Chicago, R. I. & P. Ry. Co. v. Young
| Decision Date | 04 October 1932 |
| Docket Number | 7276 |
| Court | South Dakota Supreme Court |
| Parties | THE CHICAGO, ROCK ISLAND & PACIFIC RAILWAY COMPANY, Appellant, v. RALPH YOUNG, Treasurer of Codington County, Respondent. |
Appeal from Circuit Court, Codington County, SD
#7276—Reversed
O’Brien, Horn & Stringer, St. Paul, MN
Case & Case, Watertown, SD
Attorneys for Appellant.
K.C. Patterson, State’s Attorney, Watertown, SD
Hanten, Hanten & Henrikson, Watertown, SD
Attorneys for Respondent.
Opinion Filed Oct 4, 1932
For the year 1923 Watertown Independent School District taxed agricultural lands therein at the rate of 10 mills, pursuant to chapter 102, Laws 1923. All other property in said district, including that of plaintiff railroad, was taxed at 14.23 mills. Plaintiff paid the last half of its 1923 tax under protest and instituted this action pursuant to section 6826, RC 1919, to recover the excess payment, claiming the measure of excessive tax exacted to be the difference between the tax on plaintiff’s property (the valuation thereof being undisputed) computed at 14.23 mills, which plaintiff was compelled to pay and did pay, and the amount which would have been plaintiff’s tax on the same valuation if computed at 10 mills, which was the rate granted to the favored agricultural land owners. A demurrer to plaintiff’s complaint was sustained below, and such holding was reversed by this court on appeal (see C., R. I. & P. Ry. Co. v. Monahan, Treas., 223 NW 344) upon the authority of Simmons v. Ericson, wherein this court held that chapter 102, Laws 1923, was unconstitutional in so far as it purported to limit the levy on agricultural land in school districts to 10 mills. The cause, being remanded to the circuit court, was there tried, and judgment was entered in favor of plaintiff for $5.23 (with interest and costs), from which judgment (and from a denial of its motion for new trial) plaintiff has appealed.
Respondent argues in his brief that appellant is entitled to no recovery whatever in this case, for the reason that it fails to appear that appellant made any complaint to taxation officials relative to improper taxation of its property. Respondent submits that, before recovery in any amount could be had in this action, appellant must first show that it has exhausted all available administrative remedies, and cites such cases as Milheim v. Moffat Tunnell Improvement Dist. (1923) 43 SCt 694, 67 LEd 1194, and First Nat. Bk. of Greeley, Colo., v. Bd. of Commissioners of Weld County, Colo. (1924) 44 SCt 385, 68 LEd 784. That question is not before us in this case. When the trial court entered judgment below in favor of appellant, it adjudicated adversely to respondent all questions necessarily involved in determining the right of appellant to some recovery. From that adjudication respondent did not appeal. Consequently the propriety of that adjudication is not now before us. The only appeal taken was by the party in whose favor recovery was adjudged below. This appeal assumes the rightfulness of some recovery, and the only question is as to the proper amount thereof.
There is not a great deal of agricultural land in the school district in question. It is conceded by all concerned that, if the unconstitutional discrimination of a 10-mill levy (article 11, § 2) had not been made in favor of agricultural landowners, a levy of 14.13 mills on all property in the district (agricultural and nonagricultural) would have been required to raise the necessary amount of tax for the year in question. Appellant claims that it is entitled to recover the difference between the levy of 14.23 mills on its valuation and the amount payable thereon at the 10-mill rate which was wrongfully extended to the agricultural landowners. Respondent contends, and the learned trial judge held, that the limit of appellant’s recovery is the difference between its tax at the rate of 14.23 mills (which it paid) and at the rate of 14.13 mills which might lawfully have been levied, and in fact should have been levied, against all property in the district, agricultural and non agricultural. If appellant’s theory is correct, the tax which it paid under protest was excessive by $221.14. If respondent’s theory is correct, the excess was only $5.23.
Counsel do not cite, and we have failed to find, any case precisely parallel to that here presented. In the usual case of claimed discrimination, the situation arises by reason of lack of uniformity in valuation. Here the situation arises through a statutory attempt to create a special class of property and extend a favorable rate thereto; the attempted classification being unconstitutional. In principle, however, the precise manner in which the taxpayer is discriminated against is immaterial. The vice of the situation is in compelling one taxpayer to pay more than his proper proportion of the total tax as compared with others similarly situated. Procedural methods are immaterial. It matters not whether the actual discrimination is brought about by levying the tax on all at the same rate but valuing the property of some at a higher proportion of its true value than the property of others, or whether it is accomplished by valuing all property fairly and uniformly, and then by arbitrary and unconstitutional classification levying at a higher rate upon some taxpayers than upon others. Constitutional uniformity is just as much lacking in the one case as in the other. Where the unlawful discrimination results from valuing the property of one taxpayer proportionately higher than that of others, the rate levied against all being the same, the remedy almost universally given to the taxpayer against whom the discrimination exists is to reduce his valuation to the same percentage of true value used in the case of those in whose favor the discrimination was granted and compute his tax accordingly. A contrary dictum of this court injected sua sponte into the opinion in the case of Bagley Elevator Co. v. Butler, is flatly contrary to the very great weight of authority, and is an announcement which we can no longer approve, See Pelton v. Nat. Bk. (1879) 25 LEd 901; Cummings v. Nat. Bk. (1879) 25 LEd 903; Taylor v. L. & N. Ry. Co. (1898) 88 F. 350, 31 CCA 537; Greene v. Louisville, etc., Ry. (1917) 37 SCt 673, 61 LEd 1280, Ann. Cas. 1917E, 88; Louisville, etc., v. Greene (1917) 37 SCt 683, 61 LEd 1291, Ann. Cas. 1917E, 97; Illinois...
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