South Utah Mines & Smelters v. Beaver County, 262 U.S. 325 (1923)

South Utah Mines & Smelters v. Beaver County

No. 321

Argued March 15, 1923
Decided May 21, 1923
262 U.S. 325

ERROR TO THE DISTRICT COURT OF THE UNITED STATES

FOR THE DISTRICT OF UTAH

Syllabus

1. In an action at law tried by the district court without a jury, the court, after deciding the case upon a general finding, may make special findings of fact and incorporate them in the record if all this is done at the same term. P. 329.

2. Under the Utah Constitution, which contemplates that all property shall be taxed according to its money value, and, as a means of valuing metaliferous mines, provides that, in addition to an arbitrary valuation of five dollars per acre, they shall be assessed at a value based on some multiple or sub-multiple of their net annual proceeds, and under Utah Laws 1919, c. 114, which adopts three as the multiple for valuing metaliferous mines (providing that all other mines and valuable mineral deposits shall be assessed at their true value) and defines net annual proceeds as the net proceeds realized during the preceding calendar year from the sale, or conversion into money or its equivalent, of all ores extracted by the owner, lessee, contractor, or other person working upon or operating the property during or previous to the year for which the assessment is made, including all dumps and tailings, after making certain deductions.

Held:

(a) That tailings, left as refuse from the concentration of ore derived from a mine long since worked out, and which were situate on land remote from the mine and had an ascertained and adjudicated value of their own, constituted a unit of property entirely apart from the mine. P. 332.

(b) That an agreement of the owner of the mine and the tailings, under which a leasing company took possession of and worked the tailings and paid the owner a percent of the net recovery, was a lease, and left the owner subject to taxation on the value of the tailings during the process of extraction. Id.

(c) But that an attempt to tax the owner, upon the assumption that the tailings were part of the mine, by assessing the value at three times the entire proceeds extracted from the tailings by the lessee during the tax year was void. Id.

3. It is the duty of the Court to construe state statutes, if possible, so as to remove all doubt of their validity under he Fourteenth Amendment. P. 331.

Reversed.

Error to a judgment of the district court, in favor of the county, in an action brought against it to recover the amount of a tax paid under protest.