Apartment Operators Association v. City of Minneapolis
| Decision Date | 13 April 1934 |
| Docket Number | 29,937 |
| Citation | 254 N.W. 443,191 Minn. 365 |
| Parties | APARTMENT OPERATORS ASSOCIATION AND ANOTHER v. CITY OF MINNEAPOLIS AND OTHERS |
| Court | Minnesota Supreme Court |
Taxpayers' action in the district court for Hennepin county for an injunction to restrain the city of Minneapolis its clerk, treasurer, comptroller, and assessor from enforcing the provisions of L. 1933, c. 359, relating to the assessment of real estate used for homestead purposes. Plaintiffs contend that the act is unconstitutional. Upon hearing, the court, Edward F. Waite, Judge, denied the motion for a temporary injunction, and plaintiffs appealed. Affirmed.
Taxation -- assessment of homestead property -- constitutionality of statute.
L. 1933, c. 359, providing for a lower assessed valuation on the first $4,000 of the actual value of real estate used for homestead purposes than on other real estate, held constitutional.
Frank E. Clinite, Franklin F. Ellsworth, and Ellsworth, Clinite, Dills & Dahl, for appellants.
Harry H. Peterson, Attorney General, William S. Ervin, Assistant Attorney General, and Richard S. Wiggin, City Attorney, for respondents.
This action was brought to enjoin defendants from assessing real property for taxation purposes in accordance with the provisions of L. 1933, c. 359. After a hearing upon an order to show cause directed to the defendants, the court made an order denying the relief prayed for and discharged the order to show cause. The appeal is from that order.
It is contended that the classification of real property in that chapter violates the uniformity clause of the state constitution (art. 9, § 1) and the equal protection clause contained in the fourteenth amendment to the federal constitution.
It is established that the provision in art. 9, § 1, of the state constitution providing that "taxes shall be uniform upon the same class of subjects" is no more restrictive upon legislative power to tax or classify than is the equal protection clause in the fourteenth amendment to the constitution of the United States. Lake Superior C. I. Mines v. Lord, 271 U.S. 577, 46 S.Ct. 627, 70 L.Ed. 1073. If the act here involved does not violate the one it does not violate the other. It is also established that the power to classify subjects for taxation purposes is primarily with the legislature, and such laws will not be declared invalid unless it clearly appears that they transgress the constitution. The classification, however, must not be unreasonable, arbitrary, or capricious. Reed v. Bjornson, 191 Minn. 254, 264, 253 N.W. 102, 107, and cases cited. Particular consideration should be given to that case, in which many of the propositions advanced in the instant case are disposed of and need not here be detailed.
The legislature having power to classify "subjects" for taxation, our only concern here is whether the classifications in c. 359 are reasonable. Classification must rest "on some ground of difference having a fair and substantial relation to the object of the legislation so that all persons similarly circumstanced shall be treated alike." Reed v. Bjornson, 191 Minn. 254, 253 N.W. 102. They must operate "equally and uniformly upon all persons in similar circumstances." Magoun v. Illinois T. & S. Bank, 170 U.S. 283, 296, 18 S.Ct. 594, 598, 42 L.Ed. 1037. Dohs v. Holm, 152 Minn. 529, 533, 189 N.W. 418, 420.
Prior to the 1933 enactment here considered, real property was divided into three general classes, viz: "real estate in which iron ore is known to exist" (the iron ore, mined or unmined, assessed at 50 per cent of its true value); " unplatted real estate" at 33 1/3 per cent of its true value; and all other real estate at 40 per cent of its true value. 1 Mason Minn. St. 1927, § 1993. L. 1933, c. 359, provides:
The classification of platted and unplatted land still remains. That classification is again divided into homestead and nonhomestead lands, the former being assessed at a lesser percentage of true value. The distinction is predicated upon the use made of the property. The other change is based upon value and gives a preference to homesteads of a value of $4,000 or less.
That use is a proper basis for classification cannot now well be questioned. The legislature has for many years classified property upon that basis. L. 1913, c. 483, divided property into four classifications. Class 1 included iron ore, which was assessed at 50 per cent of its true value; class 2 included household goods and personal belongings, which were assessed at 25 per cent; class 3 included live stock agricultural products, stocks of merchandise, manufacturers' materials and manufactured articles, all tools, implements, machinery, and unplatted real estate, etc., which were assessed at 33 1/3 per cent; class 4 included all property not included in the other three classifications and was assessed at 40 per cent. In State ex rel. St. Paul City Ry. Co. v. Minnesota Tax Comm. 128 Minn. 384, 150 N.W. 1087, the question involved was whether relator's railroad tracks, overhead feed wires, trolley wires and poles, underground conduits and cables were within class 3 or class 4. The claim was made that if such property was placed in class 4 the classification was so arbitrary and unreasonable that the statute was unconstitutional. This court held that the difference between the property involved and that included in class 3 was such as to justify the legislature in separating them into two classes and providing for the assessment upon the...
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