Finney v. Johnson, 30162
| Citation | 179 N.E.2d 718,242 Ind. 465 |
| Decision Date | 30 January 1962 |
| Docket Number | No. 30162,30162 |
| Parties | David D. FINNEY, Marion County Assessor, Carl T. Bowen, Washington Township Assessor, Appellants, v. G. Weldon JOHNSON and Juanita Johnson, husband and wife, Appellees. |
| Court | Supreme Court of Indiana |
Max M. Plesser, Obed T. Kilgore, Marion County Attys., Robert D. Risch, Leonard J. Betley, Indianapolis, for David D. Finney, Marion County Assessor.
William H. Traylor, Indianapolis, for appellant Carl T. Bowen, Indianapolis, Washington Township Assessor.
Ross, McCord, Ice & Miller, Johnson & Weaver, Indianapolis of counsel, for appellants.
James E. Noland, Indianapolis, Hilgedag & Noland, Indianapolis, of counsel, for appellees.
This is an appeal questioning the constitutionality of Chapter 325 of the Acts of 1961 relating to the assessment of household goods for the purpose of taxation. The Act in general provides that household goods shall be assessed at an amount equal to five per cent of the assessed valuation of the improvements on the real estate in which the household goods are kept.
The appellees were the plaintiffs below and brought the action asking for a declaratory judgment and for an injunction against the enforcement of the Act against the appellants, the Marion County Assessor and the Assessor of Washington Township. The trial court from which this appeal is taken found the Act in question unconstitutional and enjoined its enforcement.
The Act provides that beginning on March 1st of each year the assessors shall assess household goods and use as a formula the valuation thereof, '* * * an amount equal to vive per cent of the assessed valuation of the improvements in which the household goods are kept and maintained.' There is a further provision and formula with reference to breaking down the improvement valuations for apartment buildings or multiple family units on a room basis. The Act states that such valuation of household goods '* * * shall be presumed to be thirty-three and a third per cent (33 1/3%) of the true cash value * * *' and provides that the taxpayer may request by petition that his household goods be assessed pursuant to existing laws governing the assessment of property in general, if he is dissatisfied with the formula fixed by the Act. It is contended that the Act is unconstitutional because Article 10, § 1 of the Indiana Constitution requires that the rate of taxation not only be equal and uniform, but also the regulations by which the appraisement or valuation is made shall be such as to 'secure a just valuation' of all property. The wording of Article 10, § 1 of the Indiana Constitution, about which the constitutionality of this Act revolves, is as follows:
'The General Assembly shall provide, by law, for a uniform and equal rate of assessment and taxation; and shall prescribe such regulations as shall secure a just valuation for taxation of all property, both real and personal, excepting such only for municipal, educational, literary, scientific, religious, or charitable purposes, as may be specially exempted by law.'
It is argued and conceded that the formula fixed by the statute for the determination of the value of household goods is inequitable in some instances; that some highly valued residences and improvements contain household goods of little value, while in other instances, old and dilapidated homes on real estate contain household goods of very high value. In one place appellant Finney testified: 'There is a relationship certainly in the home a person resides in and the type of furniture he would use.' At another point he says, with reference to the allocation of assessments on a room basis in an apartment: 'I do not say this is ideal; it might be a step towards uniformity or equality.'
Viewing the Indiana constitutional provision (Article 10, § 1) set forth above, it has three main provisions: (1) The rate of taxation shall be uniform. (2) The valuation and assessment for taxation must be 'just' on all property. (3) Only property used for 'municipal, educational, literary, scientific, religious or charitable purposes' may be exempted from such taxation. Fesler, Auditor, v. Bosson (1920), 189 Ind. 484, 128 N.E. 145.
We are not concerned here with any question as to a uniform rate of taxation or any exemption from taxation. We are concerned only with the requirement that the valuation must be 'just' on all property. In this respect the legislature has seen fit to take the valuation of another kind or class of property (i. e. the improvements in which the household goods are kept) as a basis for valuation for the household goods. Instead of assessing and evaluating household goods themselves, it has taken a percentage of the value of another type of property. We grant there is, in some instances, a relationship between the type home in which a person lives and the value or amount of the household goods therein, just as there may be some relationship between a person's income or earnings and the kind of household goods he may own or the amount of intangible property (stocks and bonds) which he may have. Nevertheless. admitting there is a relationship, it appears too remote for the basis of a 'just valuation', such as the Constitution requires. If the legislature may use a formula to fix the valuation of a taxpayer's household goods by assessing a percentage of the value of the residence in which he lives, then the same legislature (because there is also some relationship involved) may use a certain percentage of a taxpayers' income (gross or net) as a formula for determining the assessed value of his household goods or stocks and bonds. The inequities resulting are too great to warrant a valuation under such an indirect basis as here involved, since our constitutional provision requires that the valuation on all property must be 'just'. Our court has rejected a formula under which one type of property is evaluated and used as the measure of value for a different type of property.
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