City of Houston v. Baker

• Decision Date: 25 May 1915
• Docket Number: (No. 7019.)
• Citation: 178 S.W. 820
• Parties: CITY OF HOUSTON et al. v. BAKER et al.<SMALL><SUP>†</SUP></SMALL>
• Court: Texas Court of Appeals

178 S.W. 820

CITY OF HOUSTON et al. v. BAKER et al.^†

(No. 7019.)

Court of Civil Appeals of Texas. Galveston.

May 25, 1915.

Rehearing Denied June 24, 1915.

Appeal from District Court, Harris County; John A. Read, Judge.

Suit by J. W. Baker and another, executors of Rebecca Baker, deceased, J. J. Settegast, and others, for mandamus and injunction against the City of Houston and others, in which the request of H. F. Ring to file a petition in intervention was refused. Order and decree for plaintiffs, and defendants and Ring appeal. Affirmed.

Sam, Bradley & Fogle, of Houston, for appellants. Wilson, Dabney & King, of Houston, for appellees.

McMEANS, J.

This suit was brought by J. W. Baker and Joe F. Meyer, executors of the estate of Rebecca Baker, deceased, J. J. Settegast, H. F. Cohen, S. Rosenberg, and M. P. Geiselman, for themselves and for all others similarly situated, against the city of Houston, a municipal corporation, and Ben Campbell, its mayor, J. J. Pastoriza, H. A. Halverton, Dave Fitzgerald, and Mat Drennan, aldermen of said city, and who, together with the mayor, constitute the city council of said city, and T. R. Browne, assessor and collector of taxes for said city, and the said Pastoriza, Halverton, Fitzgerald, and Browne, who constitute the board of appraisement of said city, praying for a writ of injunction and mandamus against the defendants to compel the city of Houston to abandon that which is known as the "Houston Plan of Taxation," by and under which land is taxed at 70 per cent. of its full value, improvements on land taxed at 25 per cent. of its full value, stocks of merchandise and similar personal property taxed at 50 per cent. of its full value, and money, stocks, bonds, notes, mortgages, and similar personal property are not taxed at all, but exempted by the city and its taxing officers from the payment of any taxes whatever; and to require said city and its taxing officers to tax all property in said city, not exempted by the Constitution from taxation, without discrimination, at the same ratio or portion of value.

The court upon being presented with the petition set a day for hearing thereon, and notice thereof was duly given to the defendants, who appeared and answered. The matter was heard upon the sworn petition of plaintiff and answer of defendants and amendments thereof, affidavits, and documents, and at the conclusion of the hearing the court made and entered its order, in part reading as follows:

"* * * And it appearing to the court that said petition prays for a mandamus and injunction to compel the city of Houston to abandon the so-called `Houston Plan of Taxation,' on the ground that said plan of taxation discriminates against certain classes of taxable property, and also that it fails to comply with the Constitution, by exempting certain classes of property from taxation which are not exempt under the law; and it appearing to the court, as alleged by the plaintiffs, and in essential particulars admitted and proven, that this plan of taxation was deliberately adopted, and would be adhered to unless forbidden by the courts, and that same involves the practice of taxing different kinds or classes of property at different proportions or ratios of value, and of virtually exempting certain classes of property from taxation altogether, and that said plan of taxation was violative of the Constitution of the state, and of the rights of the plaintiffs in this suit, and of all others similarly situated, on behalf of whom the plaintiffs sued; and it appearing to the court that the defendants are valuing different classes of property for purposes of taxation at different ratios, or proportions of value, and particularly are valuing lands without or independent of improvements at a much higher proportion of full value than is applied to other classes of taxable property, thereby requiring of such land without improvements to pay in excess of its just and legal proportion of taxes; and it also appearing to the court that defendants are also exempting certain classes of taxable property from any taxation whatever, all of said acts being done by defendants by a fixed and established plan of discrimination and exemption — it is therefore ordered by the court that, on the plaintiffs giving bond in the sum of $1,000, the clerk of this court will issue a writ of temporary injunction commanding and enjoining the defendants and each of them with respect to the taxes for the year 1915, and thereafter that they proceed to value the taxable property in the city of Houston, and all classes of taxable property in the city of Houston, without discrimination in valuation for or against any class of taxable property, and without exempting any class of taxable property (not exempt by the Constitution of Texas) from the taxes of the city of Houston, and commanding and enjoining the defendants and each of them that they be enjoined and prohibited from valuing different classes of taxable property at different ratios or proportions of full value for purposes of taxation, and particularly enjoining and prohibiting the defendants and each of them from valuing lands without improvements at a higher ratio or proportion of full value than is applied uniformly to all other taxable property and classes of taxable property in the city of Houston, to the end that the taxes of the city of Houston shall be equal and uniform on all classes of taxable property in said city, and shall be proportional to value as required by the Constitution of the state."

From this order and decree of the court, the defendants have appealed.

The following facts were alleged and substantially proved, viz.:

The Houston Plan of Taxation has been in force and operation in the city of Houston for several years. It was under this plan that taxes were assessed and collected for the year 1914. Under this plan the city taxes land without improvements at 70 per cent. of full value, improvements on land at 25 per cent. of full value, stocks of merchandise and similar personal property at 50 per cent. of full value, and entirely omits from taxation household goods, money, stocks, bonds, mortgages, notes, credits, and other similar personal property. The taxable values of property in the city of Houston of the classes taxed amount to more than $109,000,000, while the value of the class of property exempted from taxation, or not taxed under said plan, amounts to several million dollars.

Plaintiffs are the owners of property in the city of Houston taxable under the Constitution and laws of the state and the charter of the city, their property consisting largely of land which, in value, far exceeds the value of their other taxable property with the possible exception of plaintiff Settegast. As an example, the estate of Baker owns land of the value of $324,570, improvements upon land of the value of $7,510, and cash on hand $18,793.97; so that, under said plan of taxation, the estate would be required to pay taxes on 70 per cent. of $324,570 valuation, 25 per cent. on $7,510 valuation, and escape taxation altogether on $18,793.97 valuation. A simple calculation will show that under said plan the estate of Baker and other plaintiffs similarly situated would be required to pay taxes far in excess of the amount they would have to pay if all property in the city were taxed and taxes were equal and uniform and proportional to values.

The city of Houston and its taxing officers intend to, and if not enjoined will, follow in the year 1915 the same plan of taxation adopted and acted on by it in the year 1914, and the several years previous thereto, of taxing lands at 70 per cent. of their full value, improvements on land at 25 per cent. of their full value, stocks of merchandise and similar personal property at 50 per cent. of their full value, and omitting from taxation household goods, money, stocks, bonds, notes, mortgages, credits, and similar personal property; and to this end said city and its said officers, before the expiration of the year 1914, had made out assessment sheets for the year 1915 of property taxed under said plan, for the signature of the property owners, and a great many of the property owners and taxpayers signed such assessment sheets before the expiration of 1914, and others had signed and were signing such sheets after the 1st day of January, 1915, and the city and its said officers were thus actively putting into effect its intention to follow the Houston Plan of Taxation for the year 1915, and will follow said plan for said year unless restrained.

Plaintiffs' petition contained a sworn allegation, which was not denied, that lands being singled out in violation of the Constitution to bear the principal burden of the taxes of the city of Houston, reduced the value of plaintiffs' lands and their availability for investment.

On December 30, 1914, Hon. Ben Campbell, mayor of Houston, published in the Houston Post a formal invitation, to any one who might believe that the Houston Plan of Taxation was illegal and unconstitutional, to take the matter into the courts, so that it might be settled at once and for all. In this publication he stated:

"We found the plan here when we came into office, but if it is illegal and unconstitutional, it should be settled. It is for this reason that I invite any one who believes the plan to be illegal to file suit against the council and commission, praying for mandamus requiring them to levy taxes in accordance with their construction of the constitution and the law, and enjoining them from doing it in any other manner."

Following this invitation, William H. Wilson, Esq., counsel for the plaintiffs, interviewed the mayor and city council and obtained from them an authoritative statement as to the different percentages of values used in valuing different classes of property for taxation, which was as hereinbefore stated, and thereafter the plaintiffs presented a petition to the...