Union Land & Timber Co. v. Pearl River County

• Decision Date: 14 December 1925
• Docket Number: 25245
• Citation: 106 So. 277,141 Miss. 131
• Parties: UNION LAND & TIMBER CO. v. PEARL RIVER COUNTY. [*]
• Court: Mississippi Supreme Court

106 So. 277

141 Miss. 131

UNION LAND & TIMBER CO. v. PEARL RIVER COUNTY. ^[*]

No. 25245

Supreme Court of Mississippi

December 14, 1925

Division B

(Division B.).

1 TAXATION. Plea to declaration to recover taxes paid under void assessment, alleging payment without compulsion and without protest or objection, states defense.

Where a plea to a declaration to recover taxes paid under a void assessment alleges that the taxpayer agreed with the taxing authorities on the assessment, and that it paid the taxes without any request, demand, or threat from the tax collector, and paid it without any protest or objection, and without any compulsion on the part of the tax collector, such plea states a defense to the suit.

2 TAXATION. Taxpayer, voluntarily paying taxes without protest,

cannot recover them, although assessment was made without legal authority.

Where a taxpayer voluntarily pays taxes without protest, he cannot recover the taxes by suit, although the assessment was made without authority of law.

3 TAXATION. Statutes held not to authorize refund of taxes paid without protest and without coercive steps by taxing authorities.

Section 4346, Code of 1906 (Hemingway's Code, section 6980), does not authorize the refund of taxes paid without protest and without any coercive steps by the taxing authorities, but merely provides a method of refunding taxes paid under protest or collected under coercive proceedings.

HON. J Q. LANGSTON, Judge.

APPEAL from circuit court of Pearl River county, HON. J. Q. LANGSTON, Judge.

Action by the Union Land & Timber Company against Pearl River county to recover taxes. Judgment for defendant, and plaintiff appeals. Affirmed.

Affirmed.

F. M. West, for appellant.

Acting under the provisions of section 4346, Code of 1906, appellant applied to the auditor of public accounts of the state for a refund of excess taxes paid in to the state treasury, and on April 4, 1919, the claim was allowed and paid. The auditor certified the matter to Pearl River county in the manner provided in that section, but the same was rejected and disallowed by the board at its meeting in April, 1919. Suit was immediately filed. To the declaration now before the court, the county pleaded general issue and the affirmative defense that the assessment was agreed to by the parties and was therefore binding upon appellant.

The principal question presented to this court is: May a tax illegally collected be refunded under section 4346, Code of 1906? It is contended by the county that the payment was voluntary and cannot be recovered. It is contended by appellant that the assessment being void (Pearl River County v. Lacey Lumber Co., 124 Miss. 85) the tax was illegally exacted and was therefore paid under compulsion, coercion, and duress, amounting to an involuntary payment, and is, therefore recoverable. Appellant contends it is still recoverable under said Code, section 4346, even though voluntary.

Appellee seems to have wholly misunderstood this court's opinion in the Lacey case. The court did not hold, and did not intend to hold, that only payments under protest were refundable, under Code 1906, section 4346. It is our contention that a thing once void is always void, and no rights can accrue to the county, and no harm can attach to appellant, because of an agreement over a void thing.

The assessment for 1916 being void under the following decisions of this court, the 1915 assessment would stand as the last valid assessment; and, appellant having paid three hundred dollars and sixteen cents more on the void assessment than it did on the last previously good assessment, it is entitled to a refund of the excess. Lacey Lumber Co. v. Pearl River Co., 124 Miss. 85; Horton v. King, 73 Miss. 871, 113 Miss. 60; Bullock v. Board of Supervisors, Covington Co., 77 So. 662; I. C. R. R. v. Board, etc., 102 So. 265; Blodgett v. Pearl River Co., 134 Miss. 816.

Prior to 1900 the only remedy of the taxpayer who had paid money into the state and county treasuries under circumstances similar to that here presented was by a special relief act of the legislature. By chapter 76, Acts of 1900, the state adopted a different policy in such matters. All the sections of that Act have been brought forward in the Code of 1906, and these statutes have been in force, unchanged, for twenty-five years, and are evidently serving the purpose intended, as they are still in force.

It is settled law that where a taxpayer is subjected to the payment of a tax which is illegal, an action will lie against the collector to recover it back unless he has paid it over to his superiors; in which event the action is against the corporation. Tuttle v. Everett, 51 Miss. 27.

We contend that where an assessment is void, the tax is illegal, the payment is involuntary, and protest is not necessary in order that the taxpayer may recover the tax so paid. Also where the sovereign has provided statutory relief, as in this state (sec. 4346, Code 1906), protest of payment is not a condition precedent to the right to a refund of the tax paid. The section covers both voluntary and involuntary payments.

Section 4346 provides how the taxpayer may get a refund of a tax that is not due. Appellant paid a tax that was not due. He is entitled to a refund of the same. The state recognized his right to the refund and made him whole as to its part of the collection, and the appellee county should be forced to do likewise.

In Rand v. United States, 63 L.Ed. 731 (U. S. 1919) the United States supreme court held that payment under protest is not essential to the maintenance of a suit to recover back inheritance taxes founded upon the act of July 27, 1912 (37 Stat. at L. 240, chapter 256) which provides for the refunding to persons presenting claims of taxes erroneously or illegally collected under the War Revenue Act of June 13, 1898 (30 Stat. at L. 465, chapter 448, Comp. Stat. 1916, section 6144) imposing taxes on inheritances. See, also, Simpson v. United States, 64 L.Ed. 709 (U. S.); United States v. Hvoslef, 237 U.S. 1, 59 L.Ed. 813; Ann. Cases, 1916 A, 286.

The last named case holds that payment under protest is not prerequisite to right to a refund where there is a statute that provides for the refund of taxes erroneously, or illegally assessed or collected. That is the construction we ask this court to place upon Code, section 4346. That section of the Code has not yet been construed by this court. It is quite plain, however, what the legislature meant. A tax is certainly "not due" when it has been illegally assessed and collected.

It is also "erroneously" paid when paid under a void assessment. The decision in Mississippi, in the Tuttle case, supra, is still the law here. An illegal tax is paid under compulsion, because not due. It is exacted when not due, and is refundable.

That case clearly holds that the payment of a tax to one having formal authority to collect is involuntary and if the tax is illegal the amount paid may be recovered back.

That case was cited in Magnolia v. Sherman, 46 Ark. 358, holding that one may recover illegal tax paid under threats and compulsion; Vicksburg v. Butler, 56 Miss. 72, holding same where tax was paid upon city collector's threat to close plaintiff's shop. Cited in reference note in 26 Am. Dec. 295, as to when payment of taxes is involuntary and amount paid recoverable. Cited in notes in 45 Am. Dec. 164, on recovery of illegal taxes paid under protest; 94 Am. St. Rep. 428, on general prerequisites to recovery of taxes paid; 11 L. R. A. (N. S.) 1105, on right to recover money paid for illegal taxes after it has been paid over or distributed; 26 Am. Rep. 624, 21 L.Ed. (U. S.) 63, as to when taxes illegally assessed may be recovered. Cited in M. & O. R. R. Co. v. Steiner, 61 Ala. 559, holding that shipper paying illegal freight charges rather than forego carrier's services, may recover same; West Va. Transp. Co. v. Sweetser, 25 W.Va. 434, holding that shipper may recover excessive charges demanded by only railroad available to him. Cited in Hawkins v. Mangum, 78 Miss. 97, holding a void statute and assessments under it not validated by certain other statute.

Code section 4346 is sufficient statutory law to authorize a repayment of the tax, even though it should be held that the tax was voluntarily paid. We contend, however, that the tax was not voluntarily paid under the Mississippi cases, supra.

Referring to 45 Cent. Dig., section 999, see the numerous citations sustaining our contentions, to be found in that section. See also 26 R. C. L. 454, et seq., where the law is fully set out. See also Wilson, Auditor v. Naylor, 116 Miss. 575; Taylor, Treasurer v. Guy, 119 Miss. 357; McGehee v. Pitts, 65 Miss. 357.

As to when a payment will be considered involuntary, see 45 Cent. Dig., section 1002; 55 Miss. 37; 75 Miss. 665. The Iowa courts have held under their statute (section 1417), that the taxpayer may recover taxes erroneously or illegally exacted, or paid, even though payment was voluntary, and without protest. Lauman v. Des Moines Co., 29 Ia. 310; Richards v. Wapello Co., 48 Ia. 507; Dickey v. Polk Co., 58 Ia. 287. Further, as to the remedy of the appellee, see 26 R. C. L. 470; Eureka Pipe Line Co. v. Riggs, Ann. Cas. 1918 A, 995. For a full discussion of the law, according to the taxpayer the right to a refund of an illegal tax, especially where the statute authorizes a refund, see Phoebus v. Manhattan Club, 105 Va. 144, 8 Ann. Cas. 667, and elaborate notes; Monagham v. Lewis, 5 Penn. (Del.) 218, 10 Ann. Cas. 1048 and elaborate notes.

II. Cooley on Taxation (3 Ed.), 1487. In the following cases, refunds were held proper under the statutes similar to those here involved--Stotesbury's Co. Inheritance Tax, 20...