Case Name: SIMPSON TIMBER COMPANY v. STATE TAX COMMISSION
Court: Oregon Tax Court
Jurisdiction: Oregon
Decision Date: 1966-08-04
Citations: 2 Or. Tax 509
Docket Number: 
Parties: SIMPSON TIMBER COMPANY v. STATE TAX COMMISSION
Judges: 
Reporter: Oregon Tax Reports
Volume: 2
Pages: 509–519

Head Matter:
SIMPSON TIMBER COMPANY v. STATE TAX COMMISSION
Mr. Jack B. Schwartz, Portland, Oregon, argued the demurrer and submitted a brief for plaintiff.
Mr. John Mull, Assistant Attorney General, argued the demurrer and submitted a brief for defendant.
Demurrer overruled August 4, 1966.

Opinion:
Edward H. Howell, Judge.
The plaintiff filed this suit for a declaratory judgment and to enjoin the defendant from collecting certain excise taxes allegedly owed by plaintiff.
The defendant has demurred to plaintiff's complaint on the grounds of lack of jurisdiction in the Tax Court and on the further grounds that the complaint fails to state a cause of suit.
The parties have agreed that the issue of jurisdiction of the Tax Court should be determined first.
The main thrust of defendant's argument in support of the demurrer is that the plaintiff cannot file a declaratory judgment suit in the Tax Court without exhausting its administrative remedies before the tax commission. The plaintiff, for reasons hereinafter mentioned, has not been before the tax commission either on an appeal from a deficiency assessment (ORS 314.405 and ORS 314.455) or requested a declaratory ruling from the defendant commission under ORS 305.105 allowing for such procedure.
As a general rule those who seek judicial relief must show that they have exhausted their administrative remedies. Oregon City v. Hartke et al, 240 Or 35, 44, 400 P2d 255 (1965).
It is not necessary in this opinion to decide whether this court in tax cases has original jurisdiction in declaratory judgments under Chapter 28 of the Oregon Revised Statutes because of the allegations in the complaint. It is hornbook law that a demurrer admits those allegations of the complaint that have been well pleaded.
The complaint alleges:
"VIII
"Plaintiff has informed defendant of its contentions of law in this matter, and defendant has controverted each of said contentions. Defendant has failed and refused to issue a notice of proposed assessment or a notice of assessment of the amount it claims is due and owing it as herein alleged. Plaintiff is thus prevented from seeking administrative relief as provided by ORS 314.405 and ORS 314.455 and has no plain, speedy, or adequate method of seeking a determination of its rights other than the bringing of this action. Additionally, defendant has declared its intent to issue warrants directing the sale of property of plaintiff within the State of Oregon to collect the amount it claims is due it in accordance with ORS 314.430 and has refrained from doing so only by reason of plaintiff having agreed to bring a proceeding in a court of competent jurisdiction on or before April 2, 1966, contesting defendant's claim of taxes owing; to keep said proceeding pending at all times; to pay the liability for the claim, if any, as finally determined by such court, including such interest, costs, and penalties as may be adjudged; and to post a surety bond securing performance of said agreement."
These allegations, admitted by the defendant's demurrer, clearly show that plaintiff had no administrative remedy to exhaust before coming to the Tax Court. According to the complaint the parties agreed to the bringing of a suit in a court of competent jurisdiction (in this case only the Tax Court) and posted a surety bond to guarantee payment of any claim decided against plaintiff. For the plaintiff to do anything different would be a violation of the agreement and possibly subject the plaintiff to an action on the surety bond.
The defendant's demurrer is overruled.