Co-Operative Bldg. & Loan Ass'n v. State ex rel. Daniels

• Decision Date: 18 April 1901
• Parties: CO-OPERATIVE BUILDING & LOAN ASS'N et al. v. STATE ex rel. DANIELS, County Assessor.
• Court: Indiana Supreme Court

156 Ind. 463

60 N.E. 146

CO-OPERATIVE BUILDING & LOAN ASS'N et al.

v. STATE ex rel.DANIELS, County Assessor.

Supreme Court of Indiana.

April 18, 1901.

Appeal from circuit court, Jackson county; David M. Alspaugh, Judge.

Petition by the state of Indiana, on the relation of William H. Daniels, county assessor, for a writ of mandamus to compel the Cooperative Building & Loan Association and others to permit the relator to examine the association's books to determine whether any of its stock had been omitted from taxation. From a judgment for relator, defendants appeal. Affirmed.O. H. Montgomery, for appellants. D. A. Kochenour, W. L. Taylor, Atty. Gen., Merrill Moores, and C. C. Hadley, for the State.

BAKER, J.

Relator, as county assessor, applied for the writ to require appellants, a building and loan association and its president and secretary, to permit relator, as assessor, to examine the association's books and records for the purpose of determining whether any of the stock had been omitted from taxation. Demurrer to petition and alternative writ was overruled. A return in five affirmative paragraphs was filed, to each of which a demurrer was sustained. On appellants' refusal to plead further, a peremptory writ was awarded. The rulings on the demurrers are assigned as errors.

The sufficiency of the petition and alternative writ is affirmed in State v. Real Estate Building & Loan Ass'n, 151 Ind. 502, 51 N. E. 1061, and State v. Workingmen's Building & Loan Fund & Savings Ass'n, 152 Ind. 278, 53 N. E. 168, but the authority of those cases is challenged upon the grounds: First, that the proper construction of the tax laws denies the relator's alleged right to an examination of the association's books; and, secondly, that, if the contrary interpretation is adhered to, the guaranties of the federal and state constitutions against unreasonable searches and seizures will be violated. Section 8531, Burns' Rev. St. 1894 (section 6380, Horner's Rev. St. 1897), requires “the county assessor, at any time during the year, to list and assess upon the proper assessor's book in the office of the county auditor any omitted property that he may discover, and which should be assessed.” Building and loan stock, debenture, prepaid and running, is taxable to the owner at its true cash value. Deniston v. Terry, 141 Ind. 677, 41 N. E. 143;Harn v. Woodard, 151 Ind. 132, 50 N. E. 33. Section 8444, Burns' Rev. St. 1894 (section 6302, Horner's Rev. St. 1897), gives to various tax officials, including the county assessor, “for the purpose of properly listing and assessing property for taxation, * * * the right to inspect and examine the records of all public offices and the books and papers of all corporations and taxpayers in this state, without charges, and to administer all necessary oaths or affirmations in the discharge of their duties.” The county assessor also has the power to add omitted property to the tax duplicate after giving the owner notice and an opportunity to show cause why the addition should not be made. Sections 8531, 8560, Burns' Rev. St. 1894 (sections 6380, 6409, Horner's Rev. St. 1897). Appellants contend that the examination of books and papers mentioned in section 8444 (section 6302) cannot relate to the assessment of omitted property, because that provision comes in a later and different part of the act. The general tax law of 1891 comprises 260 sections, divided into 29 articles. Section 8444, Burns' Rev. St. 1894 (section 6302, Horner's Rev. St. 1897; section 34, p. 207, Acts 1891), is in article 5, entitled “Definitions and Rules.” The application of the definitions and rules could hardly be limited to the article devoted to definitions and rules; and, if they are not to be applied to the whole act,-to what follows as well as to what precedes article 5,-then section 8444 (section 6302) is wholly inoperative, because the listing and assessment of property, the creation of the offices, and the prescription of the officers' duties are covered by articles 6 to 17, inclusive.

Appellants also urge that a proper construction of section 8444 (section 6302) would limit the right of the assessor to examine books and papers to times when he was making up the original assessment lists between April 1st and June 1st, and when he was adding omitted property to the duplicate after notice to the owner. The assessor's duty in respect to the original assessment lists and his duty as to omitted property are both prescribed in section 8531 (section 6380). Why the right given by section 8444 (section 6302) to examine books and papers “for the purpose of properly listing and assessing property for taxation” should apply to one part of section 8531 (section 6380) (or to the township assessor) and not to the other (or to the county assessor), is not apparent. It is no more inquisitorial in its nature to pry into the private affairs of a taxpayer by the examination of him and others after the original assessment lists have been made than it is before or while they are being made. The taxpayer should correctly list and value his taxable personalty; but, if he does not, or if the assessor is in doubt, the assessor is authorized and required to examine other persons under oath as to the truth of the matter. Section 8461, Burns' Rev. St. 1894 (section 6319, Horner's Rev. St. 1897). But if, even then, property has been omitted, it should not escape taxation. The fact that the omitted property was not discovered while the original lists were being made would seem to indicate that the assessor should have at least as much power in searching later as in the first instance. It is true that, in adding omitted property to the duplicate, there must be a notice and hearing given the owner,-a quasi judicial proceeding; but there is no greater reason for claiming that an inquisition as to omitted property can only be had in aid of a pending quasi judicial proceeding to add the omitted property to the duplicate than for claiming that an inquisition as to the correctness of the original list can only be had in aid of a pending quasi judicial proceeding to list and assess the property correctly in the first instance. Yet the assessor need not give the taxpayer notice and an opportunity to be present when he conducts an inquiry into the correctness of the original listing and assessment. Appellants' error seems to be basal, arising from their assertion that these provisions of our tax law are in derogation of common right, and should be strictly and narrowly construed. On the contrary, these measures for reaching omitted property are in aid of the common right of the people, who are the sovereign, and should be liberally interpreted in support of the taxing power. Stone Co. v. Woodard, 152 Ind. 474, 53 N. E. 947;Graham v. Russell, 152 Ind. 186, 52 N. E. 806.

It is the further insistence of appellants that mandamus will not lie. The statute authorizes the issuance of the writ “to compel the performance of an act which the law specially enjoins.”...