Campbell v. State

• Decision Date: 18 December 1941
• Docket Number: 6 Div. 881.
• Citation: 242 Ala. 215,5 So.2d 466
• Parties: CAMPBELL v. STATE.
• Court: Alabama Supreme Court

5 So.2d 466

242 Ala. 215

CAMPBELL v. STATE.

6 Div. 881.

Supreme Court of Alabama

December 18, 1941

Rehearing Denied Jan. 22, 1942. [Copyrighted Material Omitted] [Copyrighted Material Omitted]

Clifford Emond, of Birmingham, for appellant.

Thos. S. Lawson, Atty. Gen., and John W. Lapsley and J. Edw. Thornton, Asst. Attys. Gen., for appellee.

FOSTER Justice.

This is a bill in equity filed by the State of Alabama, seeking an injunction for the restraint of defendant from engaging in the business in this State of selling tangible personal property at retail within the meaning of the Sales Tax Act of Alabama (approved February 8, 1939, General Acts 1939, page 16), until he pays the assessment made against him under it. That Act was incorporated in the Code of 1940, Title 51, c 20, Article 10. The particular feature of it which authorizes a restraining suit is section 777 of that title, which was section XXVIII of the Act of 1939.

The Code of 1940 was not in effect when this suit was begun, but there is no difference between the Act and Code in this respect. It provides that any taxpayer who shall violate any of the provisions of the Act may be restrained from continuing in business, and the proper prosecution shall be instituted in the name of the State of Alabama by the Attorney General, etc.

Since a court of equity is the only one which has general jurisdiction in respect to injunctions, this bill was filed in equity as for an injunction, and so prayed. There is no other prayer for special relief, but there is a prayer for general relief.

We will consider only those grounds of demurrer which are insisted upon by appellant in argument.

1. The first contention is that there is no foot-note to the bill. While this suit was begun before the Code of 1940 became effective, it was filed after the new rules in equity practice became effective. The latter date was January 1, 1940, as shown by the minutes of this Court. Rule 11 abolishes the requirement for a foot-note. Code 1940, Tit. 7, Appendix.

2. It is next insisted that the bill should be verified and that it is not done in such manner as to satisfy that requirement.

Rule 12 provides that only bills which seek preliminary or interlocutory relief or bills of discovery need be sworn to. This bill prays for a temporary injunction, which is preliminary relief and is of the sort mentioned in Rule 12. But there are two reasons why the demurrer is not well taken. One is that such bill is not rendered subject to demurrer by the failure to verify it, but unless so verified preliminary or interlocutory relief will not be granted. While the bill prays for such relief, the question here is not whether it should be granted, but whether it is subject to demurrer. If complainant does not seek to have the court grant the preliminary or interlocutory relief, the affidavit is unnecessary. If it is sought, then it must be verified by sufficient affidavit. Under the old rule (No. 15), the verification was not limited to those seeking preliminary relief, but a distinction was drawn between the sufficiency of a bill on demurrer and the propriety of the issuance of a preliminary writ without verification. Birmingham Belt R. Co. v. City of Birmingham, 211 Ala. 674, 101 So. 599.

Another reason why it was not thus rendered subject to demurrer is that by section 5644, Code 1923 (Code of 1940, Title 7, section 72), the State was exempt from such requirement. State v. Bley, 162 Ala. 239, 50 So. 263.

3. It is next insisted that an injunction is only incidental to the enforcement of some other equitable right. No authority is cited. Such is not the true theory of an injunction suit. 28 Amer.Jur. 198, section 3.

4. It is also contended that there is too much generality of expression in the bill to be good pleading.

In weighing a bill against such claim, we must look to the purpose sought to be accomplished, and the facts necessary to that relief. The bill here does not seek to collect taxes. It does not seek to enforce a lien. But it seeks to restrain the respondent from continuing to engage in the business of selling tangible personal property at retail in this State, until he shall have complied with the provisions of the State Sales Tax Act as therein set forth. The right to such an injunction is conferred by the features of the Sales Tax Act, to which we have referred.

The particular in which he has violated the Act so as to justify the injunction must be set out with such specific detail as to apprise defendant of its true nature. In this respect the bill goes into detail, by alleging that during certain periods covered by the Act, defendant was engaged in selling at retail personal property in Birmingham under the name of C. P. Campbell Produce Company. Title 51, section 753, Code of 1940. That the State Department of Revenue fixed by proceedings authorized by law upon his returns and set out in detail the amount of his unpaid tax levied by this Act, and alleged that he had not paid it: that execution was issued as provided in section 770 and returned no property found.

Appellant attacks the sufficiency of the allegations in the bill on the ground that they do not give enough detail. But it alleges facts which give the revenue department jurisdiction under the law to make a deficiency assessment and alleges that such assessment was duly made. Considering the purpose of this suit, great particularity of detail in stating the proceedings leading to that assessment is not necessary. The only necessity in that respect in making averment in this bill is to show that defendant has violated the provisions of the Sales Tax Act to such extent as to justify the injunction sought. We doubt not that a persistent failure to pay the tax imposed by the Act without adequate excuse is sufficient, likewise would probably be a persistent failure to make due returns as required by the Act. It is not to be assumed that a final assessment by the State Department of Revenue is always necessary to justify such an injunction. But when the injunction is sought solely for the failure to pay a final assessment, that assessment should be valid under the law. To that end, the bill needs only show such persistent failure. See State v. Allen, 180 Miss. 659, 177 So. 763. We think the bill is not subject to this ground of demurrer.

5. It is next insisted that the only allegation in the bill that defendant has not paid a definite sum on account of the sales tax requirement is the assessment made by the State Department of Revenue, and that the proceedings leading to that assessment are in violation of the due process (section 6), and the jury trial (section 11) clauses of the Constitution of Alabama.

The contention is that by the Act such assessment constitutes a personal judgment against defendant, and that service of notice by registered mail does not afford due process leading to such a judgment, and that a jury trial is also guaranteed to that end. Since the Act here in question authorizes execution to issue, Code of 1940, Title 51, section 770, when certain conditions exist, their existence have the force and effect of a judgment. Compare Winston v. Browning, 61 Ala. 80.

The legislature had full power under section 139 of the Constitution to confer on the State Department of Revenue the authority to render a personal judgment conformably with other constitutional requirements or to provide that its assessments shall have such force and effect. State Tax Comm. v. Bailey & Noward, 179 Ala. 620, 60 So. 913; State Tax Comm. v. Stanley, 234 Ala. 66, 173 So. 609.

The Act now under consideration requires not less than twenty days' notice by registered mail. Code of 1940, Title 51, section 767; section XVII of the Act of 1939, supra.

It has long been held that a personal judgment cannot be rendered in this State against a non-resident without personal service, and that notice by registered mail is not such service. Ex parte Luther, 232 Ala. 518, 168 So. 596, and cases cited. Long v. Clark, 201 Ala. 454, 78 So. 832; and that notice to the agent of a non-resident individual is likewise insufficient. Woodfin v. Curry, 228 Ala. 436, 153 So. 620.

The authorities generally on this subject refer to Pennoyer v. Neff, 95 U.S. 714, 24 L.Ed. 565. That case has recently been modified by the United States Supreme Court so as to justify a personal judgment against a resident of the forum who is sojourning in another state and there notified by substituted service, provided such service complies with the law of the forum, and holding that it affords due process if the "substituted service provided for such cases and employed is reasonably calculated to give him actual notice of the proceedings and an opportunity to be heard." Milliken v. Meyer, 311 U.S. 457, 61 S.Ct. 339, 343, 85 L.Ed. 278, 132 A.L.R. 1357. There he was personally served outside the state of the forum. It was held to justify a personal judgment. This is the first time the effect of substituted service has by that court been given such a result as to residents when it would not bind non-residents.

This is in accord with what appears to be the modern trend of constitutional interpretation. 12 Amer.Jur. 291.

There is a distinction between substituted service and constructive service in this connection. The former includes the act of leaving the process at the residence or place of business of the party (50 Corpus Juris 490), or of leaving it with an agent or attorney of the party (50 Corpus Juris 494, section 101), or by mailing it to the party (50 Corpus Juris 495 section 102). Service by publication alone is said more accurately to be constructive service, (50 Corpus Juris 490, section 94, note 69); but it is sometimes said to be "a substitute for...