Southwestern Settlement & Development Corp. v. State, 5025

• Decision Date: 23 June 1955
• Docket Number: No. 5025,5025
• Citation: 282 S.W.2d 78
• Court: Texas Court of Appeals
• Parties: SOUTHWESTERN SETTLEMENT & DEVELOPMENT CORPORATION, et al., Appellants, v. The STATE of Texas, Appellee.

Page 78

282 S.W.2d 78

SOUTHWESTERN SETTLEMENT & DEVELOPMENT CORPORATION, et al., Appellants, v. The STATE of Texas, Appellee.

No. 5025.

Court of Civil Appeals of Texas, Beaumont.

June 23, 1955.

Rehearing Denied Sept. 21, 1955.

Blades, Kennerly & Whitworth, Houston, Ramsey & Ramsey, San Augustine, for appellants.

E. G. Aycock, Ft. Worth, for appellee.

WALKER, Justice.

This suit is for taxes for 1951 and 1952, levied on 46 tracts of land, amounting to approximately 35,000 acres, in San Augustine County. It was brought by the State in its own behalf and in behalf of San Augustine County and 12 common school districts in that county. The defendants were the Southwestern Settlement & Development Corporation, which owns the surface of the land, and three corporations which own the mineral estate therein, namely, Houston Oil Company of Texas, American Republics Corporation, and Republic Production Company. The cause was tried to a jury, which returned a verdict favorable to the plaintiff, and the trial court rendered judgment in plaintiff's behalf against said defendants for taxes, penalties, interest and costs totalling $20,112.22. From this judgment the defendants have appealed.

1. All of the points of error assigned pertain either to special defenses alleged by the defendants or to matters occurring on trial not involving plaintiff's evidence. And, except as the special defenses affect the judgment, the prima facie case for recovery made by the plaintiff is not attacked.

2. It is provided in art. 8, § 1, of the Texas Constitution, Vernon's Ann.St., that 'Taxation shall be equal and uniform' and that 'property * * * shall be taxed in proportion to its value'.

The essence of the special defenses alleged, so far as involved on this appeal, is discrimination against defendants by the Board of Equalization of the County in assessing defendants' property, either specifically or in consequence of arbitrary action. It has not been contended that the assessments of defendants' property exceeded the value of that property, and a comparison of the jury's findings under Issues 15 and 16, fixing the market value of the defendants' property on January 1, 1951, and on January 1, 1952, at $90 and $95 an acre, respectively, with the rate of $12 an acre at which defendants' property was assessed for each tax year in suit shows that assessments did not exceed value. The findings under Issues 15 and 16 are supported by evidence and error has not been assigned to them. The pleas to be considered, with the portions of the charge submitting them, are the following:

The defendants alleged, in substance, that the provisions of art. 8, § 1, just quoted had been violated in both tax years in suit by the Board of Equalization's adoption and use of a plan of assessment under which lands were not assessed according to value but were divided into classes determined by other facts and were then assessed at a certain sum per acre according to the class in which the particular land fell. In consequence, taxation for these years was not equal and uniform and a discrimination against the defendants had resulted which injured them because defendants' lands had been assessed proportionately higher than had lands of others. The plan alleged created two major classes of lands, those in towns and those not, and defendants alleged no plan of assessment concerning urban properties. However, as regards lands outside of towns the plan alleged was: (a) all timber land to be assessed at $12 an acre; (b) all other land on or easily accessible to hard surfaced road or highway to be assessed at $10 an acre; and (c) all land remaining to be assessed at $8 an acre. (d) The value of improvements was to be added in classes (b) and (c). (e) $1 an acre was to be subtracted from these values where the taxpayer did not own the minerals. This final element is not material here. Defendants alleged further that their lands had been assessed at a uniform rate pursuant to this plan.

This defense was submitted to the jury by Issues 1 to 6, inclusive, and the jury answered all of these issues No, thereby refusing to find from a preponderance of the evidence that a plan to assess lands at the several rates alleged by defendants had been adopted by the Board of Equalization for either tax year in suit.

The matter of arbitrary action was independently submitted by Issues 11 to 14, inclusive, and the jury answered No to the basic ones of these, 11 and 13. Thereby they refused to find from a preponderance of the evidence that the Board of Equalization had arbitrarily fixed the values of defendants' properties for either tax year in suit. Arbitrary was defined in part as meaning 'without adequate determining principle.'

In addition to the charge of assessment according to plan, the defendants alleged that a discrimination was practiced against them by the Board in favor of owners of land in cities and towns and also in favor of owners of timber land, the injury caused being a proportionately higher charge against the defendants.

This defense was submitted to the jury by Issues 7 to 10, inclusive, and to the basic ones, 7 and 9, the jury answered No. Thereby the refused to find from a preponderance of the evidence that the Board of Equalization had practiced discrimination against defendants or defendants' properties in fixing the values of these properties for either tax year in suit. Discrimination was defined, in part, as meaning that 'a higher percentage of the reasonable cash market value of one owner's property is fixed as its value for the purposes of taxation than the percentage of the reasonable cash market value at which other owners' properties are fixed for the purposes of taxation.'

The defendants moved for judgment n. o. v. but this motion was denied.

Point 1 assigns as error that the evidence proved as a matter of law the adoption and use by the Board of Equalization of 'an arbitrary and unlawful' plan of assessment for each tax year in suit, to the defendants' damage by way of discrimination. The argument made is, in effect, that the element of the plan alleged by defendants which was applicable to timber land was proved as a matter of law. Accordingly, the only question under this point is whether there is anything in evidence to support the verdict of the jury, and we conclude that there is evidence of the following matters.

Four members of the Board of Equalization for 1951 and 1952, the tax years in suit, testified. One, no longer in office, had been county judge, and the other three, still in office, were County Commissioners.

All of these witnesses testified that in 1951, before the Board made any assessments, the members of it took a general view of the County, by driving over and inspecting it, considering the nature of the land and the character of improvements. The former judge said that this required three days, but two of the commissioners said that it took much longer, a week or more.

In 1951, the Board also had available, and they used in determining assessments, a report on valuations of the property in San Augustine Independent School District which had been made for the District. According to the former judge, this school district extended six or eight miles beyond the boundaries of the town and so the report necessarily must have stated valuations of land to which the general plan alleged by defendants applied. The Board refused in many instances to accept the values stated in this report, finding some too high and others too low.

The four members of the Board who testified had some acquaintance with the values of lands from long residence in the county and from their experience in office, and they received information about values of property from various persons including the tax assessor. Testimony of all four of these witnesses shows that in 1951 and again in 1952, the defendants' agent appeared before the Board when the assessments to be made against the defendants were being discussed but that the defendants had never furnished the Board with any information about the values of their lands-except as the renditions may have done so. And according to Commissioners Harvey and Fitzgerald, the defendants' agent was requested at these times, both in 1951 and in 1952, to furnish this information, and Commissioner Gardner said that the Board requested this information during the period in suit.

The members of the Board who testified all denied that the plan of assessment charged by the defendants had been adopted by the Board, and all testified that the Board had attempted to determine the values of properties assessed, considering toward that end a number of different facts. The testimony of the three commissioners furnishes no support for the defendants' claim of a plan. Cross examination of the former judge showed that on the trial of a suit for taxes against another concern owning much timber land he had given some testimony which supports defendants' claim of a plan, and which, to some extent at least, he repeated on trial of this cause, but as we have just stated, he also gave testimony to the contrary, and there is some of his evidence which indicates that the elements of the plan charged by defendants really meant to him only preliminary points at which to begin the consideration of values. See S.F. 155-6; 166-9; 178-80. Testimony of Commissioner Gardner given on the same trial (S.F. 452) also indicates that this was done. Concerning the use of a given money value as such a beginning point, see Druesdow v. Baker, Tex.Com.App., 229 S.W. 493, at page 495; Port Arthur Independent School Dist. v. Baumer, Tex.Civ.App., 64 S.W.2d 412, at page 414; Lubbock Hotel Co. v. Lubbock I.S.D., Tex.Civ.App., 85 S.W.2d 776, at page 779.

These witnesses all testified that the Board tried in a general way to make assessments at 35%, or from 30 to 35 percent, of the value of the properties in the county, although there was some...