Appeal of Van Nort

• Decision Date: 01 October 1888
• Docket Number: 23
• Citation: 15 A. 473,121 Pa. 118
• Parties: APPEAL OF CHAS. F. VAN NORT. J. J. ALBRIGHT v. C. F. VAN NORT.
• Court: Pennsylvania Supreme Court

15 A. 473

121 Pa. 118

APPEAL OF CHAS. F. VAN NORT.

J. J. ALBRIGHT v. C. F. VAN NORT.

No. 23

Supreme Court of Pennsylvania

October 1, 1888

Argued February 22, 1888

FROM THE DECREE OF THE COURT OF COMMON PLEAS OF LACKAWANNA COUNTY.

No. 23 January Term 1888, Sup. Ct.; court below, No. 5 October Term 1887, C.P. in Equity.

On June 28, 1887, Joseph J. Albright, a citizen residing in the Ninth ward of Scranton, filed a bill in equity against Charles F Van Nort, collector of taxes in said ward, averring in substance:

That the complainant had made no return to the assessor of said ward of property to be assessed to him for state purposes for the year 1886, and thereupon it became and was the duty of said assessor to make a return for the complainant estimating the amount from the best information at his command, according to the provisions of § 9, act of June 30, 1885, P.L. 193, which act was made a part of the bill.

That the county commissioners furnished to said assessor a certified list of mortgages standing unsatisfied upon the records of Lackawanna and Luzerne counties, wherein the complainant was mortgagee, and from which the assessor was to derive the best information of their existence.

That upon said list, there appeared two mortgages, one by the Union Coal Co., for $259,919.41, dated September 18, 1867 and another by the Balt. Coal & Union R. Co., for $360,449.57, dated July 22, 1868, both to Joseph J. Albright, trustee, and given to secure certain bonds in which the complainant had no personal interest, and which said mortgages had in fact been paid many years before and had been satisfied of record; that the said assessor unjustly and illegally assessed the said two mortgages for taxation against the complainant, and thereupon the said commissioners upon such illegal return, assessed a tax of 3 mills for state purposes against the complainant on the full amount of said two mortgages, the levy amounting to $1,861.10.

That the return of said assessment made by the assessor to the complainant was made in such a way that he was misled by it, and he had no knowledge that he had been assessed with the amount of said two mortgages until after the day of appeal in his ward had passed; that, as soon as he was informed of the fact that such assessment had been made, he immediately applied to the commissioners to have said illegal assessment corrected and stricken off; yet the said commissioners, though having in their hands the evidence of the illegality of such assessment, refused to grant relief and placed said tax so illegally assessed in the hands of the defendant for collection, and that said defendant was about to seize and sell the personal property of the complainant to obtain payment of said tax. The prayers were for a preliminary injunction till final hearing, a permanent injunction thereafter, and for general relief. The preliminary injunction prayed for was awarded.

From the affidavits read on the hearing of the motion to continue the preliminary injunction, on July 2, 1887, it appeared that said mortgages were of record as stated in the bill; that the bonds, to secure which the mortgages were given, had for many years before been fully paid, but through neglect the mortgages had remained unsatisfied until after the said assessment; that the assessor had handed to the complainant a slip notifying him of his assessment, but the figures thereon were so pointed off as to indicate an assessment of $642.08, instead of one of $642,088, about the amount of the mortgages; that not understanding the slip, he did not attend the commissioners' court of appeals, and had no knowledge of the illegal assessment until the tax of 3 mills had been assessed, when he applied to the commissioners for relief which was refused. It also appeared from an affidavit made by one of the county commissioners, that the complainant had never made nor offered to make the return required by law of property taxable for state purposes for the year 1886; that after the notice of the assessment to the complainant, he had several times appeared before the county commissioners and applied to have the assessment stricken off, when he was requested to make the return provided for by the law, but this he had refused or declined to do.

On August 31, 1887, the court, ARCHBALD, J., filed the following opinion and decree:

The plaintiff, who is a taxable of the Ninth ward of the city of Scranton, failed to make a return of his personal property as required by § 7, act June 30, 1885, P.L. 196, and the assessor thereupon made one for him, estimating his property as follows: Household furniture, $2,500; money due on mortgages, $642,088; money due on judgments, $9,579. Total, $654,127. It is undisputed that the amount as returned as due on mortgages, was obtained from the records of the county commissioners, and includes two trust mortgages, aggregating $620,000, in which the plaintiff had no personal property or interest, but merely stood as trustee for bondholders. At the time of the return, the bonds had been fully paid and the mortgages have since been satisfied of record. Does this showing to such extent invalidate the assessment?

The general rule in cases of this kind undoubtedly is that where the taxable has neglected or failed to make a return as required by the statute, if the assessor in the due exercise of his judgment makes an estimate of his property for him, this cannot be assailed by the taxable by showing that he has not the amount of property so returned. This would be merely a matter of excessive valuation, which the courts do not undertake to adjust: Hughes v. Kline, 30 Pa. 231. But the important part of this rule is, that there must have been a due exercise by the assessor of the discretion committed to him, and this suggests the limits to which the rule itself may alone be properly carried. Thus, if the assessor injudiciously discriminates against a taxable or makes a purposely oppressive assessment, this is such an abuse of his discretion as avoids the assessment: Cooley, Taxation, 157; Merrill v. Humphry, 24 Mich. 170; Lefferts v. Calumet, 21 Wis. 688; Milwaukee Iron Co. v. Hubbard, 29 Wis. 51. He does not in such case bring his judgment to bear upon the question submitted to him, but exerts it arbitrarily and capriciously, defeating the purpose of the laws. Similarly, it has been held that the assessment will be avoided if made in disregard of the actual and well known facts, as where the lands of one person are assessed to another who has no connection with their title or occupancy: Whiting v. Thomas, 23 N.Y. 281; Buffalo, etc., R. Co. v. Erie Co., 48 N.Y. 98; State v. Millston, 20 Wis. 228; People v. Castro, 39 Cal. 65. With regard to this it is said in People v. Castro, supra: "It was distinctly proved on the trial that the defendant was not the owner of about fifteen hundred acres of the land assessed to him, and that this land was in the actual occupation of other persons holding title under recorded deeds. This fact of itself established a legal fraud which vitiated the entire assessment. No citizen would be safe from illegal and onerous exaction, if assessors are to be permitted thus flagrantly to violate the laws by assessing large and valuable estates, not to the owners in the actual and visible possession under recorded titles, but to others, who claim no interest in the property, and are not in possession."

The present case in my opinion, falls within the decisions last cited, and the exception to the rule which they sustain. The assessor here, has not only not estimated the amount of the plaintiff's taxable property from the best information at his command, as directed to do by the statute, but he has actually disregarded his information and drawn into and made part of his estimate what the record of the commissioners' office showed did not belong to the plaintiff but to others. This did not constitute a due exercise of the discretion with which he was invested. It was either a sheer abuse of his authority, or if made in mistake, was such a mistake as amounts to a legal fraud, and to such extent avoids the return. If this assessment is invalid, the plaintiff has a right to have it so declared, and the collection of the tax restrained regardless of the existence of the remedy by appeal. This is not simply an irregularity, nor matter of overvaluation, to be so corrected. It is an illegality which vitiates the whole proceedings: Harper's Appeal, 109 Pa. 9. The mere circumstance that it might be corrected upon appeal to the county commissioners will not legalize it. Moreover, the right of appeal is not absolute. The plaintiff must excuse his default to the satisfaction of the commissioners. Suppose he should not be able to do this, must he still be subject to the return as made? The fact is, that the failure of the taxable to make a return, does not authorize the assessor to make any return he pleases for him. The discretion of the assessor must be duly exercised. If it be shown that it has not been, the return is not legal, and the taxable is not thereby subjected to the provision of the statute. He stands without it, and until brought within its pale by a proper return, is not bound to pursue the remedies which it provides: Harper's Appeal, supra.

In reaching these conclusions, I am not unaware of the decisions in Osborne v. Danvers, 6 Pick. 98, and Lincoln v. Worcester, 8 Cush. 65, but I cannot accept them as ruling this case. The statute under which the former was decided provided that whenever any person shall be aggrieved by being overrated in the assessment of any tax, he may apply to the assessors to make a reasonable abatement, and if they refuse so to do, complaint was to be made in the nature of an appeal to the...