Gray v. Foster

• Decision Date: 10 June 1910
• Docket Number: 6,740
• Citation: 92 N.E. 7,46 Ind.App. 149
• Parties: GRAY, AUDITOR, ET AL. v. FOSTER ET AL
• Court: Indiana Appellate Court

92 N.E. 7

46 Ind.App. 149

GRAY, AUDITOR, ET AL. v. FOSTER ET AL

No. 6,740

Court of Appeals of Indiana

June 10, 1910

From Fountain Circuit Court; Isaac E. Schoonover, Judge.

Suit by Wilmer N. Foster and others against William B. Gray as Auditor of Fountain county, and another. From a decree for plaintiffs, defendants appeal.

Affirmed.

James Bingham, Attorney-General, and W. H. Cox, for appellants.

Lucas Nebeker, for appellees.

HADLEY J. Rabb, J., did not participate.

OPINION

HADLEY, J.

In 1907 the State Board of Tax Commissioners, acting in its capacity as a state board of equalization, made an order increasing the valuation of lands in Fountain county, outside the limits of cities and towns, fifteen per cent upon the assessment thereof as returned and as revised by the county board of review of said county. This order was made and certified to appellant William B. Gray, then auditor of said county.

This suit was instituted by appellees, some twenty in number, who brought the suit for themselves and others similarly situated, as taxpayers and owners of lands outside of cities and towns in said county, and whose lands were assessed for taxation in that year, to enjoin appellant Gray as auditor and appellant Irvin as treasurer of said county--said auditor from placing such increase upon the tax duplicate of said county, and said treasurer from obeying said order, and from collecting or attempting to collect said increase--on the ground that said increase had been ordered by said state board, without first having complied with section two of an act concerning equalization of assessments of real and personal property, enacted by the General Assembly of 1905 (Acts 1905 p. 105, § 10296 Burns 1908), and had made such assessment in direct violation of section four of said act (§ 10298 Burns 1908); and for the further reason that said board by said order had attempted to increase the valuation of a portion of one of the statutory classes of property, as defined by section 135 of the taxing act of 1891 (Acts 1891 p. 199) as amended in 1901 (Acts 1901 p. 44, § 10303 Burns 1908), in that said board had attempted to increase the assessment on lands lying outside of the limits of cities and towns and had not applied said increase to lands lying within the limits of such cities and towns.

To this complaint appellants filed separate demurrers, which demurrers were overruled, and appellants then filed an answer, setting out in detail the proceedings of said state board of equalization, averring that a notice of the hearing of the proposed increase of lands in Fountain county was properly prepared and delivered through the mail to appellant Gray; that said appellant placed said notice in a drawer in his office, but the notice was overlooked, and was not presented to the board of county commissioners, or otherwise posted or published; that said auditor did not call the board of county commissioners to consider said matter, and that said board of commissioners of said county did not take any steps to protect the interests of the taxpayers at said hearing, but that appellant Gray and Clinton F. Hessler, chairman of the board of county commissioners, appeared before the board of tax commissioners on July 25, the date set for the hearing of the question of said increase; that said Hessler and said Gray were taxpayers of said county; that a full hearing of all of said matters was had before said board on said date; that no certified copy of the order of said State Board of Tax Commissioners was forwarded or served upon appellant Gray, and no other or different notice was ever given of the action of said board with reference to the time for hearing, as aforesaid, and that no other hearing was had; that said appellant Gray, as auditor, is placing said increased valuation upon the tax duplicate of Fountain county, but it is not yet completed, and has not been delivered to appellant Irvin, as treasurer, and will not be delivered until January, 1908; that said auditor is not threatening to deliver said duplicate before said January 1, and appellant Irvin is not threatening to proceed to collect said increase other than in the lawful, regular and usual manner in collecting taxes after the receipt of said duplicate from said auditor.

It is also averred that since the creation and organization of said board of tax commissioners, said board has so construed the laws of the State, with reference to its powers as a board of equalization, as to authorize it, in the consideration of the statutory classes of lots, and in a few instances the statutory class of lands, to compare the assessed values of the portion of said statutory classes for equalization purposes in the several subdivisions of the several counties of the State, and to increase all degrees of assessed valuation thereof in such manner as to make the total assessed valuation thereof in the several subdivisions of the several counties of the State equal and uniform. To this answer appellees' demurrer was sustained. Appellants refused to plead further, and a decree was entered against them, enjoining each of appellants from placing said increase on the tax duplicate and from collecting such tax.

The rulings on the demurrers to the complaint and the answer are separately assigned as error.

It is first urged that the action is prematurely brought, and the cases of Smith v. Smith (1902), 159 Ind. 388, 65 N.E. 183, Sim v. Hurst (1873), 44 Ind. 579, and Dows v. City of Chicago (1870), 11 Wall. 108, 20 L.Ed. 65, are cited to sustain this position. But those cases are not analogous to the case at bar. In the present case there is an equity principle involved, which does not appear in the cases cited. Here it is shown that a large number of persons, in fact all of the persons in one county, owning land outside of cities and towns, are interested in the litigation. It is also shown that if the increase is put upon the tax duplicate, it will show a record encumbrance and lien upon each individual piece of real estate in said county, outside of the cities and towns; that to remove this cloud or to prevent the collection of said taxes would necessarily produce a multiplicity of suits, and the prevention of a multiplicity of suits has always been regarded as a favorite ground in proper cases to invoke the aid of equity by way of injunction. 1 High, Injunction (4th ed.) § 12; Vandalia Coal Co. v. Lawson (1909), 43 Ind.App. 226, 87 N.E. 47.

In view of these circumstances, we are of the opinion that, under the rules of procedure in this State, the action was properly brought. Such proceedings have heretofore been recognized in this State. Bell v. Meeker (1906), 39 Ind.App. 224, 78 N.E. 641; State Board, etc., v. Holliday (1898), 150 Ind. 216, 42 L. R. A. 826, 49 N.E. 14; Yocum v. First Nat. Bank (1896), 144 Ind. 272, 43 N.E. 231.

The public has an interest in the orderly transaction of business, and in the definiteness and stability of the public revenues; and where, as here, many thousands of persons will be affected if the illegal tax is entered on the duplicate, thereby creating entanglements and confusion in bookkeeping and collection of taxes, and where, as here, only the illegal portion which can be definitely pointed out is sought to be enjoined, it is our opinion, considerations of public policy require that suit may be brought as soon as the assessment is definitely fixed.

The meritorious question involved in this appeal is whether the action of the State Board of Tax Commissioners, in increasing the assessment of lands outside the limits of cities and towns, was a valid exercise of its power. It is urged by appellees that this act was invalid for two reasons: (1) No notice, as required by statute, was given; (2) by considering only lands outside of cities and towns, to the exclusion of lands lying within such cities and towns, it separated a statutory class of property, an act not authorized by law. We shall consider these propositions in their order.

Section 10295 Burns 1908, Acts 1905 p. 105, § 1, requires that during the first five days of its second session the State Board of Tax Commissioners shall determine the counties in which the assessment appears to be too low, fix a day in their third session when it will consider the matter of increase of such assessments, and make an order directing the manner in which a hearing may be had with reference thereto, and then provides: "Within said first five days of said second session the said board shall certify to the auditor of each of such counties the fact of the determination of said board to consider the matter of increase of such assessments, stating whether the increase to be considered appertains to real or personal property or both and naming the day on which a hearing may be had. Such certificate shall be accompanied by a copy of the order directing the manner in which such hearing may be had."

Section 10296 Burns 1908, Acts 1905 p. 105, § 2, imposes upon the county auditor the duty of giving notice, and provides "It shall be the duty of the auditor of any county receiving such certificate to give the taxpayers thereof immediate notice of the time, place and object of such hearing by posting one copy thereof at the door of the court-house in said county and by one publication thereof in the first issues thereafter of two newspapers of different politics,...