Crow v. City of Corpus Christi

• Decision Date: 24 March 1948
• Docket Number: No. A-1471.,A-1471.
• Parties: CROW et al. v. CITY OF CORPUS CHRISTI.
• Court: Texas Supreme Court

Page 922

209 S.W.2d 922

CROW et al. v. CITY OF CORPUS CHRISTI.

No. A-1471.

Supreme Court of Texas.

March 24, 1948.

Rehearing Denied April 28, 1948.

Error to Court of Civil Appeals of Fourth Supreme Judicial District.

Suit by LeRoy Crow, doing business as Yellow Cab Company, and by the C. C. Checker Cab Company, a corporation, against the city of Corpus Christi, Tex., a municipal corporation, seeking a temporary injunction, and on final hearing a permanent injunction, restraining the city from collecting any gross receipts tax or license fee or street rental fee under city ordinances, and for a declaratory judgment declaring that certain provisions of the ordinances were invalid. From a judgment for the plaintiffs, the defendant appealed to the Court of Civil Appeals. The Court of Civil Appeals, 204 S.W.2d 678, reformed the judgment to provide that no recovery could be had by plaintiffs for taxes and charges paid to the city, and affirmed the judgment as reformed, and the plaintiffs bring error.

Judgment of Court of Civil Appeals reformed so as to affirm in toto the trial court's judgment.

Lyman & Pittman, Charles G. Lyman, John J. Pichinson, and Lloyd L. Davis, all of Corpus Christi, for petitioners.

Tillman Smith, City Atty., and Tom M. Pogue, Asst. City Atty., both of Corpus Christi, for respondent.

TAYLOR, Justice.

This suit was instituted by LeRoy Crow (doing business as Yellow Cab Company), and C. C. Checker Cab Company, against the City of Corpus Christi, a municipal corporation, seeking to enjoin the city from collecting under city ordinances any gross receipts tax, or license fee or street rental fee, and further restraining the city from enforcing the penal and forfeiture provisions of the ordinances; and for a declaratory judgment decreeing certain provisions of the ordinances (relating to the collection of gross receipts tax, or license fee or street rental fee) invalid. The cab companies also sought to recover fees paid, as they alleged, under duress, under ordinances alleged to be unconstitutional and void.

Upon trial without a jury (following the granting in plaintiffs' favor of the temporary injunction prayed for) the court rendered a declaratory judgment decreeing section 11 of the 1944 ordinance, and section 2 of the franchise ordinances of 1946, invalid and unenforceable in so far as the assessment, levy and collection of the taxes, or the license or street rental fee, are concerned; and perpetually enjoined the city from attempting to enforce collection of such taxes and charges, and from seeking to forfeit and cancel the franchises, permits or licenses then held by the companies (Crow and the cab company); and further decreed that plaintiffs, respectively, have and recover the amounts paid the city under the invalid ordinances.

The statement of facts upon which the cause was submitted and upon which it was agreed judgment should be rendered, contained, among others, the stipulations that the cab companies had complied fully with the requirements of the ordinances with the exception of the payment of gross receipts tax, street rental fee or charge as required by their terms, and that the companies were operating under the franchises at the time of the trial. It was further stipulated that the city would seek to assess, levy and collect the taxes and rental charges as set out in the ordinances and franchises and would seek to set aside and cancel the franchises on the ground of nonpayment of the tax or street rental fee or charges, were same not paid and the city enjoined from so doing; and further in this connection that the taxes and charges were paid without any protest or notice of protest to the city, but would not have been paid except for the penal provisions contained in the ordinances; and that such amounts as were paid under the franchise ordinances were similarly paid but would not have been paid except for the clauses providing for cancellation for nonpayment.

The court of civil appeals affirmed that part of the judgment of the trial court declaring the tax and fee provisions of the ordinances invalid, because in conflict with the provisions of article 6698, Vernon's Ann.Civ.St., as held in the recent case of Payne v. Massey, 145 Tex. 237, 196 S.W.2d 493; but so reformed the trial court's judgment as to deny the companies any recovery for payments made under the ordinances. The theory of the court in so holding appears to have been that the cab companies made their payments voluntarily in that they were made without protest, or any notice of protest, to the city; and that the city had received the money and paid it out for expenses of the city government.

The view is expressed in the opinion that the declaratory judgment law, Art. 2524 — 1, V.A.C.S., was in full force and effect at the time the taxes were paid; and that a suit for a declaratory judgment with reference to the validity of such taxes and fees, together with a request for an injunction to prevent the city from exercising and enforcing the penal, penalties or forfeiture provisions of the ordinances pending a final hearing, would have furnished appellees an adequate remedy at law; and that since the companies are now seeking relief through this remedy there was no reason "why they should not have used it some two years previously, instead of waiting until after they had paid large sums of money to the city." In other words the court's theory was that since the companies failed to show they made their payments under what may be termed duress in law, they should not now be permitted to recover...