
    SCRANTON VS. DELAWARE, L. & W. R. R. CO.
    The Act of May 23, 1874, T. Laws 242, Section 20, Clause 33, authorizes taxation for payment of loans only, and not to make necessary improvements.
    The power of a municipality to impose taxation, will not be enlarged by a strained construction of the statute. . . .
    Error to Common Pleas of Lackawanna County. No. 363 Jan. Term, 1885.
    This is a scire facias tested the second day of January, 1885, issued upon a tax lien No. 7, January Term, 1885, contained in Lien Book No. 1, page 49, to recover the sum of $38.50 city tax levied by the City of Scranton on the 3d June, 1884, and filed as a lien against defendant’s property, described as a piece of land in tbe City of Scranton, being the whole of block five (5) on assessment map of the Seventeenth Ward, and particularly described by boundaries.
    Tbe scire facias was served, defendant appeared thereto and entered tbe plea of nil debit, and specially that tbe tax was levied without authority of law, and issue was thus formed.
    The cause came on for trial, and the parties waived the right of trial by jury and submitted the case to the hearing and judgment of Alfred Hand, President Judge, without the intervention of a jury, under the Act of 22 April, 1874, P. L. 109. No points were submitted in writing by- counsel on either side.
    
      The facts iound by the Court were inter alia as follows^ .per:.
    Hand, P. J.
    ¥e find the following facts from the evidence produced at the drial, to wit:
    I. The City of Scranton levied on the 30th of June, 1884, a tax of two and one-half mills against the defendant on their real estate described in the scire facias issued in this case, which tax the defendant refused to pay, and the plaintiff thereupon filed .her lien for the amount of said tax, to wit, $38.50, against the whole of block five on the assessment map of the Seventeenth ward of said city.
    II. The said tax of two and one-half mills was levied by an •ordinance of said city “for the payment of loans and making ■necessary improvements,” and was in addition to a tax of 'ten mills levied “for city purposes,” three mills “for payment of interest on city debt,” and one mill “for sinking fund,” provided for by the same ordinance, and all said taxes have been paid •except this two and one-half mill tax.
    III. The following is a true copy of said ordinance to '•wit:
    An Ordinance Levying a City Tax eor the Fiscal.Tear 1884.
    ■“Section 1. Be it ordained by the Select and Common Coun<cils of the City of Scranton, and'it is hereby ordained by the authority of the same, That a tax is hei’eby levied upon all property, occupation, etc., within the Cityrnf Scranton, made taxable for city purposes, as follows, to wit: Upon all real estate property of the first class, ten mills on the dollar of valuation for city purposes, three mills for payment of interest on city debt, and one mill for sinking fund, and two and one-half mills for the payment of loans and making necessary improvements ; upon all real estate of the. second class, six and two-thirds mills for city purposes, two mills for interest on debt, and two-thirds of a mill for sinking fund, and one and two-thirds mills for the payment of loans and making the necessary improvements, for each dollar of valuation; upon all real estate property of tbe third class, on each dollar of valuation, five mills for city purposes, and one and one-half mills for interest on debt, and one-half of a mill for sinking fund, and one and one-quarter mills for the payment of loans and making the necessary improvements.
    “Sec. 2. Upon all taxable trades, occupations and subjects not included in the above clause, there is hereby levied a uniform rate of ten mills on the dollar of valuation for city purposes, three mills for interest on city debt, and one mill for sinking fund, and two and one-half mills for payment of loans and making necessary improvements.
    “Sec. 3. This ordinance shall constitute .the tax levy for the fiscal year 1884.”
    IV. The bonded indebtedness of the City of Scranton at the time the above ordinance was passed was $326,800.
    The foregoing constitutes the whole indebtedness of the city.
    V. A tax for the payment of interest on this bonded indebtedness sufficient to pay the interest has been levied year after year to the time of this ordinance, and a tax of one mill has been regularly levied since 1877 as a sinking fund tax to meet these ponds according to law.
    VI. The city owes as part of the floating debt above stated about $16,000 for bridges built and being built and culverts under contract, and it will require the amount of the two and one-half mill assessment over and above the general tax for city purposes to pay for these, for which no loan has been provided.
    VII. An ordinance has been passed for the purchase of a lot for city buildings, and a city hall is talked of as probably at an early day, but no ordinance has been passed for that purpose. A copy of said ordinance passed is given below.
    VIII. The tax duplicate for the year 1884 will yield about $77,246.33 for general purposes, and $48,372.23 for special purposes, including this two and one-half mill tax. The proceeds of the two and one-half mill tax in question in this case will be about $18,605. The ordinance making appropriations for the year 1884 made appropriations to the amount of $114,710, a copy of which ordinance may be found below, and is entitled “An Ordinance making appropriations to defray the expenses of the City of Scranton for the fiscal year ending March 31, 1885.”
    IX. The following is a copy of the city ordinance relating to the purchase of a lot for city buildings, to wit:
    “An Ordinance Providing eor the Purchase oe Ground and the Erection Thereon oe City Buildings.”
    “Section 1. Be it ordained by the Select and Common Councils of the City of Scranton, and it is hereby ordained by the authority of the same, That a piece or parcel of ground shall be purchased within the limits of the Eighth, Ninth or Sixteenth Wards, and city buildings be erected thereon; said ground to be not less than fifty feet in front and not less than one hundred feet in depth; and the City Clerk shall, without delay, advertise for proposals to sell to the city such a piece or parcel of ground.
    “Sec. 3. Immediately upon the acceptance by the city of any proposal to sell ground as aforesaid, the City Clerk shall advertise for plans, &e., for a city building; and upon the adoption or acceptance of any plan he shall advertise for bids for the erection of city buildings in accordance therewith.”
    X. On the 10th day of July, 1884, the same day on, which the appropriation ordinance was passed, and after the levy of the taxes for the year, including the tax in question, the following concurrent resolution was passed by the Councils and approved by the Mayor, to wit:
    “Resolved, By the Select Council of the City of Scranton, the Common Council concurring, that the City Clerk, in preparing and making of city tax duplicates for the fiscal year 1884, be and he is hereby instructed to allow an exoneration of twenty-five per cent, of taxes on all real property, except on those properties on which an appeal was taken to the County Court on the triennial assessment of the year 1883.
    “Approved the 10th day of July, 1884.
    “E. A. Beamish,
    “Mayor.”
    
      XIII. While the Court will take judicial knowledge of the Act of 1874 and its supplements, we find as matters of fact: that the City of Scranton is a city of the third class and has accepted the provisions of the Act of 1874 and its supplements, and that the following portions of said act are the ones specially referred to as giving power to the city to 'levy this tax, to wit: (a) clause 1, section 20, P. L. 1874, p. 288, which is as follows, viz:
    “To levy and collect taxes for general revenue purposes, not to exceed ten mills on the dollar, in any one year, on all the real, personal and mixed property within the limits of said cities? taxable according to the laws of the State of Pennsylvania-, the valuation of such property to be taken from the assessed valuation of the taxable property therein made under the provisions of law regulating the same.”
    (ib) Clause 38, section 20, P. L. 1874, p. 242, which is as follows, viz:
    “To provide for the assessment and collection of taxes not exceeding one per centum upon the assessed valuation in any one year on all persons, real and personal property, and all other matters and things within said city taxable for State and County purposes, for the payment of loans to support the government and make the necessary improvements in said city.” * *
    XIV. An ordinance was passed and may be found in the evidence, entitled, “an ordinance authorizing the issue and sale of bonds and specifying the purposes for which the money realized therefrom shall be used ;” but no action has been taken thereunder; no bonds issued, and it is admitted that the City Comptroller notified the Councils that it exceeded the limit of indebtedness authorized by law. It appropriated $121,400. A copy is not herein set forth, as it is deemed of no consequence in this issue, and we find ás a fact that the ordinance is a nullity so far as this case is concerned.
    XV. The ordinance which is the authority for levying this tax provides that it is “for the payment of loans and making the necessary improvements.” There are no loans to which it can apply except the bonded indebtedness referred to in the fourth finding of fact above, and no provision has been made specifying any portion of this tax to be appropriated for that purpose. The only improvements to which it can be applied as past improvements are bridges and culverts.
    NVI. The city on the trial of the case declines to specify, other than the act itself shows, for what specific object, whether of a loan or improvement, the two and one-lialf mills tax was intended to cover, asserting that if they misappropriate they can be stopped l)3 injunction.
    CON OLD SIONS OF LAW.
    The whole question in this case, it is claimed on both sides, lies in flic construction to be given to the clause 33 of the Act <T 1874, P. L. 242. This construction will be determined by the ...-wers to be given to the following questions:
    1. Is the limitation of taxation in clause 33 a repetition or re-enacting of the limitation mentioned in clause 1 ?
    2. If it is not a repetition, but an enlarging and enabling clause extending the boundaries of the taxing power to twenty mills, then does it provide for only one purpose for which the tax may be levied, viz: “payment of loansor three purposes or objects viz: (a) payment of loans, (b) to support the government, and (c) to make the necessary improvements.
    Of course it will be seen that if we answer the first question above in the affirmative, then this tax was without warrant of law. There are some incidental facts apparent in the Acts of 1874 and 1875 which point in this direction, as for instance that this appears to be a general power of taxation, if it is for three objects named ; also it is a clause repeated in the supplemental Act of March 18,1875, P. Laws 15, and provides for general assessment, classification aud lien of all taxes upon real. estate. We are, however, clearly of the opinion that the Act of 1874 is to be construed as a whole on this subject, and especially that this section 20 with its various “clauses” is to be taken together. It would be a narrow construction and one in conflict with what we deem to be the intention of the Legislature, to hold that the two clauses mean the same thing.
    We are of the opinion that clause thirty-three was intended to give an additional power of taxation to the City Councils beyond that contained in clause first, and this power was to be confined ■to one specific object, viz: the ja m nt of loans which have been made to support the government and make the necessary improvements. The two clauses, state different objects, one for •“general revenue,” the -other “for the payment of loansthey appear in the same -section in separate parts, and so separated that a natural significance can be given to each. There is we apprehend -a reason for their difference. Statutes should be so construed as to give effect to all the words therein if such interpretation be reasonable, and in harmony with the provisions and objects of the statutes ; Potter’s Dwarris on Statutes, p. 188, note. Ve conclude that this clause is confined to the one object for the payment of loans, because this is the natural significance of the language used, because it is grammatical, and because it is in accordance with the spirit and structure of the whole Act of Assembly.. It requires the introduction of other words in order to make this language stating the object for which this power is to be exercised intelligible, if it means three objects instead of one-.
    The first clause of Section 20 authorizes the levy of taxes for general revenue not exceeding ten mills. This was an essential power to be given to a -city and for the most transparent and natural object for such an incorporation; it was a power that should be expressly granted, not left in doubt or ambiguity. It is a power providing for all general wants of a city necessarily and naturally growing out. of its existence as a public municipal body-corporate — -all such wants as could not be specially enumerated. The other clauses of section 20, from clause 2 down to and including clause 32, provide for power to pass ordinances for various causes, such as opening and improving streets, building bridges, culverts, sewers, suppressing tippling houses, preventing contagious diseases, establishing hospitals, providing for sanitary regulations, removing nuisances, providing a water supply, night watch and police, lighting streets, erecting market houses, city buildings, lockups, watch houses, providing for exclusive right to supply gas, altering the channel of water «courses, and various other objects. It will be seen that these objects are all of them covered by the general terms such as “the support of the government” and “necessary improvements” used in clause 33. It will also be seen that very many of them, are not covered by the term “general revenue” used in clause 1. They are extraordinary powers not implied in the mei’e idea of a municipal corporation; they are extraordinary improvements necessary, it is true, for the comfort, welfare and peace of community or for the growth and health of a city of high order ; but not such as a city would be warranted in entering upon without express authority of law.
    Again as we read the Act of 1874 there are two modes of raising money for the objects of an incorporation such as a city of the third class. One mode is the ordinary annual tax levy for general revenue ; the other is by loans, pledging the faith of the city and the issue of bonds.
    It was evidently in the mind of the legislature that the ordinary tax levy for general revenue would not provide for the extraordinary powers granted in the clauses enumerated from two to-thirty-two and they might be a dead letter, because of the want of any provision for the money to pay for them. They could have provided for it by enlarging the power to tax for general revenue, but this would have given too much power to Councils to increase a continuing burden. They therefore left the raising-of this money to be provided for by loans. Ample power is-given to create loans up to two per centum or by a vote of the people to a higher point. This power is found in clauses 41 and 42 and section 11 of the Act of Assembly. It is a power well guarded and cannot be exercised without the citizens of the city being aware of it. It is not the increase of a debt by the imperceptible and unconscious addition of items invited through an unlimited.power- to levy taxes, which has been the ruin of many municipalities.
    The legislature having therefore arranged for the making of these improvements, and the support of the government by authorizing a loan, it is clear they provided for the payment of this loan by this tax levy mentioned in clause 33, putting also a limitation on this levy. It is in this mode that we can give effect to both of these clauses.
    
      It is, however, urged by the counsel for the city that clause 33 is an extension of the power to tax for general purposes. We .answer that it is inconsistent with other provisions of the charter, .and especially with all those provisions which, in regard to finances, have provided a definite appropriation of money raised hy the city. Section 11 of the act provides that the specific purpose for which any loan is authorized shall be distinctly set out in the ordinance therefor ; it also provides that the tax for the gradual extinguishment of the bonds and funded debt of the ■city shall be a tax called “a sinking fund tax,” and applied to that purpose and no other; and at or before authorizing the loan, .an annual tax shall be prorfided for to pay the interest and principal within thirty years.
    Noav if this assessment of two and a half mills is sustained ■on the plea that it is for loans, it is clear that it should be so levied and collected that it can be kept separate, its amount .assertained and paid into the treasury as a sinking fund tax. This is impossible; for it is a levy, in the language of -the ordinance, for the payment of loans and making the necessary improvements. How much for loans and what loans, how much for improvements, and what improvements ? It is answered by the City Solicitor, we are not obliged to tell. If we misappropriate this we can be stopped by injunction. He says we have loans sufficient to apply it to and improvements that are being made or will be made. The evidence showed bridges and culverts. These are, however, to be paid for under clause 2 out of ■the general revenue or by assessments on real estate benefited thereby, as in clause 32, and collected as in clause 33, or by .assessments as provided in clauses 3 and 4.
    Again if clause 33 authorizes the levying of a tax for the 'three objects contended for, are the Councils not shut up to the -one per centum there mentioned as the complete and only limitation for all taxes ? It includes in that sense all that is contained in clause 1, as the greater includes the less. To pay loans, support the government and make necessary improvements is everything that a city charter contemplates. It includes general revenue purposes ; the clause also authorizes an assessment on per sons, which clause No. one does not. As before stated, it provides for tlie assessment, lion, and in the Act of 1875 for the classification of taxes. It seems that the position of the plaintiff’s counsel necessarily would hold the city to this limit of one per cent, for all pui-poses. This would, however, result in the same narrow construction before mentioned, which we think the spirit of the Act and the necessities • i f the city as-contemplated therein forbid.
    It is apparent from the constitution of 1874 and the Act of 1874 that the intention is to hold municipal corporations to fixed and defined limits in regard to indebtedness and the power to> increase burdens by taxation. An effort to limit the rate of taxation is apparent throughout the act of 1874. The construction which we have given the act fixes twenty mills as the-outside limit for all purposes, unless it be some specific purpose-connected with which a power is given to levy a special tax, as-in clause 44 or in clause 33, to pay bonded indebtedness at-maturity “in addition to other taxes.” It would, however, be difficult to ascertain what, if any, limit would be given if we-should hold to the construction claimed by the City Solicitor, with the ten mill tax for general revenue, the special taxes for sinking fund, and other special taxes, and then this clause 33 to mean anything that could be. comprised in “payment of loans” unspecified, “support of the government” and “necessary improvements,” we would have a kind of definite indefiniteness that contravenes the spirit of the act.
    It is urged upon us that this ordinance and levy is in the exact language of the 33d section and therefore presumed legal. This-does not follow if it were true. The Courts will inquire into-the purpose for which a tax levied is to be used, and unless-clearly proper will restrain it; School Board Appeal, 24 P. F.. Smith, 252; Conner’s Appeal, 7 Outerbridge 356. It however does not appear to bo true. Upon the construction claimed the-Act authorizes three objects. The ordinance specifies two,, “payment of loans” and “making the necessary improvements.” It mingles without specification in one assessment a tax which is required to be kept separate as a sinking fund tax with one which is not. We think this makes a portion of the assessment illegal under the Act of 1874, and in such a manner that its proportion. cannot be ascertained. Y/Iiile we liave not found as a. fact in this case that the intention was to levy a tax apparently for one purpose and use it for another,, which we could not find except on the clearest evidence) it is clear that the counsel, with . no fault of his, was embarrassed with such an inference drawn by opposing counsel from the evidence in the case. Our examination of the case impresses us with the wisdom of the present constitution and the Act of 1874, which force municipal bodies to first make appropriations, avoid .indebtedness beyond a certain limit, and binds them to a restricted power of taxation. It requires skill, economy, and watchfulness on the part of Councils to manage a city like this within these safeguards. We believe the view we have taken of the law in this case is the correct interpretation to be given to the Act of 1874, and that no such harm can come to the public or the city from such a view.
    Deeming as we do this levy to be illegal, judgment must be entered for the defendant upon the above stated facts and conclusions of law.
    The City of Scranton then took a writ of error complaining of the action of the Court in holding that the tax was illegal.
    
      I. H. Burns, Esq., for plaintiff
    in error argued that clause 33 of the Act of May 23, 1874, P. Laws 242, authorizes a tax for purposes, paying loans and making improvements; Brown vs. Williamsport, 84 Pa. 438.
    
      Willard & Warren, G. R. Bedford and James H. Torrey, Esqs., contra,
    
    argued, that if a tax is levied by a municipal corporation under an express power to levy for one purpose, but with an intention to apply the proceeds to another purpose, the levy is illegal; School Board’s Appeal, 74 Pa. 252; Conner’s Appeal, 103 Pa. 356; Drake vs. Phillips, 40 Ill. 338:
    The power of a municipality to impose taxation will not be enlarged by implication; Boroughs on Taxation, 374; Cooley on Taxation, 209, 524 ; 2 Dillon Municipal Corporations 610; Cooley Constitutional Limitations, 644; State vs. Humphreys, 25 Ohio 520, State vs. Strader 25 Ohio 527; State vs. Mayer, 23 La. 358; Supervisors vs. United States, 18 Wallace 71,
   The Supreme Court affirmed the judgment •&£ the Common Pleas on March 9th, 1885, in the following opinion:

Per Curiam.

We think the learned judge gave a correct construction to the Act of May 23rd, 1874, P. L. 242, under which the tax in question was levied. It was for the payment of loans only; but for loans made to support the government and to make the necessary improvements in the city. The making of a loan requires a careful consideration and is accompanied by an issue of bonds. The power of a municipality to impose taxes should not be enlarged by any strained construction of the statute.

Judgment affirmed.  