Henrietta Mills v. Rutherford County
Decision Date | 14 April 1930 |
Docket Number | No. 270,270 |
Citation | 281 U.S. 121,74 L.Ed. 737,50 S.Ct. 270 |
Parties | HENRIETTA MILLS v. RUTHERFORD COUNTY, N. C., et al |
Court | U.S. Supreme Court |
Messrs. Willis Smith and Murray Allen, both of Raleigh, N. C., for petitioner.
Mr. Clyde R. Hoey, of Shelby, N. C., for respondent.
The Henrietta Mills, a corporation of North Carolina, brought this suit in the District Court of the United States to enjoin Rutherford county, in that state, from collecting a tax upon the property of the corporation for the year 1927, or for any subsequent year, based upon any valuation in excess of sixty per cent. of the actual and fair market value. It was alleged that the enforcement of such a tax would deprive the corporation of its property without due process of law and deny the equal protection of the laws, in violation of the Fourteenth Amendment of the Federal Constitution.
The bill of complaint charged that the actual value, in the sense of the applicable statutory provision of the state, of the property of the corporation in Rutherford county on May 1, 1927, did not exceed $1,887,352, but that the property was actually assessed at $2,637,819. The corporation complained to the county commissioners, as the constituted board of equalization and review, but the board declined to pass upon the questions presented. The corporation then appealed to the state board of assessment which, after hearing, reduced the assessment by the sum of $275,000 and fixed the value of the property at $2,362,819. The bill alleged that the tax officials of the county and of the state had intentionally and arbitrarily valued the complainant's property greatly in excess of its true value, while at the same time they had fixed the value of all other assessable property within the county at only sixty per cent. of its true value; that the assessment of complainant's property should have been reduced in like proportion, that is, to $1,132,411.20; and that the complainant had paid to the county a sum which would be equal to the tax if laid upon such a valuation.
The answer denied that there had been any arbitrary and intentional overvaluation, or any unlawful discrimination against the complainant, and alleged that the complainant had an adequate remedy at law.
The District Court decided against the complainant upon both these grounds and dismissed the bill of complaint. The decree was affirmed by the Circuit Court of Appeals. 32 F.(2d) 570.
Section 16 of the Judiciary Act of 1789 (1 Stat. 82) provided 'That suits in equity shall not be sustained in either of the courts of the United States, in any case where plain, adequate and complete remedy may be had at law.' This explicit prohibition, continued in section 723 of the Revised Statutes and section 267 of the Judicial Code (U. S. C. tit. 28, § 384 (28 USCA § 384)), has clear application to proceedings to enjoin the collection of taxes upon the ground that they are illegal or unconstitutional. It must appear that the enforcement of the tax would cause irreparable injury, or that there are other special circumstances bringing the case under some recognized head of equity jurisdiction, before the aid of a federal court of equity can be invoked. The mere fact that the validity of the tax may be tested more conveniently by a bill in equity than by an action at law does not justify resort to the former. 1
In the present case, a distinction is sought to be taken upon the ground that a statute of North Carolina gives a right to proceed in equity, and it is argued that a similar right should be recognized by the federal court. Section 7979 of the Consolidated Statutes of North Carolina provides:
The Supreme Court of North Carolina, in Norfolk-Southern Railroad Company v. Board of Commissioners, 188 N. C. 265, 266, 124 S. E. 560, made the following statement as to the procedure in the state courts:
'In this jurisdiction a taxpayer may contest the validity of an assessment or collection of tax upon his property in one of two ways:
3
If it be assumed that, under the state statutes, the complainant could have applied to the state court for an injunction, the complainant also had an adequate remedy at law. Schaul v. Charlotte, 118 N. C. 733, 24 S. E. 526; Teeter v. Wallace, 138 N. C. 264, 267, 50 S. E. 701; Blackwell v. City of Gastonia, 181 N. C. 378, 107 S. E. 218; Brunswick-Balke-Collender Company v. Mecklenburg County, 181 N. C. 386, 107 S. E. 317; Carstarphen v. Plymouth, 186 N. C. 90, 118 S. E. 905. This is not a matter of doubt, as in Union Pacific Railroad Company v. Weld County, 247 U. S. 282, 285, 38 S. Ct. 510, 62 L. Ed. 1110, and Atlantic Coast Line Railroad Company v. Doughton, 262 U. S. 413, 426, 43 S. Ct. 620, 67 L. Ed. 1051. The act of Congress with respect to the existence of such a remedy has reference to the adequacy of the remedy on the law side of the Federal courts (Smyth v. Ames, 169 U. S. 466, 516, 18 S. Ct. 418, 42 L. Ed. 819; Chicago, B. & Q. Railroad Company v. Osborne, 265 U. S. 14, 16, 44 S. Ct. 431, 65 L. Ed. 878; Risty v. Chicago, R. I. & P. Railway Com- pany, 270 U. S. 378, 388, 46 S. Ct. 236, 70 L. Ed. 641) and in this case there would have been an adequate remedy at law, not only in the state court, but also in the federal court, if petitioner had been able to show a violation of the Federal Constitution (Judicial Code, § 24 (28 USCA § 41)).
The contention is that the state statute authorizing a proceeding in the state court for an injunction created an equitable right which should be enforced in the federal court. It is true that, where a state statute creates a new equitable right of a substantive character, which can be enforced by proceedings in conformity with the pleadings and practice appropriate to a court of equity, such enforcement may be had in a federal court, provided a ground exists for invoking the federal jurisdiction. Clark v. Smith, 13 Pet. 195, 203, 10 L. Ed. 123; In re Broderick's Will, 21 Wall. 503, 520, 22 L. Ed. 599; Holland v. Challen, 110 U. S. 15, 24, 25, 3 S. Ct. 495, 28 L. Ed. 52; Frost v. Spitley, 121 U. S. 552, 557, 7 S. Ct. 1129, 30 L. Ed. 1010; Gormley v. Clark, 134 U. S. 338, 348, 10 S. Ct. 554, 33 L. Ed. 909; Lawson v. United States Mining Company, 207 U. S. 1, 9, 28 S. Ct. 15, 52 L. Ed. 65; Pusey & Jones Company v. Hanssen, 261 U. S. 491,...
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