Aetna Ins. Co. v. Mayor

• Decision Date: 15 June 1897
• Citation: 153 N.Y. 331,47 N.E. 593
• Parties: AETNA INS. CO. v. MAYOR, ETC., OF CITY OF NEW YORK.
• Court: New York Court of Appeals Court of Appeals

153 N.Y. 331

47 N.E. 593

AETNA INS. CO.

v.MAYOR, ETC., OF CITY OF NEW YORK.

Court of Appeals of New York.

June 15, 1897.

Appeal from supreme court, appellate division, First department.

Action by the AEtna Insurance Company against the mayor, aldermen, and commonalty of the city of New York. A judgment in favor of plaintiff was entered on a verdict rendered by direction of the court for a less amount than that demanded in the complaint. 35 N. Y. Supp. 857. Defendant appealed from the entire judgment, and plaintiff appealed from such part of it as denied him a recovery of the entire amount claimed. The appellate division affirmed the judgment as entered (40 N. Y. Supp. 120), and both parties appeal. Affirmed.

This is an action to recover money paid for taxes for the years 1886, 1887, and 1888, imposed on bank stocks owned by the plaintiff, a Connecticut insurance corporation, which during those years carried on the business of fire and marine insurance in the state of New York. The complaint, in brief, alleges that the taxes were illegal and void, and that the city collected them from the respective banks whose stock was owned by the plaintiff; that such collections were without the plaintiff's knowledge or consent, and were wrongfully deducted from funds in the possession of the banks belonging to plaintiff, against its will; and that the defendant now holds such money to the use of the plaintiff. In addition to the denials, the answer alleges that the plaintiff neglected to take any steps to review, correct, or vacate any of the assessments, or to stay or prevent the collection of any of the taxes based thereon; that the taxes were paid voluntarily, without force or duress; and that, if paid under any mistake, it was a mistake of law, and not of fact. The defense is a denial of illegality, and a plea of voluntary payment upon a claim of right, without mistake of facts.

Thomas P. Wickes, Esek Cowen, and George Richards, for plaintiff.

Francis M. Scott, George S. Coleman, and James M. Ward, for defendant.

MARTIN, J.

The first question involved in this controversy relates to the taxes assessed and collected of the plaintiff for the year 1886. On the 15th of June of that year the legislature passed an act which provides: ‘The lands and real estate of such insurance companies shall continue to be assessed and taxed where situated for state, city, town, county, village, school or other local purposes; but the personal property, franchise and business of all insurance companies incorporated under the laws of this state, or any other state or country and doing business in this state, and the shares of stock of said companies shall hereafter be exempt from all assessment or taxation except as in this act prescribed; provided that this section shall not affect the fire department tax of two per cent. now required to be paid.’ Laws 1886, c. 679, § 4. The solution of this question depends upon the construction of this provision of the statute, and how far it affected the tax for that year. This act expressly provided that insurance companies incorporated under the laws of any other state doing business in this state should thereafter be exempt from assessment or taxation, except in certain cases, which have no application here. It is contended by the plaintiff that this statute exempted it from taxation, and was applicable to the taxes for the year 1886, although the assessment for that year had been completed prior to its passage. Its claim is that, as it was to take effect immediately, and as the tax had not been actually perfected by extending it upon the assessment roll, it was exempted from the taxes of that year. With that contention we cannot agree. Indeed, the question can hardly be regarded as an open one in this court, as similar questions have been several times decided by us adversely to the plaintiff's claim in that respect. In re American Fine Arts Soc., 151 N. Y. 621, 45 N. E. 1131;Id., 6 App. Div. 496,39 N. Y. Supp. 564;Association for Benefit of Colored Orphans v. Mayor, etc., of New York, 104 N. Y. 581, 12 N. E. 279;People v. Commissioners of Taxes & Assessments, 142 N. Y. 348, 37 N. E. 116. In the first case cited the effect of chapter 540 of the Laws of 1895 was under consideration. That statute provided that the real and personal property of the American Fine Arts Society which it held under a lease from others, when the lessee was required to pay the annual taxes, should be exempt from all taxation. That act took effect on May 3d of that year. The assessment upon property situated in the city of New York is completed in each year on the 1st day of that month. This court held in that case that, as the commissioners of taxes and assessments had no power to change the assessments after that time, the act did not exempt the property of the society from a tax for that year. In the second case the same doctrine was applied, where the plaintiff became the owner of real estate after the 1st day of May, but before the tax was actually imposed; the court holding that the exemption did not apply to taxes for the year in which the act was passed. In the case of People v. Commissioners of Taxes & Assessments, although it was held that the act there under consideration relieved the property of the relator from taxation for that year, because it was passed previous to the 1st day of May, and was to take effect immediately, still the court recognized the correctness of the principle established by the preceding cases. See, also, Sisters of Poor of St. Francis v. Mayor, etc., of New York, 51 Hun, 355, 3 N. Y. Supp. 433, affirmed 112 N. Y. 677, 20 N. E. 417;People v. Commissioners of Taxes & Assessments, 91 N. Y. 593. It is urged by the plaintiff that the word ‘taxation’ relates to the imposition of the tax itself, and not to the assessment, and, as the tax had not been actually levied when this statute was passed, it exempted its property from taxation for the year 1886. We think there is no distinction between this case and In re American Fine Arts Soc., supra, as in that case, like this, the exemption was from taxation. As there was no provision in the act under consideration in this case giving it a retroactive effect, it did not affect the assessment and tax for the year 1886. It follows that the appeal of the plaintiff cannot be sustained.

This brings us to the consideration of the validity of the taxes imposed for the years 1887 and 1888. Under the statute to which we have already adverted, the personal property of an insurance corporation of another state doing business in this state is exempt from assessment and taxation, except as therein provided. As there was nothing in the act providing for a tax such as was imposed in this case, there was no law authorizing its assessment and levy. Such a tax was forbidden by that statute, and consequently was without authority and contrary to law. People v. Coleman, 121 N. Y. 542, 25 N. E. 51;Mutual Ins. Co. v. City of Poughkeepsie, 51 Hun, 595, 4 N. Y. Supp. 93. In National Bank of Chemung v. City of Elmira, 53 N. Y. 49, it was held that assessors have no power to determine what property is taxable; that is within the province of the legislature alone, and, if an erroneous decision on the part of the assessors as to what is taxable Property is made, they are liable; that the assessment founded thereon is void, and that such a decision may be attacked collaterally. In that case a tax was levied in violation of chapter 761 of the Laws of 1866, which forbade the assessment of any tax upon the capital of any bank organized under the...