Sims v. Fletcher Sav. & Trust Co.

• Decision Date: 09 January 1924
• Docket Number: No. 24541.,24541.
• Citation: 142 N.E. 121,194 Ind. 93
• Court: Indiana Supreme Court
• Parties: SIMS et al., State Board of Tax Com'rs, v. FLETCHER SAVINGS & TRUST CO.

194 Ind. 93

142 N.E. 121

SIMS et al., State Board of Tax Com'rs,

v.FLETCHER SAVINGS & TRUST CO.

No. 24541.

Supreme Court of Indiana.

Jan. 9, 1924.

Appeal from Circuit Court, Hamilton County; Fred C. Gause, Special Judge.

Action by the Fletcher Savings & Trust Company against Fred A. Sims and others, constituting the State Board of Tax Commissioners. Judgment for plaintiff, and defendants appeal. Transferred from Appellate Court under Burns' Ann. St. 1914, § 1394. Affirmed.

Superseding opinion of Appellate Court, 136 N. E. 26.

Woolen, Cox & Welliver, Chas. N. Thompson, Vinson Carter, and Donald S. Morris, all of Indianapolis, for appellants.

U. S. Lesh, Atty. Gen., and Myers, Gates & Ralston, of Indianapolis, for appellee.

WILLOUGHBY, J.

The appellee is a trust company organized and doing business under the laws of the state of Indiana, and in this action seeks to have certain deductions made from the total assessed value for taxation of its capital or capital stock, which was denied by appellants, who constitute the state board of tax commissioners of Indiana.

The complaint is in substance as follows:

The plaintiff is a trust company incorporated under the laws of the state of Indiana and that it exists, operates, and does business as such trust company under and pursuant to the laws of the state of Indiana in the city of Indianapolis, Marion county, in said state.

The defendants are the duly appointed, qualified and acting members of the state board of tax commissioners of Indiana and an such members constitute said board by virtue of their said appointment pursuant to the provisions of the statutes of the state of Indiana, embodied in an act of the General Assembly of said state, approved March 11, 1919 (Laws 1919, c. 59) and entitled “an act concerning taxation repealing all laws in conflict therewith and declaring an emergency.”

That under the provisions of said tax law said defendants as such board of tax commissioners are charged with the duty of valuing and assessing for taxation the capital or capital stock of plaintiff and other trust companies of said state according to certain rules and regulations by said law provided and specified.

That to aid and enable said defendants to so value and assess the capital or capital stock of plaintiff, said law required of plaintiff that it should between the 1st day of March and the 1st day of April of each year make out a statement under oath in duplicate amongst other things showing the true cash value of the entire capital stock of such plaintiff trust company as of the 1st day of March of the current year and deliver the said statement to the auditor of the county wherein said plaintiff trust company is located which said statement said auditor was by said law required to forward to said state board of tax commissioners.

The plaintiff did, pursuant to said tax law and to section 76 thereof, between the 1st day of March and the 1st day of April, 1919, make its said statement under oath as aforesaid showing amongst other things required by said statute, the amount of its entire capital stock and the true cash value thereof, as of the 1st day of March of said year, and did deliver the same to the auditor of Marion county, Ind., wherein plaintiff is located as aforesaid; that such statement was by said auditor duly transmitted to said state board of tax commissioners so constituted as aforesaid for the assessment thereon by said state board of plaintiff for taxation for said year; that said statement showed the gross value of the entire capital stock of said plaintiff trust company as represented by and comprising capital, surplus, undivided profits, current profits, and reserves for contingencies, rent, interest, and taxes to be the sum of $2,094,410.87; that said statement further showed a bona fide debt and liability against said gross value for accrued interest on deposit set forth therein as a reserve for interest in the sum of $112,435.16, and in the further sum of $21,972.31 set forth therein as a reserve for taxes, which items of bona fide indebtedness did in fact then and there exist; that said statement further showed that plaintiff trust company had acquired an ownership in real estate, namely, its bank building in which it transacts its business, by the investment therein of the sum of $639,135.92, which statement in said particular was true; that plaintiff holds a leasehold title to the real estate on which its banking house is situated at the northwest corner of Market and Pennsylvania streets in the city of Indianapolis, under which plaintiff has the exclusive right of possession, use, enjoyment, and disposition for a period of 99 years with the privilege of renewal for a further term of 99 years; that on said real estate plaintiff has caused to be erected and maintains and occupies a banking house in the erection of which banking house it has invested the aforesaid part of its capital, namely, $639,135.92; that said building is assessed for taxation by the taxing officers of Marion county in the sum of $625,000, and said real estate in the sum of $530,000.

That said tax law and said section 76 thereof provide that, in arriving at the true cash value of the entire capital stock of a trust company for the purposes of assessment for taxation, credit shall be given and the bona fide indebtedness of such trust company shall be deducted from aforesaid gross value; that by reason of such provision in said law it became and was the imperative duty of defendants as such state board of tax commissioners, at its first annual session for the current year of 1919 began and held on the first Monday of April for the purpose of making original assessments of the property of certain classes of persons and corporations including trust companies, to value and assess for taxation the capital or capital stock of plaintiff as shown by the statement hereinabove referred to, together with such other evidence as might be before said board in the premises; and it became and was then and there the imperative duty of defendants as such board under said law in finding the true cash value for assessment for taxation of plaintiff's capital or capital stock to deduct from the gross cash value thereof the bona fide indebtedness of said trust company as shown by said statement as hereinabove set out, and to deduct from said gross cash value the investment of plaintiff in its bank building hereinabove set forth.

That defendants as such state board of tax commissioners at its said first session for the current year of 1919 did consider the aforesaid statement of plaintiff and the matter of the assessment of its capital or capital stock and did find the gross value thereof to be the sum of $2,094,400; that at said first session said defendants as such board, contrary to the express mandate of said tax law and section 76 thereof, did fail and refuse to deduct from said gross value of plaintiff's capital or capital stock the bona fide indebtedness hereinabove averred, namely, the sum of $112,435.16 for accrued interest and the sum of $21,072.31 for taxes for 1918 accrued and payable, and that at said first session said defendants as such board, contrary to the express mandate of said tax law and section 76 thereof, did fail and refuse to deduct from said gross value of plaintiff's capital or capital stock the sum of $639,135.92 thereof invested in its said bank building as hereinabove set forth; but that said defendants, as such board, did at its said first session contrary to the express intent and purpose of said tax law value and assess for taxation the capital or capital stock of plaintiff at said gross sum of $2,094,400.

That thereafter plaintiff did pursuant to the provisions of said tax law and the rule and regulations of said tax board apply to said board by its petition in writing for a rehearing and a change and revision of said valuation and assessment by making aforesaid deductions and each of them severally, to be presented and heard at the second session of said board for the current year begun and held July 8, 1919, and continuing 12 days; that said petition for such change in plaintiff's assessment came on to be heard and was, by said defendants as such board, on the 19th day of July, 1919, denied, and said tax board then and there finally refused to make said deductions or any of them, and plaintiff's assessment for the current year was finally and definitely and contrary to their clear import and purpose of said law fixed at said gross sum of $2,094,400.

That unless enjoined by law and the process of this court defendants will immediately certify said assessment to the auditor of Marion county, who will place the same on the tax duplicate for the collection of the same by the treasurer of said county, and if the taxes on the whole of said assessment are not paid plaintiff's property will be levied upon and sold therefor and plaintiff will suffer great and irreparable injury for which it has no legal remedy; that in failing and refusing to make said deductions and each of them severally said defendants said tax board were and are acting without right or jurisdiction, and said assessment is wholly void.

Prayer that a preliminary writ may be issued forthwith against defendants as such state board of tax commissioners enjoining them from certifying said assessment to the auditor of Marion county until the final hearing of this cause and that upon such final hearing plaintiff be awarded a mandatory injunction requiring defendants as such tax board to make said deductions and each of them from said gross sum of $2,094,400, and to certify to the auditor of Marion county the sum remaining as the lawful and proper assessment of plaintiff's capital and capital stock for the current year.

A demurrer was filed to the complaint alleging that it did not state facts sufficient to constitute a cause of action. The demurrer was overruled and exceptions taken. The...