Smith v. Kelly

• Decision Date: 10 July 1893
• Citation: 33 P. 642,24 Or. 464
• Parties: SMITH v. KELLY, Sheriff, et al.
• Court: Oregon Supreme Court

33 P. 642

24 Or. 464

SMITH v. KELLY, Sheriff, et al.

Supreme Court of Oregon

July 10, 1893

Appeal from circuit court, Multnomah county; L.B. Stearns, Judge.

Action by J.E. Smith against Penumbra Kelly, as sheriff, and Multnomah county, to enjoin the collection of certain taxes. From a judgment dismissing the complaint, plaintiff appeals. Affirmed.

The other facts fully appear in the following statement by MOORE J.:

This is a suit against Multnomah county and its sheriff to perpetually enjoin the collection of a tax levied upon a mortgage taken by plaintiff as security for the payment of $9,000 upon real property. The complaint alleges that all real and personal property in said county was assessed at 50 per cent. of its true cash value, and that the assessment roll was examined and approved by the county board of equalization at such valuation, but that the state board arbitrarily increased the assessment upon the real property including city and town lots, to 65 per cent, and upon mortgages to 100 per cent., of such true cash value; that the county clerk, in making the tax roll of said county, inserted the value so increased, extended the tax thereon, attached a warrant thereto, and placed it in the hands of the sheriff for collection; that plaintiff's mortgage, by said increase in the valuation, was taxed at $175.50, but should have been no more than $104.07, which sum he tendered the sheriff in full satisfaction of the tax thereon, but that said officer refused to accept the tender; and that the tax creates a cloud upon the plaintiff's mortgage. To prevent the collection of this alleged overcharge he prayed the injunction. The answer denied these material allegations, and the case, being at issue, was tried by the court, and a decree rendered dismissing the complaint, from which the plaintiff appeals.

He contends--First, that the state board of equalization had no authority to classify mortgages for taxation separate from real estate; second, that if such power were given, it would be in contravention of section 1, art. 9, of the constitution, and that an assessment upon such classification would be void; third, that the evidence shows that the state board of equalization assessed his mortgage at a higher per centum than other real estate in said county; and, fourth that there is now no law under which a mortgage upon real estate can be assessed, or taxes levied or collected thereon.

Geo. H Williams and W.D. Fenton, for appellant.

Geo. E. Chamberlain, Atty.Gen., and John Hall Dep.Dist.Atty., for respondents.

MOORE, J., (after stating the facts.)

1. Section 7 of the act creating the state board of equalization provides that said board, in equalizing the valuation of property, as assessed in the different counties, shall consider real estate, including town and city lots, and personal property, separately; and section 8 of said act provides that said board in the performance of its duties shall add to or subtract from the aggregate valuation of the real and several kinds or classes of personal property of every county which they believe to be valued below or above the true and fair value thereof in money such per centum in each case as will bring the same to its true and fair value in money. Sess.Laws 1891, p. 182. From these sections appellant contends that there is but one class of real property, and the state board of equalization had no authority to make any change, except in the aggregate value thereof. The general rule for the interpretation of ambiguous statutes is to give them such construction as shall suppress the mischief and advance the remedy, putting down all subtile inventions and evasions for continuance of the mischief, and adding force and life to the cure and remedy, according to the true intent of the makers of the act. Parkinson v. State, 74 Amer.Dec. 522. The manifest object and intent of the legislature in creating the state board of equalization was to secure uniformity of assessment of the different classes of taxable property between the several counties. The tax levy for state purposes being uniform over the whole territory, and based upon the values fixed by the county assessor as approved by the local board, if that officer could undervalue property, notwithstanding the law requires him to assess it at its full cash value, (Code, § 2770,) the amount of state taxes collected thereon would be correspondingly low, and the temptation would present itself to each county assessor to undervalue property so that his county might escape the payment of as much as possible of its state taxes, while a high rate of taxation for county purposes could be computed upon a low assessment, and thus meet the demands of the county. Such a method would seem to offer a premium to that county whose assessor made the lowest assessment of property. The legislature created the state board of equalization to suppress the mischief that might possibly arise from such a system of assessment, and provided the remedy by equalization among the several counties. Another rule of interpretation is that all the sections of a statute shall be considered together, so as to harmonize and give effect to each clause if possible. Section 3 of the act, supra, prescribes the oath of office required of the members of the board, and each swears that he will equalize all the property, both real and personal, as enumerated upon the equalized county assessment rolls of the several counties of the state. Real estate is divided into three classes: (1) City, village, or town property, which, if divided into lots and blocks, shall be separately described on the assessment roll, (Code, §§ 2770, 2771;) (2) mortgages, deeds of trust, contracts, or obligations whereby land situated in no more than one county is made security for the payment of a debt; and (3) all other real property, which is to be described by legal subdivisions, or in such manner as to make the description certain. Sections 2770, 2773. These three classes are enumerated on the assessment roll by the county assessor, and the members of the state board of equalization swear that they will equalize them among the several counties. If appellant's contention were true that the several kinds of real property constituted but one class, and either kind was assessed in the judgment of the board at its full cash value, and the others at less than such value, then any addition to the aggregate valuation would increase the assessment of one kind of real property above its full cash value, and thus clearly become a violation of section 32, art. 1, of the constitution, which requires that all taxation shall be equal and uniform. To illustrate: Mortgages might be assessed in a county at their full cash value, and the other kinds of real property at a nominal sum. In such case the state board of equalization would be powerless to remedy the evil, since any increase of the aggregate valuation would raise the assessed value of mortgages above their full cash value. In Railroad Co. v. Croisan, 22 Or. 393, 30 P. 219, Bean, J., says: "To say that the act creating the state board of equalization is a piece of hasty and crude legislation is to say what is obvious; but laws of this kind are remedial in their character, intended to correct an admitted evil by requiring each county to pay its just proportion of the burden of maintaining the state government, to suppress wrong, and to promote the public good, and should be liberally construed, so as to bring under their operation, says Mr. Endlich, 'as well that which is within their meaning as that which is within their letter.' End.Interp.St. 346. And when the act in question is so construed in connection with the provisions of the assessment law to which it relates, we think it manifest the board has power to revise and equalize the aggregate valuation of the several classes of real property authorized by law and enumerated upon the assessment rolls." Taking the several sections of the act together, and considering the mischief to be avoided, and the remedy proposed by the act creating the board of equalization, we think the conclusion reached by this court as announced by Bean, J., is correct.

2. The legislative assembly has, in the creation of the board of equalization, provided by law for a uniform and equal rate of assessment and taxation, and prescribed such regulations as should secure a just valuation of all property, both real and personal, for the purposes of taxation, as required by section 1, art. 9, of the constitution. The...