Monroe Bond & Mortg. Co. v. State ex rel. Hybart

• Decision Date: 19 October 1950
• Docket Number: 1 Div. 414
• Parties: MONROE BOND & MORTGAGE CO. v. STATE ex rel. HYBART et al.
• Court: Alabama Supreme Court

Page 431

48 So.2d 431

254 Ala. 278

MONROE BOND & MORTGAGE CO. v. STATE ex rel. HYBART et al.

1 Div. 414.

Supreme Court of Alabama.

Oct. 19, 1950.

Barnett, Bugg & Lee, of Monroeville for appellant.

A. H. Elliott, Circuit Sol. of Brewton, John M. Coxwell, County Solicitor, and R. L. Jones, County Atty., of Monroeville, and A. A. Carmichael, Atty. Gen., and Wm. H. Burton, Jr., Asst. Atty. Gen., for appellees.

FOSTER, Justice.

The question on this appeal is whether the decree of the circuit court, in equity, fixing the value as of October 1, 1946 of real estate of appellant for ad valorem taxes for the tax year beginning at that time, is the fair taxable value of such property or violates appellant's right to equal protection of the laws. The law is that such property shall be assessed at sixty percent of its fair and reasonable market value. Title 51, sections 17, 46 and 104, Code.

The estimated taxable value of the property as returned by the taxpayer for the year in question and as fixed by the county board of equalization is as follows:

                                       By
                 4 Metal Cotton     taxpayer:    By board
                     Warehouses     $4,000.00    $8,000.00
                 8 Frame Cotton
                     Warehouses      6,500.00    10,000.00
                   Kyser Place 13
                     acres             300.00     5,000.00
                40 acres                40.00       200.00
                   Melton lots 3
                     acres             100.00     3,000.00
                                    ----------  ----------
                                    $10,940.00  $26,200.00
                

This does not seem to include the office building.

On appeal to the circuit court a trial was had de novo in equity, to which appellant caused a removal on the claim that the valuation was an arbitrary discrimination against appellant. No question is raised as to the necessity for such removal. The power of the court at law is made very broad by section 110, Title 51, Code, on such appeal. That court fixed the assessed values as follows:

                 4 Metal Warehouses                  $6,000.00
                 8 Frame "                            6,400.00
                 1 Office building (not in return)      400.00
                16 Acres (this seems to include
                    the 13 acres called the
                    Kyser Place on which
                    the buildings are situated
                    and 3 acres called the Melton
                    lots on which no buildings
                    are situated, all in
                    Monroeville)                      4,400.00
                40 Acres (not in Monroeville)           100.00
                                                    ----------
                                                    $17,300.00
                

Title 51, sections 74, 109 and 110, Code.

From that assessment an appeal was taken to this Court by the taxpayer, and cross assignments of error were made by the board of equalization. No question is here raised as to the right of the board to make cross assignments. It does not seem to have the right of appeal. Sections 74 and 109, Title 51, Code. The taxpayer claims that the taxable values should be approved as returned by it. They were the same as returned by it for the preceding year. Or if not, then the taxable values fixed by the board for the preceding year should be approved for the current year. They aggregated $11,340.00. The State Department of Revenue made an assessment of the capital stock for the year beginning October 1, 1946 at $9,600.00. It is an Alabama corporation. This figure was presumably reached by the computation required by law, that is, first to ascertain the full market value of all the stock, ascertain sixty percent of the amount of it and deduct from that amount the assessed value of the real and personal property of the corporate taxpayer. Title 51, section 25, Code. But as far as here material, the only inquiry is as to the taxable value of the property described above.

With reference to that issue the trial judge, sitting in equity, considered the evidence taken by deposition in connection with it, which he expressed as follows:

'This cause is submitted on the pleading and proof as noted by the register, and upon consideration thereof my mind was left in a state of confusion because of the contradictory and irreconcilable statements of the witnesses. The testimony for the complainant disclosed that there were twelve warehouses and one office building involved and that four of these warehouses were constructed of corrugated iron and eight of lumber. On the other hand, one of the witnesses for the respondent, who claimed to be a builder and contractor, testified that he had inspected the buildings the week before and that there were thirteen warehouses; that eight or nine of them were constructed of corrugated iron and the remainder of lumber. The witnesses for the respondent placed an average value of about $15,000.00 each on the warehouses. The witnesses for the complainant, as to value of the warehouses, were equally unsatisfactory, because it was based on the cost price some twelve to fourteen years ago, less the depreciation allowed by the Government. It was evident that a personal inspection of the premises was advisable and necessary.

'After inviting the solicitors for the parties to accompany me on a tour of inspection, which invitation was declined by the solicitors on both sides, I made a personal inspection of the premises and buildings. I found that there were eight wooden warehouses, constructed of the knottiest, shoddiest, cheapest lumber I have ever seen in any building. The boards were nailed upright to the frame and were evidently green when the buildings were built and have shrunk to where there are openings from half to one inch wide between the boards. The frame work, foundation and floors of said buildings are made of better material and they each have a corrugated iron roof.

'In arriving at a valuation to be placed upon the property involved, the court acts as a jury and under the decision of the Supreme Court in the case of Whaley v. Sloss-Sheffield S. & I. Co., 164 Ala. 216 : 'The jury is not bound to return a verdict according to the testimony of the witnesses, if such testimony is in conflict with what their personal inspection discloses.'

'After considering the testimony of the witnesses in the light of what was disclosed on my personal inspection of the premises, I am of the opinion that the Monroe County Board of Equalization has placed too high a valuation on the property involved, especially in view of the valuation for taxation fixed on comparable properties in the community and county as a whole.'

One of the chief contentions of appellant is centered around the claim that the assessment as made by the trial court is discriminatory, in that property generally in the county of a similar sort is assessed at a much less proportion of its fair and reasonable market value; and another contention is that its fair and reasonable market value is much less than ascertained by the court in fixing its assessed value.

With respect to the claim of discrimination, there is no trouble about the applicable principles of law settled by the decisions of this Court and of the Supreme Court of the United States. They hinge around the equal protection clause of the Fourteenth Amendment and the due process clause, section 6, and sections 211 and 217 of the Alabama Constitution. The discrimination which violates constitutional rights is that which results from applying a percentage of the fair and reasonable market value of the property in excess of that systematically used in respect to other property in the county and that this results from a purpose or design to discriminate against the taxpayer, either specially or as a member of a class; but that if there is a fair and honest judgment manifested in fixing the assessed value and a purpose to deal fairly without discrimination by a systematic method, the principle of inequality is not manifest. That principle was carefully reviewed with a citation of the pertinent cases in Hamilton v. Adkins, 250 Ala. 557, 35 So.2d 183; certiorari denied, 335 U.S. 861, 69 S.Ct. 133, 93 L.Ed. 407. The case of Sioux City Bridge Co. v. Dakota County, 260 U.S. 441, 43 S.Ct. 190, 67 L.Ed. 340, 28 A.L.R. 979, relied on by appellant, is not in any respect authority for a contrary view, but sustains it.

The Supreme Court of the United States gives effect to the opinion of the state supreme court in the interpretation of the state constitution, unless it violates some feature of the Federal Constitution, such as the equal protection clause of the Fourteenth Amendment. Puget Sound P. & L. Co. v. King Co., 264 U.S. 22, 44 S.Ct. 261, 68 L.Ed. 541. In interpreting the equal protection clause of the Fourteenth Amendment that court declared the principle referred to in Hamilton v. Adkins, supra. State constitutional requirements against discrimination may be more restrictive or cramping, but cannot be so liberal as to permit that which is prohibited by the Fourteenth Amendment as so interpreted. Nashville C. & St. L. R. R. v. Browning, 310 U.S. 362, 60 S.Ct. 968, 84 L.Ed. 1254. See, State v. Alabama Power Co., 48 So.2d 445. But our cases have in effect given our Constitution the same interpretation as to discrimination where no classification is involved, as the United States Supreme Court has given the equal protection clause of the Fourteenth Amendment. Penney v. State, 221 Ala. 230, 128 So. 596; State v. Hall, 172 Ala. 316, 54 So. 560; Hamilton v. Adkins, supra. So that our Constitution in respect to discrimination, not involving classification, sections 211 and 217, supra, is not more restrictive or cramping than the equal protection clause of the Fourteenth Amendment. Therefore it has application here.

The inquiry in that connection is whether the valuation fixed by the trial court is discriminatory within that principle, since it properly conducted the trial de novo. State v. Louis Pizitz Dry Goods Co., 243 Ala. 629, 630(11), 11 So.2d 342; State v. Hall, 172 Ala. 316, 54 So. 560; Title 51, sections 110 and 140, Code.

It is urged for appellant that the trial court did not undertake to fix the percentage of...