Opinion ID: 1960458
Heading Depth: 2
Heading Rank: 4

Heading: Illegal-exaction claims

Text: Article 16, section 13, of the Constitution permits any citizen to sue for himself and all others interested to protect against the enforcement of any illegal exactions whatever. When properly asserted, illegal-exaction claims may be brought in either circuit or chancery court, depending in large part on the remedy sought. Hoyle v. Faucher, 334 Ark. 529, 975 S.W.2d 843 (1998). The provision encompasses two types of claims: those involving public funds and those involving illegal taxes. Western Foods, Inc. v. Weiss, 338 Ark. 140, 992 S.W.2d 100 (1999); Pledger v. Featherlite Precast Corp., 308 Ark. 124, 823 S.W.2d 852 (1992). Cases involving taxes are divided between those alleging that the tax itself is illegal or void, and those alleging that the assessment or collection of the tax is flawed or erroneous. Allegations that a tax is contrary to a constitutional or statutory provision fall within the scope of illegal exactions, and thus come within the subject-matter jurisdiction of the circuit and chancery courts. Barclay v. Melton, 339 Ark. 362, 5 S.W.3d 457 (1999); Barnhart v. City of Fayetteville, 321 Ark. 197, 900 S.W.2d 539 (1995). Likewise, allegations that a government has failed to roll back taxes as required by Amendment 59 support an illegal-exaction claim. See Hoyle v. Faucher, 334 Ark. 529, 975 S.W.2d 843 (1998); Barker v. Frank, 327 Ark. 589, 939 S.W.2d 837 (1997). But the authorities are equally clear that a flaw in the assessment procedure, no matter how serious or grievous to the taxpayer, does not make the exaction itself illegal or void. Pockrus v. Bella Vista Village Property Owners Assn., 316 Ark. 468, 872 S.W.2d 416 (1994); Scott County v. Frost, 305 Ark. 358, 807 S.W.2d 469 (1991); McIntosh v. Southwestern Truck Sales, 304 Ark. 224, 800 S.W.2d 431 (1990). The unique posture of this case falls between the two classic situations. The original action alleged a flaw in the assessment and was properly brought in county court; it was not an illegal-exaction claim. Further, neither the county suit nor this suit specifically alleged that the tax itself was illegal or contrary to law. Accordingly, the county contends that a mistake or flaw in the assessment procedure can never rise to the level of an illegal exaction. The taxpayer on the other hand, while admitting that the special circumstances of this case present a form of illegal exaction never before addressed by this Court, contends that the mistake or error in the assessment grew into an illegal exaction because of two subsequent events: first, the determination by the county judge, and second, the county's failure to abide by the judicial determination. The taxpayer has made an express and frank request to extend existing law. Without deciding whether a flaw in the assessment procedure can ever rise to an illegal exaction, in the unusual setting of this case it did not. At a special session in 1994, the Board of Equalization decided, pursuant to its authority in Ark.Code Ann. section 26-27-311, to employ professional appraisers to conduct the appraisal, rather than have its in-house staff carry out its duties. However, the Board ignored, or overlooked, the provisions of Ark.Code Ann. section 26-26-601 et seq. These provisions require (1) a petition signed by the county assessor, a majority of the equalization board, and a majority of the local government governing bodies and school boards; (2) publication of the petition; (3) a public hearing, with the opportunity for property owners to be heard in support or in opposition to the petition; (4) approval by the county court; (5) negotiations by three property owners appointed by the court for the employment of professional appraisers; and (6) approval of the contract by the county judge, a majority of the members of the municipal governing bodies, and a majority of the affected school boards. Certainly this court should not undermine the significance of this statute or the legislative intent in enacting these safeguards. However, these facts do not rise to this court's prior definition of an illegal or void tax. Taxes collected pursuant to an appraisal conducted by an appraiser hired in violation of this statute do not become illegal or void.