Case ID: ny-super-ct_53/html/0357-01.html
Source: Caselaw Access Project
Author: {"author": "Ingraham, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

LEVI APGAR v. JOHN N. HAYWARD, et al.
    
      Assessed valuation for purposes of taxation, no power to increase after a certain time, except upon a prescribed notice—an increase otherwise made is void—Bank stock, this applies thereto— One from whom the amount of a tax fixed on a void increase of valuation has been collected under a warrant to a marshal suffers damages, and in an action therefor may recover the sum collected with interest—Remedy by certiorari not necessarily a bar — Chapter 761 of laws of 1866 does not repeal chapter 302 of laws of 1859.
    Under the consolidation act (chap. 410, Laws of 1882), and chapter 302 of the Laws of 1859, the deputy tax commissioners of the city of New York, cannot, after the first day of May succeeding the opening of the books of the assessed valuation of real and personal estate, for correction, increase the assessed value as shown by the books on that first day of May, except upon notice being given to the party to be affected by such increase, twenty days before said first day of May.
    There is nothing in chapter 761 of the Laws of 1866, which changes the law in this respect, and that chapter does repeal chapter 302 of the Laws of 1859.
    Any action of the deputy tax commissioners increasing the assessed valuation after such first day of May, without giving such notice, is unauthorized and void.
    This rule applies as well to bank stocks as to any other property.
    The fact that the commissioners had, for good reasons, reduced, pursuant to the provisions of law in that regard made, the assessed valuation of the real estate of the bank, will not authorize them to increase the assessed valuation of its stock after such first day of May, without giving the proper notice.
    The stockholders are not affected by the delay of the bank in making its application for a reduction of the assessed valuation of its real estate.
    Those from whom a city marshal, under a warrant issued to him, based on the assessment-roll made up and returned by such commissioners to the board of aldermen acting as supervisors, collects a tax upon an unauthorized and void increased valuation contained in such roll, suffer damages, which may be recovered in an action against the commissioners individually, where they do not become aware of the void act in time to review it by certiorari.
    In such an action, the amount collected by the marshal, with interest thereon, may be recovered as damages.
    Before Freedman and Ingraham, JJ.
    
      Decided May 12, 1886.
    Exceptions ordered to be heard at general term.
    The action was brought to recover damages sustained by reason of the collection by a marshal, under a warrant issued to him for the collection of the taxes of 1881, of certain taxes assessed against certain persons. The claims of the various parties were all assigned to the plaintiff. The total sum collected amounted to $2,365.93, and was collected on or prior to March 2, 1882.
    The court directed a verdict for plaintiff for $2,932.40. Numerous exceptions were taken on the trial which were ordered to be heard in the final instance at general term.
    The other facts sufficiently appear in the opinion.
    
      Nelson Smith, attorney and of counsel for plaintiff,
    on the questions considered in the opinion, argued: —After May 1, the defendants had no jurisdiction whatever to increase or in any manner tamper with the assessed valuation as it appeared in the annual record, except to grant applications for a decrease during May, under chapter 134, Laws of 1881, in cases where the application had been filed prior to May 1 (Clark v. Norton, 58 Barb. 434 ; S. C., 3 Lans. 484 ; affirmed 49 N. Y. 243 ; Westfall v. Preston, 49 N. Y. 352 ; Overton v. Foote, 65 Ib. 263 ; Mygatt v. Washburn, 15 Ib. 316; Overton v. Foote, 43 Ib. 290 ; People ex rel. Chamberlain v. Forrest, 96 Ib. 544).
    II. Any excess in the amount of an assessment beyond that stated in the annual record, would make the whole tax imposed upon it void (Huse v. Merriam, 2 Greenl. 375 ; Stone v. Bean, 15 Gray, 42; Libby v. Burnham, 15 Mass. 144 ; Cooley on Taxation, 295).
    
      III. Trespass is the appropriate remedy to recover for an injury occasioned by an illegal tax, and the assessor or other officer who exceeded his authority, is liable (Huse v. Merriam, 2 Greenl. 375 ; Westfall v. Preston, 49 N. Y. 349 ; Agry v. Young,. 11 Mass. 220 ; Ware v. Percival, 61 Me. 391;. Inglee v. Bosworth, 5 Pick. 498 ; Mygatt v. Washburn, 15 N. Y. 316).
    IV. Chapter 269 of the Laws of 1880, does not affect this case, because (a.) That is an act relating to procedure upon certiorari for the review and correction of assessments. The courts possessed such power prior to this act, but in a more limited degree. (6.) It does not affect the powers of assessors or of the commissioners of taxes and assessments in this city, nor change the statutes for the imposing of taxes, (c.) It does not undertake to validate an illegal assessment roll or tax, or correct it, nor, unless invoked, to confer authority upon any court to do) so. (d.) The power given by that act cannot be exercised, except pursuant to its provisions, nor can it be exercised after a right of action in favor of any person injured in consequence of an illegal assessment has accrued, nor after the tax upon an illegal assessment has been imposed.
    V. Before a tax upon an illegal assessment has been imposed, the court, even where the assessors have acted without jurisdiction in increasing the assessment, may correct it by reducing it to the proper amount, on the application of the person affected by it (People ex rel. Chamberlain v. Forrest, 96 N. Y. 544).
    VI. Here, neither the plaintiff nor any of his assignors had any notice that this assessment had been illegally increased, and hence could not have invoked the act of 1880. The proceedings of the defendants depriving the plaintiff of an opportunity of being heard against the assessment, make the assessment void, and render them hable as trespassers (Cooley on Taxation, 266, 267).
    
      E. Henry Lacombe, counsel for the corporation, and Arthur H. Mastín, of counsel for defendants,
    argued :—
    
      I. The plaintiff was assessed on the value of his shares, in conformity with the special provisions of law regulating the subject, found in chapter 761 of the Laws of 1866 (McMahon v. Palmer, 11 Daly, 214; Foster v. Van Wyck, 2 Abb. App. Dec. 167).
    II. The increase in the assessed valuation of the shares was the necessary result of a compliance with the foregoing provisions of the act of 1866.
    III. The provisions of the act of 1866 were controlling, and the assessment was therefore legal, notwithstanding it resulted in an apparent violation of the provisions of an earlier statute. The statute of 1859 (chapter 302), it will be seen, was broad in its scope, covering the entire subject of assessment and levying of taxes in the county of New York. It prescribed the manner in which assessments should be made on all property, both real and personal, and provided methods for the correction and review of such assessments if deemed erroneous. The act of 1860 related to personal property alone, and to a single variety of that class of property, its object being to provide more specific directions for the assessment of that particular variety than were afforded by the general laws then in existence. The act of 1866, therefore, being the latest expression of legislative will, and covering a particular branch of a general subject in greater detail than former statutes, must under well settled rules be considered as controlling (Excelsior Petroleum Co. v. Lacey, 63 N. Y. 422; Heckmann v. Pinkney, 81 Ib. 211 ; People, &c. v. Gold & Stock Telegraph Co., 98 Ib. 67; People v. Commissioners of Taxes, 95 Ib. 554; People v. Asten, 100 Ib. 597). It may well be urged, therefore, that under this rule any provision in the act of 1859 which conflicts with the act of 1866, or prevents its full application, must be deemed to be abrogated, so far as the particular subject covered by the act of 1866 is concerned. If there is no necessary inconsistency in the two acts, they will be so construed that both will stand, as far as possible, for the law does not favor repeals by implication (Chamberlain 
      v. Chamberlain, 43 N. Y. 424; McCartee v. Orphan Asylum Society, 9 Cow. 437 ; People ex rel. Van Nest v. Tax Commissioners, 80 N. Y. 573). There is nothing in the act of 1866 which is necessarily repugnant to the provisions of the act of 1859. It is possible for the assessed value of the real estate of the bank, which by the latter act is to be deducted in assessing the holders of bank shares, to be definitely ascertained and fixed without any conflict with the act of 1859. If the statutes be considered as forming parts of one act, the provisions of both will stand—the act of 1859 being so interpreted as to keep in force in ordinary cases the prohibition against increase of valuations after a given date, but to exclude from its operation the valuation of bank shares in all cases where the bank shall have so delayed making application for the reduction of its real estate, that action upon it would cause a violation of the prohibition (People ex rel. Twenty-third Street R. R. Co. v. Commissioners of Taxes, 95 N. Y. 554). By a fundamental rule of construction statutes are to be so construed as to carry into effect the intent of the legislature. In the present case, such intent is only to be carried out by holding the act of 1866 to be controlling. If, however, section 11 of act of 1859 were given the force which the plaintiff claims for it, the result would be to permit the collection of taxes on the bank’s real estate on a valuation of only $56,000, while providing for a deduction from each shareholder’s taxable property of his proportionate share of that real estate on a valuation of $96,000, thus leaving property to the amount of $40,000 practically exempt from taxation. Such a result would also defeat the evident purpose of the act of 1866, which was to provide a £1 system of taxation of the stockholders of banks, by which they should be assessed for their shares in the same method and bear the same burdens as are assessed upon other property, and thus be compelled to pay their fair and just proportion of taxes to be levied.” (People, &c. ex rel. Tradesmen’s National Bank v. Commissioners Taxes, 69 N. Y. 91).
    
      IV. It does not appear that any right of the plaintiff has been infringed, or that he has suffered any damage by the action of the defendants. The nature of the case is such, that even if the desired notice had been given, and the plaintiff had been heard, it could have made no difference in the amount of his assessment. The want of notice is therefore immaterial. Removals, under such circumstances, are accordingly sustained, though it appears that no notice was ever given to the clerks of their proposed removal, as required by the statute (Phillips v. Mayor, 88 N. Y. 245 ; Langdon v. Mayor, 92 Ib. 427). It does not appear that the person who seeks to enforce the prohibition is a “party affected” by the increased valuation. The plaintiff could not have shown the commissioners, even if he had appeared before them, that the ultimate result of their action was to affept him injuriously. The fact was apparent, that while the sum of $40,000 was added to the value of the shares, an equal sum was deducted from the value of the real estate. The bank would thus be enabled to save the taxes on $40,000, and the amount of this saving, inuring pro rata to the benefit of the shareholders, would offset to each of them the amount by which the assessment of his shares had been increased.
    V. Even assuming that damages did result from the action complained of, the plaintiff cannot recover, because such action was made necessary by the delay of the bank in presenting its application for reduction. The statute thus constitutes the bank corporation the agent of the shareholder, so far as concerns the question of determining the amounts of this particular element of the value of his shares. The deliberate postponement by the bank of the presentation of its petition until the last day allowed for the purpose, made it impossible for the defendants to act upon it, as it was their duty to do under the statute on a proper state of facts, without, at the same time, committing the act upon which this suit is based. Under such circumstances the maxim volenti non 
      
      fit injuria will apply, and the party who, by his own act, permitted or promoted the action of which he complains will be deemed to have waived his right to recover (Hilton v. Fonda, 86 N. Y. 340).
    VI. The plaintiff having failed to avail himself of any of the methods provided by law for reviewing illegal, excessive or erroneous taxation, it would be contrary to the policy of the law to permit him to recover in this action. “The assessed stockholders in this case had ample opportunity to make their application to the tribunal provided by statute, and on showing the true value of the stock or any other good reason, to have had the assessments reduced accordingly. Their failure to do this is conclusive against them and against all parties. The proceedings for that purpose, so far as this city is concerned, are controlled by statute (see Consolidation Act, §§ 817, 822 ; Laws of 1859, chap. 302; Laws of 1880, chap. 269 ; Laws of 1867, chap. 410, § 4 ; Laws of 1870, chap. 382, § 2). Where a person taxed has failed to avail himself of these opportunities he cannot subsequently ask to have his taxes reduced ” (People v. Wall St. Bank, Gen. Term, 1st Dept., March, 1886 ; Smyth v. International Ins. Co., 35 How. Pr. 126; McMahon, Receiver, v. Fowler Bros., 66 Ib. 190 ; McMahon, Receiver, v. Jones & Fairchild, 1 Ib. [N. S.] 271; Ontario Bank v. Bunnell, 10 Wend. 186 ; Boyd v. Gray, 34 How. Pr. 323 ; Genesee Valley v. Supervisors, 53 Barb. 223 ; Bank of Commonwealth v. Mayor, 43 N. Y. 184 ; People ex rel. Condert v. Tax Commissioners, 31 Hun, 235 ; Manley v. Mayor, Gen. Term, 1st Dept., March, 1886 ; People ex rel. Mut. Union Telegraph Co. v. Commissioners Taxes, 99 N. Y. 254).
   By the Court.

Ingraham, J.

Section 814 of the Consolidation Act (chapter 410, Laws 1882), provides for the assessment of the taxable property in the city of Hew York. The deputy tax commissioners are directed to commence to assess real and personal property on the first Monday of September, and to report to the commissioners the sum for which all taxable property under ordinary circumstances will sell.

Section 817 provides that the tax commissioners shall keep in their office books to be called “The annual record of the assessed valuation of real and personal estate,” in which shall be entered in detail, the assessed valuation of such property in the city of New York, and such books shall be opened for correction from the second Monday of January to the first day of May, in each year, but on said last-mentioned day the same shall be closed to enable the commissioners to prepare assessment rolls.

Section-819 provides that the commissioners may at any time before the second day of April in each year, increase, or may diminish at any time before the closing of the books of annual record on the first day of May in each year, the assessed valuation of any real or personal estate in said city, as in their judgment may be necessary for the equalization of taxation, but they shall not increase such valuation after such books are opened for correction and review, except on notice being given to the party affected by such increase twenty days before the closing of said books.

Acting under the authority conferred by the laws embodied in these sections, prior to the second Monday of January, 1881, the defendants as commissioners of taxes in the city of New York, caused eight hundred and eighty-four shares of the capital stock of The North Biver Bank, owned by plaintiff, to be valued at $20,332, and which assessed valuation was entered by the defendants in the book kept in their office as directed in § 817 before referred to, and such valuation remained unchanged until after May 1, 1881.

No notice was given to plaintiff or to the owners of the other stock that the value of such stock would be increased at any time before May 1. About the middle of May, 1881, without notice to plaintiff, defendant caused the value of the stock to be increased from twenty-three dollars per share to twenty-eight dollars per share, which would increase the assessed valuation of plaintiff’s stock from $20,332, to $24,752, and of the other stockholders in the same proportion.

That the sections above cited apply to the stock of banks as well as to other personal property cannot be disputed. No statute is cited that makes any other provision for the time at which the value of the capital stock of banks shall be assessed, or that thé provisions above cited shall not apply to them. The value of the shares of stock having been assessed and entered in the book to be kept by defendants, their valuation could only be changed in accordance with the provisions of the sections above cited, and the change in the valuation, in violation of the express prohibition contained in the sections, was unauthorized and void.

No authority for the change can be found in section 1 of chapter 761, Laws of 1866. That act provided a method by which the value of the shares of stock of banks can be ascertained. Nothing is said about the time at which the valuation is to be made.

The value of ' the shares of stock mentioned was assessed by deducting the proper proportion of the assessed valuation of the. real estate of the bank at the time the assessment was made, and on that assessment being made, the provisions of the act in relation to the change of the values of real and personal property apply.

The fact that the commissioners subsequently reduced the valuation of the real estate of the bank could not give the commissioners the right to increase plaintiff’s assessed valuation without the notice to him which the law requires. The fact that for any reason the assessed valuation of the real estate of the bank was so changed, would authorize the commissioners to increase the assessed value of the shares on giving the proper notice and complying with the law, but would not authorize them to do what the law expressly prohibits them from doing.

As the act of 1859 has been re-enacted in the Consolidation Act, it cannot be said to be repealed by the act of 1866. They are not, however, inconsistent, but by this construction may apply and furnish an entirely consistent system, by which the value of the shares of stock of banks can be ascertained, and the valuation thereof proportionately corrected.

It cannot be said that plaintiff was not injured by the increase, because on the second day of April the value of the plaintiff’s property became fixed and he could not be compelled to pay taxes on any increased value. The unlawful act of the commissioners did compel him to pay a tax on such increased value.

The claim of the bank for a reduction of its real estate was made within the time allowed by law. We are of the opinion, therefore, that the acts of the defendants as tax commissioners in increasing the valuation of the shares of stock of the North River Bank was illegal and void.

In National Bank v. City of Elmira (53 N. Y. 49), the court say : “ They (the assessors) were subordinate officers possessing no authority except such as is conferred by statute, and it is a well settled and salutary rule that such officers must see that they act within the authority committed to them, and where the right to act depends upon the existence of some fact which they erroneously determine to exist, their acts are void.

The right of the commissioners to act depended upon the existence of the fact that notice had been given to the owners of the property. Such notice not having been given, they had no jurisdiction to act, and the act was void.

Nor do I think a party can have his property taken from him by the act of a public officer which is without authority and void, and then have his action to recover his property so taken defeated by reason of the fact that if such person had known of the void act in time, he could have reviewed the act of the officer by certiorari. It was said by the court in National Bank v. City of Elmira (supra): “ The property of the plaintiff has been forcibly taken from it in violation of law, and it would be discreditable to the proper administration of justice not to give an effectual remedy.” It does not appear that the plaintiff or the other stockholders knew of the illegal acts of the commissioners until after the time in which they could have reviewed such act by certiorari had expired (See Westfall v. Preston, 49 N. Y. 349).

We are of the opinion that on the facts as proved, plaintiff was entitled to a verdict. No question is made as to the amount of the verdict, and the exceptions should therefore be overruled and judgment ordered for plaintiff on the verdict, with costs.

Freedman, X, concurred.