Hall v. Ira Tp., s. 29-31

• Decision Date: 03 June 1957
• Docket Number: Nos. 29-31,s. 29-31
• Citation: 83 N.W.2d 443,348 Mich. 402
• Parties: Thomas HALL and Sophie Hall, Plaintiffs and Appellants, v. IRA TOWNSHIP, a Municipal Corporation, Defendant and Appellee. Clark SEELY and Bernice Seely, Plaintiffs and Appellants, v. IRA TOWNSHIP, a Municipal Corporation, Defendant and Appellee. Edwin COWGILL and Georgia Cowgill, Plaintiffs and Appellants, v. IRA TOWNSHIP, a Municipal Corporation, Defendant and Appellee.
• Court: Michigan Supreme Court

Page 443

83 N.W.2d 443

348 Mich. 402

Thomas HALL and Sophie Hall, Plaintiffs and Appellants, v. IRA TOWNSHIP, a Municipal Corporation, Defendant and Appellee.

Clark SEELY and Bernice Seely, Plaintiffs and Appellants, v. IRA TOWNSHIP, a Municipal Corporation, Defendant and Appellee.

Edwin COWGILL and Georgia Cowgill, Plaintiffs and Appellants, v. IRA TOWNSHIP, a Municipal Corporation, Defendant and Appellee.

Nos. 29-31.

Supreme Court of Michigan.

June 3, 1957.

Matthews & Nank, Mount Clemens, and John C. Kane, Algonac, for plaintiffs-appellants.

Walsh, O'Sullivan, Stommel & Sharp, Port Huron, for defendant-appellee.

Before the Entire Bench, except BLACK, J.

KELLY, Justice.

Plaintiffs endeavored to recover 1954 taxes paid under protest to defendant township, and appeal from judgment of no cause of action.

The Anchor Bay Rural Agricultural School District voted, in the year 1949, its long-term bond issue and millage increase to support such issue. Later, and in conformity with the statutes, the taxable property of the plaintiffs, and many others, was added to and became part of such originally constituted and, hence, enlarged school district. The action of the municipal and school authorities in the enlargement proceedings was upheld by this Court in Ira School District No. 1 Fractional v. Chesterfield School District, 340 Mich. 678, 66 N.W.2d 72.

The defendant township, in charge of the levy and collection of taxes, proceeded to assess all taxable property in the enlarged district for and to the extent of the aforesaid millage increase, despite the fact that the area of which plaintiffs' lands are a part was already assessed and taxed to 1 1/2 per cent of the equalized assessed valuation and, also, the fact that plaintiffs were not property owners of the district when the 1949 vote approving the bond issue and millage increase was held.

The 1954 taxes are the only taxes involved in this appeal because subsequent to the assessment and levy of the 1954 taxes the remaining portion of the primary district involved voluntarily voted to annex to the larger school district and the larger school district, which then included the old primary district and the land of the plaintiffs herein, voted a new bond issue.

Michigan Constitution (1908), art. 10, § 21, as amended, reads:

'The total amount of taxes assessed against property for all purposes in any one year shall not exceed one and one-half per cent of the assessed valuation of said property, except taxes levied for the payment of interest and principal on obligations heretofore incurred, which sums shall be separately assessed in all cases: Provided, That this limitation may be increased for a period of not to exceed twenty years at any one time, to not more than a total of five per cent of the assessed valuation, by a majority vote of the electors of any assessing district, or when provided for by the charter of municipal corporation: Provided further, That this limitation shall not apply to taxes levied in the year 1932.'

Appellants contend that the above provision of the Constitution is a clear expression by the people that taxes could not be legally levied beyond certain well defined and stated limits and that only municipal corporations with charter authorization were exempt from constitutional limitation.

A school district is a municipal corporation. School District No. 4 of Marathon Tp. v. Gage, 39 Mich. 484; Attorney General ex rel. McRae v. Thompson, 168 Mich. 511, 134 N.W. 722; Waterman-Waterbury Co. v. School District, 183 Mich. 168, 150 N.W. 104; King v. School District, 261 Mich. 605, 247 N.W. 66; Daniels v. Board of Education, 191 Mich. 339, 158 N.W. 23, L.R.A.1916F, 468, and Attorney General ex rel. Kies v. Lowrey, 131 Mich. 639, 92 N.W. 289.

The municipal finance act of 1943 ¹ includes 'school district' within the term 'municipality.' Chapter 7, § 1a, of that act provides, in part:

'Whenever any municipality shall have outstanding any bonds, refunding bonds, notes or certificates of indebtedness payable from taxes, it shall be the duty of every officer or official body charged with any duty in connection with the determination of the amount of taxes to be raised or with the levying of such taxes, to include in the amount of taxes levied each year:

'(a) An amount such that the estimated collections therefrom will be sufficient to promptly pay when due the interest on all such obligations and that portion of the principal thereof falling due before the time of the following year's tax collection; * * *

'No limitation in any statute or charter shall prevent the levy and collection of the full amount of taxes required by this section for the payment of debts, but nothing herein shall authorize the levy of a tax for any other purpose exceeding the existing statutory or charter tax limitation.' C.L.S.1954, § 137.1a (Stat.Ann.1953 Cum.Supp. § 5.3188(45a)).

Council of City of Saginaw v. Board of Trustees, 321 Mich. 641, 32 N.W.2d 899, 901, presented a question as to whether the city of Saginaw, a so-called 15-mill tax city, had the power to levy taxes without limitation as to rate or amount for payment of bonds, other than refunding bonds, which pledged the full faith and credit of the city for the payment thereof. In affirming the trial court's decision that the city had such power, this Court referred to the above quoted provision of the municipal finance act, and stated:

'In City of Hazel Park v. Municipal Finance Commission, 317 Mich. 582, 27 N.W.2d 106, we held that...