Pepin v. City of Danbury

• Decision Date: 11 May 1976
• Citation: 368 A.2d 88,171 Conn. 74
• Court: Connecticut Supreme Court
• Parties: Joseph W. PEPIN et al. v. CITY OF DANBURY et al.

Page 88

368 A.2d 88

171 Conn. 74

Joseph W. PEPIN et al. v. CITY OF DANBURY et al.

Supreme Court of Connecticut.

May 11, 1976.

Richared L. Nahley, Danbury, with whom was Ronald M. Sullivan, Danbury, for appellants (defendants).

Lloyd Cutsumpas, Danbury, with whom was Francis J. Collins, Danbury, for appellees (plaintiffs).

Before HOUSE, C.J., and COTTER, LOISELLE, BOGDANSKI and BARBER, JJ.

COTTER, Associate Justice.

The plaintiffs, Danbury residents and taxpayers, brought this action aganist the city and certain of its officials seeking a declaratory judgment determining the validity of the tax formula provision contained in article V, § 4, of the consolidation ordinance of the city of Danbury, and the levy of real estate taxes pursuant thereto, and, in addition, for appropriate equitable relief.

The case was heard on a stipulation of facts which disclosed the following: Prior to January 1, 1965, the city of Danbury consisted of two municipal entities known as the town of Danbury and the city of Danbury. The town was formed by the Court of General Session in 1687 and operated under a board of selectmen and a town meeting form of government; the city was specially chartered by the General Assembly in 1889 and was located within the territorial limits of the town of Danbury.

Effective January 1, 1965, the town and city were consolidated and became the city of Danbury, in accordance with the Home Rule Act, chapter 99, §§ 7-195 through 7-199 of the General Statutes, and under the provisions of a consolidation ordinance adopted at a referendum on September 24, 1963.

The consolidation ordinance establishes three tax districts. All property in the city is inculded in the Basic Tax District, and under the tax formula challenged here, 85 percent of local tax revenue is collected from the basic district. Urban Tax District No. 1 includes properties connected to either city water or city sewer facilities, and, in addition to liability for the basic tax, these properties are further taxed to raise a sum equal to 7 1/2 percent of the total city revenue. Those properties connected to both city water and city sewer facilities are included in Urban Tax District No. 2 and, in addition to the two taxes already mentioned, are liable for an additional 7 1/2 percent of the city's total revenues. See article V, §§ 1-4, of the consolidation ordinance of the city of Danbury.

Section 4 of article V of the consolidation ordinance, in addition to setting forth the 85-7 1/2-7 1/2 tax formula, further provides that: 'If at any time a majority of all the members of the Common Council shall determine that the proportions of the foregoing tax formula are not equitable in the light of changed circumstances, they may alter the ratio of the apportionment so as to do equity; but no such alteration shall be made until the lapse of four (4) years from the effective date of the Consolidation Ordinance.' ¹

The plaintiffs are residents and taxpayers of Urban Tax District No. 2 and challenge the 85-7 1/2-7 1/2 tax formula as being illegal and invalid not only under the consolidation ordinance but on statutory and constitutional grounds as well. In addition to a declaratory judgment to that effect, they also sought to enjoin the defendants from levying taxes pursuant to an April 18, 1974 ordinance of the Danbury common council, which established the property tax mill rate under the tax formula here in issue for the fiscal year beginning July 1, 1974. The essence of their claim is that the 85-7 1/2-7 1/2 tax formula is arbitrary, unfair and bears no rational relation to the cost of municipal services rendered, because the average cost of sewers since 1965 is only 2.13 percent of the city budget and because the cost of furnishing public water is covered by service charges paid by the user.

Under the mill rate in effect for the fiscal year beginning July 1, 1974, properties connected to one service are assessed at a rate 16 percent higher than those properties not so served. Those taxpayers with both services find their property assessed at a mill rate 40 percent higher than those taxpayers with neither service. ² Also, in assessing a property's fair market value, consideration is given to whether water and sewer connections are available to the property.

The trial court rendered judgment for the plaintiffs and declared that (1) the taxformula levied with respect to Urban Tax Districts Nos. 1 and 2 was not authorized by law; (2) the tax district established for real property connected to city water was not authorized under the facts of the case; and (3) the tax district established for the purpose of paying for the cost of public sewer service was authorized but that the city had no authority to tax sums in excess of the cost of furnishing such service. From this judgment, the defendants appealed to this court.

I

At the outset we consider the effect on this case of our decision in Pelc v. Danbury, 166 Conn. 364, 349 A.2d 825, which was an action brought on behalf of Urban Tax District No. 2 taxpayers challenging the 85-7 1/2-7 1/2 tax formula levied on the List of October 1, 1971. In Pelc, the court (Testo, J.), after a trial, rendered judgment for the defendants without declaring the respective rights of the parties. On appeal, this court declined to review the case on the merits because the plaintiffs-appellants failed to request a finding, which was essential to a final determination of the sustantive issues. Id., 368, 349 A.2d 825.

In the instant case, the defendants moved for summary judgment, arguing that Pelc barred this suit on the ground of res judicata, but their motion was denied (Mignone, J.). This case was then heard on a record of stipulated facts, and the trial court (Berdon, J.) again rejected the res judicata defense and proceeded to render judgment for the plaintiffs, declaring that the tax formula was not authorized by law. From this judgment, the defendants have appealed.

Since we deal here with tax assessments for different tax years, we are not directly concerned with res judicata but instead with that branch of the doctrine known as collateral estoppel. Connecticut Light & Power Co. v. Tax Commissioner, 169 Conn. 58, 61, 362 A.2d 958; Commissioner of Internal Revenue v. Sunnen, 333 U.S. 591, 598, 68 S.Ct. 715, 92 L.Ed. 898. See also annot., 162 A.L.R. 1204, supplementing annot., 150 A.L.R. 5. The doctrine of collateral estoppel may be applied in determining the effect of a valid final judgment on subsequent litigation involving some of the issues determined in the former action between the parties, and the plaintiffs in the second action will be estopped from relitigation controverted, upon the determination of 'only as to those matters in issue or points which the finding or verdict (in the first suit) was rendered.' Connecticut Light & Power Co. v. Tax Commissioner, supra, 362 A.2d p. 958, citing Brockett v. Jensen, 154 Conn. 328, 338, 225 A.2d 190. See Partmar Corporation v. Paramount Pictures Theatres Corporation, 347 U.S. 89, 90, 74 S.Ct. 414, 98 L.Ed. 532; Corey v. Avco-Lycoming Division, 163 Conn. 309, 317, 307 A.2d 155, cert. denied, 409 U.S. 1116, 93 S.Ct. 903, 34 L.Ed.2d 699; Waterbury Savings Bank v. Danaher, 128 Conn. 78, 92, 20 A.2d 455.

The judgment in Pelc did not declare the rights of the parties, but merely entered judgment for the defendants and thus was 'tantamount to a finding that the plaintiffs had failed to establish a right to a declaratory judgment.' Pelc v. Danbury, supra, 166 Conn. 368, 349 A.2d 827, and cases cited. While such a judgment may be appropriate when a plaintiff has failed to meet the requirements of §§ 309-313 of the Practice Book, 'a proper judgment responsive to the pleadings, issues and prayers for relief should have answered such questions as were answerable whether the answers were favorable to the plaintiffs or to the defendants.' United Oil Co. v. Urban Redevelopment Commission, 158 Conn. 364, 375, 260 A.2d 596, 602; see United National Indemnity Co. v. Zullo, 143 Conn. 124, 131, 120 A.2d 73.

Applying these principles to the instant case, it should be noted that 'it is the judgment of the tribunal from which an appeal is taken which, if affirmed by us or rendered in conformity to a decision we make, conclusively determines any such issues.' Osterlund v. State, 135 Conn. 498, 502, 66 A.2d 363, 366. Thus, the judgment of the trial court and our decision in Pelc are not finally dispositive of the factual and legal issues presented for resolution in the instant case. Even though the trial court's judgment in Pelc fails to declare the rights of the parties, we are urged by the defendants to deny any relief to the plaintiffs on the basis of the trial court's memorandum of decision in Pelc. This we cannot do, since a momorandum of decision cannot constitute a finding of facts, Martin v. Connecticut Personnel Commissioner, 167 Conn. 377, 355 A.2d 256; Pelc v. Danbury, supra, 166 Conn. 367, 349 A.2d 825, nor can it 'be considered a record judgment. 'The judgment-file is the only formal written statement which expresses the decision rendered." Harris v. First National Bank & Trust Co., 139 Conn. 749, 752, 97 A.2d 260, 261. See Lusas v. St. Patrick's Catholic Church Corporation, 125 Conn. 206, 208, 4 A.2d 333; Wagner v. Zoning Board of Appeals, 153 Conn. 713, 714, 216 A.2d 182.

'[W]here in a proceeding concerning a tax for a particular period a judgment is rendered which determines that the taxpayer or his property is taxable or is exempt from taxation, but is not supported by a finding or findings specifying the grounds or facts upon which the conclusion is reached, such a judgment has been held not to settle conclusively the question that the taxpayer or his property is taxable, or exempt from taxation, for a different period not involved in the former proceeding.' Annot., 150 A.L.R. 63;162 A.L.R. 1204, 1214, § IV(d)(2).

As we noted in Pelc, it was ...