Richards v. Treasurer and Receiver General

• Decision Date: 03 June 1946
• Citation: Richards v. Treasurer and Receiver General, 319 Mass. 672, 67 N.E.2d 583 (Mass. 1946)
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court
• Parties: GEORGE E. RICHARDS & others v. TREASURER AND RECEIVER GENERAL & others.

319 Mass. 672

67 N.E.2d 583

GEORGE E. RICHARDS & others v. TREASURER AND RECEIVER GENERAL & others.

Supreme Judicial Court of Massachusetts, Suffolk.

June 3, 1946

April 4, 1945.

Present: FIELD, C.

J., DOLAN, RONANWILKINS, & SPALDING, JJ.

Equity Jurisdiction, Taxable inhabitants' suit.Commonwealth Proceeding against Commonwealth, Financial matters.Equity Pleading and Practice, Parties, Taxable inhabitants' suit, Suit against Commonwealth.Statute, Construction.

The Commonwealth cannot be made a partyrespondent to a suit in equity by taxable inhabitants under G. L. (Ter. Ed.)c. 29, Section 63 inserted by St. 1937, c. 157.

G. L. (Ter.

Ed.) c. 29, Section 63, inserted by St. 1937, c. 157, should have the same construction as that given by decisions of this court to

c. 40, Section 53, originating in St.

1847, c. 37 Section 1.A suit in equity under G. L. (Ter. Ed.)c. 29, Section 63, inserted by St.

1937, c. 157, cannot be maintained for an accounting respecting payments already made by the Commonwealth in past transactions between the trustees of the Boston Elevated Railway Company and the Commonwealth under the public control act, Spec. St. 1918, c. 159.A suit in equity could not be maintained under G. L. (Ter. Ed.)c. 29,

Section 63, inserted by St. 1937, c. 157, by twenty-nine taxable inhabitants of the Commonwealth to enjoin payments of deficits demanded from the Commonwealth by the trustees of the Boston Elevated Railway

Company under the provisions of the public control act, Spec. St. 1918, c. 159, although the petitioners were in the number and resided in several counties as required by said Section 63, where it appeared that only nine of them lived or had any taxable property in the district served by the company in which the pecuniary interests of taxable inhabitants would be harmed by the payment of improper amounts by the

Commonwealth to the trustees.

PETITION, filed in the Superior Court on February 2, 1942, and afterwards amended.

Demurrers were heard by Forte, J.

M. H. Sullivan, (C.

H. Waterman with him,) for the petitioners.

E. O. Proctor, (F.

B. Lund, Jr., with him,) for Boston Metropolitan District.

C. W. Mulcahy, (W.

B. Downey & C.

A. McCarron with him,) for the trustees of Boston Elevated Railway Company.

R. H. Holt, for Boston Elevated Railway Company.

C. A. Barnes, Attorney General, & G.

P. Drury, Assistant Attorney General, for the Commonwealth, submitted a brief.

RONAN, J.This is a petition purporting to be brought under G. L. (Ter. Ed.)c 29, Section 63, inserted by St. 1937, c. 157, by twenty-nine taxable inhabitants of the Commonwealth, six of whom are alleged to be residents of the county of Suffolk, six of the county of Middlesex, six of the county of Norfolk, six of the county of Worcester, and five of the county of Essex, against the Commonwealth, the Treasurer and Receiver General of the Commonwealth, the Boston Elevated Railway Company, the trustees of that company in charge of its operation in accordance with Spec. St. 1918, c. 159, the public control act, and the Boston Metropolitan District, created by St. 1929, c. 383(and given its present name by St. 1932, c. 147, Section 1), seeking to enjoin the payment by the Commonwealth of two deficits, one for the period ending March 31, 1941, and the other for the period ending December 31, 1941, an accounting to determine the amounts legally due from the Commonwealth on account of these two deficits, an accounting to determine to what extent the deficit payments made by the Commonwealth during 1932 to 1940 included items which it is alleged were illegally included therein, and a decree adjudging as unconstitutional St. 1931, c. 333, and all subsequent acts in so far as they purport to authorize the trustees to charge to the cost of service certain amounts that are to be applied to the reduction of the bonded indebtedness of the Boston Metropolitan District.The petitioners appealed from interlocutory decrees sustaining demurrers filed by four of the respondents, and from a final decree dismissing the petition.

The statute, G. L. (Ter. Ed.)c. 29, Section 63, provides that "If a department, commission, board, officer, employee or agent of the commonwealth is about to expend money or incur obligations purporting to bind the commonwealth for any purpose or object or in any manner other than that for and in which such department, commission, board, officer, employee or agent has the legal and constitutional right and power to expend money or incur obligations, the supreme judicial or superior court may, upon the petition of not less than twenty-four taxable inhabitants of the commonwealth, not more than six of whom shall be from any one county, determine the same in equity, and may, before the final determination of the cause, restrain the unlawful exercise or abuse of such right and power."

There was no error in sustaining the demurrer of the Commonwealth.The statute does not authorize the joining of the Commonwealth as a party to the proceeding, Hodgdon v. Haverhill,193 Mass. 406 , and, the Commonwealth not having consented to be impleaded, the petition cannot be maintained against it.Burroughs v. Commonwealth,224 Mass. 28 .Glickman v. Commonwealth,244 Mass. 148 .Arthur A. Johnson Corp. v. Commonwealth,318 Mass. 88.

The statute upon which this petition purports to be based is fashioned upon G. L. (Ter. Ed.)c. 40, Section 53, which provides a remedy to restrain cities and towns from raising or expending money or incurring obligations for any purpose or in any manner other than that for and in which they have a legal and constitutional right to raise or expend funds or to incur obligations.The phraseology of both statutes is substantially similar in so far as they define the character and nature of the transactions that come within their sweep.The aims of both are identical.What is now Section 53 originated in St. 1847, c. 37, Section 1, and has been frequently construed by this court.It is to be assumed that the Legislature was familiar with these decisions and that in enacting in 1937 what is now G. L. (Ter. Ed.)c. 29, Section 63, it intended that this latter section should have the same construction as that given to Section 53.Commonwealth v. Hartnett, 3 Gray, 450, 451.Whiting v. Board of Public Works of Holyoke,222 Mass. 22 , 24.Wilson v. Grace,273 Mass. 146 , 154.Commissioner of Corporations & Taxation v. Boston Edison Co.310 Mass. 674 , 689.A taxpayers' petition to restrain the illegal expenditure of money by a town does not come within the general jurisdiction of a court of equity, and it was not until the enactment of St. 1937, c. 157, that the taxpayers of the Commonwealth were given a remedy to prevent the illegal expenditure of State funds by State officials.Consequently, a petition by taxpayers may be maintained only when it is brought within the provisions of the statute.Prince v. Crocker,166 Mass. 347 , 358.Kelley v. Board of Health of Peabody,248 Mass. 165 , 169.Stone v. Treasurer of Malden,309 Mass. 300, 302.Fairchild v. Hughes,258 U.S. 126.Massachusetts v. Mellon,262 U.S. 447.Alabama Power Co. v. Ickes,302 U.S. 464.Coleman v. Miller,307 U.S. 433.Such a statute is subject to many well established limitations, Amory v. Assessors of Boston,310 Mass. 199 , 200, 201, one of which is that the statute is not retroactive and cannot be made to reach past transactions or to require an accounting as to them.Hood v. Mayor & Aldermen of Lynn, 1 Allen, 103.Carlton v. Salem,103 Mass. 141 .Fuller v. Trustees of Deerfield Academy,252 Mass. 258 , 260, 261.Adams v. Selectmen of Northbridge,253 Mass. 408 , 409.Morse v. Boston,260 Mass. 255, 264.Reilly v. Selectmen of Blackstone,266 Mass. 503 , 506.Dealtry v. Selectmen of Watertown,279 Mass. 22 , 27.Amory v. Assessors of Boston,310 Mass. 199, 204.

A taxpayers' petition does not lie to prevent the expenditure of municipal funds if the tax upon the petitioners is not thereby increased.The purpose of confining the remedy to taxable inhabitants of a city or town clearly appears from the state of the law existing when provision was first made by St. 1847, c. 37, Section 1, authorizing the filing of a taxpayers' petition in this court.Prior to this statute, the usual method of contesting the validity of an appropriation which, it was contended, was beyond the power of the city or town to make was to refuse to pay the tax and to compel the collector to enforce payment by distress, and to recover damages in an action of trespass against the assessors, if it was proved that such item ought not to have been included in the assessment of the tax.Stetson v. Kempton,13 Mass. 272 .Libby v. Burnham,15 Mass. 144 .Inglee v. Bosworth,

5 Pick. 498.To avoid what was thought to be a hardship on assessors, St 1823, c. 138, Section 5, provided that assessors should not be personally liable where a part of the assessment was void except where there was a lack of integrity and fidelity.The method then employed to contest the tax was to pay under protest and then to recover the full amount of the tax from the city or town, although only a small portion of it was invalid.Goodrich v. Lunenburg, 9 Gray, 38.Gerry v. Stoneham, 1 Allen, 319.Recovery in such cases was limited by St. 1859, c. 118, Section 4, to the illegal portion of the tax.For all practical purposes assessors became immune to action, and in most cases the amount that could be recovered from a city or town was not worth the effort and expense of litigation.If this situation alone prevailed, the result would be to bar the taxpayers, who after all were the real parties in interest, from any effectual remedy to contest a tax, a part of which was...