Opinion ID: 852846
Heading Depth: 2
Heading Rank: 3

Heading: The 2004 Law as Curative Legislation

Text: A general law could readily have been crafted in 2001 that would have accomplished what the General Assembly attempted to do. As explained in Part II.A.2, Lake County has a long and troubled history of assessment of property, including findings of the State Board as early as 1998 that systematic underassessment required a countywide reassessment. A statute applicable to all counties permitting the use of contracted private assessors or permitting the DLGF to perform that function where such a finding is made would be a general law not subject to Article IV challenge as special legislation. In 2004 such a law was passed. Indiana Code section 6-1.1-4-35 (2004), applies by its terms to a county other than a county subject to section 32 [I.C. § 6-1.1-4-32]. At the time this law was passed, presumably the intent of this exception was to exclude Lake County, which, as explained in Part II, is the only county that meets the population parameters of section 32. Because section 32 violates Article IV, Section 22, however, no county is subject to section 32 and section 35 applies by its terms to Lake County and all ninety-one other counties. Moreover, section 35(v) specifically provides that the provision of this section are severable as provided in I.C. § 1-1-1-8(b) [the general severability statute]. Pursuant to Section 35(v), we are to sever any invalid portions of section 35. If section 35 were inapplicable in Lake County, it would constitute special legislation for the same reasons section 32 runs afoul of Article IV, Section 22 of the Indiana Constitution. Based on the effort in 2001 to accomplish essentially the same thing for Lake County, we think it clear that the General Assembly would prefer statewide application of section 35 to its statewide invalidity. Accordingly, even if section 35 is read to exclude Lake County, that exclusion would fall, for the purpose of preserving the statute. Section 35 provides for DLGF to order a State-conducted reassessment for a county if it determines that the local officials are unable to complete the reassessment by October 2003 or are likely to complete reassessment in an inaccurate manner. The DLGF is authorized to contract with private parties to perform the reassessment. Nothing precludes the DLGF from performing a part of the reassessment itself and contracting for others. The DLGF was thus authorized by the 2004 legislation to do substantially the same things in Lake County that were in fact done under color of section 32. We are unwilling to fortify the armory of those who attack the law as famous for its ability to elevate form over substance. We see no basis to trigger the disruption that would be generated by invalidation of the entire county's property tax base where there is no showing that any identifiable property has been incorrectly assessed. Indeed, what plaintiffs seek is court preservation of a system of taxation that was held invalid six years ago in State Board of Tax Commissioners v. Town of St. John, 702 N.E.2d 1034 (Ind.1998). The 2004 law acts as curative legislation by authorizing actions taken pursuant to an unconstitutional statute. A curative act is a statute passed to cure defects in prior law, or to validate legal proceedings, instruments, or acts of public and private administrative authorities. In the absence of such an act the statute would be void for want of conformity with existing legal requirements.... [A] curative act may validate any past action which the legislature might have authorized beforehand. 2 Norman J. Singer, Statutes and Statutory Construction, § 41.11, at 466-67 (6th ed.2001). This Court has adopted Judge Cooley's test for curative acts: If the thing wanting or which failed to be done, and which constitutes the defect in the proceedings, is something the necessity for which the legislature might have dispensed with by prior statute, then it is not beyond the power of the legislature to dispense with it by subsequent statute. And if the irregularity consists in doing some act, or in the mode or manner of doing some act, which the legislature might have made immaterial by prior law, it is equally competent to make the same immaterial by a subsequent law. See State ex rel. Harris v. Mutschler, 232 Ind. 580, 590-91, 115 N.E.2d 206, 210 (1953) (citing 2 Thomas M. Cooley, Constitutional Limitations at 775-76 (7th ed.)). A curative act should be liberally construed. Mutschler, 232 Ind. at 591, 115 N.E.2d at 210. A curative or validating statute is a species of retrospective legislation, but that does not make such a curative act unconstitutional unless violating some constitutional provision such as impairing the obligation of a contract or the taking of property without due process. Martin v. Ben Davis Conservancy Dist., 238 Ind. 502, 512, 153 N.E.2d 125, 130 (1958); See Muncie Nat'l Bank v. Miller, 91 Ind. 441, 446 (1883). Therefore, when passing curative legislation the legislature may recognize and validate a de facto condition or status. There are limitations to this doctrine. For example the legislature cannot authorize an unconstitutional act, Martin, 238 Ind. at 513, 153 N.E.2d at 130, or cure a jurisdictional defect in a court proceeding, Seitz v. Mosier, 192 Ind. 416, 421-22, 136 N.E. 840, 842 (1922). But none are applicable here. The legislature plainly could have authorized statewide reassessments under the procedures of section 35. The relevant point here is that the legislature may pass curative legislation that validates official acts performed pursuant to an act which a court later determines is unconstitutional so long as the curative statute does not suffer from any of the same defects as the original law. Thus, in Martin, the 1947 legislature passed an act that gave trial courts the authority to establish conservancy districts and appoint their directors and appraisers. Subsequently, the Court held that the 1947 law violated the requirement, since removed from Article IV, Section 19 of the Indiana Constitution, that the subject of every act shall be expressed in the title. State ex rel. Pa. R.R. Co. v. Iroquois Conservancy Dist. Court, 235 Ind. 353, 359, 133 N.E.2d 848, 851 (1956). In response, the legislature passed the Conservancy Act of 1957 which by its terms authorized the conservancy districts established pursuant to the 1947 act and legalized prior acts of the board of directors for those districts. This Court held that because it was within the legislature's prerogative to establish the conservancy districts in 1947, it was also within the power of the General Assembly to cure any constitutional defects by passing curative legislation that meets constitutional requirements. Martin, 238 Ind. at 512, 153 N.E.2d at 130. Similarly, this Court in Mutschler, 232 Ind. at 591, 115 N.E.2d at 210, upheld a general law that legalized consolidated school districts that were defectively formed due to improper notice or invalid elections. It was within the legislature's discretion to dispense with those requirements for consolidation, so it was permissible to validate consolidations that had taken place without them, although they were required at the time the consolidation originally took place. Id. In Fahlor v. Board of Commissioners of Wells County, 101 Ind. 167, 171-72 (1885), this Court declared that the proceedings and orders of the Wells County board were void because the board was not in a regular or special session when it approved the construction of a road. The next year, however, in Johnson v. Board of Commissioners of Wells County, 107 Ind. 15, 26 8 N.E. 1, 6 (1886), this Court upheld legislation passed one month after the decision in Fahlor, to legalize the proceedings of the county board as to the gravel road. The Court held that curative legislation is invalid if it materially interferes with or overthrows vested rights, creates and imposes new burdens, or infringes upon the judicial department of the government. Johnson, 107 Ind. at 19, 8 N.E. at 5-6; see also 5A Ind. Law Encyclopedia, Constitutional Law § 272, at 188 (1984). But in the absence of any of these, a curative law salvages actions taken under defective statutes or in disregard of procedural requirements that are not required by due process. This reasoning has been specifically followed by the United States Supreme Court in sustaining curative laws authorizing assessments for tax purposes. In Williams v. Supervisors of Albany, 122 U.S. 154, 164, 7 S.Ct. 1244, 30 L.Ed. 1088 (1887), the Court stated: It is only necessary ... to consider whether the assessment could have been ordered originally.... If [the statutory flaws] were not essential to any valid assessment, and therefore might have been omitted or performed at another time, their omission or defective performance may be cured by the same authority. And curative legislation has been specifically upheld to validate acts taken pursuant to laws later held to be special legislation. See Marfa Indep. Sch. Dist. v. S.T. Wood, 135 Tex. 223, 141 S.W.2d 590, 592 (1940). In sum, in 2004 the Legislature authorized the DLGF to contract with private parties to perform property value reassessments or to conduct reassessments itself in counties where DLGF determines that local officials are unable to complete the reassessment by October 2003 or are likely to complete reassessment in an inaccurate manner. The DLGF did find widespread unequal assessment practices in Lake County, and pursuant to section 32 the county's property values were reassessed. The legislature had the power to authorize the DLGF to order the reassessment of property values in Lake County at the time it passed section 32. It therefore also had the power to cure the constitutional defect of the act by enacting section 35. Accordingly, the 2002 reassessment is valid subject to any individual errors in assessment that are determined in the normal review process. The doctrine of curative legislation permits the legislature in effect to ratify a previously unauthorized reassessment. This produces no injustice. There are unconstitutional statutes and unconstitutional statutes. The constitutional flaw claimed here is not that the plaintiffs' property is incorrectly valued, or that the assessments violated the substantive requirement of Article X that they be uniform and equal. Indeed there is no showing that the result would be different if the local assessors had done the job and done it properly. The constitutional issue is merely a claimed lack of authority of the persons who carried out the assessment under color of a statute that had never been declared unconstitutional at the time they acted. Moreover, as we hold today in Department of Local Government Finance v. Commonwealth Edison Co. of Indiana, 820 N.E.2d 1222, 1226, 2005 WL 67130 (No. 49S10-0307-TA-293) (Ind.2005), the law permits an appeal of a property owner's assessments even if the basis of that appeal is an incorrect assessment of other properties. The law thus affords a remedy for any inequity. But that remedy is not upsetting the entire fiscal structure of the county, which would be the result if some taxpayers are assessed on the basis of pre-reassessment values and those who are pleased with the reassessment get its benefits.