Bemis Bros. Co. v. Claremont

• Decision Date: 29 January 1954
• Citation: 102 A.2d 512,98 N.H. 446
• Parties: BEMIS BROS. CO. v. CLAREMONT.
• Court: New Hampshire Supreme Court

Page 512

102 A.2d 512

98 N.H. 446

BEMIS BROS. CO. v. CLAREMONT.

Supreme Court of New Hampshire.

Argued Dec. 1, 1953.

Decided Jan. 29, 1954.

Wyman, Starr, Booth, Wadleigh & Langdell, Manchester, William J. Starr, Jr., Manchester, orally, for plaintiff.

Robert B. Buckley, City Solicitor, Claremont, for City of Claremont.

Warren E. Waters, Dep. Atty. Gen., for State Tax Commission, as amicus curiae.

Sweeney & Temple, Robert H. Temple, Nashua, orally, as amicus curiae.

LAMPRON, Justice.

The relief granted in a petition for an abatement is equitable in nature. The plaintiff is entitled to be relieved of such sum, if any, as it has paid in excess of its share of the common tax burden. Amoskeag Mfg. Co. v. City of Manchester, 70 N.H. 200, 205, 46 A. 470. The issue is whether the plaintiff's tax is greater than it should be with respect to the taxes of other property owners in the taxing district. Rollins v. City of Dover, 93 N.H. 448, 450, 44 A.2d 113. If the whole tax assessed against it does not exceed the sum which it ought to pay plaintiff would not be entitled to an abatement because of an erroneous assessment. Connecticut Valley Lumber Co. v. Monroe, 71 N.H. 473, 479, 52 A. 940; Trustees of the Phillips-Exeter Academy v. Exeter, 92 N.H. 473, 505, 33 A.2d 665. Plaintiff claims that because its stock in trade along with that of other taxpayers was assessed at 100 percent of its fair market value for 1951 while real estate and other property taxed as such were assessed at 80, 55 and 60 percent of such value, it has paid more than its share of the common burden and is entitled to an abatement.

The tax on stock in trade, R.L., c. 73, § 16, par. I, is a tax upon 'estates'. Const. Pt. II, art. 5; Winkley v. Newton, 67 N.H. 80, 83, 84, 36 A. 610, 35 L.R.A. 756; Amoskeag Mfg. Co. v. City of Manchester, supra; See In re Opinion of The Justices, 82 N.H. 561, 581, 138 A. 284. It is a general property tax levied upon the owner or possessor of the property at fixed annual intervals. Amoskeag Mfg. Co. v. City of Manchester, 70 N.H. 336, 346, 347, 47 A. 74; Havens v. Attorney General, 91 N.H. 115, 132, 14 A.2d 636. The property is to be appraised at 'its full and true value in money'. R.L. c. 76, § 1. Such value is the market value or the price which the property will bring in a fair market, after reasonable efforts have been made to find the purchaser who will give the highest price for it. Trustees of the Phillips-Exeter Academy v. Exeter, supra, 92 N.H. at page 481, 33 A.2d 665; Brock v. Town of Farmington, 98 N.H. 275, 277, 98 A.2d 162. In those respects stock in trade is identical with land and water power, buildings and structures, and machinery.

It has on the other hand certain differing characteristics. Unlike real estate and other property taxed as such the tax is assessed not upon the amount of property on hand April 1, but upon the average amount employed in the trade or business during the year. Connecticut Valley Lumber Co. v. Monroe, 71 N.H. 473, 477, 52 A. 940. 'No particular item * * * is valued, but the average value for the tax period is assessed. The particular stock varies and shifts and as itemized property may not be at all or only in small part on hand to be taxed more than once.' Opinion of the Justices, In re, 82 N.H. 561, 581, 138 A. 284, 294. Because of this characteristic it might be said from an economic point of view that it is more closely tied to trends of inflation and deflation than a parcel of real estate which in most cases remains to be taxed year after year. In other words stock in trade being taxed not as to the items making it up but on a figure representing its average value for the tax period with the items wholly or largely changed in the next period, its value is more intimately linked to the current market prices than is a parcel of real estate whose market price will fluctuate with the changing economic trends. This seems to be the reasoning which motivated the State Tax Commission.

However our constitution provides that all taxes on 'estates' shall be proportional and reasonable, Const. Pt. II art. 5, which means equal and just. Opinion of The Justices, 4 N.H. 565, 568. Equality in the burden of taxation cannot exist without uniformity in the mode of assessment as well as in the rate of taxation. State v. United States & C. Express Co., 60 N.H. 219. By virtue of these constitutional principles each taxpayer is entitled to have his property valued for taxation by the same standard as that of other taxpayers. Rollins v. City of Dover, 93 N.H. 448, 450, 44 A.2d 113. This requires a proportional and equal valuation of the different kinds of taxable estates. Amoskeag Mfg. Co. v. City of Manchester, 70 N.H. 200, 203, 204, 46 A. 470.

The Trial Court has found on proper evidence 'that on April 1, 1951 the fair market value of real estate in the City of Claremont was on the average equal to the 'fair current value' as found for 1951 by * * * the appraisers employed by the City.' It is also uncontroverted that the fair market value of stock in trade was the same as the value used by the city assessor in making his assessment, thereon for the year 1951. It is further admitted that the city assessor did not assess land and water power at the fair market value as found but rather at 80 percent thereof. In the case of machinery the percentage used was 60. Buildings were assessed at 55 percent of the market value set by the appraisal firm.

We find no legal basis for assessing stock in trade at its full market value and real estate and other such property at varying percentages lower than its market value. Manchester Mills v. City of Manchester, 57 N.H. 309, 314. 'There is no foundation for the proposition that owners of one kind of property should pay more or less than their share of the common burden because of the character of their estate.' Amoskeag Mfg. Co. v. City of Manchester, supra, 70 N.H. at page 205, 46 A. at page 473. We are of the opinion that the assessment as made was in violation of the constitutional requirements of proportionality and equality.

We turn now to the question of whether plaintiff is entitled to an abatement and the method of determining the amount thereof. As we have said previously, erroneous assessment alone does not constitute the basis of an abatement. Trustees of Phillips Exeter Academy v. Exeter, 90 N.H. 472, 505, 27 A.2d 569. It must result in placing upon plaintiff more than his share of the common tax burden. Amoskeag Mfg. Co. v. City of Manchester, supra; Rollins v. Dover, supra. This inequity exists when the assessment placed on plaintiff's property as a whole is disproportionately higher in relation to its true value than is the case as to other property in general in the taxing district. Brock v. Town of Farmington, 98 N.H. 275, 279, 98 A.2d 162. To determine if such is the case all of plaintiff's taxable estate in the city and its total tax must be considered regardless of any agreement as to any part thereof which might have been arrived at between the parties. That is the only way of ascertaining if plaintiff is carrying more than its share of the common tax burden for the year 1951. Amoskeag Mfg. Co. v. City of Manchester, supra, 70 N.H. at...