Oakley Country Club v. Long

• Decision Date: 06 December 1949
• Citation: 89 N.E.2d 260,14 A.L.R.2d 377,325 Mass. 109
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court
• Parties: , 14 A.L.R.2d 377 OAKLEY COUNTRY CLUB v. LONG.

Page 260

89 N.E.2d 260

325 Mass. 109, 14 A.L.R.2d 377

OAKLEY COUNTRY CLUB v. LONG.

Supreme Judicial Court of Massachusetts, Middlesex.

Argued Oct. 4, 1949.

Decided Dec. 6, 1949.

R. L. Mapplebeck, Boston, for plaintiff.

W. S. Kinney, Asst. Atty. Gen., for defendant.

Before QUA, C. J., and RONAN, WILKINS, SPALDING and COUNIHAN, JJ.

QUA, Chief Justice.

This action represents an attempt on the part of the plaintiff to recover fom Mr. Long personally, compare Great Northern Life Ins. Co. v. Read, 322 U.S. 47, 64 S.Ct. 873, 88 L.Ed. 1121, certain sums paid by the plaintiff to the Commonwealth in the years 1942 and 1943 as meals taxes under color of G.L. (Ter.Ed.) c. 64B, inserted by St. 1941, c. 729, § 17. ¹ The cause was submitted to the Superior Court upon a case stated and comes here by report without decision. G.L.(Ter.Ed.) c. 231, § 111.

The sums in question were paid 'on the claim of the Commissioner of Corporations and Taxation,' who was the defendant Long. As the law then stood, the commissioner's claim for the tax was 'without warrant of law,' as appears from the decision of this court in Commissioner of Corporations and Taxation v. Chilton Club, 318 Mass. 285, 61 N.E.2d 335, where the circumstances were similar. The plaintiff applied for registration under c. 64B solely for the purpose of preventing the imposition of penalties. It reserved all rights to contend that it was not subject to the provisions of the chapter and filed returns on the forms prepared by the commissioner and paid the taxes indicated thereon under protest. These payments 'were exacted without warrant and were paid under duress to avoid imposition of penalties.'

In Chilton Club v. Commonwealth, 323 Mass. 543, 83 N.E.2d 265, we held that so many of these payments as were not barred by the three year limitation could be recovered from the Commonwealth under G.L. (Ter.Ed.) c. 258. See c. 260, § 3A, as inserted by St. 1943, c. 566, § 1. The plaintiff now seeks to recover from Mr. Long personally the payments which it could not recover from the Commonwealth because of the three year bar. The question in whether Mr. Long is personally liable for illegal exactions made in his capacity as commissioner of corporations and taxation.

It is to be noted that the defendant has been guilty of no trespass in the sense of arrest of the person or of seizure of property. This is simply a case where the plaintiff has paid money, not voluntarily, to be sure, but under a species of duress because of the penalty that might follow upon failure to pay. See c. 64B, § 9; Kirchner v. Pittsfield, 312 Mass. 342, 345-346, 44 N.E.2d 634. The plaintiff has suffered no injury or loss other than the loss of the money paid and interest thereon. We confine this decision to the case presented.

It will also be observed that the defendant in his official capacity as commissioner of corporations and taxation was both the assessor of the tax and the collector of it. C. 64B, § 6. Payment was required to be made to him. Sections 2, 6. He was required to pay all sums collected by him 'on account of the Commonwealth' into the treasury of the Commonwealth daily, or at least as often as weekly if duly established rules provide, for weekly payments. Art. 63, § 1, of Amendments to the Constitution. G.L.(Ter.Ed.) c. 30, § 27. This includes sums 'received * * * as excise' under c. 64B, § 10. We cannot doubt that the sums in question were received 'on account of the Commonwealth' and 'as excise,' within the meaning of the Constitution and of the statute, even though they were illegally exacted. The obvious purpose of the constitutional amendment and of the statute precludes the idea that the commissioner could lawfully retain in his own hands sums received by him merely because there was, to his knowledge, doubt or dispute as to the legality of their exaction. See Baker v. Commonwealth, 312 Mass. 490, 493, 45 N.E.2d 470. In the absence of anything to show the contrary the commissioner must be presumed to have performed his duty of paying the sums in question into the treasury before this action was brought in 1948. Horgan v. Boston Elevated Railway Company, 208 Mass. 287, 288-289, 94 N.E. 386; Petition of Flynn, 265 Mass. 310, 314, 163 N.E. 900; AEtna Life Ins. Co. v. Commissioner of Corporations & Taxation, 323 Mass. 657, 661, 84 N.E.2d 1; Taylor v. United States, 324 Mass. 639, 646-647, 88 N.E.2d 121; State v. Maryland Casualty Co., 189 S.C. 405, 411-412, 1 S.E.2d 516; Higbie v. County of Los Angeles, 47 Cal.App.2d 281, 117 P.2d 933.

It has been held in a number of other States that an officer charged with the collection of taxes is personally liable in an action of this kind at least so long as he retains the illegally exacted money in his possession and has not turned it over to the State or municipality in whose behalf he collected it. Fiscal Court of Owen County v. F. & A. Cox Co., 132 Ky. 738, 746-747, 117 S.W. 296, 21 L.R.A., N.S., 83; Cox v. Welcher, 68 Mich. 263, 37 N.W. 69, 13 Am.St.Rep. 339; Tuttle v. Everett, 51 Miss. 27, 24 Am.Rep. 622. Some jurisdictions go farther and hold him liable after he has turned over the money if it was originally paid to him under protest. Seaboard Air Line Railway v. Allen, 82 Fla. 191, 196-199, 89 So. 555; Scottish Union & National Ins. Co. v. Herriott, 109 Iowa 606, 610-611, 80 N.W. 665, 77 Am.St.Rep. 548; Atchison, Topeka & Santa Fe Railway Company v. O'Connor, 223 U.S. 280, 287, 32 S.Ct. 216, 56 L.Ed. 436, Ann. Cas. 1913C, 1050. See cases collected in 61 C.J. 1001-1002.

The restatement: Restitution, § 75, relieves the collector from liability after payment over, 'if he is required by statute to make such payment over irrespective of protest.' Hartford Fire Ins. Co. v. Jordan, 168 Cal. 270, 274, 142 P. 839; Yazoo and Mississippi Valley Railroad Company v. Conner, 188 Miss. 352, 363-364, 194 So. 915; State ex rel. American Mfg. Co. v. Reynolds, 270 Mo. 589, 601-602, 194 S.W. 878; Pacific Livestock Co. v. Cochran, 73 Or. 417, 423, 144 P. 668; Cary v. Curtis, 3 How. 236, 11 L.Ed. 576; Smietanka v. Indiana Steel Co., 257 U.S. 1, 4, 42 S.Ct. 1, 66 L.Ed. 99. This seems a sound qualification upon the liability of collectors. If this rule governs, the defendant in this case is not liable because of having collected the tax.

In this Commonwealth it was early held that local collectors were not personally liable because they were protected by the assessors' warrant, except where the warrant was void on its face or where they proceeded beyond its scope. Stetson v. Kempton, 13 Mass. 272, 282, 7 Am.Dec. 145; Shaw v. Becket, 7 Cush. 442, 444; Lincoln v. Worcester, 8 Cush. 55, 58-59; Hays v. Drake, 6 Gray 387; Cone v. Forest, 126 Mass. 97; Warr v. Collector of Taxes of Taunton, 234 Mass. 279, 282-283, 125 N.E. 557. Assessors, however, were originally held personally liable for making illegal assessments. Stetson v. Kempton, 13 Mass. 272, 282-283; Gage v. Currier, 4 Pick. 399, 405; Joyner v. School District Number Three in Egremont, 3 Cush. 567, 570. This may have been an outgrowth of the methods of collection by arrest of the person or distress of goods, each of which constituted an active trespass deemed to have been committed at the command of the assessor. Lincoln v. Worcester, 8 Cush. 55, 58-59. But by St. 1823, c. 138, § 5, especially as more comprehensively phrased in Rev.Sts. c. 7, § 44, the responsibility of assessors, where the tax levy as a whole was duly voted and certified to them, was confined to their own 'want of integrity and fidelity.' Baker v. Allen, 21 Pick. 382. See now G.L. (Ter.Ed.) c. 59, § 87. On the other hand, the liability of the municipality to repay taxes received by it under a void assessment has been recognized from our earliest reports. Salem Iron Factory Co. v. Danvers, 10 Mass. 514; Amesbury Woollen & Cotton Mfg. Co. v. Amesbury, 17 Mass. 461; Summer v. First Parish in Dorchester, 4 Pick. 361, 364; Preston v. Boston, 12 Pick. 7; Joyner v. School District Number Three in Egrement, 3 Cush. 567. Since the collector was not liable, except for abuse of his warrant and the responsibility of the assessors was cut down by the statute of 1823 so as to apply only to 'want of integrity and fidelity,' the remedy by payment and recovery back from the municipality has been for many generations the common, convenient, and ordinarily sufficient remedy for a wholly illegal assessment of local taxes. See Shaw v. Becket, 7 Cush. 442, 444-445; Lincoln v. Worcester, 8 Cush. 55; Loud v. Charlestown, 99 Mass. 208; McGee v. Salem, 149 Mass. 238, 242, 21 N.E. 386. It is unnecessary to add more recent citations regarding a procedure which has now become so familiar. This remedy is now regulated by G.L. (Ter.Ed.) c. 60, § 98. So far as we are aware no action resembling the present one has been brought for many years against any local collector or assessor. The remedy in all ordinary cases is by action against the municipality.

It can perhaps be argued that the commissioner, as an assessor is personally liable on the same grounds on which local assessors were held liable in the early cases before the statute of 1823. But in our opinion, at least where there has been no actual trespass upon person or goods it would be unfortunate at this late day to extend to the commissioner a personal liability which long ago ceased to have practical utility as applied to local assessors. See Richards v. Treasurer and Receiver General, 319 Mass. 672, 676, 67 N.E.2d 583. The commissioner stands in as great need of protection...