State v. State Board of Equalization

• Decision Date: 12 January 1920
• Docket Number: 4478.
• Citation: 186 P. 697,56 Mont. 413
• Parties: STATE v. STATE BOARD OF EQUALIZATION et al.
• Court: Montana Supreme Court

186 P. 697

56 Mont. 413

STATE v. STATE BOARD OF EQUALIZATION et al.

No. 4478.

Supreme Court of Montana

January 12, 1920

Original proceedings in mandamus, on the relation of the State against the State Board of Equalization and others, to compel assessment of intercounties properties of certain power companies. Peremptory writ issued.

See also, 185 P. 708.

After the opinion on motion to quash was delivered, issues were joined by answer of the board and the separate answer of each of two members. The cause was then referred to James A Walsh, Esq., to take testimony and report findings and recommendations upon these questions:

Did the state board of equalization equalize the assessments made by the several county assessors of property belonging to the Montana Power Company, the Great Falls Power Company, the Thompson Falls Power Company, and the Montana Reservoir & Irrigation Company, so as to make the assessments represent the full cash value of the property assessed?

Did the board assess the intercounties property belonging to these corporations, as required by law?

To the report made by the referee the Attorney General filed exceptions, and the cause was thereupon argued and submitted for final determination. All objections by the relator to the assessment of the property of the Montana Reservoir & Irrigation Company were withdrawn, and the subject-matter of that assessment is no longer before us.

S. C. Ford and Frank Woody, both of Helena, for the State.

John Brown, of Helena, for respondent. W. B. Rodgers, of Anaconda, D. M. Kelly, of Butte, and Henry C. Smith, of Helena, amici curiae.

PER CURIAM.

1. Upon the hearing before the referee, the Attorney General offered in evidence the several reports made by these corporations to the Public Service Commission for the years 1914 to 1918 inclusive, for the purpose of showing that each of these corporations in making its reports treated its property as an entire plant, making no segregation of the different transmission lines, but regarding them as a single line and continuous property. By this evidence it was sought to furnish a basis for the inference that the board had failed to make an original assessment as required by subdivision 5, section 1, chapter 48, Laws of 1919. These reports were again offered for the purpose of showing the cost of each plant and equipment, the amount of capital stock of each company, and the amount of its bonded indebtedness, in order to furnish a basis for the inference that the board had not revised the assessments made by the several county assessors so as to make the assessments represent the full cash value of the property locally assessed. All of this evidence was excluded by the referee, and the Attorney General predicates error upon the rulings. The contention must be overruled. The evidence did not reflect in any way upon the question whether the property owned by each company should be regarded by the board as an entire property and plant. This was a question to be determined by the board as a conclusion of law from the facts showing the situation of the several transmission lines; that is, whether they were in fact intracounty or intercounty lines, to be assessed by the county assessors or by the board. It was wholly immaterial how any one of the companies considered its property. Neither was the evidence competent to show the value of the property. As was pointed out in the opinion on motion to quash, it was not within the province of this court to ascertain and fix values for the purpose of assessment.

2. Did the board review the assessments made by the county assessors? Subdivision 7, section 1, chapter 48, above, provides that the board shall "adjust and equalize the valuation of taxable property among the several counties; *** supervise and review the acts of the county assessor and the county boards of equalization; change, increase or decrease valuation, *** and exercise such authority and do any and all things necessary to secure a fair, just and equitable valuation of taxable property among the counties." This is merely an amplification of the duty imposed on the board by section 15, article 12, of the Constitution.

Neither the statute nor the Constitution prescribes the method of review, or what steps shall be taken in arriving at a fair, just, and equitable valuation. The minutes of the board show that the board had before it the assessments made by the several county assessors; considered and discussed those assessments; took testimony as to the value of all the property so assessed; and approved the assessments as made, except that the board increased the valuation placed by the assessors on intracounty power transmission lines 30 per cent. The board, in this instance, was sitting, not as original assessors, but merely for the purpose of reviewing, adjusting, and equalizing the assessments made by the county assessors, or taking such other steps as it might deem proper to secure a fair, just, and equitable valuation of the property so assessed, but the manner in which it should proceed and the result to be reached were entirely within its own judgment and discretion. The court could compel action, in the event of the failure or refusal of the board to act; but, having proceeded in the matter, exercising its own judgment and discretion, in the absence of any statutory provision directing how the board shall proceed, and in the absence of fraud or what amounts to fraudulent action, the court is powerless to compel the board to proceed in any particular manner in arriving at its conclusion or to reverse its decision. The writ of mandamus is not a writ to correct errors, but to compel action. Cooley on Taxation (2d Ed.) 730; 18 R. C. L. 103; Attorney General v. Supervisors, 42 Mich. 72, 3 N.W. 260; State ex rel. Pub. Co. v. Smith, 23 Mont. 51, 57 P. 449; Danforth v. Livingston, 23 Mont. 563, 59 P. 916; State ex rel. Gravely v. Stewart, 48 Mont. 347, 137 P. 854; State ex rel. Marshall v. District Court, 50 Mont. 289, 146 P. 743, Ann. Cas. 1917C, 164; State v. Savage, 65 Neb. 714, 91 N.W. 716; Blomquist v. Board, 25 Idaho, 284, 137 P. 174; Illinois C. R. R. Co. v. Greene, 244 U.S. 555, 37 S.Ct. 697, 61 L.Ed. 1309; Pittsburgh, etc., Ry. v. Backus, 154 U.S. 421, 14 S.Ct. 1114, 38 L.Ed. 1031.

Mr. Cooley in his work on Taxation has this to say on the subject:

"Assessors exercise a quasi judicial authority, and when property is to be taxed by value, the value must be determined by their judgment. If they fail to proceed in the performance of their duty, they may be compelled to act; but no court can decide for them what their judgment ought to be. These principles are not only applicable to the case of assessors proper, but also to that of appellate boards who review and revise their decisions." Cooley on Taxation, supra.

What was said by this court, in Danforth v. Livingston, above, is equally applicable here; that is to say:

"There is no provision of the statute allowing any appeal from the action of these officers. It seems clear, therefore, that it was the intention of the Legislature *** to make their action final, and to deny to the courts the power to review their judgment or to assume supervisory control over their proceedings. *** The value of property is a matter of opinion, and there must necessarily be left a wide room for the exercise of this opinion. Absolute accuracy cannot always be attained. Courts cannot be called upon, in every instance, to settle differences of opinion in this regard between the assessing officer and the property owner. Otherwise, courts would be converted into assessing boards, and, in assuming to act as such, would usurp the powers lodged elsewhere by the lawmaking branch of the government."

Where a board has acted within the law, even though the result reached is clearly unjust and erroneous, mandamus will not be granted unless bad faith or dereliction of the official clearly appears. "The abuse of discretion must be so flagrant as to be irreconcilable with an honest judgment, courts being averse to revising the judgment of a board on the strength of allegations of undervaluations, and the single adjective 'fraudulent' without more specific allegations of fact." 18 R. C. L. 289; Woodbury County v. Talley, 147 Iowa, 498, 123 N.W. 746, Ann. Cas. 1912B, 782; Missouri v. Dockery, 191 U.S. 165, 24 S.Ct. 53, 48 L.Ed. 133, 63 L. R. A. 571. Fraud is never presumed. Butte Hdw. Co. v. Knox, 28 Mont. 111, 72 P. 301. Nor can the court inquire as to the operation of the minds of the taxing officials in fixing values. Boston & M. R. Co. v. State, 76 N.H. 86, 79 A. 701; Railroad Co. v. Babcock, 204 U.S. 585, 27 S.Ct. 326, 51 L.Ed. 636.

The board did review the action of the county assessors, and whether it arrived at a correct or an erroneous conclusion as to the values placed on the properties by the assessors is a matter with which the court cannot interfere. The determination of the value of property for the purpose of assessment is referred to the sound judgment of the assessing officers, subject to review only by the boards of equalization. For the manner in which these officers exercise their judgment they are accountable to the people who elect them, and the burden of their responsibility cannot be imposed upon the courts.

3. Are the power lines of these companies located entirely within one county to be assessed by the county assessors, or are they to be considered as parts of a continuous property operated in more than one county and assessable by the state board?

The state board of equalization is created by section 15, article 12, of the Constitution, and by section 16 the power is conferred upon the board to assess railroads situated in more than one county....