Chi., R. I. & P. Ry. Co. v. Slate, 41073.

• Decision Date: 08 March 1932
• Docket Number: No. 41073.,41073.
• Citation: 241 N.W. 398,213 Iowa 1294
• Parties: CHICAGO, R. I. & P. RY. CO. v. SLATE, COUNTY TREASURER.
• Court: Iowa Supreme Court

213 Iowa 1294

241 N.W. 398

CHICAGO, R. I. & P. RY. CO.

v.SLATE, COUNTY TREASURER.

No. 41073.

Supreme Court of Iowa.

March 8, 1932.

Appeal from District Court, Keokuk County; Frank Bechly, Judge.

Action in equity in which the plaintiff asks for a writ of mandamus requiring the defendant, the County Treasurer of Keokuk County, Iowa, to issue his official tax receipt for the payment of taxes. The trial court found for the plaintiff. The defendant appeals. The facts appear in the opinion.

Affirmed.Edwin Willcockson, Co. Atty., of Sigourney, for appellant.

A. B. Howland, of Des Moines, and Shaw & Yoder, of Sigourney, for appellee.

GRIMM, J.

The plaintiff company operates a line of railway passing through Keokuk county, Iowa. The board of supervisors of that county included in the taxes for the year 1928, payable in 1929, a levy of 1.82 mills, designated as “County Emergency Levy.” This levy, as applied to the plaintiff's property, produced a tax of $773.22.

On March 5, 1929, this court held the act creating said emergency tax (Acts 40th Gen. Assem. [Ex. Sess.] c. 4 § 60 et seq.) void, because of defects in the title. C. R. I. & P. Ry. Co. v. Streepy, 207 Iowa, 851, 224 N. W. 41. The Legislature of the state of Iowa was then in session, and by an act approved March 27, 1929 (chapter 396, Acts 43d G. A.), this emergency tax was legalized. Said chapter did not, however, become effective until April 2, 1929.

On March 29, 1929, the plaintiff railway company tendered to the defendant county treasurer, in legal tender, the first installment of the taxes upon its property in said county for 1928, payable in 1929, less the so-called county emergency tax, said tender amounting to $19,985.39. The county treasurer refused to accept the payment.

The validity of said chapter 396 of the Acts of the 43d G. A., passed as a legalizing act, was questioned, and it was determined by this court on June 23, 1930, by sustaining said legalizing act. C., R. I. & P. Ry. Co. v. Rosenbaum (Iowa) 231 N. W. 646.

On September 20, 1929, the railway company delivered to the defendant a voucher for $17,286.37 as the amount of the second installment of appellee's taxes, less the second installment of the county emergency levy.

On June 27, 1930, the railway company sought to pay the amount of the emergency levy with penalty thereon, but the appellant demanded penalties in the total amount of $1,629.91. This amount is made up as follows:

+---------------------------------------------------------------+
                ¦Penalty on $20,372.00 from April 1 to Sept. 25, 1929 ¦$1,222.32¦
                +-----------------------------------------------------+---------¦
                ¦Penalty on $17,672.98 from Oct. 1 to Nov. 27, 1929   ¦353.46   ¦
                +-----------------------------------------------------+---------¦
                ¦Penalty on $386.61 from Apr. 1, 1929 to June 30, 1930¦30.93    ¦
                +-----------------------------------------------------+---------¦
                ¦Penalty on $386.61 from Oct 1, 1929 to June 30, 1930 ¦23.20    ¦
                +-----------------------------------------------------+---------¦
                ¦Total penalty and interest demanded                  ¦$1,629.91¦
                +---------------------------------------------------------------+
                

I. We will first consider whether the railway company is liable for a penalty on the $20,372 from April 1 to September 25, 1929. It will be noted that said sum is the total of the first half of the railway company's taxes for the year 1928, payable in 1929, including one-half of the emergency tax.

[1] By the decision in C., R. I. & P. Ry. Co. v. Streepy, 207 Iowa, 851, 224 N. W. 41, filed March 5, 1929, the act creating the emergency tax was held invalid because of insufficient title. The legalizing act, passed by the Forty-Third General Assembly affecting said emergency tax, did not become effective until after publication was completed, which was April 1, 1929, making the legalizing act effective April 2, 1929. In the meantime, on March 29, 1929, the railway company had tendered to the defendant one-half of its entire taxes for the year 1928, payable in 1929, in said county, less the emergency tax. Manifestly, at the time this tender was made, there was no emergency tax in existence. The act under which an attempt was made to levy such a tax was declared void. The railway company, before the legalizing act became effective, tendered to the defendant one-half of the railway company's taxes for 1928, payable in 1929, and, as the payment was refused, the defendant cannot now demand a penalty against the plaintiff on said tendered tax, unless it was incumbent upon the railway company to tender the first half of its entire taxes, including one-half of the emergency tax. The company was privileged, by statute, to pay one-half of its taxes at that time. As we shall see later, as the emergency tax was separable from the total of the claimed taxes, the company was privileged to contest the validity thereof. It could and did tender the entire first half of all other taxes in proper time. The defendant is not entitled to interest or penalty thereon.

It is the contention of the defendant that the tender made by the plaintiff of the first half of its taxes, less the emergency fund, was inoperative because, as defendant contends, no valid tender can be made unless the entire tax then due is tendered. In other words, it is the contention of the defendant that, in order to make a valid tender, it was incumbent upon the railway company, on or before March 1, 1929, to pay to the defendant one-half of the entire tax then charged against the company, including the emergency tax. On the other hand, it is the contention of the plaintiff that it had the right to tender that tax which it conceded to be correct and to refuse to pay that tax which it claimed to be illegal and test the legality of said latter tax.

The defendant relies largely upon section 7188 of the Code, which reads as follows:

“7188. Receipt. The treasurer shall in all cases make out and deliver to the taxpayer a receipt, stating the time of payment, the description and assessed value of each parcel of land, and the assessed value of personal property, the amount of each kind of tax, the interest on each and costs, if any, giving a separate receipt for each year; and he shall make the proper entries of such payments on the books of his office. Such receipt shall be in full of the first or second half or all of such person's taxes for that year, but the treasurer shall receive the full amount of any county, state, or school tax whenever the same is tendered, and give a separate receipt therefor.”

Section 7210 provides, in substance, that it shall be the duty of every person subject to taxation to pay his taxes in full or one-half thereof before the 1st day of March and the remaining half before the 1st day of September of each year.

It will be recalled that in this state we are one year behind in the payment of taxes; that is to say, in 1929, we pay the taxes for 1928.

Section 7211 of the Code provides, in substance, that in all cases where the half of the taxes have not been paid before the 1st day of April the amount thereof shall become delinquent from the 1st day of April, and, in case the second installment is not paid before the 1st day of October, said installment then becomes delinquent.

Section 7214 provides a penalty after delinquency.

In Iowa Railroad Land Company v. Carroll County, 39 Iowa, 151, this court had before it substantially this same question. The land company had paid to the county treasurer a certain sum of money, directing when to apply it in payment of taxes which were concededly due and excluding certain taxes, the legality of which was in doubt. The treasurer credited the amount upon all taxes against plaintiff's property, claiming it had the right so to do. This court said: “On the 30th day of June, 1870, the plaintiffs made an offer in writing to pay all of certain specified taxes charged against their lands for the year 1869, together with the interest then due thereon, and demanded receipts from the treasurer accordingly. This offer included the $8000.00 already paid to the treasurer, and proposed to return to him his receipt for that sum. As we have seen, the statute gave the plaintiffs the right to pay the whole of any particular taxes charged against them, as they saw fit and proper to do; this offer, therefore, would stop the running of interest upon the taxes included in the written offer.”

In that case, some question arose about the legality of some county and bridge warrants which were tendered as payment, and the court afterwards said: “If the tender was good for any tax specified in the written offer, it stopped interest on such tax, without reference to whether the tender was good as to other taxes specified.”

It will be noted that Iowa Railroad Land Co. v. Carroll County, 39 Iowa, 151, was decided on June 30, 1874 and that the law at that time provided for the payment of the entire tax for a year at one time. This accounts for the phrase in said case, as follows: “As we have seen, the statute gave the plaintiffs the right to pay the whole of any particular taxes charged against them, as they saw fit and proper to do; this offer, therefore, would stop the running of interest upon the taxes included in the written offer.”

After expressly finding that it was the legal right of the taxpayers to have its payments “applied only in payment of such taxes as they should direct,” this court further said: “If, therefore, he [the treasurer] then had authority to apply the money in his hands to the payment of the plaintiffs' taxes, it was his duty to apply it to those taxes, the payment of which was not forbidden [by the taxpayer], at least, until all except the forbidden taxes were paid. The evidence shows that if this had been done there would have been no money left to apply upon the forbidden taxes. As before remarked, the act of the treasurer in applying the money of plaintiffs in his hands to the payment...