Appeal of Sears, Roebuck & Co.

• Decision Date: 31 December 1952
• Docket Number: No. 18294,18294
• Citation: 123 Ind.App. 358,109 N.E.2d 620
• Court: Indiana Appellate Court
• Parties: Appeal of SEARS, ROEBUCK & CO. DUDLEY v. SEARS, ROEBUCK & CO.

Page 620

109 N.E.2d 620

123 Ind.App. 358

Appeal of SEARS, ROEBUCK & CO. DUDLEY v. SEARS, ROEBUCK & CO.

No. 18294.

Appellate Court of Indiana, in Banc.

Dec. 31, 1952.

Glenn W. Funk, Indianapolis, for appellant.

Max M. Plesser, County Atty., Indianapolis, for Auditor of Marion county.

Winslow Van Horne, Auburn, William H. Dye, New Augusta, Eugene M. Fife, Jr., Indianapolis, for Sears, Roebuck & Co.

ACHOR, Judge.

This is an action begun by appellant, Irl O. Dudley as a taxpayer, and representing all other taxpayers of Marion County, Indiana, similarly situated, to set aside and vacate a certain judgment in the Circuit Court of Marion County. This judgment purported to set aside an assessment of the Auditor of Marion County, Indiana, against Sears, Roebuck and Company on certain omitted personal property for the years 1938 through 1947 inclusive. The amount of tax fixed by the Auditor for the years in question totalled $204,941.50. The judgment entered by the Court is as follows:

'It Is Therefore, Considered, Adjudged and Decreed by the Court that that certain assessment of property of the appellant herein, Sears Roebuck & Company, described as merchandise in layaway and merchandise in warehouses, which assessment was made by Ralph Moore, Auditor of Marion County, Indiana, as property omitted from taxation, and which was by him entered upon the tax duplicate of Marion County, Indiana, upon the 3rd day of November, 1948, be and the same is hereby set aside and held for naught and said auditor is hereby ordered to expunge the same from said duplicate; that said assessment be and the same hereby is remanded to said Auditor of Marion County, Indiana, with instructions to make and enter upon the tax duplicate of Marion County, Indiana, the following assessment upon the property of Sears Roebuck & Company as and for property omitted from taxation to-wit:'

(Here the court fixed the value of omitted property for each year in controversy)

'and that such assessment when so made shall be and constitute a final and complete assessment on all of such property of such description owned by said Sears Roebuck & Company and located in Marion County, Indiana, at any time prior to the date hereof; and said Auditor is further ordered to compute and enter the taxes due upon said assessment and enter the same upon said duplicate without penalty or interest if paid on or before the first day of April, 1949.'

On the basis of the assessment purportedly fixed by the court, the tax on the omitted property amounted to $20,203.20.

Appellant's action was in the form of a verified petition in two paragraphs filed in the original action, seeking in Paragraph I to have the judgment set aside and vacated and expunged as being illegal and void for the following reasons: (a) That the appeal was not perfected in time because the transcript of the Auditor was not filed within 90 days from the date of his finding, or within 90 days of the filing of bond by Sears, Roebuck and Company for the purpose of appeal to the Circuit; and (b) that, as stated in appellant's brief, 'the appeal was not concerned with any judicial or legal question but a matter wholly administrative and legislative in character, and therefore the Circuit Court had no jurisdiction of the subject matter of said appeal.'

In Paragraph II, the appellant herein asked that the judgment of the Circuit Court be set aside and held for naught for the reason that the attorneys for Sears, Roebuck and Company at the time of and prior to the taking of the appeal also represented the State of Indiana, notwithstanding the State's adverse interest. 'That the judgment was an agreed entry prepared by the attorneys.' That thereby the attorneys 'actually fixed the new and greatly reduced assessment * * * thus usurping the authority of the Auditor of Marion County, * * * all without authority of law.' That no evidence was heard, 'and that by initialing and agreeing on the entry and infalsely representing to the court that it had jurisdiction thus to determine a new tax assessment, the attorneys duped and defrauded the court, thus rendering the purported judgment void ab initio.'

The allegations of the petition were challenged by the filing of a demurrer, an amended demurrer, and by a third demurrer.

The third demurrer to both paragraphs of complaint was sustained. Petitioner refused to proceed further. Judgment was rendered that petitioner take nothing by his petition. This appeal followed.

The errors assigned and relied upon by appellant in this appeal are summarized as follows:

(1) Errors in pleading and practice incident to the filing of said multiple demurrers.

(2) The sustaining of the final (third) demurrer by the court as to both appellant's first and second paragraphs of complaint.

With regard to the first assigned error, it is asserted by appellant that the case of Joseph v. State, 1951, 229 Ind. 496, 501, 99 N.E.2d 244, 246, is decisive upon this point. In that case, the court (1) overruled the State's demurrer, (2) permitted the State to withdraw its demurrer, (3) permitted it to file a second demurrer, and (4) sustained the second demurrer. The Supreme Court negated the practice and stated as follows:

"Clearly the Indiana practice does not permit the filing of successive demurrers on separate grounds. That is, a defendant may not first demur for defect of parties and if that is overruled then demur for insufficient facts, although no case is found which expressly decides this point. * * *

"It is clear also that the statutes on amendment do not contemplate the amendment of a demurrer. * * * in terms they are limited to the amendments of pleadings, and in the sense in which these statutes use the word 'pleading' a demurrer is not a pleading.

On the other hand it would seem that the statutes on amendments are not necessarily exclusive and that the trial courts would have inherent power to permit an amendment of a demurrer prior to a ruling on the demurrer. * * *' Gavit Indiana Pleading and Practice, Vol. 1, § 135, pp. 649, 650.

'After the state's demurrer was overruled on December 3, 1949 and a record thereof was made and signed by the court, its rights to demur in the case were exhausted and could not be extended by favorable action of the trial court on a motion to withdraw the demurrer thereafter made. It was, therefore, error to allow the demurrer to be withdrawn and to allow another demurrer to be thereafter filed.'

In the above case, the court held that 'After * * * the demurrer was overruled * * * and a record thereof was made and signed by the Court, * * *. It was, therefore, error to allow the demurrer to be withdrawn and to allow another demurrer to be thereafter filed.' (Our italics.) However, it must be observed that the above case does not contradict the inherent power of the court to alter, amend or set aside its former rulings and orders in procedural matters so long as the issue before it remains in fieri. Nor does the case go so far as to deny the court the right to set aside its ruling on a demurrer while the case was in fieri, if convinced of the error of his ruling. Nor does it pretend to hold that in event such ruling is set aside by the court, a party may not thereafter withdraw its demurrer and be permitted to file another demurrer to the pleading. In fact, the reasoning of the case would seem to support a contrary conclusion.

In the case before us, the court, on appellant's motion, first set aside its ruling on the demurrer. Having so expunged the record of the ruling thereon, the reason for the rule in the Joseph case, supra, no longer existed. There being no "ruling on the demurrer", the court had authority to grant the withdrawal of the demurrer and permit the filing of an 'amended' demurrer, the Joseph case notwithstanding.

We conclude, therefore, that, although the filing of multiple demurrers is ordinarily not permitted, under the circumstances above recited it did not constitute reversible error.

The second error assigned by appellant was the sustaining of the (third) demurrer to his petition. The demurrer, among other things, challenged the sufficiency of both appellant's first and second paragraphs of complaint upon the grounds (1) that appellant had no right as a taxpayer to attack the judgment, and (2) that the trial court was without jurisdiction for the reason that appellant's petition was filed in the original cause of action after term and without notice.

The demurrer further challenged the sufficiency of paragraphs one and two for grounds specifically related thereto. However, consideration need not be given to any of the other issues raised by the demurrer if it be true, as contended by appellee, that appellant as a taxpayer had no right to intervene, or if appellant's action was improperly filed so as not to give the court jurisdiction over the parties or the subject matter.

First, it is contended that a taxpayer has no right to intervene in a cause of action between a governmental body and another taxpayer, even though substantial loss or damage may be sustained by said taxpayer and other taxpayers as a class because of neglect, fraud or malfeasance on the part of government officials involved in the proceeding.

The case of Van Der Veer v. Union Trust Co., etc., 1920, 73 Ind.App. 336, 126 N.E. 38, is cited by appellee as conclusive authority for this position. However, an examination of that case discloses that the facts in that case are not analogous, nor is the conclusion therein controlling of the case before us. In the Van Der Veer case, supra, the appellant sought to intervene in the original action while the same was pending on motion for new trial, for the purpose of objecting to a proposed compromise settlement submitted to the court for approval by the parties. Without affirming the ruling of the court in that case, we do observe that in the case before us the appellant sought not to intervene or intermeddle...