Court Opinion

ID: 6687432
Source: CourtListenerOpinion
Date Created: 2022-07-20 21:34:03.794571+00
Date Added: 2024-06-11T16:01:00.456289
License: Public Domain

HANEY, J.
(dissenting). The nature of this litigation is disclosed by the decision of the trial court wherein it is found: That defendant is one of the organized counties of this state; plaintiff, a city of the third class located therein. “That between the 20th day of November, 1894, and -the 1st -day of December, 190C, the duly elected, qualified, and acting county treasurers of defendant county, as officers thereof,' collected for the plaintiff the sum of $38,621.85, in taxes as the city tax for the said city, and that the said amount of taxes was paid to the respective treasurers of the said county by the taxpayers of the said city as the city tax thereof; that at several times during each year from the 20th day of November, 1894, to the 1st day of December, 1906, the respective treasurers of the said county remitted to the said city the city taxes so collected by the said treasurers during said period of time, less 4 per cent, of the total amount of taxes so collected, which said treasurers retained as a commission for collecting the said taxes; -that -the total amount retained by the said treasurers of the said county during said period for collecting the said city -taxes was $1,544.73, or 4 per cent, of the total amount so collected; that the said treasurers of the said county during said period deposited the said sum of $1,544.73 retained as commissions as aforesaid in special salary fund of the said county; that out of the said special salary fund certain officer’s salaries were paid, and the balance remaining in the said fund at the end of each fiscal year was deposited by the proper county officers in the general fund of the county for the use and benefit of the county;” that payment of the difference between 1 and 4 per cent, on the amount of taxes so collected was demanded and refused January 8, 1907. And the-court concludes: “(3) That the defendant is made by law the agent -of the plaintiff to collect and enforce the collection of the said taxes, and the relationship existing between the plaintiff and defendant is a fiduciary one, and *308the said taxes when so collected by the comity became, and is, a trust fund in the possession of the said county, the county acting as a -trustee of an express trust; (4) that the defendant county is now holding and retaining the sum of $1,158.54 as taxes belonging to the plaintiff (being the difference between 1 per cent, and 4 per cent, of the total taxes so collected) for which defendant must account to plaintiff; (5) that the plaintiff is entitled to judgment against the defendant for the sum of $1,158.54, with interest thereon at the rate of 7 per cent, per annum from January 8, 1907, and for costs.” Thus it was determined in the court below (1) that the defendant county was authorized by the statute to retain only 1 per cent,' as commission for collecting plaintiff’s taxes; and (2) that the '-.six years limitation of actions pleaded in the answer did not -preclude recovery of the whole amount so retained with interest from the date of the demand. In the former decision of this court the trial court was sustained as to the first proposition, -but reversed as to the second. City of Centerville v. Turner County, 23 S. D. 424, 122 N. W. 350.
After a careful re-examination of these propositions, I am entirely satisfied with the former decision of this court as to the first proposition, but not as to the second. “No tax,” declares the istate Constitution, “shall be levied except in pursuance of a law which shall distinctly state the object of the same, to which the taxes only shall be applied.” Const, art. 11, § 8. The taxes here involved were levied for the use and benefit of the plaintiff city. Having been levied and collected for that purpose, they cannot be applied -to any other, not even by express authority of the Legislature itself. The money' so collected, in contemplation of the law of this state, as expressed by its Constitution, remains in possession of the defendant county, and will so remain until applied to the object for which it was collected. This being so, its proper application cannot be prevented by legislation in the nature of limitations of actions or otherwise. The mandate of the Constitution is imperative and continuing. It cannot be evaded by legislation or the acts of public officers. This is not an action by the city or county against an individual tO' recover misappropriated funds. It is a controversy -between the taxpayers of the *309city and the taxpayers of the county. It involves a trust created by the Constitution itself, an obligation imposed by the Constitu-tion itself upon the officers of both city and county to see that all money collected by taxation shall be applied to the purpose for which it was levied, an obligation to ‘be enforced by the courts whenever called upon to do so, agreeably to the requirements of ■the organic law. This view works no injustice. The county, having had the -benefit of taxes to which it was not entitled, should make restitution. So, assuming that the payment by the city to the county of one per cent, for collecting the former's taxes as authorized by the statute is a proper use of taxes levied and collected for city purposes, I think this court should recede from the conclusion in its former decision as to the six-year limitation and sustain the court below in all respects.
SMITH, J., taking no part in the decision.