McCord v. Southern Ry. Co.

• Decision Date: 03 May 1948
• Parties: McCORD et al. v. SOUTHERN RY. CO.
• Court: Tennessee Supreme Court

213 S.W.2d 184

187 Tenn. 247

McCORD et al. v. SOUTHERN RY. CO.

Supreme Court of Tennessee.

May 3, 1948

Error to Circuit Court, Davidson County; E. F. Langford, Judge.

Certiorari proceeding by the Southern Railway Company to review an assessment of petitioner's properties in Tennessee for ad valorem taxes by the State Board of Equalization. Judgment declaring the assessment void, and Jim McCord and others constituting the board, bring error.

Reversed and petition for certiorari dismissed.

Roy H. Beeler, Atty. Gen., William F. Barry, Sol. Gen., and E. J. Walsh, both of Nashville, and Hamilton E Little, of Memphis, for plaintiffs in error.

L. M. Abbot, of Washington, D. C., Chas. H. Smith of Knoxville, and Ferriss C. Bailey, of Nashville, for defendant in error.

TOMLINSON Justice.

This is an appeal by the State Board of Equalization, hereafter designed as the Board, from the judgment of the Circuit Court of Davidson County adjudging void the assessment of the properties in Tennessee of appellee, Southern Railway Company, for ad valorem taxes for the biennium 1945-1946.

That Court likewise adjudged invalid the assessment by this Board of the properties in Tennessee of the N. C. & St. L. Railway Company. That judgment has this day been reversed and the assessment held valid in an opinion written for this Court by Mr. Justice Gailor in the case of McCord et al. v. Nashville C. & St. L. Ry. Co., 213 S.W.2d 196. With the exception of the difference in the amount of the assessment, the record in that case and the issues determined are, as to several questions, the same as in this case. The opinion in that case makes an extensive review of the law which controls the determination of those questions made by the record. Hence, extensive restatement here of that law is not necessary.

Pursuant to the requirements of Code Section 1509, as amended by Chapter 18 of the Public Acts of 1945, the Southern Railway Company, hereinafter referred to as the Railroad, in 1945 filed with the Railroad and Public Utilities Commission, hereinafter called the Commission, required schedules, statements and other information for its use, as intended, in making the assessment of the properties. Upon consideration of this and other evidence in the record the Commission fixed the assessment. The exceptions of the Railroad were heard and overruled, and it appealed to the Board. The Commission filed its assessment, together with the record made before it, with the Board as required by Code Section 1533, as amended by Chapter 19 of the Public Acts of 1945.

Pursuant to the requirements of Code Section 1534 and the authority thereby granted, a hearing de novo was had by the Board on the appeal of the Railroad upon the record filed with it by the Commission and upon such further testimony and arguments as the Railroad elected to present. After the examination of the assessment and record and consideration of the additional evidence and insistences, the Board some days later fixed the assessment at the amount fixed by the Commission.

The assessment so made by the Board is by Code Section 1535 made 'conclusive and final' and 'is not open to review by the courts' on the merits. Nashville C. & St. L. Ry. v. Browning, 176 Tenn. 245, 140 S.W.2d 781, 783, affirmed by the U.S.S.C., 310 U.S. 362, 60 S.Ct. 968, 84 L.Ed. 1254. Review may be had only by means of the common law writ of certiorari, and is limited to an examination of the record made before the Board, such examination being permissible only for the purpose of determining whether it is disclosed by that record that the Board has acted illegally, fraudulently, or in excess of its jurisdiction. State ex rel. v. Dixie Portland Cement Co., 151 Tenn. 53, 58, 267 S.W. 595; Anderson v. Memphis, 167 Tenn. 648, 652, 72 S.W.2d 1059; Nashville C. & St. L. Ry. v. Browning, supra. In this connection, it is important to keep in mind that 'the good faith of the Commission and Board and the validity of their action are presumed; when assailed, the burden of proof is upon the complaining party.' The Browning case, supra, 176 Tenn. at page 253, 140 S.W.2d at page 784. This rule makes it necessary, in determining the issues, to first state and then determine the Railroad's insistences.

In keeping with the requirements of the law as just above stated, the Railroad in December 1945 filed its petition for common law writ of certiorari in the Davidson County Circuit Court and in that petition charged the Board with having acted illegally, fraudulently and in excess of its jurisdiction in making this assessment. Specifically, the petition charged in substance that the record discloses (1) an assessment so far in excess of the actual cash value of its properties as to conclusively impute that which amounts to an intentional fraud upon the part of the Board, and (2) a systematic, intentional and long practiced discrimination against this and all other railroads in making assessments.

The above mentioned charge of discrimination is predicated upon the fact that properties of Railroads are assessed for ad valorem taxes by the Railroad and Public Utilities Commission, Code Section 1508 et seq., and its assessments then returned to the State Board of Equalization for its action thereon. Other properties are assessed in each county by a County Tax Assessor. Code Section 1336 et seq. The assessment lists made by the repective Tax Assessors are then certified to their County Boards of Equalization consisting of five members in each County, and it is the duty of this Board to examine, compare, fix and equalize the county assessments. Code Section 1419 et seq. These county assessment then come under the jurisdiction of the State Board whose duty it is to equalize the assessments of all properties in the state. Code Section 1456. All property of every kind is required to be assessed at its actual cash value. Code Section 1349.

It is specifically alleged in the Railroad's petition for certiorari that the Commission assesses its property at what the Commission considered actual cash value, but that the county taxing authorities have systematically, deliberately and as a practice assessed the properties coming within their jurisdiction in amounts ranging from 40% to 80%, or perhaps an average of 60%, of actual cash value. It is then asserted that the State Board of Equalization has intentionally, systematically and as a practice failed to equalize the assessment of the Railroad's properties by reducing them to the average percent of value at which it is alleged that the county authorities assessed the properties coming within their jurisdiction; and that this alleged discrimination is a violation of its rights under both the Federal and State Constitutions. There is no charge of discrimination as between Railroads or other such public utilities.

The Board certified to the Circuit Court the record upon which the Railroad necessarily predicates its charges and moved thereafter that the Railroad's petition for certiorari be dismissed upon grounds, in substance, as follows:----

(1). The petition for certiorari filed by the Railroad in the Circuit Court and the record show that the railroad's 'properties have been duly and legally assessed by the Railroad and Public Utilities Commission, as required by law, and that said assessment was appealed to the State Board of Equalization and there duly heard, examined and considered, and that the valuation set forth in the assessment complained of by (Railroad) was duly fixed and made and finally certified by the State Board of Equalization, as required by law, and the action of the State Board of Equalization in fixing the valuation set forth in the assessment complained of is conclusive and final'.

(2). There is no showing in the record of the proceedings with respect to the assessment that either the Commission or the Board did not comply with the requirements of law with reference to the method of making the assessment.

(3). The record in the proceedings upon the assessment entirely fails to show that either the Commission or the Board exceeded its jurisdiction or acted illegally or fraudulently.

The Circuit Court upon motion of the Railroad overruled this motion of the Board to dismiss the Railroad's petition and the Board excepted. There followed certain proceedings detailed in the current Nashville C. & St. L. case and unnecessary here to repeat further than that this Court upon proper proceedings directed the Circuit Court to consider the case on the record of the proceedings before the Board as certified and filed by the Board and for the entry of such final judgment as it deemed proper upon that record.

In December 1947, the Circuit Court entered a final judgment, wherein it is recited that the allegations made in the Railroad's petition for certiorari are sustained and the assessment adjudged void. A remand to the Board for further appropriate proceedings was ordered. No opinion of the Court other than the recitations in the judgment was filed. The Board's motion for a new trial was overruled and the case is here upon its appeal.

It assigns as error the action of the Court in not sustaining and in overruling its motion to dismiss the Railroad's petiton for certiorari for the reasons set out in the motion, and hereinbefore stated in substance. The Railroad responds by insisting that the record made before the State Board of Equalization discloses it as a fact under applicable law that the Board acted illegally, fraudulently and in excess of its jurisdiction in the particulars and with the alleged results hereinbefore stated.

In order to ascertain the amount of the assessment to be made the Board first determined from the exhibits, schedules and information required...