Montana Attorney General Opinion 15-356

Opinion No. 356 Taxation-Net Proceeds-Oil and Gas -l\1ines and l\1ining HELD: The Ohio Oil company is liable for the taxes levied according to the provisions of Chapter 161, Laws 91'I:'\\0:'\S O}' TH\'j A'L'TOH:'\EY GE:,\l-~RAL 243 of lll3.3 , upon its net proceeds of IHS::! although such levy is retroactive find the comJlan~' has not operated in ImtH. October 6, IH33. In your letter' to us of recent date y()U made the following statement: "During a portion of the year IH32 The Ohio Oil Company operated an oil lease in the Kevin-Sunburst Field. ohtaining therefrom certain quanti- ties of oil upon which it paid the landowner's royalties without de- flueting therefrom any amounts for the purpose of paying net proceeds taxes which might be levied in IH33 npon the 1932 p1·oduction. Some time after .January 1st, 1933, it made a report to the State Board of Equaliza- tion, the contents of which are not now a\'ailable to me. For some rea- son-possibl~' on account of the allow- ance by the board of the cost of aban- doning wells as a deductible item- no net proceeds tax was le\cied upon the operator's interest but taxes amounting to around $40.00 were lev- ied upon the various royalty interests. Some time in 1932 the lease was aban- doned by the Oil Compan~-, the wells plugged and a release of the lease executed and delh-ered to the land- owner. There has been no produc- tion of an~' character from the lease during 1933." You then added that "the attorney for the Ohio Oil Company now takes the position that since the Ohio Oil Company is not now and has not been in 1933 the operator 01' producer, it is not responsible for payment of anv net proceeds tax and also suggests' that the royalty owners themselves may not be responsible for payment of any tax hy reason of the fact that there are no operations even though the amount of the 1933 tax is measured by the 1932 production," and concluded bv re- questing our opinion as to "the 'liabil- ity of the operator in such cases." It is apparent, we think, that the State Board of Equali7~'ltion deter- mined from an examination of the statement .furnished by the Ohio Oil Company that it had no net proceeds. other than royalties paid, to assess and vax for the year 1932. In that con- nection, it will be presumed, in the absence of evidence to the contrary, that official duty has been regularl\' performed. (SuM. 15, Sec. 10606. He,:. Codes 1H21: Great l\'orthern Utilitiel'; Co. ,- Public Service Com.. 88 Mont. 180; State v Phelps, ll3 :\Iont. 277.) 'l'here cannot he any doubt that Chap- ter 161, Laws of Hl3:{, has entirl'- Iy superseded Chapters 139 and 140, Laws of H)27, and Chapter 133. Laws of In31. According to its terms it "shall gO\'ern the assessment and tax- ation of net proceeds of mine and min- ing claims yielded in the year 1H32 and thereafter." It provides that "the op- erator or producer shall he liable for the payment of the. taxes assessed a~ainst the net proceeds of the mine or mines, including a II royalty taxes", and that the taxes so assessed "shall constitute a lien upon all of the right title and interest of such operator i~ or to such mine or mining claim and upon all of the right. title and interest in or to the machinery, buildings, tools and equipment used in operating said mine or mining claim." It further provides that the county treasurer shall notify the operator when the taxes fall due, and he may enforce col- lection thereof in the manner specified by Section 2005, Re\'ised Codes 1921. as amended hy Chapter 143. Laws of 1925.' : The statute is retroactive hut reti·o- active legislation is not )}r~ltihited b~' the Constitution. (S'ullivan v City of Butte, 65 Mont. 4H5.) Furthermore, it ~Ias heen repeatedly held that the leg- Islature has plenary pOwer to pass any law not forhidden by the Constitu- tion of the United Stat~s or the Con- stitution of this state. ('State ex reI. Sam Toi ,'. French, 17 :\Iont. 54; Mis- souri HiYer Power CO. Y. Steele. 32 }Iont. 433; In re Pomeroy, 51 Mont. 119: State ex reI. Evans v. Stewart. 53 Mont. 18; Hilger v Moore, 56 Mont. 14(;; I'-ltate ,'. State Board of Equaliza- tion, 56 Mont. 413; The Veto Case 69 Mont. 325; State ex reI. Corry v Cooney, 70 Mont. 355; Butte & Super- ior Min. Co. \'. McIntyre 71 Mont. 254: State ex reI. Jones ~, mrickson. 75 Mont. 429; O'Connell ,'. State Board of Equali7Altion, H5 Mont. 91.) So far as taxation is concerned. there is no yes ted right to the contin- uance of any particular tax, or partic- ular apportionment of taxes. So a tax- 244 OPIXIOXS OF THE ATTORXEY GEKERAL payer has no vested right under a statute fixing a certain portion of the actual value of property as a basis for assessment. i\IoreoYer, a tax statute which is made retrQl,;pecth'e does not necessarily nor ordinaril~' disturb vest- ed rights. (Durret v. Da"idson, 9:l S. W. 25, 8 L. H. A. (n. s.). 546; People ,'. Chicago & E. I. H. Co., 93 N. E. 761: 1 Cooley on Taxation, Sec. 134; 12 C. J. 968.) The authority to impose taxes is confided exclusively to the legislature. 'I'hat authority is absolute, except ai; restricted by the Constitution of the state or nation. 'Vithin constitutional rest.rictions, its determination is final upon all matters involving the purpose of a tax. its extent and apportionment. the persons and property affected by it. and the time and manner of its collection. The power of taxation rests upon neceSSity, and is an essen- tial and inherent attribute of so"- ereignty, belonging as a matter of right to every independent state or goYernment, and it is as extensive as the range of subjects over which the power of that government extends. (Cruse v. Fischl, 55 l\Iont. 258; Butte & Superior Min. Co. v. McIntyre. su- pra: Pardee v. Rayfield, 182 N. Y. S. :l; 61 C. J. 76.) If, then, the royalties paid were a part of the actual net proceeds and the same were assessed and taxed in accordance with the prOVISIOns of Chapter 161, it is our view that the Ohio Oil Company is liable for the taxes so levIed. (Byrne v. Fulton Oil Co., 85 Mont. 329.) 'Opinion No. 357 Abstracters Board of Examiners-- Mileage HELD: Members of the State Ah- stracters Board of Examiners are en- titled to mileage at the rate of 7c per mile. October 7, 1933. You inquire what shall be the mile- age for members who attend meetings of the Abstracters Board of Examin- ers. Chapter 16 of the Laws of 1933 fixes the mileage of all state officers and all of the persons entitled to mileage at not more than 7 c per mile. Cha pter 105, Laws of 1931. provides that members of the Abstracters Board of Examiners sha Il recei "e 10c for each mile neces- sarily tra,-eled. In the construction of two similar conflicting statutes. this of- fice held that the H)33 statute con- trolled and that county commissioners were entitled to recieve but 7c per mile. (Opinion No. 170, this volume.) The following statement by Mr. Chief Justice Calla way very clearly fixes the law in this state: "While re- peals hy implication are not favored. when two legislath'e enactments reo lating to the same suhject matter are in conflict, and cannot be harmonized. the Act last enacted controls." State V. :\IiIler, 69 1\1ont. 1 This definite statement of the law has at least twice lleen subsequently quoted with apprm'- al by the Supreme Court of this state. In the case of State V. Board, 52 l\Iont. 91, it has been held that mem- bers of the Board of Examiners for Nurses are public officers. Whether or not the same conclusion would be reached as to this boanl.-the 193;:\ statute by its express terms applies not only ,to all state and county offi- cersbut also to all other persons en- titled to mileage,-the act cannot be re- conciled with the prior statute and the latter statute must control; there- fore, the members of this board are entitled to mileage at the rate of 7c per mile.