Jackson Lumber Co. v. McCrimmon

• Decision Date: 26 October 1908
• Citation: 164 F. 759
• Parties: JACKSON LUMBER CO. v. McCRIMMON, Tax Collector.
• Court: U.S. District Court — Northern District of Florida

164 F. 759

JACKSON LUMBER CO. v. McCRIMMON, Tax Collector.

United States Circuit Court, N.D. Florida.

October 26, 1908

The plaintiff, a citizen and a corporation under the laws of the state of Alabama, brings its bill to this court to enjoin the sale of its real estate situated in Walton county, in the Northern district of Florida. The tax sale which the bill seeks to enjoin is for the accrued taxes of the years 1905-06-07, and the amount involved is $4,080. A rule to show cause with a temporary restraining order was granted, and the cause is now before the court on answer to the rule to show such cause and the motion to dissolve the injunction pendente lite.

The bill mainly attacks the constitutionality of the revenue act of Florida, and, to summarize the allegations of the third paragraph, it charges: That the state statute governing the assessment and collection of taxes authorizes the tax assessor to value real estate without giving notice to the taxpayer, except notice for the purpose of securing from the several taxpayers the description of their real estate. That by the taxing law of the state owners of real estate are neither authorized, permitted, nor required to value their real estate for the purpose of assessment. That there is no provision in the act for complaints to the assessor for excess valuation or to the board of county commissioners (the reviewing and equalizing board) before the assessment made by the assessor becomes final, 'except that class of taxpayers, assessment of whose property by the assessor shall have been raised by the board of county commissioners, and with such class the board of county commissioners are required by said assessment laws to give the taxpayers 15 days' notice of the time and place when said board will meet to hear complaints from those of the class of taxpayers who feel aggrieved at the increase of valuation, which may have been made by said board over and above the value fixed by the assessor," 'and that it is only this class of taxpayers for whom there is provided any notice to complain or opportunity to be heard. ' That complainant was not one of the latter class, and, notwithstanding that it had made due return of its property situated in Walton County for assessment, the assessor, without notice to the complainant had increased complainant's property valuations from $92,082, as returned by it, to $221,769, and that the tax laws of Florida require the assessor to complete the assessment rolls by the first Monday of July, 1907, and to deliver the same to the tax collector with his warrant attached requiring the collector to make collection in accordance with said assessment, and to that end to advertise and sell so much of said real estate as may be necessary to satisfy delinquent taxes. That, if such sale is permitted the purchaser thereat would receive a certificate which after two years will inure into a deed from the state to said real estate. That the assessment made without any provisions in the acts for notice of the increased valuation, and with no provision for an opportunity to be heard by the assessor or board before the assessment became fixed and final is a nullity, as being a deprivation of property without due process of law and in contravention to the fourteenth amendment to the Constitution.

Equitable interference is sought by the bill on the further grounds that, by the statute in question, the compensation of the assessor is fixed on a commission basis on the valuation of the property assessed, his compensation was correspondingly increased, that his action, being of a judicial nature, his assessment was therefore incompetent because of his pecuniary interest therein. It is also averred that the assessor refused to assess the property by the descriptions given by the owner, and arbitrarily adopted his own method of listing the property for taxation.

Wm. W Flornouy, for complainant.

S. K. Gillis, for defendant.

SHEPPARD District Judge (after stating the facts as above).

It will be observed from this statement of the case that the plaintiff seeks his remedy here on the theory that the tax statute of Florida (chapter 5596, p. 1, Laws Fla. 1907) is defective in respect to the essential requirements of notice and opportunity to the taxpayer, and that the provisions of the statute therefore fail to meet the requirements of due process of law, as ordained by the fourteenth amendment. All that due process implies when applied to tax proceedings may not be readily defined, but enough has been said on the subject by judges and text-writers to leave no uncertainty that the 'door of opportunity' must be open to the taxpayer to at least importune and plead with the powers who would 'lade him with burdens grievous to be borne. ' While the process of taxation may not require the same kind of notice as judicial proceedings, or even proceedings for 'betterment' assessments, or taking private property under power of eminent domain, the Supreme Court has settled the law that the assessment of a tax is action judicial in its nature, requiring for the legal exertion of that power that opportunity to appear and to be heard is indispensable; that somewhere during the process of assessment the taxpayer must have notice and opportunity to be heard; that it must be provided as an essential part of the statutory provision, and not awarded as a mere matter of grace to the taxpayer. Weyerhaueser v. Minn., 176 U.S. 550, 20 Sup.Ct. 485, 44 L.Ed. 583; Central of Ga. v. Wright, 207 U.S. 137, 28 Sup.Ct. 47, 52 L.Ed. 137;

Londoner v. Denver, 210 U.S. 373, 28 Sup.Ct. 708, 52 L.Ed. 1103; Security Trust Co. v. Lexington, 203 U.S. 323, 27 Sup.Ct. 87, 51 L.Ed. 204.

We have seen that notice is a fundamental requisite to the validity of the assessment, and that it must be provided for in the legislative scheme for taxation, or the statute may be repugnant to the due process requirement of the fourteenth amendment.

Let us examine the provisions of the statute on that subject in order to determine whether the sale of complainant's property in the manner designed by the Legislature would be a deprivation of its property without due process of law; for it is not a question of methods adopted for the assessment, but whether or not the scheme as devised by the law-making power meets the indispensable requirements of notice and opportunity before there is deprivation of property. Unless the statute, which is the foundation of all authority for collection of the tax, secures to the taxpayer this constitutional guaranty of due process, the tax proceeding, however regular, could not import legality to a sale of complainants' property, but, as was recently held by the Supreme Court in Longyear v. Toolan, 209 U.S. 417, 28 Sup.Ct. 506, 52 L.Ed. 859:

'If the statute gives him full opportunity to be heard as to the assessment on definite days, and definitely fixes the time for payment and the time for sale in case of default, so that he cannot fail if diligent to learn of the pendency of the sale, he is not denied due process of law because the notice of sale is by publication, and not by personal service.'

Referring to the provisions contained in the statute on the subject-matter under consideration, we find authority for the assessment of back taxes contained in section 22, c. 5596, p. 13, Laws 1907, as follows:

'If any county assessor of taxes when making his assessment shall discover that any land in his county has for any reason escaped taxation for any or all of the three previous years, or that any land was illegally sold for taxes and was then liable for taxation, he shall, in addition to the assessment of such lands for that year, assess same separately for such year or years that they may have

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