Case Title: Bartlett & Company, Grain v. Board of County Com'rs

Citation: 382 P.2d 193

Docket Number: 

State: colorado

Court: Colorado Supreme Court

Date: 1963-06-03T00:00:00Z

Document:
382 P.2d 193 (1963) BARTLETT AND COMPANY, GRAIN, a corporation, and Gano Grain Corporation, Plaintiffs in Error, v. The BOARD OF COUNTY COMMISSIONERS OF the COUNTY OF BACA, State of Colorado, Defendant In Error. No. 19841. Supreme Court of Colorado. En Banc. June 3, 1963. *194 Gordon & Gordon, Lamar, for plaintiffs in error. Schmidt & Schmidt, Springfield, for defendant in error. HALL, Justice. The parties appear here in the order of their appearance in the trial court. We refer to them as they there appeared, as plaintiffs, or Bartlett and Gano, and to the defendant as the Board. Separate actions were commenced by Bartlett and Gano. Each sought relief from alleged illegal assessments and ad valorem taxes levied for the year 1958 against their properties situate in Baca County. Problems presented for adjudication are the same or similar in each case and the cases were consolidated for trial and one judgment entered. From the record it appears that for several years prior to 1958, Bartlett and Gano each owned and operated several grain elevators in Baca County. They had paid taxes on their various properties each year, including taxes for the year 1957. Valuations on the various properties for the year 1958 were increased twenty-five percent above the 1957 valuations. Bartlett and Gano protested the increases to the assessor and the Board, sitting as The Board of Equalization. Their protests were denied. Bartlett and Gano, having exhausted their administrative remedies whereby they sought to have their properties properly assessed, paid the taxes levied under protest, and commenced this action, claiming that the assessments were "unreasonable, arbitrary, discriminatory, not uniform, unequal and void, and resulted in oppressive and illegal taxes." In their complaint they sought a complete review by the trial court of all proceedings culminating in the alleged illegal assessments and taxes and prayed for a determination that said assessments are void, and for judgments for refund of the amounts paid, together with interest and costs. The Board by answer denied that the assessments were improper or void, and set up as an additional defense the fact that Bartlett and Gano had not exhausted their administrative remedies. Trial was to the court. Plaintiffs, in order to establish the allegations of their complaint, offered the testimony of one Keats Soder, who dealt in, owned and operated grain elevators and qualified as an expert in determining the cash market value of grain elevators located in Baca County and of the type involved in this action. His appraisal of the properties involved was completed in May 1959. In making his appraisal he visited and examined each property, took into consideration the kind of materials used, the date of construction, the then condition of each property, *195 and determined whether there had been recent additions or deletions. In arriving at the 1958 "full cash value" of each item of property under consideration, he computed 1958 replacement costs and considered the same together with the accumulated depreciation from date of construction, average yearly net income derived from the last ten years' operation of each facility, the amounts for which he thought the various properties could be sold to a willing buyer, based partially on sales of elevators in Baca County, and also capitalized the properties on an income basis. Predicated on such factors, he expressed his opinion as to the 1958 full cash value of each property. His testimony was clear and convincing and not questioned by anyone, nor was there any evidence to indicate or even intimate that his procedures for arriving at actual cash values were not proper or the values assigned correct. Bartlett and Gano also called for cross-examination Lee J. Winkleman, who was then, and for ten years and four months last past had been, employed as an "Industrial Appraiser Engineer for the Colorado Tax Commission." He testified that in 1952 he examined the subject properties, and, following procedures contained in a manual (not made available to the trial court or this court) supplied to him by the Colorado Tax Commission, determined the 1941 replacement costs of each property and pursuant to manual procedures depreciated that cost to 1952. He testified: After completing this appraisal, Winkleman turned the same over to the Director of Appraisals of the State Tax Commission, who presumably sent copies of the same to the then assessor of Baca County. Jimmy Patterson, the assessor for Baca County during the years 1955-1959, testified that he never examined the properties for additions, deletions or condition, nor for the purpose of arriving at the assessable value. He had never computed the values of the elevators. A portion of his testimony follows: Patterson, the assessor, relied entirely upon Winkleman's appraisal setting forth 1941 reconstruction costs less depreciation through 1952. He had no idea as to the procedures used by Winkleman in arriving at reconstruction costs. He further testified that, acting under instructions given to him in the spring of 1958, he raised the assessed value of each subject property in the amount of twenty-five percent for that year. These increases were not Patterson's but were clearly the handiwork of the State Tax Commission. The foregoing contains the pertinent facts established by testimony and documentary evidence in which there was no substantial conflict. On January 25, 1960, the court made detailed FINDINGS OF FACT, CONCLUSIONS OF LAW AND ORDER. Pertinent portions thereof are as follows: "With respect to market value, the Court finds that the only evidence submitted was by Plaintiffs through their expert witness, Keats Soder, who testified as to market value, actual cash value, or market cash value (the terms *197 being used interchangeably to mean the highest possible price when there is a willing seller & buyer) on the subject properties. The court ordered that: On February 24, 1960, hearing was had before the board. There it was proved that Hiram Burton, assessor of Baca County in 1953, pursuant to orders of the Colorado Tax Commission, for the year 1953 reduced the assessed valuations of all Baca County grain storage elevators twenty-five percent. It was also proved that Jimmy Patterson, assessor of Baca County in 1958, pursuant to orders of the Colorado Tax Commission, for the year 1958 increased the assessed valuations of all elevators in Baca County by twenty-five percent. No properties other than elevators were subjected to this decrease or increase. Both were the handiwork of the Colorado State Tax Commission. Drought conditions prompted the decrease and rainfall prompted the increase. The board, on March 1, 1960, entered its FINDINGS OF FACT AND ORDER complying with paragraphs 1, 2, 3 and 4 of the court's order, supra, and further found that in 1958 all grain elevator assessments were increased twenty-five percent and that no other properties were subjected to these changes. The board entered the following further order: This order was forwarded to the trial court as directed and made a part of the case then pending before the trial court. Bartlett and Gano, on March 16, 1960, filed objections to the order, claiming, among other things, that the Board, being a party to the litigation, could not act as a finder of facts in a case to which it was a party; further, that there has been no valid assessment of the subject properties, and urged that the trial court reopen the case, hear evidence, and enter a decision. On December 27, 1960, these objections were overruled and the court ordered: Plaintiffs are here by writ of error, seeking reversal and remand with directions that the assessor be required to value and assess the properties on the basis of the 1957 assessments, without increase, or, in the alternative, remand the case to the district court with instructions to follow statutory provisions as well as cause the assessor to make an assessment in accordance with his judgment and not the judgment of the State Tax Commission. *199 The assessment, levy and collection of ad valorem taxes is exclusively a legislative function and is to be exercised pursuant to general laws, subject only to limitations imposed by the Constitution of the State of Colorado and the Constitution of the United States. In City and County of Denver v. Lewin, 106 Colo. 331, 105 P.2d 854, this court said: See, also, Stanley v. Little Pittsburg Mining Co., 6 Colo. 415. Pertinent constitutional limitations on the power of the legislature in force in 1958 are found in Article X, Section 3 (as amended November 6, 1956, L.1957, page 7961960 Perm.Supp. C.R.S., Article X, Section 3): and in Article X, Section 15 (as amended November 3, 1914, L.1915, p. 163): In People v. Pitcher, 61 Colo. 149, 156 P. 812, the court said: See, also, Weidenhaft v. Board of County Commissioners, 131 Colo. 432, 283 P.2d 164. In Citizens' Committee, etc. v. Warner, 127 Colo. 121, 254 P.2d 1005, this court said: "It not only is the duty of the assessor to see to it that all property within his county is returned for tax assessment, and to finally fix the valuation upon each item for that purpose, *200 but he further is obligated to undertake, so far as within his power and judgment, to see to it that taxes shall be uniformly assessed within his county. `All taxes shall be uniform upon the same class of subjects within the territorial limits of the authority levying the tax, and shall be levied and collected under general laws, which shall prescribe such regulations as shall secure a just valuation for taxation of all property, real and personal;' Section 3, Article X, Colorado Constitution." There, it is expressly stated that the assessor has specific duties to perform in conformity with legislative directives and that in performing these duties he, as well as others, shall comply with the very general admonitions in Article X, Section 3 of the Colorado Constitution with the ultimate goal of securing "just and equalized valuations." The duty of listing and valuing all taxable property devolves upon the assessor, and he alone. The State Constitution, Article X, Section 15, expressly states that: "* * * the state board of equalization shall have no power of original assessment." The Eighteenth General Assembly, effective June 2, 1911, created the Colorado Tax Commission and defined its duties and powers. The Nineteenth General Assembly, effective May 1, 1913, delegated to the Colorado Tax Commission: In Bohen v. Board of County Commissioners, 109 Colo. 283, 124 P.2d 606, this court said: *201 Counsel for plaintiffs contend that the 1958 assessments are void, having been made by the Tax Commissioner rather than the assessor. From the record it clearly appears that the State Tax Commission took a lively and unseemly interest in the performance by the assessor of his exclusive duty of placing values on plaintiffs' properties; however, we do not agree that the assessor in taking the 1957 valuations with certain deductions for depreciation was acting under the control and direction of the Tax Commission. Those figures of valuation were those of the assessor, even though predicated on the 1941 reconstruction costs as computed by Winkleman in 1952, pursuant to Manual "procedures." In Northcutt v. Burton, 127 Colo. 145, 254 P.2d 1013, this court said: In Weidenhaft v. Board of County Commissioners, 131 Colo. 432, 283 P.2d 164, this court said: Here, we do not have a situation involving taxes levied against property exempt from taxation, double assessments or other factors rendering the whole of the 1958 assessments and taxes levied void. However, with reference to the addition of twenty-five percent onto the values arrived at by the assessor, we have a different situation. The record clearly shows that the increase was not the voluntary act of the assessor. Prior to making the increase the assessor had valued the properties. The increases were not the handiwork of the assessor. He entered the increases "on the request of The Colorado State Tax Commission." It is thus clear that that part of the valuations sought to be reviewed are not the assessor's figures, *202 but those of the Commission, which has no power to assess. It is true that the Commission has wide powers of supervision, though not as wide as this record indicates it ascribes to itself. After an assessment has been made, it can, pursuant to 137-6-12(6), make a reappraisement of property, (7) raise or lower the assessed value of any property on notice and hearing to interested parties. The Commission did not take either of these steps. Hence, its action in increasing the assessor's values by twenty-five percent is without authority and void. We find nothing in the constitution, statutes or decisions of this court to warrant the ruling of the trial court adopting and approving the assessments, including the twenty-five percent increase. Findings and Conclusions of the trial judge indicate that he did not find justification for his ultimate conclusion within the constitution, statutes or court decisions. In fact the judgment, affirming the Board's conclusion entered pursuant to the directions of the trial court, is predicated entirely on what the court found to be "the standard in Baca County and generally throughout the entire state." Thus, it appears that the trial court found justification for the assessments in customs and standards then prevalent in Baca County and generally in Colorado. Insofar as these customs or standards are not in conformity with law, they must give way to the law to the end that lawful, rather than customary, assessments be made. The judgment is reversed and the cause remanded to the trial court with directions to order the assessor to value and assess the subject properties for the year 1958 according to law and not inconsistent with the views herein expressed, and to make the deletion, addition and modification ordered by the trial court in paragraph VII, 1, 2 and 3 of its Findings of Fact and Conclusions of Law, entered January 25, 1960, the assessor to report to the trial court the assessments so made; whereupon the trial court enter a proper judgment based upon said assessments granting to Bartlett and Gano proper relief as provided under CRS '53, 137-3-38.