State v. State Board of Equalization of Montana

Decision Date21 May 1923
Docket Number5152.
Citation215 P. 667,67 Mont. 340
CourtMontana Supreme Court

Appeal from District Court, Silver Bow County; Wm. E. Carroll Judge.

Mandamus on the relation of George Bourquin, as County Attorney of Silver Bow County and as a taxpayer, to require the State Board of Equalization, Wellington D. Rankin, Attorney General, and others, and Peter J. Kelly, as Assessor of Silver Bow County, to properly assess property of the Butte & Superior Mining Company. From a judgment of dismissal for the defendants, the relator appeals. Affirmed as to the County Assessor and reversed as to the State Board of Equalization.

George Bourquin, Co. Atty., Ed. Fitzpatrick, and H. A. Tyvand, all of Butte, for appellant.

Kremer Sanders & Kremer, of Butte, and W. D. Rankin, Atty. Gen., for respondents.


This is an application for a writ of mandamus. On February 21, 1922 George Bourquin, as county attorney and a taxpayer of Silver Bow county, filed in the district court his affidavit setting forth that the Butte & Superior Mining Company, a corporation (hereinafter referred to as the company), was at all the times therein mentioned the sole owner of and operating the Black Rock mine in Silver Bow county; that on July 9, 1920, the company made and delivered to the assessor of said county the written and verified statement required by sections 2563, 2564, and 2565, Revised Codes of 1907, showing the gross yield of ores of said Black Rock mine for the year next preceding June 1, 1920, to have been of the value of $6,787,783.48, and likewise showing that the actual expenditures during that year for necessary labor, machinery, and supplies needed and used in its mining operations, for improvements necessary in and about the working of said mine, for reducing the ores, transporting the same, and extracting the metals therefrom, and for the construction of mills and reduction works used and operated in connection with the mine (being all the deductions specified in the above sections of the Code), amounted to $5,601,537.68, which made the net proceeds of the operations for said year amount to $1,186,245.85, but that the company at the time of filing the statement wrongfully, unlawfully, and without authority of law placed in said statement an item of expenditure and deduction of $2,719,379.73, which was charged off as "cost of ore purchased," thereby showing a deficit of $1,533,133.93, while in truth and fact it had purchased no ores whatever during that time; that said deduction was wilfully made in order to evade payment of taxes on the net proceeds of the Black Rock mine for the preceding year, and thereby the assessor of the county was deceived so that he did not place on the "assessment book of the net proceeds of mines" for the year 1920 the name of the said company or assess it with or for any net proceeds of mines for said period; that the county board of equalization did not have its attention called to these facts until its meeting in the following year, but that on July 21, 1921, while said board was in session, the same were brought to its notice, and on that date it notified the company in writing that on August 3, 1921, it would take up, consider, and act upon the matter of directing the county assessor to assess such net proceeds; and that at the time designated the company appeared in response to the notice and furnished additional information showing that said deduction was the amount which it had been obliged to pay to the owners of the Elm Orlu mine for ores which it had extracted therefrom during a period of time extending from May 31, 1912, to May 31, 1920, through a mistake as to its rights, and that it had from year to year during said time paid the net proceeds tax upon all of said ores, and by reason of these facts claimed to be lawfully entitled to make such deduction; that this matter was considered by said board of equalization, and such proceedings were had in connection therewith that on the 8th day of August, 1921, it made and entered an order directing the county assessor to enter on the assessment book of Silver Bow county for the purpose of taxation as the net proceeds of the Black Rock mine for the year extending from June 1, 1919, to June 1, 1920, the sum of $1,186,245.80, but that said assessor willfully, knowingly, and fraudulently at all times refused so to do; that on August 12, 1921, the company appealed to the state board of equalization (hereinafter referred to as the state board) from this action of the county board of equalization of Silver Bow county, which appeal was duly perfected and subsequently came on for hearing before the state board, and that body, after hearing statements and arguments of the several parties interested and considering the same, on October 7, 1921, caused the following entry to be made in the minutes of its proceedings:

"The appeal of the Butte & Superior was taken up and discussed, after which Mr. Stewart moved the appeal of the Butte & Superior be granted. This motion was seconded by Mr. Porter. Clerk was instructed to call the roll. Voting: Mr. Stewart, Yes. Mr. Porter, Yes. Mr. Rankin, No (until further hearing). Governor Dixon, Yes. Motion carried."

The affidavit then recites that the state board by said action in effect held that the company was not subject to assessment for net proceeds from said Black Rock mine for the year 1920, and that said net proceeds were not subject to taxation at all for said year, which action is alleged to have been taken unlawfully, knowingly, and intentionally, contrary to the laws of this state and in total disregard of its duties and powers as a board of equalization in the matter of the taxation of the net proceeds of mines; that said state board acted in bad faith and has refused to reassemble or further consider its action, and by reason thereof the relator and other taxpayers of Silver Bow county have suffered loss and damage by the addition of increased burdens of taxation upon their property, and that the relator has no plain, speedy, or adequate remedy in the ordinary course of law.

Upon the filing of this affidavit an alternative writ of mandate was issued, directed to the assessor of Silver Bow county and to the state board commanding the board to reassemble and take further action upon said appeal, to revoke and annul their order theretofore made, and to assess and tax said company for the net proceeds of the Black Rock mine for the period ending June 1, 1920; and commanding the assessor to immediately place upon the "assessment book of net proceeds of mines" of Silver Bow county said net proceeds, or that they show cause before the court on March 4, 1922, why they had not done so.

Upon the return day of this alternative writ, the respondent state board appeared and moved to quash, vacate, and set the same aside upon numerous grounds, among them being that the court was without jurisdiction of the subject-matter; that the affidavit upon which the same was issued did not state facts sufficient to constitute a cause of action or to entitle the relator to any relief; and that mandamus was not the proper remedy. A similar motion was made on behalf of the respondent county assessor. After a hearing the motions were sustained, and thereupon, on May 5, 1922, a judgment was entered to that effect, which also contained the following:

"It is further ordered, adjudged, and decreed that the said action be and is hereby dismissed and that judgment be entered in favor of the defendants upon the merits."

From this judgment the relator has appealed.

In the proceedings before the state board and in this...

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