Lake Shore & M.S. Ry. Co. v. People

• Decision Date: 15 June 1881
• Citation: 9 N.W. 249,46 Mich. 193
• Parties: L.S. & M.S.R. Co. v. PEOPLE.
• Court: Michigan Supreme Court

9 N.W. 249

46 Mich. 193

L.S. & M.S.R. Co. v. PEOPLE.

Supreme Court of Michigan

June 15, 1881

Former proceedings for taxes for years prior to those involved in this proceeding, though presenting the same questions, are not to be deemed res adjudicata as to this. The state will not be concluded by the mere non-action of one of its officers. Thus, where the auditor general for several years accepted from a railroad company a statement of the amounts for which it was taxable, and it was assessed upon the basis of such reports, no further or additional ones being asked held, that the state was not estopped thereby from claiming taxes for amounts not included in those reports, and afterwards discovered. M.S.R. Co. v. Auditor General, 9 Mich. 448, and People v. M.S.R. Co. 4 Mich. 398, as to liability of Michigan Southern Railroad Company to pay taxes upon certain stock and bonds followed and also 4 Mich. 398, as to taxation upon discounts allowed by the company upon making loans. Interest upon taxes involved herein held improperly allowed.

MARSTON, C.J.

In many respects this case resembles the Michigan Southern, etc R. Co. v. The Auditor General, 9 Mich. 448; and The People v. The Michigan Southern, etc., R. Co. 4 Mich 398. Some preliminary questions have been raised, which it was claimed should dispose of the present controversy without the necessity of passing upon what might be considered the merits, and these perhaps had better first be disposed of. As to the proceedings in the Wayne circuit court in chancery commenced in 1862 and in which a decree was rendered restraining the auditor general from collecting taxes claimed to be due the state from the company for the years 1858 and 1861 inclusive, on account of the discounts and Jackson branch bonds hereinafter referred to, I am of opinion such proceedings are not res adjudicata against the state in this case. If in the present case the state sought to recover the taxes for 1858-9-60 and '61 which were then in controversy and the collection of which was restrained by the decree rendered in that case, the company might well say the state was concluded, and the mere fact that the decision was acquiesced in by the state, from necessity, would be no answer. Such, however, is not the present case. This action was commenced in 1880 and the state was permitted to recover taxes for the years 1872 and subsequent thereto. The decree in the Wayne circuit would not prevent the state from claiming and seeking to recover taxes accruing subsequent to the years or taxes then passed upon. This is a new controversy, for a new cause of action, and in which some of the legal questions then passed upon are again raised and the decision of the court thereon is of no importance except as a precedent. In this case it is not conclusive. Such was the view of Mr. Justice Campbell upon a similar question in the case in 9 Mich., already referred to, and as that case is reported there does not seem to have been any diversity of opinion on this point. The parties are bound in so far as regards the subject-matter then involved, but are at liberty to raise anew the same legal questions in a case arising subsequently, even although the facts may be substantially alike in other respects. The principle is that a party shall not be twice vexed for the same cause; but this is not the same cause but one arising since then, and the state is not in this case seeking to recover any portion of the taxes, the collections of which were restrained in that case.

The auditor general having assessed the company upon the reports made by it, for the several years covered by this action, and such assessments having been paid, it is claimed that in the absence of fraud by the company the action of the auditor was final. The auditor general is required to ascertain and estimate, from the annual report made by the company, the amount of the tax chargeable against it, and for this purpose he may require the company to make further and additional reports. It is not claimed that there was any fraud practiced by the company, and the auditor general seems to have been satisfied with the annual reports as made, as he did not call for anything further. An examination of one of the reports made, all being alike, shows that the company gave therein the aggregate amount upon which it claimed the state could tax it, but whether correct or not, or whether the company was not liable to pay a tax upon the items in controversy in this case the auditor general from the report made could not determine. The company did not set up or present the fact in its report concerning these disputed items and leave it to the auditor general to exercise his judgment and make an assessment therefrom. Had the company done so and the auditor made his assessment therefrom, or had he called for a further report, or in any way passed upon the facts and made an assessment accordingly, the question presented would have been very different. In this case the auditor general seems to have accepted the conclusion of the company as to the amount upon which it was liable to pay taxes, and having done so the amount of the tax was a matter of computation, a merely ministerial act. The only discretion or judgment he exercised, if any, was to not call for a further report, but this was not a discretion, or judgment passed upon any facts, but if anything, simply that he would not ask for or look into the facts at all. The law declared that the company should pay a...