Source: https://caselaw.findlaw.com/us-supreme-court/306/505.html
Timestamp: 2019-04-23 07:00:50+00:00

Document:
SANCHO v. YABUCOA SUGAR CO.
Mr. William C. Rigby, of Washington, D.C., for petitioner.
As conceded by respondent, this suit cannot be maintained unless authorized by a Porto Rican law, because Porto Rico cannot be sued without its consent. 2 It is also conceded that the Porto Rican legislature is not obligated to provide a judicial remedy for tax refunds. 3 Respondent's contentions here are that the governing statutes of the Island do authorize the present suit 'either by express language or by necessary implication,' and that the Porto Rican courts erroneously construed the local statutes.
The courts of Porto Rico construed Section 75 to mean that the Treasurer's refusal to refund taxes not paid under protest is final; that the local statutes grant the courts no jurisdiction to review this refusal; and that after the Treasurer's report to the legislature, a voluntary taxpayer's complaint must be addressed to the legislature. Disagreeing with this construction given the statute by the courts of Porto Rico, the Circuit Court of Appeals (one Judge dissenting) found that the 1925 Act plainly provided a resort to the courts, even in suits to recover taxes voluntarily paid without protest.
Taxing acts of Porto Rico are purely local and the traditional reluctance of this Court to overturn constructions of such local statutes by local courts is particularly applicable to interpretations of Porto Rican statutes by Porto Rican tribunals. 18 Orderly development of the government of Porto Rico as an integral part of our governmental system is well served by a careful and consistent adherence to the legislative and judicial policy of deferring to the local procedure and tribunals of the Island.
The judgments of the Porto Rican courts in this case are not unsupported by logic or reason. They embody a recognition of our constitutional division of powers between the legislative and judicial branches of government. Believing the legislature had declined to give the right to sue to a taxpayer who computed his own tax from his own records and voluntarily paid it without protest, the Porto Rican courts properly declined to read implications into a statute which they could not fairly find there. In passing upon a previous construction of a Porto Rican statute by the Supreme Court of Porto Rico, this Court said, 'The construction adopted in Porto Rico at least does no violence to the words of the statute; it concerns local affairs under a system with which the court of the Island is called on constantly to deal, and we are not prepared, as against the weight properly attributed to the local decision, to say that it is wrong.' 19 So [306 U.S. 505, 511] here, we cannot say the Porto Rican courts were wrong. In failing to uphold their construction of the local statutes, the Circuit Court of Appeals was in error.
The judgment of the Court of Appeals is reversed and the complaint in the district court of Porto Rico must stand dismissed, as ordered by that court and affirmed by the Supreme Court of Porto Rico.
[ Footnote 1 ] 1 Cir., 98 F.2d 398. The opinion of the Supreme Court of Porto Rico, and its opinion on rehearing, have as yet been reported only in Spanish. 50 D.P.R. 962, 51 D.P.R. 135.
[ Footnote 2 ] See People of Porto Rico v. Rosaly, 227 U.S. 270, 274 , 33 S.Ct. 352, 353; Puerto Rico v. Shell Co., 302 U.S. 253, 262 , 58 S.Ct. 167, 171.
[ Footnote 3 ] Cf., Dismuke v. United States, 297 U.S. 167, 171 , 172 S., 56 S.Ct. 400, 403.
[ Footnote 4 ] Laws of Porto Rico 1925, No. 74, pp. 400, 536.
[ Footnote 5 ] Laws, 1919, p. 612, 666.
[ Footnote 6 ] Section 66: 'That the Treasurer be, and he is hereby, authorized to remit, reimburse or make restitution for any tax or duty erroneously or unlawfully imposed or collected, as well as of the amount of any fine collected by error or without legal authority therefor.
[ Footnote 7 ] Laws, 1921, p. 312.
[ Footnote 8 ] Compania Agricola de Cayey, Ltd. v. Domenech, Treasurer, 47 D.P.R. 535 (Spanish Ed.), decided prior to the present case, is to the same effect.
[ Footnote 9 ] 43 Stat. 253, 343, 26 U.S.C.A. 1672-1673.
[ Footnote 10 ] Cf., United States v. McClure, 305 U.S. 472 , 59 S.Ct. 335.
[ Footnote 11 ] Act of April 12, 1900, c. 191, 31 Stat. 77.
[ Footnote 12 ] Act of March 2, 1917, c. 145, 39 Stat. 951, 48 U.S.C.A. 731 et seq.
[ Footnote 13 ] See, Garzot v. Rios de Rubio, 209 U.S. 283, 302 , 28 S.Ct. 548, 556.
[ Footnote 14 ] Nadal v. May, 233 U.S. 447, 454 , 34 S.Ct. 611, 612.
[ Footnote 15 ] Santa Fe Cent. R. v. Friday, 232 U.S. 694, 700 , 34 S.Ct. 468, 469.
[ Footnote 16 ] Phoenix R. Co. v. Landis, 231 U.S. 578, 579 , 34 S.Ct. 179, 180.
[ Footnote 17 ] De Villanueva v. Villanueva, 239 U.S. 293, 299 , 36 S.Ct. 109, 111; Waialua Co. v. Christian, 305 U.S. 91, 109 , 59 S.Ct. 21, 30; Inter-Island Co. v. Hawaii, 305 U.S. 306, 311 , 59 S.Ct. 202.
[ Footnote 18 ] Diaz v. Gonzalez, 261 U.S. 102, 105 , 106 S., 43 S.Ct. 286, 287.
[ Footnote 19 ] Cordova v. Folgueras Y Rijos, 227 U.S. 375, 378 , 379 S., 33 S.Ct. 350, 351.

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