Bauer-Schweitzer Malting Co., Inc. v. City and County of San Francisco
| Decision Date | 24 October 1972 |
| Docket Number | BAUER-SCHWEITZER |
| Citation | 28 Cal.App.3d 209,104 Cal.Rptr. 604 |
| Parties | MALTING CO., INC., a corporation, Plaintiff and Appellant, v. CITY AND COUNTY OF SAN FRANCISCO, a body politic and corporate, Defendant and Respondent. Civ. 29512. |
| Court | California Court of Appeals Court of Appeals |
John P. Macmeeken, L. K. Whitaker, Chickering & Gregory, San Francisco, for plaintiff and appellant.
Thomas M. O'Connor, George E. Baglin, San Francisco, for defendant and respondent.
Plaintiff taxpayer has appealed from a judgment entered in favor of defendant city and county after the issues presented in plaintiff's complaint to recover personal property taxes paid under protest and the defendant's answer thereto were submitted on the pleadings, briefs and argument. The taxes in question represent taxes levied against amounts which the assessor found the taxpayer's personal property had been underassessed for the years 1964, 1965 and 1966, and were placed upon the 1966 unsecured tax roll on March 28, 1967, long after the rolls for each of said years was subject to equalization. The background giving rise to the making of the deficiency assessments is detailed in Knoff v. City etc. of San Francisco (1969) 1 Cal.App.3d 184, pp. 190-193, 81 Cal.Rptr. 683 and People v. Wolden (1967) 255 Cal.App.2d 798, pp. 801-802, 63 Cal.Rptr. 467 [cert. den. (1968) 391 U.S. 965, 88 S.Ct. 2032, 20 L.Ed.2d 877]. The taxpayer contends that the purported increases in its assessments for the years in question were illegal and void because there is no statutory authority for making such additional assessments, and because the mandate imposed upon the city and county, its board of supervisors, its board of equalization and its assessor by Knoff v. City etc. of San Francisco, supra, does not, as contended by defendant, preclude the taxpayer from contesting an assessment which is illegally imposed. The taxpayer also contends that each of the additional assessments was discriminatory in that it was made at a ratio of cash value which was grossly in excess of the prevailing ratio for the year in question, and that it was denied due process of law under the State and United States Constitutions, because the defendant's board of equalization summarily denied the taxpayer's timely application for equalization of the contested assessments. Defendant contends that the assessments were authorized by law under general constitutional and statutory provisions; that it was so adjudicated in Knoff; and that the taxpayer is bound by the decision in Knoff because it appeared therein as an amicus curiae, and because that decision, which purports to direct the conduct of public officers, binds the public generally. The defendant concedes that the taxpayer may have had a right to seek equalization of the contested assessment, but asserts that its right to do so has been lost by failure to present proof of any discrimination in this action.
It is concluded that the defendant's contrary position in Knoff does not preclude it from attempting to uphold the legality of the deficiency assessment in these proceedings; that Knoff did not authorize the assessor or the board of equalization to reassess property or levy taxes other than as provided by law; that there is no express authorization for reassessment because the assessor unilaterally erroneously applied an improper ratio to the correctly reported and ascertained cost of personal property; that the constitutional requirements that property shall be assessed at its full cash value, and in proportion to its value does not authorize assessments or taxes in a manner not provided by the Legislature; that the taxpayer is not barred from contesting the assessment by any principle of stare decisis or res judicata; that the issue of whether the reassessments were discriminatory is not properly before this court at this time; and that the judgment must be reversed and the case must be remanded for a determination of whether legal grounds exist for the deficiency assessments.
The pleadings establish the nature and capacity of each of the parties. It is admitted, by failure to deny, that in each of the years 1964 and 1965 the assessor, in order that he would be fully apprised of the cost of the taxpayer's personal property as of the first Monday in March of each of those years, reviewed the taxpayer's books and records and prepared from them a confidential analysis of inventory accounts and equipment which correctly set forth the cost of all of the taxpayer's personal property on each of those lien dates; that a copy of each such analysis was furnished to the taxpayer by the assessor to enable the taxpayer to report the cost of the personal property as so determined by the assessor in its property statement for each of those tax years; that within the time personal property as so determined by the assessor in its property statement for each of those tax years; that within the time permitted by law the taxpayer filed property statements in the form prescribed by the assessor, which in 1964 set forth the costs as so determined by the assessor, and which in 1966 fully and accurately set forth the cost of all of the taxpayer's taxable, tangible property save and except for the inadvertent omission of tangible personal property having a cost of $2,716. 1 The taxpayer's allegation that he filed a property statement for 1965 which set forth the costs of its personal property as determined by the assessor was denied, and the trial court found that the taxpayer had failed to prove that allegation. In any event, it is admitted that an audit concluded in 1966 of the books and records of the taxpayer relating to the costs of the taxable, tangible personal property held by it on the respective lien dates in 1964, 1965 and 1966 confirmed that plaintiff's costs, with the exception noted above, had been fully disclosed. Although the taxpayer alleged that the assessor (presumably the new assessor) conducted this audit, the defendant denied that the assessor made the audit, and alleged that certified public accountants made the audit as provided in and required by the writ of mandate in the Knoff case. It would appear it was conducted by governmental authority in any event, and the trial court failed to find on this apparently inconsequential issue.
The taxpayer's allegation that the full cash value of its personal property on the lien dates in question did not exceed the following amounts respectively: 1964--$782,800; 1965--$861,000; and 1966--790,800, is uncontroverted. It is also conceded that the assessments of the taxpayer's taxable personal property which were included upon the defendant's assessment rolls and were unchanged by defendant's board of equalization during any of the regular equalization periods were respectively: 1964--$300,140; 1965--$335,250; and 1966--$309,678.
Thereafter, on March 28, 1967, following the 1966 audit referred to above, the assessor included upon the 1966 unsecured tax roll additional assessments for the years in question as follows: 1964--$96,859; 1965--$72,596; and 1966--$57,347, of which $1,358 is not contested (see fn. 1 above). The taxpayer refers to each of these additional assessments as 'a purported escaped property assessment.' Defendant alleged 'that the escape assessment was imposed because the writ of mandate in Knoff . . . so required' and denied any contrary allegations.
On April 7, 1967 the taxpayer filed an application for equalization 2 with defendant's board of equalization and the matter was regularly set for hearing. According to the taxpayer 'at the time and place theretofore set for the hearing of Plaintiff's said Application for Equalization, the said Board of Supervisors sitting as a County Board of Equalization, acting arbitrarily and in wilful disregard of the law intended for its guidance and control, with the evident purpose of imposing an unequal burden upon Plaintiff, ruled that it would not grant Plaintiff any hearing upon its Application for Equalization and summarily denied Plaintiff's said Application, refusing to hear any evidence or to receive any statement of Plaintiff thereon.' The defendant denied the foregoing allegations and alleged, 'The Board of Equalization denied plaintiff's application because it was required to deny it in conformance with this Court's writ of mandate of March 28, 1966, and its order of April 3, 1967, in Knoff, supra. . . .' 3 The court determined that the taxpayer had failed to prove the allegations of its complaint which are quoted above. Its statement of intended decision indicates that it accepted defendant's contention that the mandate in Knoff rendered a hearing before the board of equalization futile because the writ of mandate precluded the board from considering anything but a 50 percent assessment on 'all San Francisco taxable properties that were unassessed or underassessed or otherwise escaped taxation for any reason, and especially because of the application to any taxable properties of an improperly low assessment ratio, i. e., one below 50%, causing an improperly reduced or low assessment valuation. . . .'
On April 27, 1967, when its application was denied, the taxpayer paid under protest the taxes levied on the additional assessments in the following sums: 1964--$9,848.62; 1965--$7,381.56; and 1966--$5,831.04, of which $138.08 represented the tax against property which had not been reported (see fn. 1 above). On September 18, 1967 this action was filed.
Other allegations, which are contained in the taxpayer's fourth, fifth and sixth causes of action and are directed to the failure to secure a hearing before the board of equalization and the alleged discriminatory nature of the additional assessment, are referred to below. The defendant in separate defenses...
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