Opinion ID: 1309027
Heading Depth: 1
Heading Rank: 4

Heading: wyoming litigation

Text: The legality of the mill levy was raised in Powder River Cattle Co. v. Board of County Commissioners of Johnson County, 3 Wyo. 597, 29 P. 361, 377 (1892), and Board of Commissioners of Johnson County v. Searight Cattle Co., 3 Wyo. 777, 31 P. 268 (1892), involving a claim to recover allegedly erroneously assessed taxes collected upon horses, cattle and property in the wrong county. Those cases were further considered in Kelley v. Rhoads, 7 Wyo. 237, 51 P. 593 (1898), a basic tax case which again raised the issue of recovery of taxes claimed to have been illegally assessed or levied. The general question involved whether sheep that were being grazed across the state of Wyoming were assessable as property within the state. See also Carton v. Board of County Commissioners of Uinta County, 10 Wyo. 416, 69 P. 1013 (1902), and see similarly Standard Cattle Company v. Baird, 8 Wyo. 144, 56 P. 598 (1898). Grazing sheep and the statute of limitations for the recovery of taxes, current issues of the time, arose in Marks v. Board of Commissioners of Uinta County, 11 Wyo. 488, 72 P. 894 (1903). The first cases directly raising fair assessment issues were Bunten v. Rock Springs Grazing Association, supra, 215 P. 244, and Baker v. Paxton, supra, 215 P. 257, which became the foundation law for equalization and propriety of state board of equalization action, with uniformity and due-process attributes. In Bunten, the association brought an action against the county treasurer to enjoin collection of real estate taxes valued on an acreage basis when the county board of equalization had increased the value from $1 per acre to $2 per acre. The rule, which has not been denied since or overtly diluted, was: The laws in this state contemplate the valuation of all taxable property at its true value in money at private sale. Id. 215 P. at 248. Since the actual decision to increase the valuation had been made by the state board of equalization, the validity of its decision was questioned. Justice Blume, writing for the court, stated the general principle which has since been restated although not necessarily always applied:    [P]laintiff had the right to have all the taxable property in the county, as well as in the state, assessed at a uniform rate, and a departure therefrom if made in an illegal manner is, where its property is assessed at full value, a discrimination against it which would not only be a fraud against plaintiff, but would also violate the constitutional provision of uniformity. Such discrimination may arise in various ways, for instance by the adoption of a wrong or illegal rule, principle, or method; and an unjust tax resulting therefrom has frequently been enjoined as illegal. Id. 215 P. at 251, but then added as dictum what has served as a basis for subsequent taxation process confusion:    The statute limits the valuation of property for purposes of taxation to its actual value. But the percentage of value at which property is assessed is, after all, secondary to the constitutional provision that all taxable property shall be assessed uniformly, so as to bear a just proportion of the burdens of taxes. The latter is the end, the former the means to that end, and we should not exalt the less important over the more important. Id. 215 P. at 253. In Baker v. Paxton, supra, the county in similar fashion increased agricultural land assessment pursuant to direction from the state board of equalization. In analyzing the function of the state board to equalize assessments, the court found that responsibility to have been properly performed when challenged by a due-process contest against the increased valuation. In the tax cases that followed in the melange of circumstances, two propositions remained concomitant: the equal and uniform purpose of the Constitution was unquestioned and essentially unenforced. Ricketts v. Crewdson, 13 Wyo. 284, 79 P. 1042, reh. denied 13 Wyo. 284, 81 P. 1 (1905), challenged addition of cattle to the taxpayers' assessment rolls; Harkin v. Board of Commissioners of Niobrara County, 30 Wyo. 455, 222 P. 35 (1924), soldier exemption, and likewise State ex rel. Board of Commissioners of Goshen County v. Snyder, 29 Wyo. 199, 212 P. 771 (1923); Town Council of Town of Hudson v. Board of Commissioners of Fremont County, 37 Wyo. 160, 259 P. 1051 (1927), mandamus to attack the constitutionality of special improvements assessments; State ex rel. Greenwood v. Pearson, 46 Wyo. 307, 26 P.2d 641 (1933), attacking action of the state board of equalization and ordering a county commissioners increase of farm land assessments; Chicago & Northwestern Railway Co. v. Hall, 46 Wyo. 380, 26 P.2d 1071 (1933), constitutional inquiry as to whether adjunct properties of a railroad should be assessed by the state board or the county assessor; State Board of Equalization v. Stanolind Oil & Gas Co., 54 Wyo. 521, 94 P.2d 147 (1939), application of the sales tax to an oil producer and utility; Unemployment Compensation Commission v. Renner, 59 Wyo. 437, 143 P.2d 181 (1943), unemployment compensation law as considered constitutional taxation power uniformity under Art. 1, § 28, Wyoming Constitution. In citing State ex rel. Board of Commissioners of Goshen County v. Snyder, supra, 212 P. at 779, the court recalled that the constitutional provision that `all taxation shall be equal and uniform' must be construed in connection with Art. 15, § 11, Wyoming Constitution, which provides that [a]ll property, except as in this Constitution otherwise provided, shall be uniformly assessed for taxation, and that equality and uniformity in taxation applies only to property, not to excise taxes, and then in Stewart v. City of Cheyenne, 60 Wyo. 497, 154 P.2d 355 (1944), construed legislative authorization to municipalities and boards of public utilities in discussion of eminent domain and delegation of power of taxation to pay indebtedness. [11] As a fundamental rule case, Kelsey v. Taft, 72 Wyo. 210, 263 P.2d 135 (1953) determined inherent taxability of a gift in contemplation of death, by statutory interpretation and by recitation of the principle that    [u]nder the Wyoming constitutional restriction that `No tax shall be levied, except in pursuance of law   ', we are unwarranted in `levying' or `imposing', by judicial decree, a tax which the legislature mentioned only by indirection. Id. 263 P.2d at 138. Town of Pine Bluffs v. State Board of Equalization, 79 Wyo. 262, 333 P.2d 700 (1958) called for inquiry of the taxation of municipally owned electric light facilities, and notice and a right to be heard about intended illegal levy of missed taxes was injunctively considered by the federal court in Orcutt v. Crawford, 85 F.2d 146 (10th Cir.1936) as found to contravene the due-process provision of the Fourteenth Amendment as well as the Wyoming Constitution. In Rowley v. Chicago & Northwestern Railway Co., 293 U.S. 102, 55 S.Ct. 55, 79 L.Ed. 222 (1934), the United States Supreme Court came to consider a federal district court injunction invoking discrimination complaints of taxation of Wyoming railroad properties. The court recognized the criteria of Wyoming law for an actual-value assessment, and only considered whether the property was intentionally and arbitrarily overvalued, noting that the ascertainment of value is not only a matter of arithmetic. The decision affirmed the methods used for value conclusion by the Wyoming state board of equalization. Sunday Lake Iron Co. v. Township of Wakefield, 247 U.S. 350, 38 S.Ct. 495, 62 L.Ed. 1154 (1918) was cited with approval in restating the principle at that time: There is nothing in this record to suggest any lack of good faith on the part of the board. Overvaluation resulting from error of judgment will not support a claim of discrimination. There must be something that amounts to an intention, or the equivalent of fraudulent purpose, to disregard the fundamental principle of uniformity. Rowley v. Chicago & Northwestern Railway Co., supra, 293 U.S. at 111, 55 S.Ct. at 59. The court further found: There was no discrimination against respondent by undervaluation of the property of others. Id. at 111, 55 S.Ct. at 59. The amount of the assessment was the sole issue, and the tax and its amount were expressly not considered. In Ludwig v. Harston, 65 Wyo. 134, 197 P.2d 252 (1948), concerned constitutionality of the oleomargarine excise tax; Morrison-Knudson Co. v. State Board of Equalization, 58 Wyo. 500, 135 P.2d 927 (1943), another excise-tax case, involved application of the sale and use tax to material used in dam construction; Barber v. Board of County Commissioners of Uinta County, 73 Wyo. 222, 277 P.2d 977 (1954), presented a reserved constitutional question as to the proper salaries of county officials as derived from contended deliberate underassessment by the county commissioners. In denying the reserved question, the court elucidated that [c]ourts have no inherent power to fix and determine what the assessed valuation shall be. That is ordinarily a matter for administrative officers, id. 270 P.2d at 980, and that perhaps the correction should be directed to the state board of equalization which, [i]f its present powers are not broad enough for such purpose, the matter may be easily remedied by amending the statutes, and thus injustice in assessed valuation may be reduced to a minimum. Id. 270 P.2d at 981. J. Ray McDermott & Co., Inc. v. Hudson, Wyo., 370 P.2d 364 (1962), another foundational case, presented the basic issue of the propriety of property valuation in assessment of produced oil: Although the discussions upon this subject in many jurisdictions reflect the existence of pertinent constitutional or statutory provisions relating to tax valuation, the rule is well settled that the value of personal property for purposes of taxation should be estimated according to the fair actual cash market value or the price that the property would sell for in cash in the usual course of business. Id. at 368. In the instant situation the general rule that the value of personal property for purposes of taxation should be estimated according to the fair actual cash market value, or the price that the property would sell for in cash in the usual course of business, must be applied. Id. at 370. The court in Scott Realty Company v. State Board of Equalization, Wyo., 395 P.2d 289 (1964), answered the fair-value and uniform-assessment as a valuation method in approving the discretionary decision of the state board of equalization. In re Use Tax Assessment No. 32950, Wyo., 491 P.2d 1232 (1971), and State Board of Equalization v. Kansas-Nebraska Natural Gas Co., Wyo., 457 P.2d 963 (1969), considered contests by a gas company to the assessment of its property with an interstate transportation defense, where objection and arbitrary characterization of the board's conclusion applied, and Lund v. Schrader, Wyo., 492 P.2d 202 (1971), reviewed a school district unification attack, raising doubt as to the equitable distribution of the tax burden for debt. In Weaver v. State Board of Equalization, Wyo., 511 P.2d 97, 98 (1973), we had an inquiry on assessment uniformity, and said:    [T]he Wyoming Constitution, Art. 1, § 28 [is] unequivocal in its statement that `All taxation shall be equal and uniform.' As was said in Sunday Lake Iron Company v. Township of Wakefield, 247 U.S. 350, 352-353, 38 S.Ct. 495 [495], 62 L.Ed. 1154, `it must be regarded as settled that intentional systematic undervaluation by state officials of other taxable property in the same class contravenes the constitutional right of one taxed upon the full value of his property,' The burden of proof of discrimination was not sufficiently demonstrated to justify relief. Appeal of Monolith Portland Midwest Company, Inc., Wyo., 574 P.2d 757 (1978) presented a further inquiry of mineral extractive value and cost of transportation as implicit in derived market value, with the case remanded for determination of actual, not formula cost. In seven Wyoming cases, the equal-and-uniform assessment criteria of the Wyoming Constitution were discussed by this court in some fashion. Bunten; Baker; Unemployment Compensation Commission v. Renner, 59 Wyo. 437, 143 P.2d 181 (1943); Scott Realty Company; Weaver; J. Ray McDermott & Co., Inc.; and most recently, Teton Valley Ranch v. State Board of Equalization, Wyo., 735 P.2d 107 (1987), an appraisement-method case. [12] In none of those cases was the direct inquiry ever raised to challenge either a differentiated or tier system or a ratio application to full value as changeable for different categories of property. Each of the cases recognized the constitutional constraints of taxation, but since they did not directly address percentage ratios there was no definition of the administrative authority of the state board of equalization as compared to the fundamental law enactment responsibility of the legislature. It can fairly be stated, after a near century of litigative disregard of the equal-and-uniform constitutional criteria, that the issues now before this court have never previously been directly addressed, except for actual-value assessments as the initial sequence in ad valorem taxation. It is not now the predilection of this court to amend the Wyoming Constitution by present decision to say it means what it does not say in acceptance of what is clearly denied.