Paluck v. Board of County Com'rs, Stark County

• Citation: 307 N.W.2d 852
• Decision Date: 09 July 1981
• Docket Number: No. 13,No. 9891,13,9891
• Parties: Casmir PALUCK, Plaintiff and Appellant, v. BOARD OF COUNTY COMMISSIONERS, STARK COUNTY, North Dakota, Defendant andAppellee, and State Tax Commissioner of North Dakota and Elm Grove School DistrictofBelfield, North Dakota, Respondents. Civ.
• Court: United States State Supreme Court of North Dakota

Page 852

307 N.W.2d 852

Casmir PALUCK, Plaintiff and Appellant, v. BOARD OF COUNTY COMMISSIONERS, STARK COUNTY, North Dakota Defendant andAppellee and State Tax Commissioner of North Dakota and Elm Grove School District No. 13 ofBelfield, North Dakota, Respondents.

Civ. No. 9891.

Supreme Court of North Dakota.

July 9, 1981.

Robert A. Keogh, Dickinson, for plaintiff and appellant (on brief); argued by Casmir Paluck, pro se.

Owen Mehrer, State's Atty., Dickinson, for defendant and appellee Stark County.

VANDE WALLE, Justice.

Casmir Paluck appealed a decision of the district court of Stark County reversing a determination of the North Dakota Tax Appeals Board. We affirm the decision of the district court.

Paluck owns certain rural property in Stark County. The property is not tilled but, rather, Paluck utilizes it as pasture. In 1978, the Stark County assessor assessed the property at $1,878. Paluck appealed the assessment to the Stark County Board of Equalization, which approved the assessment. Paluck then appealed the assessment to the State Board of Equalization in accordance with the provisions of Section 57-12-06(4), N.D.C.C. The State Board also affirmed the assessment. Subsequently Paluck filed a written application for abatement and settlement of taxes with the Stark County Board of County Commissioners (hereinafter "Stark County") in accordance with the provisions of Chapter 57-23, N.D.C.C. Paluck, in his application, contended that the assessed valuation was excessive considering the use and productivity of the property. After a hearing before the Board of County Commissioners, the Board denied the application for abatement and settlement of the taxes. Paluck appealed the denial to the North Dakota Tax Appeals Board as authorized by Chapter 57-23.1, N.D.C.C. The Board, after a hearing, entered its findings of fact, conclusions of law, and order reducing the assessment on the land in question from $1,878 to $1,431. Stark County appealed the decision of the Board to the district court. ¹ The district court determined that Chapter 57-23.1 is unconstitutional and further determined that the decision of the Board was in error. The district court ordered that the decision of the Board be vacated and that the original assessment be reaffirmed. Paluck appealed to this court setting forth the following issues:

1. Is Chapter 57-23.1, N.D.C.C., which creates the North Dakota Tax Appeals Board, constitutional?

2. Are the findings of fact, conclusions of law, and order of the Board supported by the evidence?

3. Did the Board err in considering the use of the property when making its findings of fact, conclusions of law, and order reducing the assessment on the land in question?

I

Before considering the merits of the decision of the Board we are faced with the issue of the constitutionality of the legislation establishing the Tax Appeals Board. ² The district court concluded that the statutes (Chapter 57-23.1, N.D.C.C.) creating the Board were unconstitutional because, in creating an administrative agency, the Legislature created a body that had nothing to administer, thus violating the separation-of-powers doctrine. The district court determined the only function of the Board was to hear appeals from a decision of a county on the abatement or refund of real estate taxes. The district court's opinion states, in part:

"The creation of the Board with no other function than to hear such appeals is a Legislative attempt to create a court, albeit termed a board, and violates the constitution of the State of North Dakota that vests the judicial power of the State in the Supreme Court, District Courts, County Courts, Justices of the Peace, and in such other Courts as may be created by law for cities, incorporated towns and villages. The constitution of North Dakota does not permit the creation of special courts by the legislature, only those courts that are enumerated in the constitution."

The district court's language reflects reliance on Section 85 of the North Dakota Constitution which prior to its repeal in 1976 provided:

"The judicial power of the State of North Dakota shall be vested in a supreme court, district courts, county courts, justices of the peace, and in such other courts as may be created by law for cities, incorporated towns and villages."

On September 7, 1976, the electorate of North Dakota repealed the entire judicial article of the Constitution, including Sections 85 through 120, and replaced it with a new judicial article. 1975 N.D.Sess.Laws ch. 615; 1977 N.D.Sess.Laws ch. 599. ³ Section 1 of Article VI of the North Dakota Constitution currently reads:

"The judicial power of the state is vested in a unified judicial system consisting of a supreme court, a district court, and such other courts as may be provided by law." (Emphasis supplied.)

The difference between the two constitutional provisions above quoted is immediately apparent: Prior to 1976 the Constitution limited the authority of the Legislature to create additional courts except for "cities, incorporated towns and villages." The current constitutional provision in effect since 1976 contains no such limitation but specifically authorizes the Legislature to create other special courts without limitation. But the statutes creating the Tax Appeals Board were enacted in 1973 by N.D.Sess.Laws ch. 459, prior to the time the current constitutional provision became effective, although the current cause of action did not arise until 1978, after the new constitutional provision was effective. If we were to view the enactment of the Tax Appeals Board in light of the current constitutional provision, we might well conclude that the Legislature has established a special court which, according to the current constitutional provision, it is authorized to do. However, if we consider the Legislature to have established a special court the validity of that establishment must be measured by the constitutional provision in effect at the time of the enactment unless the constitutional amendment expressly or impliedly ratifies or confirms the statute. State v. Bates, 305 N.W.2d 426 (Iowa 1981); Bucher v. Powell County, Mont., 589 P.2d 660 (1970); Fellows v. Schultz, 81 N.M. 496, 469 P.2d 141 (1970); 16 Am.Jur.2d, Constitutional Law § 259, p. 732; 16 C.J.S. Constitutional Law § 45, p. 140. At the time of the enactment of the statutes creating the Tax Appeals Board in 1973, the constitutional provision permitted the Legislature to establish courts only for "cities, incorporated towns and villages." The Tax Appeals Board is obviously not established for "cities, incorporated towns and villages" nor is there in the current constitutional provision any express or implied ratification of the Tax Appeals Board as a court. Therefore, if we are to consider the Tax Appeals Board as a court we must hold the establishment of that court in 1973 unconstitutional as violating the constitutional provision limiting the establishment of courts by the Legislature to those for "cities, incorporated towns and villages."

In his brief, however, Paluck urges that we view the establishment of the Tax Appeals Board as the creation of an administrative agency rather than a court. Indeed, the minutes of the legislative committees which considered the bill establishing the Tax Appeals Board ⁴ as well as an opinion of the Attorney General ⁵ indicate that was the intent of the legislation. Furthermore, in previous cases involving appeals of matters heard by the Tax Appeals Board this court, for purposes of the appeal, has considered the Board to be an administrative agency although we either refused to decide the issue of whether or not the Tax Appeals Board was an administrative agency (Caldis v. Board of Cty. Comrs., Grand Forks Cty., 279 N.W.2d 665 (N.D.1979)) or the issue was not raised by the parties and was not discussed by this court (United Power Assn. v. Board of Cty. Comrs., 300 N.W.2d 36 (N.D.1980); N.D. Conf. A. of 7th-D. Adv. v. B. of C. Comrs., 234 N.W.2d 912 (N.D.1975)) or we considered the Board to be an administrative agency for purposes of the appeal, although we specifically indicated that we were not deciding the issue because it had not been raised by the parties (Mills v. Board of County Commissioners, Burleigh County, 305 N.W.2d 832 (N.D.1981)).

In addition, if a statute is susceptible of two constructions, one which will be compatible with constitutional provisions or one which will render the statute unconstitutional, we must adopt the construction which will make the statute valid. See, e. g., State v. Howe, 247 N.W.2d 647 (N.D.1976). Therefore, we must determine whether or not the Tax Appeals Board, if considered an administrative agency rather than a court, will violate our Constitution.

An "administrative agency" is defined by Section 28-32-01(1), N.D.C.C., as "any officer, board, commission, bureau, department, or tribunal other than a court, having state-wide jurisdiction and authority to make any order, finding, determination, award, or assessment which has the force and effect of law and which by statute is subject to review in the courts of this state."

Section 57-23.1-02, N.D.C.C., establishing the authority of the Tax Appeals Board, provides, in part:

"The board may abate or order the refund of, in whole or in part, any assessment or tax upon real or personal property for any of the grounds provided for in section 57-23-04.... Any party aggrieved by a decision of the tax appeals board may appeal to the district court...."

The Tax Appeals Board meets the requirements for an administrative agency as prescribed in Section 28-32-01(1) in that it has state-wide jurisdiction and authority to make an order which has the force and effect of law and which by statute is subject to review in the courts of this State. We have already determined that the Board cannot be a court.

Stark County does not take issue with a construction which...