Aiken v. Armistead, 12258.

CourtSupreme Court of Georgia
Writing for the CourtBELL, Justice.
Citation198 S.E. 237,186 Ga. 368
PartiesAIKEN v. ARMISTEAD et al.
Docket Number12258.
Decision Date24 June 1938

198 S.E. 237

186 Ga. 368


No. 12258.

Supreme Court of Georgia

June 24, 1938

Error from Superior Court, Fulton County; John D. Humphries, Virlyn B. Moore, and Hugh M. Dorsey, Judges.

Suit by C. P. Aiken against John Armistead and others to cancel an alleged contract between the members of the State Revenue Commission and the named defendant authorizing him to collect taxes on intangible property for the preceding seven years and receive as a fee 20 per cent. of the collection, and to enjoin further procedure under the contract, wherein defendants filed a general demurrer. To review a judgment which sustained the demurrer and dismissed the suit, plaintiff brings error.

Affirmed. [198 S.E. 238]

Syllabus by the Court.

1. In the instant suit by a citizen and taxpayer, to cancel an alleged contract between members of the State Revenue Commission and another person, authorizing the latter to assess and collect on commission all taxes due to the State by its citizens on unreturned intangible property, and to enjoin further procedure under such contract, the record does not require decision as to whether the plaintiff has such interest in state funds as to authorize him to sue in equity to prevent waste or unlawful expenditure, or as to whether the action should be construed as a suit against the State. Nor is any ruling necessary as to the validity of the contract.

2. So far as the petition referred to proposed collection of taxes due by the plaintiff himself, it was fatally defective for failure to tender the amount due or for the absence of any offer to do equity. It further appears that in this respect the petition was based on a mere apprehension of unlawful interference, and showed no reason why the plaintiff could not easily avoid such interference by dealing directly with the proper [186 Ga. 369] authorities. Nor was a cause of action stated in reference to possibility of double taxation.

3. As to citizens and taxpayers other than the plaintiff, the petition contained no sufficient allegation of taxes due, or that, if due, they would be paid independently of the alleged unlawful contract between the defendants. For these reasons, the petition failed to show any depletion of or injury to the public treasury.

4. So far as the petition alleged unlawful acts in reference to citizens other than himself, with consequent injury to them, and general exodus of people and capital from this State, it did not show such special injury to the plaintiff as to authorize an action in equity by him.

5. The petition failed to state a cause of action in the plaintiff for any of the relief sought. The court properly sustained the general demurrer and dismissed the action. [198 S.E. 239]

G. Seals Aiken, of Atlanta, for plaintiff in error.

M. J. Yeomans, Atty. Gen., and O. H. Dukes, Ellis G. Arnall, and W. H. Duckworth, Asst. Attys. Gen., for defendants in error.

BELL, Justice.

On November 5, 1937, C. P. Aiken, a citizen and taxpayer of Fulton County, Georgia, filed a suit in equity against W. B. Harrison, T. Grady Head, and J. B. Jones, composing at the time the State Revenue Commission, and against John Armistead, in which action the plaintiff sought, among other things, to cancel an alleged contract made by Harrison, Head, and Jones as members of the State Revenue Commission, with John Armistead, authorizing him to assess and collect all ad valorem taxes due to the State of Georgia on unreturned 'intangible' property, for the preceding seven years, on the basis of twenty per cent. commission to Armistead; and to enjoin further procedure under the contract. After the allowance of several amendments to the petition, the court, at interlocutory hearing, sustained a general demurrer and dismissed the action, and the plaintiff excepted. In the bill of exceptions error is also assigned upon exceptions pendente lite taken by the plaintiff to the refusal of the judge to grant a temporary restraining order on presentation of the petition, and to his refusal to allow introduction of evidence at the interlocutory hearing. According to our view of the case, any question of error in the intermediate rulings will be controlled by a proper decision as to whether the petition as amended was sufficient to state a cause of action; and therefore no further reference will be made [186 Ga. 370] to the exceptions pendente lite. The petition as amended is very lengthy; but since the whole of it must be considered in determining whether the court erred in sustaining the general demurrer, we will endeavor to state it in substance, following generally in this respect what appears to be a true and correct statement in the brief of counsel for the plaintiff in error. See Rules 13, 14, and 15, 178 Ga. page VIII.

Petitioner is a citizen and taxpayer of the City of Atlanta, Fulton County, Georgia, and of the United States, and has been for many years. He is vitally interested in the welfare of the people of the State of Georgia and of the United States, and in maintaining intact and unimpaired our republican system of government, as declared in the Declaration of Independence and established by the constitution of Georgia and the constitution of the United States. John Armistead and the other defendants herein named have entered into a contract under which Armistead is to receive at least 20 per cent. commission on the amount of taxes he collects for the State of Georgia. The contract authorizes Armistead to assess and collect state taxes on all unreturned intangibles owned or controlled by citizens of Georgia and the United States, for the next preceding seven years. The defendants anticipate and intend collecting through Armistead the sum of $100,000,000, at least, in alleged taxes due the State of Georgia on alleged unreturned intangibles owned or controlled by citizens of Georgia and the United States during the next preceding seven years, in addition to all other taxes of every kind and nature which have been paid on said intangibles to the various units of government. The said assessments and collections are to be based entirely upon alleged information and statements and assumed and asserted authority of John Armistead. Said contract authorizes and auticipates Armistead's being in effect the law, the jury, and the judge as to whether said alleged citizens, or any of them, owe the State of Georgia or any municipality or county of Georgia any ad valorem taxes for any or all of the said years, and, if so, how much, upon what basis, upon what theory or authority, and in what amount. Armistead is acting as judge and jury and the law as to what compromise or settlement shall be made of said alleged taxes due by citizens. Armistead is permitted, under said contract and arrangement, to use his own arbitrary discretion in discriminating between said alleged [186 Ga. 371] citizens of [198 S.E. 240] the municipalities and counties of Georgia, of the State of Georgia, and of the United States, in conducting inquisitions of said citizens in regard to said alleged taxes due by them, and in placing said alleged unreturned intangibles upon the tax digests, in assessing taxes thereon, in giving legal advice and notice relative thereto, and in holding or not holding hearings with reference thereto.

Armistead is discriminating in his own arbitrary discretion against the alleged 'holders of intangible out-of-state investments' and in favor of holders of investments within the State of Georgia, by assessing and collecting more taxes on the same class of property from the former than the latter under said contract, contrary to Amendment 14 of the United States constitution, U.S. C.A.Const. Amend. 14, which declares: 'All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside. No State shall * * * deny to any person within its jurisdiction the equal protection of the laws.' Code, § 1-815. The said conduct of Armistead is contrary to article 1, section 1, paragraph 2, of the constitution of Georgia, providing that 'Protection to person and property is the paramount duty of government, and shall be impartial and complete.' § 2-102. It is also contrary to the uniformity required by the constitution of Georgia in article 7, section 2, paragraph 1, as follows: 'All taxation shall be uniform upon the same class of subjects, and ad valorem on all property subject to be taxed within the territorial limits of the authority levying the tax, and shall be levied and collected under general laws.' § 2-5001. The defendants, especially Armistead, have already discriminated in many instances between holders of intangibles during said seven-year period, in his own arbitrary discretion and that of his confederates, and in the arbitrary discretion of the other defendants herein named, through themselves and their confederates, in open violation of the provisions of the United States and Georgia constitutions just quoted. Armistead personally, and through twenty-five or thirty of his confederates, is spying upon, inspecting, investigating, giving legal advice and opinions in regard to assessing, writing about, demanding returns and payment of taxes upon alleged intangibles claimed by him to have been unreturned by said citizens during said seven-year period while owning, holding, or controlling them, or having [186 Ga. 372] an interest therein, and Armistead has been thus conducting 'a general, roving, offensive, inquisitorial, compulsory investigation' concerning sad citizens of Georgia and the United States, 'without any allegations, upon no fixed principles, and governed by no rules of law or evidence, and no restrictions except' his own 'will or caprice' and that of the other defendants herein named and their confederates, and said procedure 'is unknown to our constitution and laws, * * * and an...

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