification of corporations made by the act of 1897, because "it was not organized and incorporated for the purpose of distilling liquors"; but we cannot so agree. While "organized" is a word susceptible of different uses, yet, in the phrase "organized and incorporated," it has an established import. "Organize' or ‘organization,' as used in reference to corporations, has a well understood meaning, which is the election of officers, providing for the subscription and payment of the capital stock, the adoption of by-laws, and such other steps as are necessary to endow the legal entity with capacity to transact the legitimate business for which it was created" (Words and Phrases, vol. 6, p. 5053); and, in our law, the word has been held to include within its meaning "incorporation." In Com. v. Westinghouse Elec. & M. Co., 151 Pa. 265, 275, 24 Atl. 1107, 1111, citing Com. v. Wm. Mann Co., 150 Pa. 64, 24 Atl. 601, we said that "a corporation is organized when the agents or officers by which alone it can perform its appropriate functions have been appointed and taken upon themselves the burden of their offices, and that it is then organized for the purposes authorized by the law of its creation." The court below properly held the present company was "organized and incorporated for the purpose of distilling liquors and selling the same at wholesale," and therefore fell within the class fixed by the act of 1897. corporations as is represented by actual prop- The authorities relied upon by appellant erty invested in Pennsylvania, according to do not rule the present case. For example, the real value thereof. "It has been repeat- under the governing act in International edly decided and is settled law, that the tax Navigation Co. v. Com., 104 Pa. 38, the point upon the capital stock of a company is a tax to be determined was, What is the corporaupon its property and assets" within the con- tion in question-is it really a railroad comfines of the taxing power. Com. v. Standard pany, or is it a navigation company? and Oil Co., 101 Pa. 119, 145. this was held to depend upon the business the corporation was actually doing at the time. In Com. v. Pottsville T. & S. Co., 157 Pa. 500, 506, 27 Atl. 371, 22 L. R. A. 228, the controlling inquiry was as to whether or not the defendant was actually carrying on manufacturing within the state. We held (157 Pa. 505, 27 Atl. 372, 22 L. R. A. 228) that, since it was so doing, "the mere possession of ancillary power [to mine iron ore], which it had never used or sought to use * and which was evidently intended for use only in aid of its manufacturing enterprises, [did] not change the character of the corporation, or deprive it of its privileges and immunities as a manufacturing corporation." In the present case, however, the act itself provides in distinct terms that companies "organized and incorporated for the purpose of distilling liquors and selling the same at wholesale" shall "constitute a separate class for the purpose of taxation." Hence, here, the question is, not what kind of a business is appellant engaged in, or what charter powers is it exercising? but, was the company organized and incorporated for "distilling liquors and selling the same at wholesale"? This the court below properly held could, for present purposes, be judged from its charter (Com. v. Pottsville Co., supra, at page 506 of 157 Pa., 27 Atl. 372, 22 L. R. A. 228), and, since the company was incorporated with "capacity to accomplish” (Com. v. Mann, supra, 150 Pa. 71, 24 Atl. 601) the "distilling of liquors and selling of same at wholesale," with the name of a distilling company (Com. v. Pottsville Co., supra, at page 506 of 157 Pa., 27 Atl. 371, 22 L. R. A. 228) such was its design, so far as the application of the act of 1897 is concerned. In other words, it makes no difference what else appellant may do, since the corporation can appropriately be found to have been organized and incorporated as a distilling company, it falls within the class fixed by the act of 1897, and must pay accordingly. [2-4] We cannot follow appellant's contention that the present tax should be "settled according to equity." In some cases, equity may control the apportionment of a tax, when duly assessed (Com. v. Independence Trust Co., 233 Pa. 92, 99, 81 Atl. 928; Com. v. P. & R. R. R. Co., 150 Pa. 312, 24 Atl. 612); but it cannot in any manner affect the classification of a corporation for purposes of taxation, where, as here, the relevant act, itself, clearly states that companies, such as the one in question, "shall constitute a separate class," not according to the business actually conducted, but when "organized and incorporated" for a designated purpose. A corporation may, in point of fact, be solely engaged in the pursuit of one business, yet, if possessed of charter powers to carry on another, the Legislature has the right to classify it in the latter category; and, when this is plainly done, the course adopted is binding upon the courts. Cochranton Tel. Co. v. Petroleum Tel. Co., 263 Pa. 506, 509, 107 Atl. 23. [5] The act under which the taxing authorities proceeded is an independent statute, which, without resort to other legislation, provides machinery to work out its purposes. In Com. v. Hannis Distilling Co., 108 Atl. 822, the contentions concerning modification or repeal of this act of 1897, by subsequent legislation, are disposed of, and therefore need not be discussed in this opinion. The assignments of error are overruled, and the judgment is affirmed. |