Central R. Co. of New Jersey v. Jersey City

• Decision Date: 16 August 1912
• Citation: 199 F. 237
• Parties: CENTRAL R. CO. OF NEW JERSEY v. MAYOR AND ALDERMEN OF JERSEY CITY et al.
• Court: U.S. District Court — District of New Jersey

199 F. 237

CENTRAL R. CO. OF NEW JERSEY v. MAYOR AND ALDERMEN OF JERSEY CITY et al.

United States District Court, D. New Jersey.

August 16, 1912

George Holmes and R. V. Lindabury, for complainant.

Warren Dixon, for defendants.

RELLSTAB District Judge.

In view of the absence of any evidence on the part of the defendants either in contradiction of the testimony offered by the complainant, or to support their unverified answer, a more extended reference to the pleadings than is usual is necessary for the proper understanding of this case. Complainant, a railroad corporation of the state of New Jersey, in its bill of complaint filed December 21, 1908 charges, in substance: That in the year 1899 and the subsequent years to and including 1906 the defendant, the mayor and aldermen of Jersey City, a municipal corporation of said state, by its taxing officers, intentionally and systematically undervalued for the purposes of taxation the property of individuals and others in said city, except in a few isolated instances of properties owned by railroad companies and other corporations immediately adjoining the large railroad yards in said city, at rates varying from 45 per cent. to 70 per cent. of the true value of the properties assessed, and at the same time overvalued that part of the property of complainant known as 'third-class railroad property'-- i.e., held for railroad purposes, but not yet so applied-- whereby its said lands were taxed largely in excess of the assessment against the property of others contributing to the same common burden of taxation. That the description of lands, the valuations thereof for taxation and the taxes assessed against the same as aforesaid are as follows:

Year. Block. Lot. Location. Valuation. Total Amount

of Tax.

1899 2154 22 Communipaw Avenue $1,603,000.00 $45,525.20

1900 " " " " 1,603,000.00 45,204.60

1901 " " " " 1,603,000.00 44,884.00

1902 " " " " 1,603,000.00 44,563.40

1903 " " " " 1,603,000.00 44,082.50

1904 " " " " 1,603,000.00 43,922.20

1905 " " " " 1,803,000.00 49,221.90

1906 " " " " 2,390,000.00 59,511.00

1907 " " " " 2,937,000.00 60,189.60

1899 1497 1 New York Bay 771,000.00 21,896.40

1900 " " " " 771,000.00 21,742.20

1901 " " " " 771,000.00 21,588.00

1902 " " " " 500,000.00 13,990.00

1903 " " " " 500,000.00 13,750.00

1904 " " " " 500,000.00 13,700.00

1905 " " " " 550,000.00 15,015.00

1906 " " " " 1,125,000.00 28,012.50

1907 " " " " 1,450,000.00 28,315.00

That from the assessment for the year 1899 complainant appealed to the State Board of Taxation of New Jersey, which board had power to review and ascertain the true value of all property assessed for taxation throughout the state, except that levied against property used for railroad purposes by the State Board of Assessors of said state, and that said board after a hearing confirmed the valuation for such year. That on the application of complainant reviews of the legality of such taxes were successively made by the Supreme Court of the state of New Jersey and the Supreme Court of the United States, on the ground, among others, that said lands were not within the jurisdiction of Jersey City, nor within the jurisdiction of the sovereignty of New Jersey for the purposes of taxation. That in the year 1908 the United States Supreme Court decided that said lands were within the jurisdiction of said state and its taxing authorities for the purpose of taxation, the mandate of said court bearing date the 1st day of June, 1908. That the complainant in each of the years 1900, 1901, and 1902 appealed to said State Board from the said assessments for said years, respectively, on said lot 22, and that said board confirmed said assessments. That in each of the years 1906 and 1907 complainant appealed from the said assessments made on said lot for said years respectively, to the State Board of Equalization of Taxes of New Jersey, said board having superseded the State Board of Taxation with all its said powers, and that said board, after taking evidence, determined the true value to be $1,603,000 and $1,743,000 for said years respectively. That in each of the years 1900 and 1901 complainant appealed to said State Board of Taxation from said assessments for said years respectively, on said lot 1, and that said board reduced said assessments to $500,000, and that said lot was assessed that sum in the years 1902, 1903, and 1904. That in each of the years 1906 and 1907 complainant appealed from said assessments made on said lot for said years to said State Board of Equalization of Taxes, who determined the true value of said lot for each of said years to be the sum of $747,820, and reduced the said assessments to said sum. That these two lots, 22 and 1, consist partly of upland and partly of land under the waters of the Hudson River, the greater part being still under water. That lot 22 comprises 448 acres of which 6 acres are occupied and used for railroad purposes, and that during all of said years such 6 acres were taxed by the state of New Jersey, through its State Board of Assessors, which has the exclusive power to tax such lands. That such taxes, so assessed by the state authorities, have been paid, and that under the laws of said state the taxes levied by Jersey City thereon are unlawful and void. That pending the review in the state and United States courts, respectively, of the right of Jersey City to tax said lands, no attempt was made by said city or its officers to enforce the collection of any of said taxes, and that from such determination in the United States Supreme Court until October 27, 1908, complainant was negotiating with certain of the officers of said city to get a fair settlement of all of said taxes, on which date such negotiations were broken off. That complainant has exhausted all the remedies afforded by the laws of the state of New Jersey in respect to the correction of said valuations and assessments and to prevent the enforcement thereof. That by the statutes of such state, as 'interpreted by the decisions of its courts, the only remedy afforded to a taxpayer where property is assessed at a larger rate than other property in the taxing district, but not in excess of its true value, is to apply to said State Board of Taxation, or to the said Board of Equalization in each year, to increase the assessments upon property undervalued for the purposes of taxation, and that such increase can only be made after due investigation and upon notice to the owners of each parcel of property so underassessed. That the number of parcels of real estate in the city of Jersey City so underassessed during the years 1899 to 1906, inclusive, amounted to at least 160,000 separate parcels owned by at least 60,000 separate owners; and your orator charges and insists that not only would it have been impossible within the time afforded by law to have given notice to each owner and proved the underassessment of each parcel upon a hearing, but that the cost of such a proceeding would have been absolutely prohibitive, and that such remedy afforded no remedy at all. ' That it has no adequate remedy at law to correct said discriminations, or to prevent the enforcement thereof, or to recover back the taxes so assessed in case it pays them in order to prevent the sale of its said property, as no legislative remedy has been provided to meet such cases. That, if a remedy to recover back any part of the taxes so paid exists, 'it would involve a multiplicity of suits, because part of the said taxes when collected are paid over by the city authorities to the state, the county collector of Hudson county in said state, and the other part is retained by the aforesaid city. ' That the true value of said lots 22 and 1 in each of said years did not exceed $1,603,000 and $500,000, respectively, and that the total taxes on such sums at the rate charged by the city during said years amounts to $495,635.04. That, to place complainant on an equality with said owners of other property in said city, it should pay but $297,381.02, that being 60 per cent. of the last-stated sum. That said sum of $297,381.02 was tendered to the city collector (the other named defendant) on December 19, 1908, in payment of said taxes, and that such payment was refused. That the said city collector has advertised said property for sale to enforce the collection of such taxes, and that, if such sale be made, complainant will be deprived of its said property without due process of law, in violation, not only of the Constitution of the state of New Jersey requiring that property be assessed for taxes by uniform rules and according to the true value, but also of the fourteenth amendment of the Constitution of the United States of America.

The complainant, after tendering itself ready to pay such sum for taxes as the court shall direct either to Jersey City or into court, prays that this court determine the amount of taxes which the complainant should pay for said years, that the excess of such taxes be canceled, and that the defendants be restrained from collecting by the sale of said lands or otherwise any taxes in excess of the sum that shall be finally decreed to be due to such municipality. It also contains the usual prayer for general relief.

The answer, unverified, so far as is pertinent to the questions raised on this record (the defendants, as stated, not having offered any evidence either in contradiction of complainant's case as made by the pleadings and its proofs), in substance, denies that the suit is of a civil nature in equity, arising under the Constitution of the United States; that the taxes assessed by Jersey City on the 6 acres of lot 22 are unlawful and void; that complainant has no adequate remedy at law for any of its...