Meadowbrook Manor, Inc. v. City of St. Louis Park, 37946

• Decision Date: 10 June 1960
• Docket Number: No. 37946,37946
• Parties: MEADOWBROOK MANOR, INC., Appellant, v. CITY OF ST. LOUIS PARK and County of Hennepin, Respondents.
• Court: Minnesota Supreme Court

Page 540

104 N.W.2d 540

258 Minn. 266

MEADOWBROOK MANOR, INC., Appellant, v. CITY OF ST. LOUIS PARK and County of Hennepin, Respondents.

No. 37946.

Supreme Court of Minnesota.

June 10, 1960.

Appeal from Clerk's Taxation of Costs

July 29, 1960.

SYLLABUS BY THE COURT.

Upon the facts set forth in the opinion it is held that constructive notice by publication of special assessment against property for sanitary sewer improvement did not meet requirements of due process.

Dorsey, Owen, Scott, Barber & Marquart, De Forest Spencer, Jr., Minneapolis, for appellant.

Richards, Janes, Montgomery & Cobb, Edmund T. Montgomery, Minneapolis, H. H. Burry, St. Louis Park, George M. Scott, County Atty., Edward J. Shannon, Asst. County Atty., Minneapolis, for respondents.

MURPHY, Justice.

This is a tax contest under M.S.A. § 278.01 to challenge the assessment levied upon the appellant's property. The district court dismissed the case on the ground that the challenge made was untimely. Meadowbrook Manor, Inc., which we will refer to as the taxpayer, is the owner of a real estate development in the city of St. Louis Park, Minnesota. Its property was assessed by the city for the sum of $44,402 as benefits for a sanitary sewer improvement. Although published notice of the assessment proceedings was given as required by statute, § 429.061, subd. 1, the taxpayer had no actual notice of the assessment until it learned of it on receipt of a statement from the county treasurer. We are asked to consider the taxpayer's contention that published notice does not comply with the due process requirements of U.S.Const. Amend. XIV and that under the authority of Wisconsin Elec. Power Co. v. City of Milwaukee, 352 U.S. 948, 958, 77 S.Ct. 324, 351, 1 L.Ed.2d 241, 317, the order of the district court should be reversed.

It may be conceded at the outset that notice of the hearing on the proposed improvement was duly published as required by § 429.031. Following the completion of the work, a hearing on the proposed assessment was set by resolution of the city council. Notice of this hearing was duly published pursuant to § 429.061, subd. 1. It is not claimed that the statutory provisions with reference to published notice were not fully complied with. It is further agreed that no appeal was taken by the taxpayer within the 20-day period after adoption of the assessment as provided by § 429.081.

It is unnecessary to cite the numerous authorities which have held that the notice required in an assessment proceeding is not the same kind of notice as is required in a suit at law and that constructive notice by newspaper publication of assessment proceedings complies with due process requirements. This is particularly true as applied to notices published pursuant to procedures established by statute. We have held that an assessment for a local improvement 'is a public matter, a species of tax, and the due process clause of the Constitution is satisfied easier in such cases.' Everington v. Board of Park Com'rs, 119 Minn. 334, 339, 138 N.W. 426, 428; 51 Am.Jur., Taxation, § 730; 16A C.J.S. Constitutional Law, § 662; Winona & St. Peter Land Co. v. State of Minnesota, 159 U.S. 526, 16 S.Ct. 83, 40 L.Ed. 247.

The taxpayer contends that since Wisconsin Elec. Power Co. v. City of Milwaukee, 352 U.S. 948, 958, 77 S.Ct. 324, 351, 1 L.Ed.2d 241, 317, the foregoing authorities are no longer controlling as to the particular facts in this case. The Milwaukee case and the authorities from which it is derived (Mullane v. Central Hanover Bank & Trust Co., 339 U.S. 306, 70 S.Ct. 652, 94 L.Ed. 865, and Walker v. City of Hutchinson, 352 U.S. 112, 77 S.Ct. 200, 1 L.Ed.2d 178) deserve a brief discussion. In the Milwaukee case the Wisconsin Electric Power Company sued to vacate special assessments levied on its property, alleging that the notices of the assessment hearing given by publication only were inadequate even though such notices complied with the Milwaukee City Charter. The demurrer of the city was sustained. On appeal the Supreme Court of Wisconsin, being equally divided, affirmed in a per curiam opinion. Wisconsin Elec. Power Co. v. City of Milwaukee, 263 Wis. 111, 56 N.W.2d 784. On remand to the lower court the company filed an amended complaint to which the city again demurred, and again the demurrer was sustained. On review of this order the Supreme Court of Wisconsin held that the previous appeal had established the law of the case to the effect that published notice was sufficient. Wisconsin Elec. Power Co. v. City of Milwaukee, 272 Wis. 575, 76 N.W.2d 341. The company then appealed to the U.S. Supreme Court. The complete text of the per curiam opinion of that court, Wisconsin Elec. Power Co. v. City of Milwaukee, 352 U.S. 948, 77 S.Ct. 324, 1 L.Ed.2d 241, is as follows:

'In this case probable jurisdiction is noted. The judgment of the Supreme Court of Wisconsin is vacated and the case is remanded to the Circuit Court for Milwaukee County for consideration in the light of Walker v. City of Hutchinson, 352 U.S. 112, 77 S.Ct. 200.'

On remand the Wisconsin Supreme Court held in a per curiam opinion that 'the constructive notice given by the defendant city by publication of the proposed special assessments against the plaintiff's lands did not meet the requirements of due process,' citing the Walker and Mullane cases. Wisconsin Elec. Power Co. v. City of Milwaukee, 275 Wis. 121, 123, 81 N.W.2d 298, 299. The Walker case had been decided in the U.S. Supreme Court one week prior to the Milwaukee case. The court there held that, in a condemnation proceeding instituted by a city, newspaper publication alone did not comply with the due process clause of Amend. XIV, particularly where the name of the party whose property was being condemned was known to the city and was on the official records. In the Mullane case the defendant bank filed a petition in surrogate's court for allowance of its account as trustee of a common trust fund. The beneficiaries were numerous and some were not residents of New York. The only notice of the application was given by publication in a newspaper for 4 successive weeks as required by the New York Banking Law, McKinney's Consol.Laws, c. 2, § 100--c. It was there held that the published notice was inadequate to afford due process under Amend. XIV and that the court lacked jurisdiction to render a final and binding decree. The court was of the view that due process requires a notice which is (339 U.S. 314, 70 S.Ct. 657, 94 L.Ed. 873) 'reasonably calculated, under all the circumstances, to apprise interested parties of the pendency of the action and afford them an opportunity to present their objections.' They expressed the view that published notice was inadequate to reach the interested parties and that the beneficiaries whose addresses were known were entitled to notice by mail. ¹ The court said (339 U.S. 319, 70 S.Ct. 660, 64 L.Ed. 876):

'* * * However it may have been in former times, the mails today are recognized as an efficient and inexpensive means of communication.'

It is contended by the city here that the Milwaukee case is not controlling because the Walker and Mullane cases, on which it rests, do not involve tax proceedings. It argues that historically the right to notice in tax proceedings is purely statutory and that the rule is firmly established that constructive notice of tax proceedings given pursuant to statute providing for publication complies with due process. It argues further that constructive notice is approved by well-recognized public policy of the state, which requires speedy collection of taxes free from procedural complications. It further stresses the proposition that taxation does not require the same kind of notice as is required in a suit at law or even in proceedings for taking private property under the power of eminent domain and does not involve violation of due process when it is executed under the customary forms and established usages or in subordination to the principles which underlie them, citing Bell's Gap R. Co. v. Commonwealth of Pennsylvania, 134 U.S. 232, 10 S.Ct. 533, 33 L.Ed. 892; City of Newark v. Yeskel, 5 N.J. 313, 74 A.2d 883; Devitt v. City of Milwaukee, 261 Wis. 276, 52 N.W.2d 872. ²

In considering the contentions of the city it should be admitted at the outset that due process requires that the property owner is entitled to a reasonable notice and hearing before his property is subjected to the lien of a special assessment for a local improvement. Under the facts in the case before us we do not think it can be fairly said that the taxpayer had an opportunity to question the validity of the amount of the assessment. The published notice given was not one reasonably calculated to call the matter to its attention. Having to knowledge of the special improvement or the assessment therefor, it could not be expected to appeal within the time provided by § 429.081. ³ Although the taxpayer subscribed to the paper in which the notice was published, the court nevertheless found as a fact that 'no officer, director, agent or employee of petitioner had actual knowledge of the levy or intended levy of said special assessments, or of the said assessment hearing * * * or of the adoption and approval of said assessments * * * or of the construction of said Sanitary Sewer Improvement * * * until receipt by the petitioner (taxpayer) from the County Treasurer of Hennepin County of the regular statement for taxes and special assessments payable in the year 1958,' and that 'no notice of the assessment hearing other than the said published notice * * * was given * * * to any owner of property within the area assessed, * * *.'

The improvement was not made in the vicinity of the taxpayer's property where the taxpayer maintains its office. It was constructed wholly within the city limits of Minneapolis at a place more than 2 miles distant from the taxpayer's property. It involved...