Bischoff v. City of Appleton, 75-510

• Decision Date: 03 January 1978
• Docket Number: No. 75-510,75-510
• Citation: 81 Wis.2d 612,260 N.W.2d 773
• Parties: Jack L. BISCHOFF and Paul F. Babich, Plaintiffs-Appellants, v. CITY OF APPLETON, a Municipal Corporation, Defendant-Respondents.
• Court: Wisconsin Supreme Court

Page 773

260 N.W.2d 773

81 Wis.2d 612

Jack L. BISCHOFF and Paul F. Babich, Plaintiffs-Appellants, v. CITY OF APPLETON, a Municipal Corporation, Defendant-Respondents.

No. 75-510.

Supreme Court of Wisconsin.

Submitted Nov. 2, 1977.

Decided Jan. 3, 1978.

This is an appeal from an order sustaining the demurrer of the defendant-respondent City of Appleton, a municipal corporation, to the complaint of the plaintiffs-appellants, Jack L. Bischoff and Paul F. Babich, seeking a refund of taxes levied on an allegedly illegal and excessive valuation.

The complaint alleges that the plaintiffs purchased fourteen lots and a vacated alley in the city of Appleton on or about June 1, 1973, for a total price of $448,000, in an arm's length transaction. The tax assessors for the defendant city placed the tax valuation of the property at $858,200 for the year 1973. The plaintiffs objected in writing to the City of Appleton Board of Review. The board confirmed the valuation after a meeting held on October 8, 1973.

On December 31, 1973, the plaintiffs paid the total tax of $21,497.92 under protest. On January 17, 1974, the plaintiffs submitted a written claim for a refund of $10,275.52. The plaintiffs claimed that the taxes paid were excessive and were levied on an illegal "income approach" rather than upon the fair market value as evidenced by the recent purchase price. On April 4, 1974, the plaintiffs received notice from the city of Appleton that their claim for a refund was disallowed.

On October 10, 1974, the summons and complaint in this action were filed in the circuit court for Calumet county. On October 17, 1974, the defendant city demurred to the complaint on the ground that the action was barred by the limitation statute, sec. 74.73(4), Stats. On August 23, 1975, the trial court sustained the demurrer of the defendant city. The plaintiffs appeal.

Gregory Gramling, Jr., Milwaukee, submitted brief for appellants.

David G. Geenen, City Atty., submitted brief for respondent.

ROBERT W. HANSEN, Justice.

Two sections of the same statute, sec. 74.73, entitled Recovery of illegal taxes plus interest; limitation, are involved in this appeal.

The defendant city claims and the trial court agreed that this cause of action is statutorily barred under sec. 74.73(4), Stats., which provides that:

"No claim shall be filed and no action shall be brought under this section which is based upon an allegedly excessive assessment except that in counties with a population of under 500,000 a claim may be filed and an action may be brought if the tax is paid on the contested assessment by January 10 of the year following the year of the assessment and a claim filed within 10 days thereafter and suit commenced within 30 days following the denial of the claim or within 90 days after the claim is filed if the municipalities fail to act on the claim." (Emphasis supplied.)

If this subsection provides the only avenue for challenge open to these plaintiffs, it follows, as the trial court held, that the latest date their action could have been commenced was May 17, 1974. Since it was brought on September 30, 1974, it would be untimely under this subsection of the statute. Additionally, the plaintiffs filed their claim seventeen days after payment of the tax. This filing was also too late under sub. (4), which requires that the claim be filed within ten days of payment of the tax.

However, the plaintiffs claim they are entitled to bring this action under sec. 74.73(1), Stats., which provides:

"Any person aggrieved by the levy and collection of any unlawful tax assessed against him may file a claim therefor against the town, city or village which collected such tax in the manner prescribed by law for filing claims in other cases. If it appears that the tax for which such claim was filed or any part thereof is unlawful and that all conditions prescribed by law for the recovery of illegal taxes have been complied with, the town board, village board or common council may allow and the town, city or village treasurer shall pay such person the amount of the claim found to be illegal and excessive. If any town, city or village fails or refuses to allow the claim, the claimant may have and maintain an action against the same for the recovery of all money so unlawfully levied and collected, together with interest at the legal rate computed from the date of filing the claim. Every such claim shall be filed, and every action to recover any money so paid shall be brought, within one year after such payment." (Emphasis supplied.)

If this action by these plaintiffs is one to recover the payment of an "unlawful tax," then it is not barred by the filing requirements of sec. 74.73(1). However, the city contends and the trial court agreed that in effect sub. (4) operates to limit sub. (1) so that sub. (1) does not apply to a claim that a tax or an assessment is "excessive in amount," even where such excessiveness derives from an alleged illegality of the assessment.

If this issue of statutory construction were before us for the first time, there are those joining this opinion who see substance in the argument that the specific provisions of sub. (4) limit the more general provisions of sub. (1). However, a different construction has been given to the impact of sub. (4) upon sub. (1), and where a statute has been construed by this court, changes in the application of the statute are to be made by the legislature, not by a subsequent court in a later case. ¹

The construction of subs. (1) and (4) urged by the city was expressly rejected by this court in the case of Barker Lumber Co. v. Genoa City. ² There the plaintiff lumberyard operator had his personal property assessed at 100 percent of true value while the rest of the village real estate was assessed at 58.02 percent of true value. The plaintiff filed a claim with the village for a refund within the one-year limitation period of sub. (1), and the defendant village argued that the claim was controlled by sub. (4) because it was based on an allegedly excessive assessment. Rejecting this contention, our court held:

"Defendant argues that sec. 74.73(4), Stats.1953, specifically provided an exclusive remedy for the plaintiff application to the board of review and appeal from its determination. We cannot agree. The question before us is whether, under the facts stated in the complaint, the plaintiff can bring his action under sec. 74.73(1) providing for actions based on the 'levy and collection of any unlawful tax.'

" . . .n t

"In neither the enactment of that subsection (sec. 74.73(4), Stats.1953) nor its repeal and re-creation in 1955 did the legislature repeal or alter the provisions of sec. 74.73(1); in neither of those enactments did it use language indicating an intention to take away from an aggrieved taxpayer his right of action under sec. 74.73(1) to recover an unlawful tax exacted from him by such an arbitrary act of the assessor as resulted in the imposition of an inequitable burden." ³

The Barker construction of subsections (1) and (4), that sub. (4) does not "repeal or alter" the provisions of sub. (1), was given in a case where the issue presented involved an unlawful rate applied to a lawful valuation of property, rather than an allegedly illegal valuation of the property itself. However, the construction given in Barker applies to a claim of illegality based upon an allegedly unlawful valuation as clearly as it did to a claim of an unlawful rate applied to...