Northside Canal Co. v. State Board of Equalization

• Decision Date: 26 September 1925
• Docket Number: No. 1453.,1453.
• Citation: 8 F.2d 739
• Parties: NORTHSIDE CANAL CO., Limited, v. STATE BOARD OF EQUALIZATION et al.
• Court: U.S. District Court — District of Wyoming

8 F.2d 739 (1925)

NORTHSIDE CANAL CO., Limited, v. STATE BOARD OF EQUALIZATION et al.

No. 1453.

District Court, D. Wyoming.

September 26, 1925.

James R. Bothwell, of Twin Falls, Idaho, and Kinkead, Ellery & Henderson, of Cheyenne, Wyo., for plaintiff.

Albert D. Walton, U. S. Atty., of Cheyenne, Wyo., B. E. Stoutemeyer, of Boise, Idaho, and Ethelbert Ward, of Denver, Colo., for the United States.

D. J. Howell, Atty. Gen., and Ray E. Lee, Sp. Asst. Atty. Gen., J. A. Christmas, Co. Atty., of Kemmerer, Wyo., Wilford W. Neilson, Co. Atty., of Jackson, Wyo., and W. C. Mentzer, of Cheyenne, Wyo., for defendants.

KENNEDY, District Judge.

This was a suit begun originally against the state of Wyoming, the state board of equalization of that state, the board of county commissioners of the county of Teton, as well as the treasurer and assessor of that county. Its general purport is to enjoin and restrain the assessment, levy, and collection of taxes by the defendants named upon the ground that such assessments are illegal. After the suit had been instituted, the United States became an intervening party plaintiff through an order of the court, and answers have been interposed, which make denials of many of the allegations of the original and intervening bills, and likewise assert rights which would have the legal import of sustaining the alleged assessment and taxes complained of. The defendants further seek by cross-bill to secure an affirmance of the tax levies and the foreclosure by a decree of this court of their liens upon the property purported to be assessed and taxed. It would seem to serve no useful purpose to rehearse at length the substance of the various pleadings, as they seem to raise issues which are more or less clearly defined, and which perhaps may be sufficiently treated in a limited statement of the facts and the legal principles applicable thereto.

Some time prior to the year 1913 the government, through its Department of the Interior, under the Act of Congress of June 17, 1902 (Comp. St. § 4700 et seq.), had constructed a dam and reservoir for the storage of water in Jackson Lake, which was then located in Lincoln county, but in territory which was afterwards by appropriate legislative action created into the county of Teton. Thereafter the predecessor in interest of the plaintiff, which is an Idaho corporation having for its function the furnishing of water to Carey Act projects in the state of Idaho for irrigation, entered into a contract with the Interior Department, under the authority of what is known as the Warren Act (Act Feb. 21, 1911 Comp. St. §§ 4738-4740), providing in substance that the government should construct a larger reservoir at Jackson Lake, by the raising of the dam a distance of about 17 feet, the expense of the improvement to be largely paid by the company, but the work to be done under the exclusive supervision of the Interior Department. It was provided that the title and control of the reservoir and works should remain in the United States. The contract also provided for this company to have a perpetual water right in the water so stored, by being liberated from the reservoir during the late irrigating season into the channel of Snake river and thence finding its way into the reservoirs and ditches about 300 miles below. Some of the features of the contract in this respect are as follows:

"(8) Each year after the said enlarged reservoir shall have been constructed as herein provided, the United States reserving to itself the first right to a storage capacity in the enlarged reservoir equivalent to the storage capacity in the enlarged reservoir, that is, all of the water which can be stored in said reservoir up to the elevation 6752, U. S. Reclamation Service Survey and U. S. Geological Survey datum, will deliver and measure to and for the company at the outlet of said reservoir all of the available water therein in excess of said amount reserved to the United States.

"(9) That is to say, the United States shall have the first right to the waters of said reservoir to the extent of the capacity thereof up to said elevation 6752 and that as the second right from said reservoir the company shall be entitled to receive an amount of water equivalent to the amount made available by storage above said elevation 6752. As soon during the construction period as storage capacity becomes available above said elevation 6752, the company shall be entitled to such amount of stored water as becomes actually available from the storage capacity above said elevation 6752."

"(12) The water to be delivered to the company shall be turned out as required by the company during the low-water period of the irrigation season at a rate not in excess of its proportionate share of the available outlet capacity, and subject to the provisions of paragraph 8½, the United States to be notified of the rate of delivery desired in abundant time to enable it to transmit the proper instructions to its agent in charge of the dam and storage works."

A grant of 10,000 acre feet in the original reservoir was also given, in consideration of the settlement of pending litigation over irrigation projects in Idaho. The contract also reserved the option to the government to substitute water from one of its reservoirs in Idaho, in lieu of water from the Jackson Lake reservoir, making appropriate allowance for loss of volume in travel.

The Interior Department proceeded to secure a right to appropriate and store the surplus waters from the state engineer of the state of Wyoming, erected the dam, stored the waters, and presumably discharged its contractual obligation in the delivery of water to the plaintiff for application to the lands within the project. In 1923 the county assessor of Teton county purported to assess the alleged property of the plaintiff in said county, which assessment was subsequently equalized by the board of county commissioners of that county, upon the authority of the state board of equalization, in the sum of $534,000, and to levy a tax in the amount of $8,090.10. The description of the property so assessed takes the form of "equity or water rights in Jackson Lake reservoir; total value, $534,000."

Numerous points are raised by the litigants, the most of which are as interesting as they are difficult of solution. The point was raised by defendants, upon a motion to dismiss, that the suit was against the state, and therefore this court had no jurisdiction under the Eleventh Amendment, which, after the state had been dismissed out of the suit, this court overruled for reasons stated in a memorandum filed on December 2, 1924, and largely upon the strength of the following cases: Poindexter v. Greenhow, 114 U. S. 270, 5 S. Ct. 903, 962, 29 L. Ed. 185; General Oil Co. v. Crain, 209 U. S. 211, 28 S. Ct. 475, 52 L. Ed. 754; Huidekoper v. Hadley, 177 F. 1, 100 C. C. A. 395, 40 L. R. A. (N. S.) 505.

It is contended by defendants that, on account of the change in some of the officials against whom the suit is directed, it cannot be maintained. This may be true as to a county official, but in so far as the suit is directed against boards attempting to perform illegal acts, it should and must be sustained. This is apparently the gist of the holding in the case of Irwin v. Wright, 258 U. S. 219, 42 S. Ct. 293, 66 L. Ed. 573, in which case a controversy arose under the laws of the state of Arizona, very similar to those of Wyoming concerning the mode of levying taxes.

It is again contended by the plaintiff that the description of the property is so vague and insufficient as to make the assessment void. In the opinion of the court this cannot be sustained, as the general rule is that any description which identifies the property so that the owner cannot be misled will be sufficient, the rule being clearly stated in Cyc. as follows:

"It is essential to the validity of the assessment list and of all proceedings founded on it that it should contain a description of all the property intended to be assessed; but minute particularity is not required, any description being sufficient which identifies the particular property so clearly that the owner cannot be misled. And a detailed description will be more easily dispensed with where the assessor is unable to ascertain the exact nature of the property. It is not necessary to enumerate every item of personal property, but it has been held that the different classes mentioned in the statute should be separately listed, although, by the force of some statutes, it is now held sufficient to list all such property under the general description of `personal property,' and an assessment even under such a heading as `miscellany' may be considered sufficient if the owner himself knows exactly what is meant." 37 Cyc. 1051.

See, also, Wells Fargo & Co. v. State of Nevada, 248 U. S. 165, 39 S. Ct. 62, 63 L. Ed. 190.

Again, if there were error in description, it would have been the duty of the plaintiff to have secured from the proper authorities a correction of any error. Ricketts v. Crewdson, 13 Wyo. 284, 79 P. 1042, 81 P. 1; Choctaw v. Mackey, 256 U. S. 531-538, 41 S. Ct. 582, 65 L. Ed. 1076. In any event, it is quite evident that the plaintiff was advised by the assessment what property of the plaintiff the authorities were attempting to assess, for the plaintiff has made very clear its reasons why a tax levy cannot be made upon any property in the state of Wyoming by the bill in this case.

It is urged by the defendants that the plaintiff is not entitled to the relief sought in a federal court of equity, for the reason that such a court will not entertain a suit based merely upon the alleged illegality of the taxes, unless it is supplemented by some additional grounds recognized as affording equitable relief, such as irreparable injury, multiplicity of suits, and the like. The Supreme Court has so held in a number of cases arising in different states of the...