Bismarck Water Supply Co. v. Barnes

• Decision Date: 27 May 1915
• Parties: BISMARCK WATER SUPPLY CO. v. BARNES, Sheriff, et al.
• Court: North Dakota Supreme Court

30 N.D. 555

153 N.W. 454

BISMARCK WATER SUPPLY CO.

v.BARNES, Sheriff, et al.

Supreme Court of North Dakota.

May 27, 1915.

Syllabus by the Court.

Public policy demands that no needless restriction be placed upon the securing of the necessary means for conducting the government.

As a general rule, equity will not interfere by injunction with the enforcement or collection of a tax which is alleged to be illegal or void, merely because of its illegality, hardship, or irregularity, but, in addition thereto, facts must be shown to exist bringing the case within some recognized head of equity jurisprudence; otherwise the party aggrieved will be left to his remedy at law.

As a general rule, equity will not enjoin the distraint of personal property for a tax.

Courts of equity are more reluctant to interfere with the collection of a state tax than with a tax levied by a municipality.

An injunction will not issue where legal remedies are, or have been available.

The complaint and evidence considered, and it is held that plaintiff is not entitled to injunctive relief.

Appeal from District Court, Burleigh County; Nuessle, Judge.

Action by the Bismarck Water Supply Company against Frank Barnes, as Sheriff of Burleigh County, and others. From judgment for defendants, plaintiff appeals. Affirmed.Engerud, Holt & Frame, of Fargo, for appellant. H. R. Berndt, F. E. McCurdy, and Geo. E. Wallace, all of Bismarck, for respondents.

CHRISTIANSON, J.

This is an action in equity brought to enjoin the defendant Barnes, who is the sheriff of Burleigh county, from enforcing a certain personal property tax levied, for the years 1909 and 1910, against plaintiff's property situated in the city of Bismarck, in Burleigh county. The city of Bismarck and the county of Burleigh were also made parties defendant. The suit was commenced on January 31, 1912, in the district court of Burleigh county. The plaintiff is a foreign corporation organized under the laws of the state of West Virginia, owning and operating the waterworks plant in the city of Bismarck, in Burleigh county, and, as far as the pleadings and record in this case show, this is the only property of any kind owned by the plaintiff within the state of North Dakota.

The material allegations of the complaint are substantially as follows:

“That the actual cost value of plaintiff's waterworks plant in Bismarck in the years 1909 and 1910 did not exceed the sum of $85,000; that in the year 1909, and ever since that time, the municipal government of the city, of Bismarck has been and now is vested in a board of five commissioners; that in the month of June, 1909, said board of city commissioners, sitting and acting as the board of equalization of assessments for said city, fixed the value of this plaintiff's said water supply plant and assessed the same for the purpose of taxation at the sum of $40,500 and thereafter at the regular meeting of the state board of equalization of assessments for the state of North Dakota in said year said state board increased the valuation and assessments of all property in the state 12 1/2 per cent., thereby increasing this plaintiff's assessments to the sum of $45,562, and thereupon the annual tax levies for said year were made by the respective taxing officers for the respective purposes provided by law, and the taxes for said year for all purposes were imposed and charged upon and against plaintiff's said property and computed and fixed on the basis of said assessment of $45,562, resulting in an aggregate tax in the sum of $2,237.09; that in the year 1910 said board of commissioners of the city of Bismarck in like manner valued and assessed said property for the purpose of taxation at the sum of $36,000, and the taxes for all purposes for said year 1910 were computed, imposed, and charged upon and against said property based on said valuation and assessment of $36,000, resulting in an aggregate tax of $1,926; that, notwithstanding the legal requirements that all property shall be assessed for taxation at its actual cost value, the uniform practice throughout all parts of the state of North Dakota always has been, and was in the years 1909 and 1910, to value taxable property at much less than its actual cash value, and such practice has been universally and uniformly followed and acquiesced in by all assessors, boards of equalization, and taxing officers throughout the entire state of North Dakota; that in the years 1909 and 1910 the city board of equalization of said city of Bismarck, as well as all other boards of equalization in Burleigh county, and in all other parts of the state, in fixing the assessed value of property for taxation, adopted and used as the assessable value a value which was intended to represent approximately 25 per cent. of the actual value of the property assessed, and the assessed value was computed by taking one-fourth of the conservatively estimated actual value as the assessed value; that in assessing and equalizing assessments of taxable property throughout the city of Bismarck in the years 1909 and 1910 said city board of equalization acted upon and applied the aforesaid practice of fixing the assessed value of property at approximately 25 per cent. of its actual value as to all taxpayers, save and except as to this plaintiff; that, with respect to this plaintiff's said establishment, said city board of equalization intentionally and arbitrarily departed from said general rule, and willfully and unjustly assessed this plaintiff's property at a value representing approximately 50 per cent. of its actual value, as said board then and there well knew, and this was done with the intent and for the purpose of fraudulently causing to be imposed upon this plaintiff a rate of taxation in excess of the rate of taxation imposed on other taxpayers in said city; that the just and true assessable value of said property in the years 1909 and 1910 was not to exceed the sum of $85,000, and the just and true amount of taxes that this plaintiff ought to pay for said respective years on said property is for 1909 not to exceed the sum of $1,200, and for 1910 not to exceed the sum of $900; that plaintiff did on the 11th day of August, 1911, pay to the county treasurer of Burleigh county, in part payment of the 1910 taxes, the sum of $692.18, and is now ready and willing to pay, and hereby offers to pay, sums stated in paragraph 6 in this complaint (less the partial payment last mentioned), or such other or different sum as this court may find to be justly due or owing for or on account of the taxes on said property for said respective years; that plaintiff has offered to pay to the county treasurer of Burleigh county the just amount of taxes due, but said county treasurer has refused and still refuses to accept any other or different sum than the full amount of said taxes as they appear charged on the tax lists, with interest and penalties; that the defendant Barnes, who is the sheriff of Burleigh county, has by virtue of his office as sheriff, and pursuant to the statute in such cases made and provided, made distraint upon and seized all this plaintiff's said property for the purpose of selling the same for the satisfaction of said pretended taxes, and asserts and claims that the aggregate sum due for such taxes, exclusive of his fees and costs, is the sum of $4,370.37, and will, unless restrained from so doing, sell and dispose of said property therefor, and wholly deprive this plaintiff thereof, and this plaintiff will be remediless in the premises; that, inasmuch as part of said taxes are valid, and hence said sheriff may lawfully distrain and sell plaintiff's property therefor, this plaintiff cannot pay said taxes under protest and recover the same back from said sheriff, and, inasmuch as in an action at law it cannot be determined how much of said taxes are justly due, plaintiff is wholly without remedy in an action at law, and is without remedy save in a court of equity.”

Plaintiff's prayer for judgment is that the defendant sheriff be enjoined from further proceeding with said distraint of plaintiff's property, and be required to release the same until the final determination of this action, that the court ascertain and determine the just amount of taxes due, and that plaintiff be permitted to pay the same, and that thereupon the remainder of taxes in excess of the amount justly due be declared null and void and canceled of record, and that the defendants be forever enjoined from attempting to enforce the same. The defendants answered, alleging that the cash value of said plaintiff's property was not less than $175,000, and set forth in detail the facts showing that the property had been properly assessed on an equitable and just basis, and also alleged that the plaintiff's complaint did not set forth facts entitling the plaintiff to equitable relief. At the commencement of the action the district court issued a temporary injunctional order whereby the defendant Barnes was restrained “from selling or attempting to sell the property of the plaintiff which he had distrained and seized under and by virtue of the claim for the alleged delinquent taxes due thereon for the years 1909 and 1910.” This injunctional order remained in force during the pendency of the action. The cause was tried on its merits, and final judgment rendered in favor of the defendant for a dismissal of the action. Plaintiff has appealed from the judgment, and demanded a trial de novo in this court.

It will be noticed that the only objection made to the tax in the original complaint is that the city board of equalization fraudulently and arbitrarily placed an excessive and grossly disproportionate valuation on plaintiff's property. But after the cause had been noticed for trial, and prior to the trial, an amended complaint was served alleging as additional grounds that the taxes imposed on said property for state purposes for the year 1909 ...