Charlottesville v. Marks' Shows

• Decision Date: 02 March 1942
• Docket Number: Record No. 2500.
• Citation: 179 Va. 321
• Parties: CITY OF CHARLOTTESVILLE v. MARKS' SHOWS, INCORPORATED.
• Court: Virginia Supreme Court

Page 321

179 Va. 321

CITY OF CHARLOTTESVILLE v. MARKS' SHOWS, INCORPORATED.

Record No. 2500.

Supreme Court of Virginia, Richmond.

March 2, 1942.

Present, All the Justices.

1. LICENSES — Power of Municipalities — Exercise beyond Corporate Limits — Code Section 3006 Invalid insofar as It Authorizes Levy Solely for Revenue. — Section 3006 of the Code of 1936 is unconstitutional insofar as it authorizes the levy by a city of a license tax upon a circus exhibition beyond its corporate limits for the sole purpose of raising revenue to defray the general expenses of the city government.

2. LICENSES — Power of Municipalities — Exercise beyond Corporate Limits — May be Authorized for Police Purposes. — A municipal corporation may be authorized by the legislature to exercise its licensing power for police purposes within a reasonable distance outside of its municipal limits.

3. LICENSES — Revenue Measure or Police Regulation — Determined by Substance and Purpose of Ordinance. — Whether an ordinance is a police regulatory measure as distinguished from a revenue measure is determined not by the denomination given to it by the legislative body, but rather by its substance and its real purpose.

4. LICENSES — Revenue Measure or Police Regulation — Determined by Primary Purpose. — In determining whether an ordinance is a police regulatory measure as distinguished from a revenue measure, if revenue is the primary purpose and regulation is merely incidental, the imposition is a tax. If regulation is the primary purpose the mere fact that incidentally a revenue is also obtained does not make the imposition a tax.

5. LICENSES — Revenue Measure or Police Regulation — Determined by Conditions Imposed. — Where a license fee is imposed for the purpose of regulation and the ordinance requires compliance with certain conditions in addition to the payment of the prescribed sum, such sum is a license proper, imposed by virtue of the police power. But where it is exacted solely for revenue purposes and its payment gives the right to carry on the business without any further conditions, it is a tax.

6. LICENSES — Revenue Measure or Police Regulation — If Police Regulation, Charge Must Bear Reasonable Relation to Burdens Imposed. — Where an ordinance provides for a license fee under the police power, the exacted charge must bear some reasonable relation to the additional burdens imposed upon the municipality and the necessary expenses involved in the police supervision.

7. LICENSES — Revenue Measure or Police Regulation — When Presumed to Be for Revenue Purposes Alone. — Where the imposition is laid upon persons or property under a general taxing ordinance, and the proceeds are paid into the general treasury and no part thereof is devoted to the expense incident to carrying out the provisions of the ordinance, the conclusion is that the exaction is laid for revenue purposes alone, unless the contrary is made clearly to appear.

8. LICENSES — Revenue Measure or Police Regulation — Ordinance Held to Be a Revenue Measure — Case at Bar. — In the instant case, an action by a carnival to recover license fees assessed for the years 1935 through 1940, the ordinance under which the license was assessed provided for the payment of $50 a day from all circuses, etc., "which license is charged for the purpose of affording police protection." The ordinance provided for no regulation or inspection, imposed no condition in addition to the payment of the prescribed sum, and the charge exacted greatly exceeded the expense incurred by the city. Furthermore, the facts showed that the taxes were levied as part of the general license tax of the city and were paid into the general fund of the city.

Held: That the imposition under the ordinance was a revenue measure sought to be imposed under the guise of a police regulation.

9. TAXATION — Recovery of Illegal Tax — May Be Recovered in Action of Assumpsit. — At common law taxes illegally levied and paid under compulsion may be recovered in an action of assumpsit for money had and received.

10. TAXATION — Recovery of Illegal Tax — Assumpsit — Statute of Limitations Is Three Years. — The statute of limitations applicable to an action in assumpsit to recover taxes illegally exacted and paid under compulsion is the same as that applicable to a suit to recover money had and received under an implied promise to pay, which in Virginia is three years.

11. TAXATION — Recovery of Illegal Tax — Cause of Action Accrues When Taxes Are Paid. — A cause of action to recover taxes illegally levied and paid under compulsion accrues at the time the taxes are paid.

12. TAXATION — Recovery of Illegal Tax — Action Barred by Statute of Limitations — Case at Bar. — The instant case was an action of assumpsit by a carnival to recover license fees assessed for the years 1935 through 1940 under an invalid ordinance. The action was begun in January 1941, and the lower court held that the recovery of taxes for the years 1935, 1936 and 1937 was barred by the three-year statute of limitations, section 5810 of the Code of 1936.

Held: No error.

13. TAXATION — Recovery of Illegal Tax — Section 414 of Tax Code Not Exclusive Remedy — Case at Bar. — The instant case was an action by a carnival to recover license fees assessed for the years 1935 through 1940 under an invalid ordinance. The city contended that section 414 of the Tax Code afforded the only remedy whereby license taxes illegally levied and collected by a locality could be recovered.

Held: That the contention of the city was unsound since the statute contained no express provision to that effect and in it there was no basis for the conclusion that such was its implied purpose.

14. STATUTES — Construction — Remedial Statutes — Construed to Be Cumulative. — A statute prescribing a new remedy for an existing right should never be construed to abolish a pre-existing remedy in the absence of express words or necessary implication.

15. TAXATION — Recovery of Illegal Tax — Voluntary Payments Cannot Be Recovered in Absence of Statute. — In the absence of statute taxes illegally assessed and paid voluntarily and not under compulsion cannot be recovered in an action at law.

16. TAXATION — Recovery of Illegal Tax — Voluntary Payments Cannot Be Recovered — Basis of Rule. — The holding that taxes illegally collected but voluntarily paid cannot be recovered is based upon the principle that every man is supposed to know the law, and if he voluntarily makes a payment which the law would not compel him to make, he cannot afterwards assign his ignorance of the law as a reason why the state should furnish him with legal remedies to recover it.

17. TAXATION — Recovery of Illegal Tax — All Payments Presumed to Be Voluntary — Declaration of "Protest" Insufficient. — All payments of taxes are presumed to be voluntary until the contrary is made to appear. The mere declaration of the plaintiff when it made payment, that it was made under "protest" does not show that it was not voluntarily made.

18. TAXATION — Recovery of Illegal Tax — Payment Not Involuntary because Failure to Pay Would Subject Party to Fine and Imprisonment. — Where the party, of his own motion, procures his license and pays the tax, if the tax be afterwards judicially decided to be illegal, he cannot recover. Such payment is not under compulsion, although the pursuit of the occupation, without the payment of the license tax, would subject the party to fine and imprisonment.

19. TAXATION — Recovery of Illegal Tax — Voluntary Payments Recoverable When Statutory Procedure Is Followed. — When the prescribed statutory procedure is followed, taxes illegally assessed and collected must be refunded to the taxpayer regardless of whether they have been paid voluntarily or under compulsion.

20. TAXATION — Recovery of Illegal Tax — Payments Held Voluntary — Recovery Denied — Case at Bar. — In the instant case, an action by a carnival to recover license fees paid pursuant to an invalid city ordinance, the president of the corporation was told that if the fees were not paid his show would be closed and his possessions levied upon. Thereupon he paid the required fees stating it was under "protest". In subsequent years, plaintiff paid the fees without making any protest.

Held: That the taxes were not paid under compulsion but were paid voluntarily and, consequently, could not be recovered in an action at law.

Error to a judgment of the Corporation Court of the city of Charlottesville. Hon. A. D. Dabney, judge presiding.

The opinion states the case.

H. W. Walsh and Lyttleton Waddell, for the plaintiff in error.

M. J. Fulton and Robert E. Taylor, for the defendant in error.

EGGLESTON, J., delivered the opinion of the court.

In January, 1941, Marks' Shows, Incorporated, which we will sometimes refer to as the plaintiff, filed in the court below a notice of motion for judgment against the city of Charlottesville seeking to recover certain license fees which the city had assessed and collected from it for the years 1935 through 1940, both inclusive, under appropriate ordinances, for the privilege of exhibiting its carnival shows and amusements during the respective years in Albemarle county, but within one mile of the corporate limits of the city. It was alleged that the ordinances which authorized the assessment and collection of licenses on exhibitions beyond the corporate limits of the city were unconstitutional and void, that the exaction of the licenses was illegal, and that the sums had been paid under protest in order to escape prosecution, and should be refunded to the plaintiff.

By appropriate pleadings the city asserted, among others, these defenses:

(1) The licenses are valid because the ordinances under which they were exacted are not revenue measures but regulatory measures enacted under the city's police power pursuant to authority delegated to it by Code, section 3006.

(2) Even if the licenses were illegally...