Mayor and City Council of Baltimore v. Household Finance Corp.

• Citation: 176 A. 480,168 Md. 13
• Decision Date: 15 January 1935
• Docket Number: 59.
• Parties: MAYOR AND CITY COUNCIL OF BALTIMORE v. HOUSEHOLD FINANCE CORPORATION.
• Court: Maryland Court of Appeals

176 A. 480

168 Md. 13

MAYOR AND CITY COUNCIL OF BALTIMORE v. HOUSEHOLD FINANCE CORPORATION.

No. 59.

Court of Appeals of Maryland

January 15, 1935

Appeal from Court of Common Pleas of Baltimore City; Joseph N Ulman, Judge.

Suit by the Household Finance Corporation against the Mayor and City Council of Baltimore. Judgment for plaintiff, and defendant appeals.

Reversed.

Argued before BOND, C.J., and URNER, OFFUTT, PARKE, and SLOAN, JJ.

Hector J. Ciotti and Lawrence B. Fenneman, Asst. City Sols., both of Baltimore (R. E. Lee Marshall, City Sol., of Baltimore, on the brief), for appellant.

James F. Thrift and Guy B. Brown, both of Baltimore (McIntosh & Thrift, of Baltimore, on the brief), for appellee.

URNER Judge.

By section 153 of article 81 of the Code, as enacted by chapter 226 of the Acts of 1929, it is provided: "Whenever any person shall have erroneously or mistakenly paid to the County Commissioners of any of the counties of this State, or to the collector or treasurer for such County Commissioners or to the Mayor and City Council of Baltimore, or its collector, more money for taxes or other charges than was properly and legally chargeable to or collected from such person, the said County Commissioners and the Mayor and City Council of Baltimore shall rectify the error and immediately levy and pay to such person any money that was so paid."

That provision was held in Baltimore v. Home Credit Co., 165 Md. 57, 166 A. 604, 167 A. 552, to have changed the common-law rule that taxes paid under a mistake of law could not be recovered. This suit was brought in 1933 for taxes levied and paid in 1929 and 1930 under a mistake of law. The defense to the suit is based upon the statute of limitations embodied in section 1 of article 57 of the Code. That section provides that suits in assumpsit shall be commenced within three years after the cause of action accrued. The plaintiff's contention is that the suit is on a statutory specialty and may therefore be brought within twelve years from the accruing of the claim, as provided by section 3 of the Code article last cited. The case was tried before the lower court, sitting as a jury, upon an agreement as to the facts, including statements that the taxes in question were not properly and legally chargeable, and that they were paid more than three years before repayment was claimed. The trial court refused to rule, as proposed by the defendant, that the suit was barred by limitations, and accordingly sustained a demurrer to the plea and rejected the prayers presenting that defense. The verdict and judgment being in favor of the plaintiff for the amount of the taxes paid in error, the defendant has appealed.

In George's Creek C. & I. Co. v. County Com'rs of Allegany County, 59 Md. 255, the court had under consideration the provision of section 7 of article 28 of the Code (now section 10 of art. 25), that county commissioners shall, "when satisfied that any error has arisen by assessing property not liable to be assessed, rectify such error and levy and pay to the proper person any money that may have been paid in consequence of such error." In that case the taxpayer sued by mandamus to compel a refund of taxes assessed and paid upon a conception of law subsequently adjudged to be erroneous. The asserted right to redress by mandamus was denied on two grounds: First, because the plaintiff had an adequate remedy by action on the implied promise of the defendant to repay the taxes mistakenly and illegally exacted, the statute having obliterated the distinction between mistakes of law and of fact in such cases; and, secondly, because the claim for repayment, if prosecuted in such an action, would be barred by limitations. In discussing the latter ground for refusing the writ of mandamus, the court said: "Supposing, however, the circumstances of the case to be otherwise such as to justify the allowance of this extraordinary remedy, the question is raised, whether the Statute of Limitations in any form, or lapse of time, can be availed of as a defence. It is admitted that three years had elapsed since the last payment of taxes before this application was made, or before demand was made upon the appellees for repayment. We suppose it to be clear that if an action of assumpsit had been brought against the appellees to recover the taxes erroneously paid, the Statute of Limitations could have been effectually pleaded,--the right to interpose such a defence being in nowise affected by the statute under which this application is made. There would seem to be great reason, therefore, for giving the statute application in some form; or otherwise the appellees would be entirely deprived of the benefit of a defence that would be open to them in an ordinary action for the recovery of the money claimed."

That adjudication is directly pertinent to the present question since the state-wide statute here invoked (Code, art. 81, § 153 as re-enacted in 1929), like the provision applicable to the counties only (Code, art. 25, §...