Svoboda v. Hahn

• Decision Date: 28 April 1976
• Docket Number: No. 40324,40324
• Citation: 241 N.W.2d 499,196 Neb. 21
• Parties: Frank B. SVOBODA, Appellant, Cross-Appellee, v. Raymond HAHN et al., Appellees, Cross-Appellees, Keith County Bank, Intervener-Appellee, Cross-Appellant.
• Court: Nebraska Supreme Court

Page 499

241 N.W.2d 499

196 Neb. 21

Frank B. SVOBODA, Appellant, Cross-Appellee, v. Raymond HAHN et al., Appellees, Cross-Appellees, Keith County Bank, Intervener-Appellee, Cross-Appellant.

No. 40324.

Supreme Court of Nebraska.

April 28, 1976.

Syllabus by the Court

1. In the absence of statute, taxes voluntarily paid cannot be recovered back.

2. Generally, a tax is paid voluntarily when it is paid not under compulsion or without threat of seizure or sale of the property of the taxpayer to satisfy the tax in question.

3. The payment of a tax before it becomes delinquent and its collection can be enforced by compulsory process is generally held to be voluntary.

4. Before a taxpayer can recover taxes under a statutory procedure he must substantially comply with the requirements of the statute.

5. In passing on claims for a refund of taxes, a county board acts quasi-judicially.

6. A written claim for refund timely filed is a prerequisite to a refund of taxes under section 77--1735 or 77--1734.01, R.R.S.1943.

7. The granting of declaratory relief is discretionary with the trial court.

Frank B. Svoboda, pro se, Firmin Q. Feltz, Ogallala, for appellant, cross-appellee.

Patrick Hayes, Ogallala, for Hahn et al.

Maupin, Dent, Kay, Satterfield, Girard & Scritsmier, Milton R. Larson, North Platte, for intervener-appellee.

Heard before WHITE, C.J., BOSLAUGH, NEWTON and CLINTON, JJ., and REAGAN, District Judge.

BOSLAUGH, Justice.

This is an action for a declaratory judgment to determine the validity of a resolution of the county board of Keith County, Nebraska, relating to a refund of taxes. The plaintiff is a citizen and taxpayer of Keith County, Nebraska, and is the former county attorney. The defendants are the members of the county board and the county treasurer. The intervener is the taxpayer which was seeking a refund of intangible taxes it had paid in 1965.

The controversy arose as a result of a provision in section 77--710, R.S.Supp., 1963, a part of the intangible tax law that has since been repealed. Section 77--710 provided in part: 'For the purposes of assessment it shall not be permissible to deduct from the amount of capital stock the value of any United States government securities owned by such bank, * * *.' For the year 1965, the intervener filed a return dated February 5, 1965, declaring the value of its capital stock to be $201,343.99, and paid an intangible tax in the amount of $805.38. If the intervener had deducted the value of United States government securities owned by it, its capital stock would have had a negative value for intangible tax purposes and there would have been no tax due.

On April 30, 1965, the Tax Commissioner advised all county assessors that the Attorney General had ruled that the provision in section 77--710, R.S.Supp., 1963, prohibiting banks from deducting governmental securities for tax purposes was unconstitutional. The intervener did not attempt to amend or change its return and paid the tax in full to the county treasurer on November 1, 1965. There was some conversation between Mel Adams, the president of the intervener, and an assistant county assessor concerning whether the intervener would be able to obtain a refund. Adams testified that he was assured the intervener would be able to obtain a refund. The intervener claims the tax was paid under protest.

After some time had elapsed and the tax had not been refunded, Adams talked to several of the county officials, including the plaintiff who was then the county attorney. Adams testified the plaintiff advised him that only the county commissioners could refund the tax. Adams then met with the county board and the board voted to refund the tax. According to Adams, the plaintiff then advised the commissioners they could not refund the tax so no record was made of the action of the board.

On July 2, 1971, the county board adopted the resolution which is the subject of this action. The resolution provides as follows: 'RESOLUTION

'BE IT RESOLVED:

'That whereas Keith County, Nebraska, unlawfully assessed intangible personal property tax against the assets of the Keith County Bank and Trust Company of Ogallala, Nebraska, in the year 1965 in the amount of $805.00, and

'Whereas said $805.00 assessed in that year has not been returned or paid back to the said Keith County Bank and Trust Company of Ogallala, Nebraska, after request made in 1965, and

'Whereas the County Board of Commissioners of Keith County, Nebraska, desire to resolve this matter.

'Now therefore be it resolved:

'That the Keith County Bank and Trust Company of Ogallala, Nebraska, be allowed as a credit against their current and future personal property tax liability to Keith County, Nebraska, the sum of $805.00 plus interest or the aggregate sum of $1,187.29, PROVIDED, however, that the said Keith County Bank and Trust Company of Ogallala, Nebraska, shall pay up to a current status any and all personal property taxes due and owing to Keith County, Nebraska, in the event said amount allowed as a credit does not pay for same, and that if the $1,187.29 should be in excess of the tax liability of the said Keith County Bank and Trust Company of Ogallala, Nebraska, to Keith County, Nebraska, for personal property taxes, then they should be allowed as a credit against their future personal property tax or real estate tax the amount, if any, by which the $1,187.29 exceeds their current personal property tax liability to Keith County, Nebraska.

'SO RESOLVED.'

The plaintiff contends the resolution is illegal and void because it releases, discharges, and commutes taxes in violation of section 77--1737, R.R.S.1943.

The authority of public officials to refund taxes is very limited. The Constitution of Nebraska prohibits the Legislature from enacting any law releasing or discharging any individual, corporation, or property from taxes levied for state or municipal purposes. Art. VIII, § 4, Constitution of Nebraska; State ex rel. Meyer v. Story, 173 Neb. 741, 114 N.W.2d 769. Section 77--1737, R.R.S.1943, provides no county board shall have the power to release, discharge, remit, or commute any portion of the taxes assessed or levied against any person or property within its jurisdiction for any reason whatever.

The right of a taxpayer to recover taxes that have been paid is also very limited. In the absence of statute, taxes voluntarily paid cannot be recovered back. When a tax imposed is illegal and unauthorized for any purpose, an original action may be brought to recover the...