First Nat. Bank v. Board of Com'rs of Latah County

• Citation: 40 Idaho 391,232 P. 905
• Parties: THE FIRST NATIONAL BANK OF MOSCOW, a Corporation, et al., Appellants, v. BOARD OF COMMISSIONERS OF LATAH COUNTY, Sitting as a Board of Equalization, et al., Respondents
• Decision Date: 03 January 1925
• Court: United States State Supreme Court of Idaho

232 P. 905

40 Idaho 391

THE FIRST NATIONAL BANK OF MOSCOW, a Corporation, et al., Appellants, v. BOARD OF COMMISSIONERS OF LATAH COUNTY, Sitting as a Board of Equalization, et al., Respondents

Supreme Court of Idaho

January 3, 1925

TAXATION-ASSESSMENT-ASSESSOR-BOARD OF EQUALIZATION-APPEAL TO DISTRICT COURT-SCOPE OF APPEAL-POWER OF DISTRICT COURT-REVERSING OR MODIFYING ORDER OF BOARD OF EQUALIZATION-ASSESSMENT OF BANK STOCK-ACTUAL VALUE-EVIDENCE-LACK OF MARKET VALUE-PROOF OF SALES OF SIMILAR PROPERTY-OPINION EVIDENCE AS TO VALUE.

1. An appeal lies to the district court from any act, order or proceeding of the board of county commissioners, sitting as a board of equalization. (C. S., secs. 3339, 3340.)

2. On appeal from an order of the board of equalization, the district court has power to affirm, reverse or modify the order appealed from. (C. S., secs. 3340, 3512.)

3. Under C. S., secs. 3297 and 3298, the valuation of the capital stock of a bank for purposes of assessment is determined by adding to the par value of the capital stock paid up the surplus and undivided profits less expenses and taxes paid and subtracting from this total the amount of the capital stock, surplus or undivided profits actually invested in other property owned by and assessed to the bank.

APPEAL from the District Court of the Second Judicial District, for Latah County. Hon. Edgar C. Steele, Judge.

Appeal from judgment of district court modifying order of county board of equalization on appeal. Reversed.

Reversed and remanded, with instructions. Costs awarded to appellants.

C. J Orland, for Appellants.

On an appeal from the board of commissioners, where it has discretionary powers, the court can only pass upon the questions of law, and not upon the facts on which it acted. (Sullivan v. Commissioners, 22 Idaho 202, 125 P 191.)

The only power of the court on appeals from the board of commissioners is to affirm, reverse or modify the order or acts of the board. (C. S., sec. 3512.)

The court has no power to change the valuation of property for assessment purposes, unless the assessment violates a positive law or is fraudulent. (Youngstown Bridge Co. v Kentucky & I. B. Co., 64 F. 441; Templeton v. Pierce Co., 25 Wash. 377, 65 P. 553; Hart v. Smith, 159 Ind. 182, 95 Am. St. 280, 64 N.E. 661, 58 L. R. A. 949; Burton Stock Car Co. v. Traeger, 187 Ill. 9, 58 N.E. 418.)

The testimony introduced over the objection of the appellant as to private sales of shares of stock, and of the values of farm lands in Latah county, was incompetent and immaterial, and was acted on by the court in making its findings and judgment. (Blomquist v. Board of Commrs., 25 Idaho 286, 137 P. 174; Pittsburg C. C. & St. L. Ry. Co. v. Backus, 154 U.S. 421, 14 S.Ct. 1114, 38 L.Ed. 1031.)

The judgment of the district court is right, so far as it allows to be deducted from the assets of the bank the amount actually invested in other property taxed directly to the bank. (C. S., sec. 3298; Washington Co. v. First National Bank, 35 Idaho 438, 206 P. 1054; Security Sav. Bank v. Board of Review, 189 Iowa 463, 178 N.W. 562.)

A. H. Oversmith and Frank L. Moore, for Respondents.

The trial court was and this court is without jurisdiction to determine any question involved in the controversy for the reason that no appeal lies from any decision of the county board of equalization. (General Custer M. Co. v. Van Camp, 2 Idaho 40, 3 P. 22; Feltham v. Board of Commissioners, 10 Idaho 182, 77 P. 332; Humbird Lumber Co. v. Morgan, 10 Idaho 327, 77 P. 433.)

The county board of equalization is a constitutional body and is entirely separate from the board of commissioners. (Const., art. 7, sec. 12; Feltham v. Board of Commissioners, supra.)

Bank stock must be assessed "upon the same basis of actual value, and uniformly with all other property." (C. S., sec. 3297.)

Value for assessment purposes is fixed by law and should be based upon what the property would sell for at a voluntary sale in the ordinary course of business. (C. S., sec. 3105.)

The assessment of bank stock at its actual market value instead of the book value of the stock is legal. (First Nat. Bank v. Christensen, 39 Utah 568, 118 P. 778; Alva State Bank v. Renfrew, 10 Okla. 26, 62 P. 285; Ankeny v. Blakly, 44 Ore. 78, 74 P. 485; First National Bank v. Estherville, 136 Iowa 203, 112 N.W. 829; People v. Albany, 2 Hun (N. Y.), 583; People v. New York City, 8 Hun (N. Y.), 536.)

The board of equalization did not err in deducting merely the assessed value of the capital invested in other property under the wording of the Idaho statute. (C. S., sec. 3299; Smith v. Stephens, 173 Ind. 564, 91 N.E. 167, 30 L. R. A., N. S., 704.)

Admitting the right of appellants to appeal from the order of the board it was the duty of the court to try the case anew and affirm, reverse or modify the action of the board. (C. S., sec. 3512; Fisher v. Commissioners, 4 Idaho 381, 39 P. 552; Latah County v. Hasfurther, 12 Idaho 797, 88 P. 433; Prothero v. Board of Commrs., 22 Idaho 598, 127 P. 175.)

MCCARTHY, C. J. Budge and William A. Lee, JJ., concur. Wm. E. Lee, J., did not sit at the hearing and took no part in the decision.

OPINION

MCCARTHY, C. J.

Appellant bank made its tax statement for 1921 to the assessor of Latah county, showing paid-up capital stock of $ 50,000, surplus and undivided profits $ 27,262.45, expenses and taxes paid $ 756.27, or a total of $ 76,506.18 as the full cash value of the capital stock. It also showed a total of $ 96,306.49 invested in real estate, furniture and fixtures which had been assessed, and in Federal Reserve Bank stock. The result was that the bank reported that its capital stock had no valuation for taxing purposes. The assessor did not assess the stock. Respondent board of commissioners sitting as a board of equalization gave notice to the bank to appear and show cause why its assessment should not be raised. The board accepted appellant's valuation of its capital stock and found that property in Latah county was valued by the assessor for assessment purposes at 66 2/3 per cent of its actual value, and that the capital stock and surplus of the bank should be valued at $ 51,004.12. It deducted from this the amount for which the real estate, furniture and fixtures of the bank was assessed, to wit, $ 33,005, and the $ 2,250 invested in Federal Reserve Bank stock, and concluded that the capital stock of the bank should be assessed at $ 15,749.12 or $ 31.50 per share. Appellants duly appealed from respondents' order to the district court. The principal grounds of the appeal, as stated in the notice, are that the board assessed the capital stock, and that it refused to deduct from the value of the stock the amount actually invested in other property upon which appellant paid taxes. On the trial the district court found that the actual cash value of appellant's capital stock was $ 200 a share, or $ 100,000, that the actual amount of money invested by appellant bank in other property assessed to it was $ 86,556.49; that other real estate and personal property in Latah county was assessed on the basis of 66 2/3 per cent of its actual value; that the full cash value of appellant bank's capital stock including surplus and undivided profits and after deducting the amount invested in other property assessed to it was $ 13,443.51, and that the capital stock should be assessed at 66 2/3 per cent of that amount, or $ 8,962.32, which would make $ 17.92 per share. By its judgment the court provided that the order of the board of equalization be modified; that each share of appellant bank's stock be assessed at $ 17.92, and that this assessment be extended upon the tax-rolls of Latah county. It further adjudged that said county recover from each shareholder the amount of tax for the year 1921, based upon the assessment of each share at $ 17.92, with seven per cent interest from the fourth Monday in December, 1921, the date on which the tax became delinquent. It further provided that if such amount was not paid within thirty days the county should recover the statutory penalty of six per cent of the amount owing on the fourth Monday of December with one per cent per month interest thereafter. From this judgment this appeal is taken.

Of the many specifications of error, the principal ones, and the only ones which we find it necessary to expressly mention, are that the court erred, first in finding that the value of the stock was $ 200 per share and that its value for assessment purposes was $ 8,962.32 or $ 17.92 per share; second, in assuming to fix the value of the property for assessment purposes; third, in permitting evidence as to the price for which the stock had sold in 1920; fourth, in admitting evidence as to the value of land in Latah county; fifth, in reopening the case some months after the trial and permitting the introduction of further testimony. Appellants contend in effect that the valuation of the stock for taxing purposes was as shown on the bank's report. They also contend that the district court had no power to fix the amount of the assessment.

Respondents contend that neither the district court nor this court has any jurisdiction in such cases because no appeal lies from a decision of the county board of equalization, citing General Custer Mining Co. v. Van Camp, 2 Idaho 40, 3 P. 22; Feltham v. Board of Commissioners, 10 Idaho 182, 77 P. 332; Humbird Lumber Co. v. Morgan, 10 Idaho 327, 77 P. 433. These authorities do so hold, but that was before the enactment of the present statute, enacted in 1919. It provides:

C S. "Sec. 3339. Any time within 20 days after the adjournment of any meeting of the board of county commissioners, sitting as a board of equalization, an appeal may be taken from...