Lutz v. Arnold

• Citation: 193 N.E. 840,208 Ind. 480
• Decision Date: 04 February 1935
• Docket Number: 26352.,26343,Nos. 26406,s. 26406
• Parties: LUTZ et al. v. ARNOLD et al. MUNCIE FINANCE CO. v. WALSMAN et al. HAMER v. WISE et al.
• Court: Supreme Court of Indiana

208 Ind. 480

193 N.E. 840

LUTZ et al.

v.ARNOLD et al.

MUNCIE FINANCE CO.

v.WALSMAN et al.

HAMER

v.WISE et al.

Nos. 26406, 26343, 26352.

Supreme Court of Indiana.

Jan. 29, 1935.

Dissenting Opinion, Feb. 4, 1935.

Appeal from Huntington Circuit Court; County; J. Fred Bingham, Judge.

Appeal from Superior Court, Delaware County; Robert F. Murray, Judge.

Appeal from Huntington Circuit Court; Sumner Kenner, Judge.

Action under Declaratory Judgment Act by Walter R. Arnold, etc., against Frank N. Nevins and another, wherein intervening petitions were filed by Philip Zoercher and others; separate action by the Muncie Finance Company against Albert F. Walsman and others, and a separate action by William D. Hamer against Claude Wise, etc., and others. From judgments rendered, Philip Lutz, Jr., etc., and others, the Muncie Finance Company, and William D. Hamer separately appeal, and the three causes were consolidated for purposes of argument and disposition of all the issues.

Orders in accordance with opinion.

No. 26406:

Philip Lutz, Jr., of Boonville, for appellants.

Roland Obenchain, Virgil Nobles, Harry S. Taylor, Walter R. Arnold, Joseph Hemphling, Wm. Cain, D. M. Shively, and Geo. L. Rulison, all of South Bend, for appellee.

No. 26343:

F. Clayton Mansfield, of Muncie, for appellant.

Philip Lutz, Jr., of Boonville, Joseph W. Hutchinson, of Indianapolis, Wm. H. Bales, Myron H. Gray, and Wm. F. White, all of Muncie, and Leo M. Gardner and Wm. C. Harrison, both of Indianapolis, for appellees.

No. 26352:

Claude Cline and E. O. King, both of Huntington, Harry Taylor, of South Bend, and Emsley W. Johnson, of Indianapolis, for appellant.

Philip Lutz, Jr., of Boonville, Edward Barce, of Fowler, Joseph W. Hutchinson, of Indianapolis, and Otto H. Krieg, of Huntington, for appellees.

HUGHES, Judge.

Causes numbered 26406, 26343, and 26352 relate to chapters 81, 82, and 83 of the Acts of 1933, being the Intangible Tax Law. These causes were consolidated for the purpose of argument and we are consolidating them for the purpose of disposing of all questions raised in different causes. The greater part of all questions presented in the different causes are the same.

In cause No. 26406 the nature of the action, as stated by appellants, is as follows: This is an action brought originally by Walter R. Arnold, as trustee and attorney for A. P. Callahan Company v. Frank v. N. Nevins, as Clark of the St. Joseph Superior Court No. 1, St. Joseph County, Ind., and Adrian Ross, seeking a declaratory judgment declaring chapter 81 of Acts of 1933, known as the General Intangibles Tax Act of 1933, to be unconstitutionaland void. The complaint was predicated upon the allegation that the plaintiff was the owner of a judgment upon a promissory note made to the plaintiff in plaintiff's capacity as attorney and trustee for A. P. Callahan Company and taken in payment of an indebtedness upon contracts of sale of merchandise from A. P. Callahan Company to the defendant Ross in interstate commerce. It was alleged that this judgment was entered in St. Joseph superior court on February 26, 1931; that on the 27th day of July, 1932, the plaintiff caused an execution of be issued, which execution was returned unsatisfied at the expiration of 180 days; and that on the 30th day of March, 1933, the plaintiff applied for an alias execution and then and there the defendant clerk declared and maintained that no execution could issue upon the judgment to satisfy the judgment or any part thereof until and unless there was paid by way of adhesive stamps in denominations in the aggregate equivalent to 5 cents on each $20 or fractional part of said judgment in the judgment docket or some other evidence was presented to the clerk to satisfy him that the tax under and by virtue of chapter 81 of the Acts of the General Assembly for the year 1933 had been paid and satisfied in reference to said judgment.

Thereafter, the above-named appellants, Philip Zoercher, Albert F. Walsman, and Gaylord S. Morton, as and constituting the state board of tax commissioners, filed their petition to intervene and be made parties defendant, which petition was granted by the court.

Thereafter, the appellees Thomas and Thomas, as resident freeholders, citizens, and voters of Portage township, St. Joseph county, Ind., filed their complaint against the above-named state board of tax commissioners and others seeking a declaratory judgment.The complaint was based upon the theory that the plaintiffs are resident free-holders, citizens, and voters of said township and county and owners of real estate in said township and county, which tangible personal and real estate are liable to the payment of taxes assessed against said real estate and tangible personal property. This complaint alleges the constitutionality of chapters 81, 82, and 83 of the Acts of the General Assembly of 1933, except that the plaintiffs allege that sections 31 and 32 of chapter 81 and section 9 of chapter 82 and sections 16 and 19 of chapter 83 of the Acts of 1933 are unconstitutional and void.

The appellee Rulison filed his complaint against the state board of tax commissioners and others also seeking declaratory judgment holding chapter 81 of the Acts of the General Assembly of 1933 inapplicable to postal savings deposits and, if applicable, holding that said act is unconstitutional and void.

The appellee Lehman filed an intervening petition asking to be joined as a party in said cause. The petition was granted and was considered as the complaint of said Lehman. This complaint or petition was based upon the general allegation that the plaintiff or petitioner was the owner of real estate and tangible personal property, exclusive of money on deposit in banks and trust companies, subject to assessment for taxation in Portage township, St. Joseph county, Ind. This petition sought the judgment of the court declaring chapters 81, 82, and 83 unconstitutional and invalid.

The state board of tax commissioners filed demurrers to each of the complaints which were overruled. Answers and replies were filed, evidence heard, and the court entered judgment declaring all of said laws to be unconstitutional. Motion for new trial overruled.

The errors relied upon for reversal in cause No. 26406 are as follows:

1. The court erred in overruling the demurrer of said appellants, defendants below, to the complaint of Walter R. Arnold, as attorney and trustee for A. P. Callahan Company.

2. The court erred in overruling the demurrer of said appellants, defendants below, to the amended complaint of the appellees Thomas and Thomas.

3. The court erred in overruling the demurrer of said appellants, defendants below, to the complaint of the appellee Rulison.

4. The court erred in overruling the demurrer of said appellants to the complaint of appellee Lehman.

5. The court erred in overruling the motion of said appellants for a new trial.

In cause No. 26343 the plaintiff, Muncie Finance Company, brought an action for injunction against the defendants. The plaintiff alleges that it is a corporation and the owner of real and personal property in the city of Muncie, Center township, Delaware county, Ind., and prays that the defendants, the taxing officials of said township, county, and state, be enjoined and restrained from carrying out, performing, or enforcing any proyisions of chapter 81 of the General Assembly of 1933, and that said defendants be ordered and enjoined to assess for taxation and place and cause to be placed on the tax duplicate of the city of Muncie for taxation all of the annual intangibles mentioned in clause 6 of said act. The defendants filed a demurrer to said complaint, which demurrer was sustained by the court. The plaintiff refusing to plead further, judgment was rendered against plaintiff, and plaintiff appealed from said judgment. The assignment of errors is as follows:

1. The court erred in sustaining the demurrer of appellees W. Max Shaffer, as county auditor of Delaware county, Ind., Joseph T. Meredith, as county treasurer of Delaware county, and Pearl C. Hopkins, as county assessor of Delaware county, to appellant's complaint.

2. The court erred in sustaining the demurrer of Phillip Zoercher, Albert F. Walsman, Gaylord S. Morton, as members of the state board of tax commissioners, to appellant's complaint.

In cause No. 26352 the appellant brought an action on April 3, 1933, in the Huntington circuit court against the appellees Claude Wise, as assessor of Huntington county, Ned F. Brown, county auditor, Eldon T. Lawver, county treasurer of said county, and the members of the state board of tax commissioners, alleging that appellant was a resident of the city of Huntington, Huntington county, Ind., and the owner of real estate and of personal property each of value of more than $500 on March 1, 1933; that pursuant to chapter 81 of the General Assembly of 1933, the appellees were attempting to act and proceed in the assessment of property in said Huntington county, in connection with other laws in force in the state providing for the assessment and collection of taxes.

Plaintiff alleges that said act is unconstitutional and prays that each of said appellees be enjoined from carrying out or exercising any of the duties or functions as prescribed by said act with respect to the assessment or collection of any taxes thereunder, as to any property classified by said act as ‘intangible’ or ‘intangibles'; that said act be declared unconstitutional, illegal, null and void, and of no effect; and that appellees and each of them be required and mandated by the court to list for assessment all the property described in said act as intangible property in the same manner and subject to the same rates as other property including tangible property and real estate.

The appellees filed a demurrer to the complaint. The court sustained the demurrer to the complaint and the appellant refused to plead further and elected to stand on the ruling...