Bd. of Com'rs of Marion Cnty. v. Western Elec. Co.

• Decision Date: 13 November 1924
• Docket Number: No. 11822.,11822.
• Citation: Bd. of Com'rs of Marion Cnty. v. Western Elec. Co., 145 N.E. 504 (Ind. App. 1924)
• Parties: BOARD OF COM'RS OF MARION COUNTY v. WESTERN ELECTRIC CO.
• Court: Indiana Appellate Court

145 N.E. 504

BOARD OF COM'RS OF MARION COUNTY

v.WESTERN ELECTRIC CO.^*

No. 11822.

Appellate Court of Indiana.

Nov. 13, 1924.

Appeal from Circuit Court, Marion County; H. O. Chamberline, Judge.

Action by the Western Electric Company against the Board of Commissioners of Marion Couty.Judgment for plaintiff, and defendant appeals.Reversed, with instructions.

Superseding former opinion, 143 N. E. 370.

Emsley W. Johnson, of Indianapolis, and Wm. A. Hough, of Greenfield, for appellant.

Miller, Dailey & Thompson and Albert L. Rabb, all of Indianapolis, for appellee.

NICHOLS, P. J.

This appeal is from a disallowance by the board of commissioners of a claim for refund of taxes alleged to have been illegally assessed in 1919.

The claim was presented to the board of commissioners.In addition to the formal statement of the claim and averments as to the corporate existence of appellee and its right to transact business in the state of Indiana, it avers that appellee's property, both real and personal, was duly assessed for taxation in Center township, Marion county, for the year 1919, and the valuation thereof fixed.Thereafter the taxing officers of said township, county, and state, in pursuance of the pretended order of the state board of tax commissioners, entered on August 23, 1919, increased said valuation of appellee's lands and lots 20 per cent., the improvements thereon 30 per cent., and its personal property 50 per cent.Appellee was thereupon charged upon the tax duplicate of the county and state with the sum of $2,486.32, as the first installment of taxes for the year 1919, of which sum $643.97 was for taxes based upon said increased valuation.At the time there was pending in the Marion superior courtthe case of Hendrickson v. Fesler et al., wherein an injunction was sought on behalf of the taxpayers of Center township against the collection of taxes based upon increases in assessments made under said order of August 23, 1919.Prior to May 4, 1920, appellee paid to the treasurer of Marion county $2,486.32, paying $643.97 under protest; the same being, as aforesaid, based upon the alleged invalid increase in assessment, and it was agreed that said amount so representing the increased assessments should be credited upon the second installment of appellee's taxes for 1919, payable in November, 1920, if that increase should finally be held invalid.

The superior court thereafter in the Hendrickson Case held that the order of the state board of tax commissioners, and the assessments made in pursuance thereof, was invalid and void, and enjoined the collection of taxes based thereon.There was no appeal in that case, and the judgment of the superior court is still in full force and effect.Thereby the said $643.97 became a credit upon appellee's second installment of taxes as aforesaid.Thereafter the Legislature, in special session, adopted an act known as the Tuthill-Kiper Act(ActsSpec. Sess.1920, p. 153), after which the state board of tax commissioners, the county board of review of Marion county, and the taxing officer of said county, purporting to act under the provisions of said Tuthill-Kiper Act, took such action as in effect readopted and reaffirmed said pretended order of equalization of August 23, 1919.Such action is illegal and void for the reason that the Tuthill-Kiper Act is void, that no notice was given appellee or any taxpayer of said increases in assessments made under said act, and that said increases and assessments are unlawful and excessive.After such void action under said act, appellee was charged upon the tax duplicates of said county with $2,486.32, as its second installment of taxes for the year 1919.Appellee had already paid $2,486.32.On October 29, 1920, appellee tendered the treasurer of Marion county $1,198.39 as the total amount due from it as its second installment of taxes for the year 1919.Said two sums of $2,486.32 and $1,198.39 constitute together the full amount of taxes for the year 1919 due from appellee, without said void horizontal increase under said pretended order of August 23, 1919.Said treasurer refused to accept said sum of $1,198.39 and demanded payment of $2,486.32 as such second installment, as shown by the tax duplicates then in the hands of the treasurer.Thereupon on said day appellee paid the treasurer $2,486.32, of which amount $1,287.93 was paid by appellee, not voluntarily, but under protest, and in order to avoid the penalties which would attach from the failure of appellee to pay the same, and in order to prevent levying upon appellee's property by the taxing officers.The result of the void increases in assessments was to increase the total assessment of appellee $89,496, upon which appellee has paid $1,287.93 as illegal taxes.Said sum has not been distributed by the treasurer, and appellee is entitled to a refund thereof.There is a demand for such refund, together with 6 per cent. interest thereon from the date of payment.It will be observed that there is no averment in the complaint that appellee's property was assessed at more than its true cash value, nor that it was not assessed equally and proportionally with other property.It is true that there is an averment that the increases in assessments were “illegal and excessive,” but we regard this as the pleader's conclusion, based on the averments of illegal procedure preceding the conclusion.

Appellant answered its petition in three paragraphs: The first a general denial; the second, in substance, that the value of appellee's property as increased and upon which taxes were paid was taxed and appeared upon the duplicates at no more than its true cash value as defined by the statute, and equally and proportionally with all other property; the third paragraph, in addition to allegations similar to the second, averred further that the valuations of appellee's and all other property, as entered upon the tax duplicates, including the increases claimed to be void, were used by the county auditor and included by him in his certificates of total valuations to the various tax-levying bodies in 1919, and were used by such tax-levying bodies in fixing the rates to be collected; that all such rates were so reduced by the use of such total valuations as to make a total rate of $1.60 on each $100, which was the rate paid by appellee; that upon the budgets of expense used by the various tax-levying bodies a rate of $1.97 on each $100 would have been necessary if the increases complained of had not been used.The increases in the assessments applied to all property in Center township except the property originally assessed by the state board of tax commissioners.

A demurrer to each of these paragraphs of answer was sustained, appellant withdrew its general denial, refused to plead further, and judgment was rendered against it on demurrer, from which this appeal is prosecuted.

Appellee relies upon Fesler v. Bosson, 189 Ind. 484, 128 N. E. 145, andBosson v. Lemcke(Ind. Sup.)137 N. E. 551, to sustain its contention that the horizontal increases upon which the taxes in question were collected were wholly unauthorized and void; but, as we viewthis case, the Fesler Case has but little bearing in determining the question here involved.In that case it was held that the state board of tax commissioners had acted without authority of law in ordering horizontal increases in the assessment of property such as is averred in the petition, and it was held that such increases so ordered by the state board were void.After that the Legislature, at a special session, passed what is known as the Tuthill-Kiper Act(ActsSpec. Sess.1920, p. 153), which, after providing for the meeting of the state board to reconsider and review its order of August 23, 1919, and to certify its conclusion with reference thereto to the auditors of the several counties affected by such order, provided by section 2 that-

“Upon receipt of said certified conclusions provided for in section 1 of this act, by the county auditor, he shall immediately convene the county board of review, *** and said county board of review shall proceed to review and equalize the assessments on the property in said several townships and other taxing units for taxing purposes for the year 1919, and certify the same to the state board of tax commissioners in the manner now required by law.*** Thereupon the state board of tax commissioners shall immediately proceed with the equalization of assessments as between the several counties of the state, both as to personal property and real estate, and shall make orders equalizing such assessments, and immediately thereafter certify such orders to the auditor of each of the counties of the state. ***”

[1] It was under this section of the Tuthill-Kiper Act that the county board of review, as averred in the petition, “took such action as in effect to readopt and reaffirm such pretended order of equalization of August 23, 1919,” which action of the county board of review and the state board is challenged by appellee as being illegal and void.This averment of the complaint that...