Security Abstract & Title Co. v. Leonardson

• Decision Date: 23 December 1953
• Docket Number: No. 7941,7941
• Citation: 264 P.2d 1027,74 Idaho 528
• Court: Idaho Supreme Court
• Parties: SECURITY ABSTRACT & TITLE CO. v. LEONARDSON et al.

Page 1027

264 P.2d 1027

74 Idaho 528

SECURITY ABSTRACT & TITLE CO. v. LEONARDSON et al.

No. 7941.

Supreme Court of Idaho.

Dec. 23, 1953.

Davison & Davison and R. H. Copple, Boise, for appellant.

J. N. Leggat, Asst. Atty. Gen., Blaine F. Evans, Pros. Atty., J. Charles Blanton, Dep. Pros. Atty., Boise, for respondents.

Richards, Haga & Eberle, Boise, amici curiae.

KEETON, Justice.

Appellant, in Idaho corporation, doing business as a title insurance company sought in a proceeding in the district court to enjoin the assessor of Ada County and its sheriff from collecting an ad valorem tax levied for the year 1951 on appellant's tract indexes and records used in the business in which it is engaged. Appellant had paid taxes for the year upon its premiums for the business written under the provisions of SEC. 41-2806, I.C., 1947¹ S.L. Ch. 249, Sec. 6.

Appellant claims that the premium tax of one per cent so paid is in lieu of all other property taxes assessable against it, and that its books, records and equipment used in conducting its business are not subject to an ad valorem tax in addition to its premium taxes paid.

Prior to the enactment of Sec. 41-2806, I.C., Ch. 249, 1947 S.L., when the Legislature originally provided for regulations of title insurance companies, Ch. 117, 1945 S.L. Sec. 6 of said act exempted title insurance companies from the annual tax on premiums covering other insurance companies. Taxes levied against such title insurance companies for the years 1945 and 1946 were assessed in accordance with the general laws relating to taxation, Ch. 117, 1945 S.L., Sec. 6. ²

In 1947 the title insurance act, Ch. 117, 1945 S.L., was amended by Ch. 249, 1947 S.L. Sec. 6 of the prior act (1945) was amended by Sec. 6, Ch. 249, 1947 S.L., page 663, now Sec. 41-2806, I.C.

In the same session of the Legislature, prior to the passage of Ch. 249, 1947 S.L. above, the Legislature passed Ch. 50, now Sec. 41-804, I.C., ³ which among other things provides that title insurance companies shall pay, together with other insurance companies, a tax of three per cent on the amount of gross premiums collected in excess of premiums and cancelations returned to policyholders.

Sec. 41-2806, I.C. taxing title insurance companies one per cent does not say that this tax shall be in lieu of other personal property taxes; and it is the contention of respondents that in addition to the one per cent tax paid under the provisions of Ch. 249, 1947 S.L., Sec. 41-2806, I.C., the county has the right to assess an ad valorem tax against the personal property of appellant used in its business. It plainly appears that Sec. 41-2806, I.C. is in conflict with Sec. 41-804, I.C.

While the general insurance act relative to taxation of insurance companies, Sec. 41-804, et seq. I.C., specifically provides in Sec. 41-806, I.C. ⁴ that the premium tax paid under the provisions of Sec. 41-804, I.C. shall be in lieu of all other taxes except real estate; Sec. 41-2806, I.C. assessing title insurance companies one per cent does not so provide.

Respondents argue that appellant should have proceeded under Secs. 63-401, I.C., 63-2210, I.C., as amended, 1951 S.L. Ch. 81, page 150 and 63-2214, I.C., for which reason, they contend this action cannot be maintained. The question here presented is not the equalization of a valid tax levied, nor whether appellant is or is not exempt from taxation.

If the respondent assessor had no authority under the conditions presented, and complained of, to make an ad valorem assessment against appellant's property, then the tax is void and can be challenged in the manner here done. Equity can afford relief against a void or illegal assessment. The procedure provided by law for the correction of an erroneous or excessive assessment is not involved. Oregon Short Line v. Ada County, D.C., 18 F.Supp. 842; Ada County v. Oregon Short Line R. Co., 9 Cir., 97 F.2d 666; Nelssen v. Elec. Dist. No. 4, 60 Ariz. 175, 133 P.2d 1013; McDonald v. Clarke County, 196 Iowa 646, 195 N.W. 189; Hutchinson v. City of Omaha, 52 Neb. 345, 72 N.W. 218; Koch v. City of Detroit, 236 Mich. 338, 210 N.W. 239; Chicago M. St. P. & P. Rd. Co. v. Kootenai County, 33 Idaho 234, 192 P. 562.

Appellant does not claim it is exempt from taxation and the question here presented is whether the tax appellant pays on the premiums under Sec. 41-2806 I.C. is in lieu of other personal property taxes, that is, must appellant pay the premium tax and the ad valorem tax in addition?

Unless we apply the general provisions relative to the taxing of all personal property, there is no provision which provides for an ad valorem tax against appellant's property.

The original provision for taxing title insurance companies on an ad valorem basis, the same as other personal property in the state was amended by Sec. 6, Ch. 249, 1947 S.L., now Sec. 41-2806, I.C., and at the time the assessment here challenged was made had not been re-enacted. The above section, Sec. 41-2806, I.C., must be construed in conjunction with the tax pattern adopted by the Legislature for taxing insurance companies. If it was the intention of the Legislature to tax the title insurance companies on a premium basis, in addition to an ad valorem tax, it certainly did not say so. On the other hand it substituted a premium tax for the previous ad valorem tax.

Construing the section providing for the one per cent tax on...