River Excursion Co. v. City of Louisville

• Decision Date: 31 May 1932
• Citation: 244 Ky. 811
• Parties: River Excursion Company et al. v. City of Louisville.
• Court: United States State Supreme Court — District of Kentucky

244 Ky. 811

River Excursion Company et al. v. City of Louisville.

Court of Appeals of Kentucky. (Common Pleas Branch, Fourth Division).

Decided May 31, 1932.

1. Licenses. — Injunction is remedy to prevent enforcement of discriminatory ordinance assessing license tax.

2. Taxation. — Right to recover back mere property tax depends on whether its payment was voluntary or involuntary, each case depending upon its own facts.

3. Licenses. — Where ordinance does not provide penalty for engaging in business without license fee, whether licenses illegally paid thereunder can be recovered depends upon whether payment was voluntary or involuntary.

4. Payment. — Money paid under mistake of law may be recovered.

5. Taxation. — Taxes paid voluntarily may not be recovered.

6. Taxation. — Taxes paid under compulsion which exists whenever they are collectible by summary process of fine and imprisonment may be recovered.

7. Taxation. — When taxes can be collected by suit only, action to recover taxes voluntarily paid cannot be maintained.

8. Limitation of Actions. — Generally, pleading wholly or partially setting out cause of action which accrued over five years before commencement of action is not demurrable on that ground.

9. Licenses. — Excursion company could not, in action to recover alledgedly illegal municipal license fee, recover interest prior to demand for refund or, absent demand, until institution of action.

10. Appeal and Error. — Appellate court cannot determine question of limitation or recovery of interest on demurrer to petition.

Appeal from Jefferson Circuit Court

LEO J. SANDMANN for appellants.

ROWAN HARDIN, Assistant City Attorney, for appellee.

OPINION OF THE COURT BY JUDGE RICHARDSON.

Reversing.

The city of Louisville is a city of the first class. Prior to January 1, 1920, it enacted an ordinance providing for and requiring a certain license fee of each boat or vessel carrying passengers on excursions from any wharf or shore in the city, whether operated by a person, firm, or corporation. It provided that:

"Upon the failure of any person, firm or corporation to take out such license it should be the duty of the treasurer and secretary of the sinking fund or any assistant license inspector of the city to procure or cause to be procured the issuance of a warrant of arrest for each violation thereof, and to cause such offender to be prosecuted thereunder."

The license fee was by the original ordinance, $200 the month, or $10 the day. By amendment it was changed to $200 the month, or $5 the day. In December, 1929, it was fixed by an amendment at $50 the month, or $10 the day.

The River Excursion Company, Inc., Streckfus Steamers, Inc., Louisville & Cincinnati Packet Company, Inc., and Coney Island, Inc., were engaged in interstate commerce, operating boats carrying passengers on excursions to and from the wharf in the city, for and during the years 1920, to and including 1930. The Louisville & Cincinnati Packet Company and the River Excursion Company paid under the ordinance license fees aggregating $4,800; the Streckfus Steamers, Inc., paid during these years $20, and the Coney Island, Inc., $50.

On June 16, 1930, they filed an action against the city of Louisville in the District Court of the United States for the Western District of Kentucky, at Louisville, Ky., attacking the ordinance and its amendments on the ground that they were regularly enrolled, licensed, and engaged in the coasting trade under the laws of the United States in accordance with the provisions of chapter 12, title 46 USCA (section 251 et seq.), and asserted that such license authorized them to engage in the business designated by the ordinance, and that therefore it was void as to them, and that the city was illegally exacting of them the license fee fixed by the ordinance and its amendments. It was determined by the court that the city was without right to require them to pay the license fee fixed and imposed by the ordinance as amended.

In December, 1930, they filed this action against the city to recover the amount of license fees which they had paid to it under the original and amended ordinance, which they allege, together with interest, amounts to $6,353.70. On demurrer to the petition it was dismissed, from which this appeal was taken.

The city argues that the appellants had three remedies against the payment of the license tax, viz.: (a) Injunction; (b) payment and suit to recover back; (c) trial of the question in the ordinance division of the police court of the city of Louisville; and (d) that the payment of the license fees was made every September 1, for ten years, and under the circumstances such payments should be deemed voluntary. To sustain this insistence the city cites City of Lancaster v. Pope, 156 Ky. 1, 160 S.W. 509, Ann. Cas. 1915C, 752; Bean v. City of Middlesborough, 57 S.W. 478, 22 Ky. Law Rep. 415; Carr v. City of Memphis (C.C.A.), 22 F. (2d) 678, and Vol. 17 R.C.L., sec. 66, page 552.

In City of Lancaster v. Pope, the city endeavored to collect ad valorem taxes of Pope. He resisted payment and sought an injunction to prevent the city from collecting it. This court held that an injunction was an appropriate remedy to prevent the collection of illegal taxes upon personalty and sustained Pope's contention. An injunction is also the remedy to prevent the enforcement of a discriminatory ordinance assessing a license tax, to be paid under such ordinance. City of Danville v. Quaker Maid, Inc., 211 Ky. 677, 278 S.W. 98, 43 A.L.R. 590.

In Bean v. City of Middlesborough, cited by the city, an ordinance required "every huckster doing business in the city . . . shall pay a license of ten dollars per annum," and excepted from its operation persons living in the country who may bring to the city any country produce or marketing of their own raising and sell the same from his or their wagon, whether to a store or upon the streets to the citizens. Bean was arrested for a violation of this ordinance. After his arrest and before the trial, he agreed with the city authorities to take out the license, pay $10 therefor, on the condition that the warrant against him be dismissed. After so doing, he filed suit to recover the $10 paid by him and $1,000 damage for his arrest. The ordinance was valid, but did not apply to Bean, since he was engaged in raising and selling produce from his wagon. The court held that he was not entitled to recover; that having voluntarily paid the money under the circumstances he was estopped. It will be observed hereinafter that the rule enunciated in Carr v. City of Memphis, supra, and in 17 R.C.L., sec. 66, page 552, is not followed in this state.

Counsel for the city in the present case concedes that there is a line of cases in Kentucky apparently contrary to the contention of the city. The decisions of this court bearing on the question seemingly, but do not, conflict. The view that there is a conflict in the opinions of this court arises from the...