Suburban Dept. Stores v. City of East Orange

• Decision Date: 20 November 1957
• Docket Number: No. A--411,A--411
• Citation: 47 N.J.Super. 472,136 A.2d 280
• Parties: SUBURBAN DEPARTMENT STORES, a corporation of New Jersey, Plaintiff-Respondent, v. CITY OF EAST ORANGE, a municipal corporation of New Jersey, Defendant-Appellant, ESSEX COUNTY BOARD OF TAXATION, Third-Party Defendant-Appellant. . Appellate Division
• Court: New Jersey Superior Court — Appellate Division

Page 472

47 N.J.Super. 472

136 A.2d 280

SUBURBAN DEPARTMENT STORES, a corporation of New Jersey Plaintiff-Respondent, v. CITY OF EAST ORANGE, a municipal corporation of New Jersey Defendant-Appellant ESSEX COUNTY BOARD OF TAXATION, Third-Party Defendant-Appellant.

No. A--411.

Superior Court of New Jersey Appellate Division.

Argued Oct. 14, 1957.

Decided Nov. 20, 1957.

Donald Karrakis, East Orange, for appellant City of East orange.

David Furman, Deputy Atty. Gen., for appellant Essex County Board of Taxation (Grover C. Richman, Jr., Atty. Gen., attorney; John F. Crane, Deputy Atty. Gen., of counsel; Thomas P. Nolan, Deputy Atty. Gen., on the brief).

Herman J. Harris, Newark, for respondent.

Before Judges GOLDMANN, FREUND and CONFORD.

The opinion of the court was delivered by

GOLDMANN, S.J.A.D.

Defendant City of East Orange ('city') appeals from a judgment of the Superior Court, Law Division, awarding plaintiff $670.24 as a refund of a portion of taxes paid for the year 1952 on property at 536 Main Street, East Orange. Defendant Essex County Board of Taxation ('tax board') also appeals the award, as well as that part of the judgment entered against it in favor of the city as third-party plaintiff, amending and reducing the assessment on the property as certified by it for the year 1952 and amending the assessment lists and records for that year accordingly.

Plaintiff was not the owner of the premises in question, but paid the taxes thereon. The East Orange Board of Assessors had assessed the property at $47,500 for the year 1952. On March 20, 1952 defendant tax board by order directed the local board of assessors to revise and correct its assessment lists as to certain parcels of real estate, including the premises in question. As a result the assessment was increased to $59,300. Plaintiff paid the tax bill of $3,368.24, based upon this increased assessment, without protest. Neither plaintiff nor the owner ever appealed the assessment. Nor was either a party plaintiff in the case of Baldwin Construction Co. v. Essex County Board of Taxation, 32 N.J.Super. 18, 107 A.2d 567 (Law Div.1954), affirmed 16 N.J. 329, 108 A.2d 598 (1954), dealing with other East Orange assessments for 1952. Indeed, neither plaintiff nor the owner has ever contested the tax board's order of March 20, 1952 or the increased assessment, in any court or before any administrative tribunal.

Plaintiff's action to recover $670.24, representing the increase in 1952 taxes brought about by the increased assessment, is predicated upon the result in the Baldwin case. It claims that the court in Baldwin set aside the tax board's order as illegal and void, the effect being to restore all East Orange assessments to the figures originally fixed by the local board of assessors.

Leave having been granted, the city filed a third-party complaint against the tax board in which it asked that if the court should hold that plaintiff was entitled to a judgment against the city, then the tax board be required to revise its 1952 assessment lists and records so as to restore the assessment on plaintiff's property to the original figure.

We deem it unnecessary to set out all the separate defenses raised to the complaint and third-party complaint. Among them were the defenses that plaintiff's payment of the 1952 taxes was voluntary; that it had not contested the tax board order of March 20, 1952 in any court or before any statutory administrative tribunal; that the Baldwin judgment affected only the assessments of the parties plaintiff therein, and plaintiff was not a party; estoppel by reason of failure to pursue statutory procedures and to commence an appropriate action promptly; waiver because of failure to contest the assessment in accordance with statute; laches; and bar by reason of failure to seek relief under R.R. 4:88--15(a).

At pretrial the parties agreed that the action be disposed of on the basis of the stipulations contained in the pretrial order and the exhibits introduced at the conference. The trial court held that the tax board order of March 20, 1952, which resulted in the increased assessment on the property occupied by plaintiff, was rendered null and void by the Baldwin case, and hence it would be unjust for the city to retain the tax representing such increase, paid by plaintiff. It thereupon entered the judgment referred to at the head of this opinion.

There is no need to detail the history of the increases in 1952 assessments in East Orange, for it is fully set out in the Baldwin case above, 16 N.J., at page 332 et seq., 108 A.2d, at page 599 et seq. Suffice to say that early in 1952 the Essex County Board of Taxation undertook a revision of property assessments throughout the county. Having only a limited budget and a limited period of time within which to effectuate the program, and with the intention of continuing the revision in the years following, the tax board on March 20, 1952 directed certain revisions of the tax lists, generally by increasing the assessments of business and commercial property in the most highly valued sections of municipalities throughout the county, including East Orange. Hundreds of individual parcels were subjected to increases in assessments as a result of this partial revision program, 62 being located in East Orange.

The owners of 31 of the properties in East Orange thereupon inaugurated a joint legal program seeking nullification of the tax board action with respect to their properties. They first filed regular appeals to the county tax board, and when these were dismissed, appealed to the State Division of Tax Appeals from the county board's action. They also instituted a joint action in lieu of prerogative writs in the Law Division under R.R. 4:88. Their contention there was discrimination in the effectuation of the revision of assessments upward on the ground that the revision policy was not uniform nor was it uniformly applied to all similar or comparable property. They also contended there was legal doubt as to whether a complaint of discrimination, seeking uniformity of assessment rather than a decrease of assessments to true value, was cognizable before the administrative agencies, county and state, and they therefore invoked direct judicial relief from unconstitutional action.

Motions were made to dismiss the proceedings for want of jurisdiction, predicated on the failure to exhaust asserted available administrative remedies before the tax boards, but these were denied both in the Law Division and on appeal in the Appellate Division. Baldwin Construction Co. v. Essex County Board of Taxation, 21 N.J.Super. 370, 91 A.2d 224 (Law.Div.1952); 24 N.J.Super. 252, 93 A.2d 800 (Law Div.1952); 27 N.J.Super. 240, 99 A.2d 214 (App.Div.1953); 28 N.J.Super. 110, 100 A.2d 341 (App.Div.1953), for the reason that the jurisdiction of the administrative tax boards was either doubtful or non-existent. The tax board and the city then appealed to the Supreme Court, which heard oral argument in the late spring of 1954 and then, without deciding the case, entered an order calling for the immediate trial of the action on the merits in the Law Division and the reargument of the appeal, together with argument of an appeal from whatever decision the Law Division might render.

Pursuant to that order, Law Division Judge Colie tried the case on the merits in July 1954 and concluded that the action of the tax board in revising the assessments in the manner it did was discriminatory and unconstitutional. Although his opinion calls for setting aside the March 20, 1952 order of the tax board, the judgment which he entered provides specifically that the order is 'set aside and vacated as to the plaintiffs and their properties particularly mentioned and described on Schedule A hereto attached.' Plaintiff's property was, of course, not included in that schedule. It is entirely clear that the Law Division judgment set aside the revised assessments for 1952 only on the properties of the plaintiffs who joined in the proceeding in lieu of prerogative writs. Unaffected by that judgment were not only the 31 other properties in East Orange but hundreds of parcels in the remaining municipalities throughout Essex County, all of which had been revised upward in their assessed valuations pursuant to the same order of the tax board.

After reargument of the entire case before the Supreme Court, that court affirmed the judgment of the Law Division. 16 N.J. 329, 108 A.2d 598 (1954). There can be no question that the Supreme Court was adjudicating only the tax status of the properties of the plaintiffs who had joined in the Baldwin action. This is explicit throughout the length of its opinion; the court, for example, said: 'Here, we redress the injury sustained by plaintiffs; this is the only justiciable controversy before us,' and 'This is a proceeding in the nature of Certiorari to remedy the undue discrimination suffered by the plaintiff landowners, neither more nor less.' 16 N.J. at pages 344, 345, 108 A.2d at page 606. The opinion closes with a direction that 'the final judgment vacating the assessment increases made by the county board, (is) accordingly affirmed.' 16 N.J. at page 346, 108 A.2d at page 607. The final judgment of the Law Division thus affirmed having, in terms, eliminated only the assessment increases on the properties of the plaintiffs in the action, it must follow that the affirmance of that judgment by the Supreme Court had no broader effect.

This review of the Baldwin litigation convincingly demonstrates that the revised assessment of the present plaintiff's property was never changed or legally affected in any way by those proceedings.

Plaintiff can get no help on the theory that the Baldwin suit was a class action under R.R. 4:36. Everything in that case points in the other direction: the plaintiffs there were interested in their own particular situations and not in altruistically saving...