Howard-Sevier Road Imp. Dist. No. 1 v. Hunt
| Citation | 265 S.W. 517 |
| Decision Date | 27 October 1924 |
| Docket Number | (No. 193.) |
| Parties | HOWARD-SEVIER ROAD IMP. DIST. NO. 1 v. HUNT et al. |
| Court | Supreme Court of Arkansas |
Appeal from Howard Chancery Court; L. F. Monroe, Special Chancellor.
Action by the Howard-Sevier Road Improvement District No. 1 against J. M. Hunt and others. Judgment for defendants, and plaintiff appeals. Reversed and remanded, with directions.
Lamb & Frierson, of Jonesboro, Rose, Hemingway, Cantrell & Loughborough and D. K. Hawthorne, all of Little Rock, and Daily & Woods, of Ft. Smith, for appellant.
J. W. Bishop, of Nashville, and Shaver, Shaver & Williams, of Ashdown, for appellees.
On the 23d day of June, 1923, the Howard-Sevier road improvement district No. 1 of Howard and Sevier counties, Ark. (hereafter called district), instituted an action in the chancery court of Howard county against delinquent lands. This case was numbered 211 on the docket of the trial court. The complaint alleged the organization of the district and the levying of assessments under the authority of the act creating the same and the failure to pay these assessments. The complaint set forth a list of the supposed owners and a description of the lands returned delinquent, together with the amount of the assessment and penalty set opposite the names. It was alleged that the assessments, penalties, interest, and cost had not been paid on the lands mentioned. The prayer was that notice be given of the pendency of the action as provided by law, and that, unless the sums due were paid, a judgment be entered for the several amounts and for the sale of the lands described to satisfy the same. After the institution of the suit, John C. Gardner, the receiver of the district, was joined as party plaintiff.
J. M. Hunt and others, taxpayers in the district, filed an answer denying the allegations of the complaint and set up affirmatively that the commissioners of the district had wholly failed to comply with the law requiring them to obtain and file a certified copy of the list of lands alleged to be delinquent. The parties filing the answer as defendants in the above cause also instituted an action in the Howard chancery court against the district and its commissioners for themselves and "all those who have a general common interest with them in this suit." This case was numbered 258 on the docket of the trial court. In their complaint they attacked the validity of the assessment of benefits as a whole, which the district and the receiver were attempting to collect in their suit against the lands of the district. They set up in detail the causes which they alleged made the assessment as a whole invalid. They alleged in substance that the assessment of benefits sought to be charged against their lands was an arbitrary legislative assessment, the Legislature having ratified and adopted an invalid assessment made by the board of assessors under a void act; that the assessment was so excessive as to amount to a confiscation of property; that it was in excess of any possible benefit to the property by reason of the improvement, and was greater in amount than the value of all the property in the district; that the attempted assessment was by the zone system in which none of the elements affecting the benefits to their property were considered; that they had never had a day in court to challenge the assessment of benefits. They alleged that they were not seeking to avoid or repudiate any just and legal assessment that might be made against their property by reason of the construction of the improvement; that they were ready and willing to submit to any just and proper assessment of benefits made in the manner provided by law. They prayed that the assessment of benefits now standing against their lands be canceled, and that the district be restrained from prosecuting the suit for the collection thereof, and that a reassessment of benefits by reason of the improvement be ordered to the end that a fair, proper, and legal assessment of benefits be ascertained and fixed.
The answer of the district and its receiver alleged the appointment of a receiver under the terms of the act creating the district, and set up and made an exhibit to the answer a copy of the decree of the United States District Court of the Western District of Arkansas validating $380,000 of the bonds of the district "secured by first mortgage on the assessment of benefits." All of the allegations of the complaint were denied, except as to the due organization of the district, and the qualification of the assessors, and the making of the assessment by them. The answer admitted that the assessment made by the assessors was under a special act passed at a special session of the Legislature, which session was declared void by the Supreme Court. They alleged that such assessment was afterwards validated by Act No. 13 of the Special Session of the General Assembly in January, 1920; that, after the assessment was thus validated, a large amount of bonds were issued and sold, and the proceeds used in the construction of the roads provided for under the original act creating the district and Act No. 13, supra, amending the same. It was further alleged in the answer that on the 9th of April, 1921, T. G. Kennedy and others, for themselves and all other taxpayers in the district, instituted an action in the Howard chancery court against the commissioners as representatives of the district and also in their individual capacity, in which suit they attacked the validity of the assessment of benefits as a whole, alleging that the same was arbitrary, discriminatory, and confiscatory, in violation of the due process clause of the Constitution of the United States (Amendment 14, § 1), and also contrary to the Constitution of the state of Arkansas. It was alleged that the district duly appeared and was made a party to the suit and answered, denying all the grounds upon which the validity of the assessment of benefits was challenged. It was also alleged that the Howard chancery court rendered a decree in that cause sustaining the validity of the assessment of benefits, and that no appeal had been prosecuted from that decree; that the issues in the suit of Kennedy et al. against the district and its commissioners were identical with the issues in the present suit; that such suit was a class suit instituted by the taxpayers in the district in their own behalf, and also for all other taxpayers within the district, and the district and receiver pleaded that the decree in that case sustaining the assessment of benefits was res judicata of the present action.
The causes were consolidated and tried together in the chancery court. The testimony was adduced on the issue as to the validity of the assessment of benefits, and the cause was heard upon this testimony and upon the pleadings and exhibits in the consolidated causes. Among other things the court found that:
"There is no merit to the plea of res judicata made by the plaintiffs in cause No. 211 and by the defendants in cause No. 258; that none of the parties plaintiff in case No. 258 and defendants in case No. 211 were parties to the cases pleaded in bar."
The court further found that:
"The attempted assessment of benefits is arbitrary, confiscatory, and an unwarranted exercise of the taxing powers."
The court thereupon entered a decree canceling the assessment of benefits and enjoining the collection thereof or any levy made for that purpose, and directed that the commissioners appoint assessors to "assess the real, just, fair, true, and actual benefits as have accrued against the several tracts and parcels of land in the district by reason of the construction of said improvements." The plaintiffs in case No. 211 and defendants in case No. 258 excepted to the findings and decree of the court and duly prosecute this appeal.
1. It will be observed from the above résumé of the pleadings in these causes that the appellees contend that the assessment of benefits which the appellants are attempting to enforce is, as a whole, an invalid assessment for the reasons alleged. On the other hand the appellants contend that the assessment of benefits was valid, and that such issue had already been determined by the former decrees of the Howard chancery court and the District Court of the United States, Western District of Arkansas, adversely to the appellees, which decrees they pleaded as res judicata of the matters raised by the appellees in their pleadings in these causes. Therefore the first question for our determination is whether or not the court erred in holding that there was no merit in appellants' plea of res judicata.
The appellants' pleadings and the exhibits thereto established the following facts which are undisputed by the appellees, to wit: On the 9th of April, 1921, T. G. Kennedy and others instituted an action in their own right and for all other taxpayers within the district against the district and the commissioners in their representative and individual capacities, in which the assessment of benefits now under review as a whole was challenged on the ground that it was "unfair, unjust, discriminatory, confiscatory, and not uniform," and in violation of the due process clause of the Constitution of the United States and contrary to the Constitution of the state of Arkansas and therefore void; that the cause was heard upon the pleadings raising the issue of the validity of the assessment, and the evidence adduced, and a decree was entered on the 9th of November, 1921, sustaining the validity of the assessment of benefits and dismissing so much of the complaint in that action as challenged the validity of such assessment for want of equity.
The appellees contend that they were not parties to that action, and hence were not bound by the decree, citing the case of Cooper v. McCoy, 116 Ark. 501, 173 S. W. 412, and other cases which hold that, in order that a former...
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Howard-Sevier Road Improvement District No. 1 v. Hunt
... ... 72] was no valid assessment of benefits, there could be no ... valid issue of bonds. Western Randolph County Rd. Imp ... Dist. v. Clifford, 150 Ark. 94, 233 S.W. 914 ... It is not pretended that the action in the Federal court was ... collusive or simulated ... ...