Nat'l Bank of Detroit v. City of Detroit
Decision Date | 09 September 1935 |
Docket Number | 109.,Nos. 108,s. 108 |
Citation | 272 Mich. 610,262 N.W. 422 |
Parties | NATIONAL BANK OF DETROIT v. CITY OF DETROIT et al. |
Court | Michigan Supreme Court |
OPINION TEXT STARTS HERE
Suits by the National Bank of Detroit against the City of Detroit and another, and against the County of Wayne and another. From a judgment, defendants in each case appeal, and plaintiffs cross-appeal.
Remanded for entry of judgments in accordance with opinion.
Appeal from Circuit Court, Wayne County; Allan Campbell, judge.
Argued before the Entire Bench.
Walter Barlow, of Detroit (Raymond J. Kelly, of Detroit, of counsel), for appellants City of Detroit and others.
Duncan C. McCrea, Pros. Atty., of Detroit , for appellants County of Wayne and others.
Bulkley, Ledyard, Dickinson & Wright, of Detroit (Robert E. McKean, of Detroit, of counsel), for plaintiff and cross-appellant.
In complaince with the provisions of the law (12 USCA § 282; Rule 12, Treasury Document No. 2961, 1928), the National Bank of Detroit, plaintiff, upon its organization subscribed for an amount of stock in Federal Reserve Bank equal to 6 per cent. of its capital and surplus, and on March 21, 1933, paid $675,000, one-half of its subscription. It was required to do this before the comtroller of currency would issue a certificate authorizing it to begin business. The money paid for this Federal Reserve Bank stock came from the General Motors Corporation, which had paid in on that same day $12,500,000 for all of the common stock in plaintiff corporation. This amount paid was allocated as follows on the books of the corporation: $5,000,000 in full payment of the common stock; $5,000,000 to surplus; and $2,500,000 to undivided profits. On the following day, March 22, 1933, the Reconstruction Finance Corporation paid in the sum of $12,500,000, for which it received an equal amount of preferred stock. Plaintiff did not receive deposits until March 24, 1933.
On April 1, 1933, the bank had received deposits amounting to $29,629,019.62. It had also invested $31,620,695.61 in government bonds. The Federal Reserve Bank stock, the government bonds and the preferred stock in plaintiff corporation in the hands of the governmental agency are tax exempt. In submitting its statement to the board of assessors of the city of Detroit showing its condition as of April 1, 1933, so as to determine the value of its common stock for the purpose of taxation, plaintiff deducted the $675,000 invested in Federal Reserve Bank stock in its entirety from its capital, surplus and undivided profits, claiming that such procedure was in accord with paragraph 8 of section 8 of Act No. 206 of 1893, as amended (Comp. Laws 1929, § 3396), section 1 of Act No. 94, Pub. Acts 1931, which amends former acts referred to in the title of Act No. 94. We quote the pertinent portions of this paragraph: The assessors, board of review, and state tax commission, however, held that the $675,000 of Federal Reserve Bank stock should be figured in the same manner as the other tax exempt securities subsequently purchased by the bank, and not be deducted in its entirety as a capital asset from the capital, surplus, and undivided profits; that the deduction should be determined in accordance with the formula set forth in the quoted portion of the statute providing for the method of calculation as to such tax exempt securities of which the source of funds invested therein could not be determined with reasonable certainty.
While the controversy between the bank and the tax authorities was still pending, the bank paid without protest one-half of the city taxes due July 15, 1933, based on the incorrect valuation of the assessors. It, however, paid the second half of the city taxes in December, 1933, under protest. The amount of the city's assessment was adopted for the levying of the state and county taxes for 1933, which also were paid under protest by the bank. It thereupon began two suits, one against the city of Detroit and its treasurer, the other against the county of Wayne and its treasurer, to recover the portion of the taxes paid on the overassessment. The trial judge held that plaintiff could not recover the entire amount of $12,599.07, the overpayment of the city taxes claimed, but only the half of this amount, that being the overtax on the installment paid under protest, together with the 5 per cent. interest. He also held that it was entitled to recover the entire overpayment amount to $3,059.75 paid for state and county taxes to the county of Wayne. Defendants appeal in each case. They were heard together, one opinion rendered and again submitted together in ...
To continue reading
Request your trial-
Carbonneau Industries, Inc. v. City of Grand Rapids
...Mich. 16, 18, 77 N.W.2d 255; Ready-Power Company v. City of Dearborn, 336 Mich. 519, 522, 58 N.W.2d 904; National Bank of Detroit v. City of Detroit, 272 Mich. 610, 614, 262 N.W. 422. It should be noted that Comp.Laws Mich. 1948, § 211.114, provides that "no injunction shall issue to stay p......
-
Regency Park v. City of Topeka, Ks
...266, 140 S.W. 185 (1911); Central Savings Bank & Trust Co. v. City of Monroe, 194 La. 743, 194 So. 767 (1940); Nat. Bank of Detroit v. Detroit, 272 Mich. 610, 262 N.W. 422 (1935); Brink v. Kansas City, 355 Mo. 860, 198 S.W. 2d 710 (1947); Manufacturer's Casualty Ins. Co. v. Kansas City, 330......
-
Booker v. City of Detroit
...of the amount owed or if the taxes were void. Hertzog v. Detroit, 378 Mich. 1, 17, 142 N.W.2d 672 (1966); Nat'l Bank of Detroit v. Detroit, 272 Mich. 610, 262 N.W. 422 (1935); Bateson v. Detroit, 143 Mich. 582, 583-584, 106 N.W. 1104 (1906). We agree. Although the city mistakenly accepted t......
-
BRIGGS TAX SERVICE v. DETROIT PUB. SCHOOLS
...a mistake of fact, there is no authority for a like recovery of void taxes and assessments, see National Bank of Detroit v. City of Detroit (1935), 272 Mich. 610, 614, 615 262 N.W. 422. . . These cases stand for the proposition that a mistake about the validity of a tax constitutes a mistak......