Arundel Corp. v. Sproul

• Decision Date: 24 January 1939
• Parties: ARUNDEL CORPORATION v. SPROUL, Tax Collector.
• Court: Florida Supreme Court

186 So. 679

136 Fla. 167

ARUNDEL CORPORATION v. SPROUL, Tax Collector.

Florida Supreme Court

January 24, 1939

Rehearing Denied Feb. 14, 1939.

Suit by the Arundel Corporation against Stetson O. Sproul, as Tax Collector of Palm Beach County, Fla., to set aside as illegal and void an assessment and levy of personal property taxes on certain dredging equipment. From a decree dismissing an amended bill of complaint, plaintiff appeals.

Judgment in accordance with opinion.

On Petition for Rehearing. Appeal from Circuit Court, Palm Beach County; C. E. Chillingworth, judge.

COUNSEL

Arthur H. Shoupe, of Lake Worth, and Loftin, Stokes & Calkins, of Miami, for appellant.

Harry A. Johnston and Sidney J. Catts, Jr., both of West Palm Beach, for appellee.

OPINION

CHAPMAN Justice.

This case is here on appeal from a decree by the Circuit Court of Palm Beach County Florida, dismissing an amended bill of complaint seeking to set aside as illegal, null and void an assessment and levy of personal property taxes of $250,000 on the Hallandale, and other dredges, and dredging equipment situate and being in Lake Okeechobee, Palm Beach County, Florida, from June, 1934 to December, 1935. The dredges and equipment were used by the plaintiff in the construction of dykes around Lake Okeechobee under the provisions of a contract with the Federal Government. The amended bill of complaint alleged that other dredging companies were engaged in like work, using similar equipment in connection therewith, but the taxing authorities of Palm Beach County had systematically, intentionally and arbitrarily discriminated against the property of the plaintiff. The taxes were not paid and a warrant was issued predicated on the aforesaid assessment of $250,000, for the sum of $23,750, being the amount of the taxes claimed to be due, and the dredge Hallandale was advertised and sold by the Tax Collector of Palm Beach County to satisfy the aforesaid sum. The parties will be referred to in this opinion as they appeared in the lower court, as plaintiff and defendant.

It was contended by counsel for the Tax Collector of Palm Beach County that the property of the plaintiff acquired a situs in Florida for the purpose of taxation and was therefore subject to taxation because the property was in Palm Beach County on January 1, 1935, as well as prior and subsequent thereto. The description of the property owned by the plaintiff as having its situs in Florida on January 1 1935, and subject to taxation, is set out or accurately described in the pleadings. Counsel for plaintiff contends that the property assessed for taxes, as well as the Hallandale, advertised and sold under a Tax Collector's warrant in the total sum of $23,750, did not have a situs in Palm Beach County on January 1, 1935, sufficient in law for taxation purposes; that the Hallandale was registered and documented in the office of the United States Collector of Customs at the Port of Baltimore, Maryland, under date of December 27, 1928; that such registration existed on January 1, 1935, and had not been changed; that it was plaintiff's intention to return the Hallandale to Baltimore, its port of registration, after it had performed certain government contracts in Florida waters and elsewhere; that the Hallandale had been employed for dredging purposes in the intercoastal waterways between Jacksonville and Miami between the dates of January, 1933 and May, 1934. It is contended that the dredges of the plaintiff were temporarily in Florida and it had no situs in Florida for taxation purposes.

The case of Johnson, Collector, v. De Bary-Baya Merchants' Line, 37 Fla. 499, 19 So. 640, 37 L.R.A. 518, is cited. The facts in that case show that the ownership of the vessels was in a New York corporation which maintained an office in said City. The vessels were registered in the Customshouse in the State of New York where the property had been annually and regularly returned to the City, County and State of New York for taxation purposes. The vessels were sent into Florida waters and elsewhere when the demands of trade, business or commerce rendered it necessary or profitable, and for long periods of time some of the vessels operated on the St. Johns River between Jacksonville and Sanford; its business, trade or commerce likewise required the vessels to go into the waters of other States and these vessels had not been connected exclusively with trade or commerce in Florida waters when they were assessed by the Tax Collector of Duval County, Florida, for taxation purposes. Paragraph 7 of the bill of complaint showed that the vessels had a New York ownership and had not become so blended with commerce and business of the State of Florida as to make them taxable in Florida, and that their status for taxation purposes had not been changed from the registry in the New York Customshouse. It was held in the case, and properly so, that the vessels had not acquired such a situs in Florida as to be subject to taxation, and when in Florida were engaged in commerce between other States and not exclusively within waters of the State of Florida and therefore were not subject to taxation in Florida.

In the case of National Dredging Company v. State, 99 Ala. 462, 12 So. 720, that court had before it a similar question. A dredging company, being a Delaware corporation, contracted with the United States Government to do certain dredging work in Mobile, Alabama, which it began in 1891, and completed in July, 1892. The dredging equipment was taken into Alabama from waters of other States when the performance of the contract was begun and the Tax Assessor of Mobile County, Alabama, assessed the property of the dredging company for taxation. It was contended that the property was not subject to taxation by the Tax Assessor of Mobile County, Alabama, because the vessels were registered in the Customshouse at Wilmington, Delaware. The property had remained exclusively in the State of Alabama during the time that the contract was being performed, and the Supreme Court of Alabama upheld the assessment made by the Tax Assessor of Mobile County. See North American Dredging Co. v. Taylor, County Treasurer, 56 Wash. 565, 106 P. 162, 29 L.R.A.,N.S., 105.

As a general rule vessels engaged in state or interstate traffic or commerce, with no established situs, but going in and out of a port upon a fixed run, or as the necessities of the business or commerce engaged upon may demand, or when engaged upon no fixed schedule, but sailing from one port to another as a carrier of state, interstate, or international traffic, can be assessed for taxation purposes at the home port, or at the domicile of the owner, but a vessel may be assessed for taxation purposes without reference to the home port or the residence of the principal owner or agent, when it is put to such use as to impress it with a local character. The lower court held that the property described in the amended bill of complaint in the case at bar had a situs for taxation purposes in Palm Beach County from June, 1934, continuously until the latter part of 1935, and was therefore subject to taxation. See McRae v. Bowers Dredging Co., C.C., 90 F. 360; City of Galveston v. J. M. Guffey Petroleum Co., 51 Tex.Civ.App. 642, 113 S.W. 585; State v. Higgins Oil & Fuel Co., Tex.Civ.App., 116 S.W. 617; Old Dominion Steamship Co. v. Virginia, 102 Va. 576, 46 S.E. 783, 102 Am.St.Rep. 855; Id., 198 U.S. 299, 25 S.Ct. 686, 49 L.Ed. 1059, 3 Ann.Cas. 1100.

It is next contended that Tax Assessor of Palm Beach County, Florida, in making up the tax roll intentionally omitted and neglected to assess for taxation purposes the property of other dredging companies engaged in the same work as the plaintiff, and in doing so there was an illegal discrimination against the property of the plaintiff and in favor of the owners of similar property located in Palm Beach County, which said discrimination amounted in law to a constructive fraud. Several decisions of this Court have been cited to sustain this contention. The law contemplates that assessing officer shall make just, fair and impartial valuations for assessment purposes, without discrimination, and that these values when made in the manner provided by law and with proper regard to their location, use, values, etc., the assessment so made, in general, will not be disturbed by the courts. See Camp Phosphate Co. v. Allen, 77 Fla. 341, 81 So. 503.

In the case of City of Tampa v. Palmer, 89 Fla. 514, 105 So. 115, this court said [page 120]:

'The fixing of a valuation upon property by a tax assessor for purposes of taxation, and the equalization thereof by a board of equalization, are administrative acts, involving the exercise of administrative discretion, and a court of equity will not in general control that discretion unless it is illegally or fraudulently exercised or exerted in such manner or under such circumstances as will amount in law to a fraud. King v. Gwynn, supra ; Wade v. Murrhee, supra [75 Fla. 494, 78 So. 536]; Board of Com'rs of Finney County v. Bullard, 77 Kan. 349, 94 P. 129, 16 L.R.A.,N.S., 807. The jurisdiction of courts of equity in such cases is one of necessity. Relief will not be granted by courts of equity in such cases merely upon the ground that the valuation is excessive, for we have seen that mere excessive valuation, when due solely to error in judgment, inadvertence, or mistake, does not amount to fraud (Shear v. Commissioners of Columbia County, supra ), and the assumption of jurisdiction of such a case by a court of equity, would be an attempt to regulate and control the administrative discretion expressly vested by law in another body, and to grant relief in equity when there exists a plain, adequate, and

...