Wash. County Nat. Bank v. Wash. County

• Decision Date: 05 September 1940
• Court: Virginia Supreme Court
• Parties: WASHINGTON COUNTY NAT. BANK. v. WASHINGTON COUNTY et al.

10 S.E.2d. 515

WASHINGTON COUNTY NAT. BANK.

v.WASHINGTON COUNTY et al.

Supreme Court of Appeals of Virginia.

Sept. 5, 1940.

Error to Circuit Court, Washington County; Walter H. Robertson, Judge.

Proceeding by the Washington County National Bank against Washington County, Virginia, and others, to correct a tax assessment on petitioner's bank building. To review a judgment reducing the assessment an insufficient amount, the petitioner brings error.

Reversed and remanded.

Argued before HOLT, HUDGINS, GREGORY, BROWNING, EGGLESTON, and SPRATLEY, JJ.

Roby C. Thompson and E. W. Potts, both of Abingdon, for plaintiff in error.

Fred C. Parks, of Abingdon, for defendants in error.

HOLT, Justice.

Under review is a motion to correct a tax assessment said to be erroneous and excessive.

The property taxed is a five-story bank building at the intersection of Main and Wall streets in the town of Abingdon in Abingdon magisterial district of Washington county.

There is a clear presumption in favor of these assessments which must be met and overborne before a petitioner can prevail. Values are matters of opinion. Estimates of competent and disinterested witnesses must vary, and so, at the most, all that we can hope, for is that rough jus tice be done. City of Norfolk v. Holland, 163 Va. 342, 175 S.E. 737.

Before relief can be given it must appear that the assessment is out of line generally with other neighborhood properties, which in character and use bear some relation to that of a petitioner. It is not enough to show that it is valued above a rate apportioned to another nearby lot. The inequality must be not only out of line but out of line generally.

The Constitution of Virginia, section 169, declares that assessments of real estate shall be at their fair market value. But this mandate has been so honored in the breach that no assessors feel called upon to apply it in practice. If this bank building be assessed at its fair market value, it would probably be the only building in Abingdon so assessed. Indeed, section 169 of the Constitution is to be read in connection with section 168, which provides that taxation shall be uniform upon the same class of subjects within the territorial limits of the authority levying the tax. Under our system of taxation, local political subdivisions must rely for support upon income from tangible taxable properties within their territorial jurisdiction. Adequate provisions for the maintenance of government are necessary. The money must come and from this designated source. In the argot of the stage, the play must go on.

If values are high, the rate is low; if the rate is low, values must be raised. With this in mind, any system of taxation which rests upon all citizens ratably meets the requirements of the 14th Amendment to the Federal Constitution. Sunday Lake Iron Co. v. Wakefield Township, 247 U.S. 350, 38 S.Ct. 495, 62 L.Ed. 1154; Sioux City Bridge Co. v. Dakota County, Neb., 260 U.S. 441, 43 S.Ct. 190, 67 L.Ed. 340, 28 A.L.R. 979. If the burden be uniform upon a class of properties within the territorial limits of the authorities levying the tax, the requirements of our State Constitution are also met.

The burdens of government, as near as may be, must be ratably apportioned among all its citizens, although absolute equality is never obtainable.

"A municipality cannot function unless it can meet its necessary expenses, and that it can do only through taxation. If in its ratable distribution it be fair that a certain lot should pay $100, it makes littledifference to the owner if the lot be assessed at $5,000 with a 2 per cent, rate, or at $10,000 with a 1 per cent. rate. In practice it has been the general custom in this state to undervalue property and to advance the rate, and so to a corresponding extent the letter of section 169 of the Constitution has not been observed; property has not been assessed at its market value, and an assessment in excess of market value would be no greater departure from its mandate provided these assessments were, as they must be in any case, ratable." City of Roanoke v. Gibson, 161 Va. 342, 170 S.E. 723, 725.

An unavailing attempt was made to reduce the assessment for 1937. The reason for this failure was thus stated by the trial judge:

"The assessment of these properties ranged from twenty to thirty per cent of the fair market values as testified to by said witnesses. According to their opinion and testimony the fair market value of petitioner's property is $40,000, while its assessed value is $25,000, which is to say that, according to the evidence, the petitioner's property is assessed at sixty-two and one-half per cent of its fair market value.

"My opinion, from the evidence before me, is that the assessment of petitioner's property, based on present day values, is uniform and unequal as compared with the other properties described in the evidence, but my further opinion is that this court is powerless to do anything about it."

"Under the Constitution and law of Virginia, real estate is to be assessed at its fair market value."

* * *

"It appears to me that the only remedy for a situation such as that presented in this case rests in a general reassessment and equalization of assessed values. Whether or not there shall be such general reassessment and equalization is a matter for the board of supervisors to decide, and, as already stated, in my opinion the court is powerless in this proceeding to grant to petitioner the relief prayed for."

Probably to meet such a situation the General Assembly by an act approved March 10, 1938, Acts of Assembly, 1938, p. 163, c. 97, provided that:

"Any person assessed with county levies or other local taxes on real estate, aggrieved by any such assessment, may, if the real estate involved is located in a county where there had been no general re-assessment of real estate since nineteen hundred and thirty and no board of equalization of real estate assessment appointed since nineteen hundred and thirty, apply for relief to the circuit court of the county wherein such assessment was made.

"In such proceeding the burden of proof shall be upon the taxpayer to show that the assessment against the...