Roberts v. American Nat. Bank of Pensacola

• Decision Date: 01 August 1927
• Citation: 115 So. 261,94 Fla. 427
• Parties: ROBERTS, Tax Collector of Escambia County v. AMERICAN NAT. BANK OF PENSACOLA.
• Court: Florida Supreme Court

115 So. 261

94 Fla. 427

ROBERTS, Tax Collector of Escambia County v. AMERICAN NAT. BANK OF PENSACOLA.

Florida Supreme Court

August 1, 1927

Suit by the American National Bank of Pensacola against J. S Roberts, Tax Collector of Escambia County, for an injunction. From an order overruling a demurrer to the complaint and granting a temporary injunction, defendant appeals.

Affirmed.

Syllabus by the Court

SYLLABUS

National bank being agency of United States, its shares can be taxed by states only in manner and to extent authorized by federal statutes; construction by federal courts of federal statutes permitting states to tax national bank shares is binding on state courts. A national bank is an agency of the United States, and its shares can be taxed by the states only in the manner and to the extent authorized by federal statutes, and the construction given to such statutes by the federal courts in binding upon the state courts.

In proceeding to tax national bank stock, if appropriate facts are alleged showing dispute involving right under federal statute permitting such taxation, statute is invoked without specially pleading it. In a proceeding to collect taxes assessed against the shares of a national bank to their owners, disputed questions as to the liability of such shares ordinarily arise under the federal statute authorizing their taxation, and when appropriate facts are alleged, distinctly and definitely making it appear that the dispute involves some right claimed under such statute, such allegations are sufficient to enable the statute to be invoked, without specially pleading the act or its provisions.

To invoke equity to restrain collection of state tax for invalidity, complainant must exclude every reasonable hypothesis of legal assessment. To invoke equity to restrain the collection of state taxes on the ground of the invalidity of the assessment, complainant must exclude every reasonable hypothesis of a legal assessment.

One assailing good faith of tax assessors and validity of their official acts must charge and prove bad faith and invalidity of acts. When the good faith of tax assessors and the validity of their official acts are assailed, the burden is upon the complainant of clearly and distinctly charging the bad faith of such official and the invalidity of such acts as well as of proving the same.

Showing that state assessors habitually and intentionally or by prescribed rule assessed national bank shares higher in proportion to value than other competing moneyed capital held ground for avoiding state tax. Discrimination in taxation against the shares of national banks, resulting from the actions of tax assessors, may be relied upon to avoid a tax on such property when it appears that tax assessors habitually and intentionally, or by some rule prescribed by themselves or by some one whom they are bound to obey assessed such shares higher in proportion to their value than other moneyed capital coming into competition with the business of such banks.

Equity will relieve against illegality or intentional or systematic unjust discrimination in taxation. Equity will afford appropriate relief against illegality or intentional or systematic unjust discrimination in taxation.

When property substantial in value is deliberately or intentionally omitted from assessment roll, any one whose burdens are unduly increased thereby has right of complaint against entire assessment (Rev. Gen. St. 1920, §§ 694, 696 716, 717). The statutes of Florida require that all property, real and personal, in the state, and all personal property belonging to residents of the state, not expressly exempted by statute, shall be subjected to taxation; and when property subject to taxation, substantial in value, is deliberately or intentionally omitted from the assessment roll by an assessor with knowledge of its liability, a right of complaint is thereby given against the entire assessment to any one whose burdens are unduly increased by such omission.

Complaint by national bank to enjoin collection of tax on its shares, alleging omission of competing property from assessment roll, held sufficient on demurrer (Rev. St. U.S. § 5219 [12 USCA § 548]). A charge by a complainant, against whose property it appears an assessment has been made substantial in amount, that a tax assessor omitted from the assessment roll a large amount of specifically mentioned property and of great value, that same was known to the assessor and that he deliberately failed to assess same for taxation, sufficiently shows the invalidity of the acts of the assessor, clearly distinguishing the same from the exercise of a discretion as to value, mistaken judgment, or accidental omission, and affords grounds for equitable interference.

Appeal from Circuit Court, Escambia County; A. G. Campbell, judge.

COUNSEL

J. R. Johnson, Atty. Gen., and H. E. Carter, Asst. Atty. Gen., for appellant.

Watson, Pasco & Browne, of Pensacola, for appellee.

OPINION

LOVE Circuit Judge.

This suit was brought by the appellee, a banking association organized under the National Banking Law of the United States to enjoin the appellant, the tax collector of Escambia county, from collecting a tax levied upon the shares of its stockholders, for the year 1925, payment of which was demanded of the complainant as agent of the holders of such shares. The bill assails the validity of such tax upon three grounds, alleging:

(1) That such tax is discriminatory in that other moneyed capital coming in direct competition with complainant and subject to taxation under the laws of Florida was not taxed at all for the year 1925, while state and county taxes were levied against the shares of the capital stock of complainant.

(2) That under the Constitution of the state of Florida, as amended in 1924, shares of the capital stock of national banks are not taxable at a higher rate than 5 mills on the dollar.

(3) That because a large amount of property of like character to that of shares of capital stock of national banks, and subject to taxation, has not been assessed for taxation in Escambia county, the assessment against the shares of the capital stock of complainant is so arbitrary and discriminating as to amount to fraud and to render such tax invalid and void.

The defendant filed a demurrer, attacking the bill as a whole, and also the several grounds for relief alleged in the bill. Upon hearing of the demurrer and the application of complainant for a temporary injunction, an order was entered whereby the demurrer was overruled and a temporary injunction granted, from which order this appeal was taken.

1. After alleging the payment by complainant of the tax on real estate, assessed against it, the bill charges that the tax assessed against the stock of complainant corporation in the hands of its stockholders is invalid and void because of illegal discrimination, and, to establish this claim, alleges that after deducting the assessed value of its real estate, the aggregate assessed valuation of its capital stock for the year 1925 on the tax rolls of Escambia county was $232,000, which is alleged to be only 50 per cent. of its actual value, and the aggregate amount of the tax assessed against all of its stockholders for state and county purposes was $13,220; that the entire property of complainant, other than its real estate and fixtures for said year 1925, consisted of moneys, deposits in banks, notes, mortgages, and similar securities; that on January 1, 1925, and during said year, there were, in addition to all banks doing business in said county 20 companies licensed to lend money and actually engaged in the business of lending money; that said companies had an aggregate capital of more than $200,000 all used in the business aforesaid and in said county at said time, and that said companies were on January 1, 1925, and during said year, actually engaged in the lending of money on real estate, mortgages, notes, retention of title contracts and similar securities; that the complainant as a part of its banking business was then and there lending money on securities identical in character with that enumerated, and the capital invested in said other companies then and there came in direct competition with the complainant in its business as a national bank and was substantial in amount; that companies and individuals in Escambia county, at the time aforesaid, had invested in the business of lending money on securities, in direct competition with the complainant and other banking companies in the banking business, more than half a million dollars; that 'the capital stock of said 20 other companies was not assessed or taxed at all for said year, nor were any of the loans, credits, or moneys of said companies or any of them assessed, but, to the contrary, all of said companies and all of the individuals and companies engaged in the business as aforesaid were exempt from all taxation other than license tax on the capital stock and on all loans, mortgages, notes, moneys, deposits, and evidences of indebtedness'; and that if the tax on the shares of the capital stock of complainant should be enforced, and if the other companies and individuals competing with complainant and their property are exempt from taxation, the result would be an unjust and illegal discrimination against the shareholders of complainant corporation, in that the taxation imposed upon the shares of the capital stock of said corporation would be at a greater rate than is assessed upon other moneyed capital in the hands of individual citizens of the state.

Appellant contends that because in its original bill appellee specially pleaded the provisions of section 5219 of the Revised Statutes of the United States (12...