Court Opinion

ID: 7134737
Source: CourtListenerOpinion
Date Created: 2022-07-24 15:22:43.549572+00
Date Added: 2024-06-11T16:14:35.253185
License: Public Domain

Opinion op the court by
JUDGE HOBSON
Affirming.
On July 13, 1891, the general council of the city of Louisville passed an ordinance for improving the streets of the city with vitrified brick, which contained, among others, this provision: “The contractor shall guaranty the performance of his contract according to this ordinance, and the pavement therein specified and the material composing the same shall be kept in good repair for a period of *59five years from tlie completion of the work and the acceptance by the general council; and to protect the city as to the character of said work and material and such repairs as may be needed, the city engineer to be the judge, the contractor shall deposit bonds of the city of Louisville or of the United 'States, amounting to ten per cent, of the original contract price of the entire work with the city treasurer, who shall hold the same, principal and interest, to be applied as far as need be in the necessary repairs of said work, and at the end of the said five years the1 unexpended balance, if any, to be subject to the order of said contract or.” Pursuant to this ordinance, and others of similar character, a number of vitrified brick streets were built in Louisville, and the cost of their construction apportioned among the owners of property fronting thereon. After this, in Gosnell v. City of Louisville, 104 Ky., 201 (20 Ky. Law Rep. 519), (46 S. W., 722), this court held that, where there was an improvement of the carriageway of the public street by original construction with vitrified brick pursuant to these ordinances, the 10 per cent, of the cost was for the reconstruction or repair of the street for five years, and that for such cost of reconstruction or repair the city was alone liable, and no part of it could be collected from the property owners. Appellants, who had paid their apportionments thereupon, filed this action against the city, suing in' equity, not only for themselves, but all other property owners of the city who had paid similar assessments, and sought to recover from the city the amounts so paid the contractors on the grounds that at the request of the city, they had paid a debt of the city to the contractor, and that, as the city was alone liable for the debt, and they had paid it by direction of the city, and in ignorance of their rights, the city should reimburse them. The learned *60chancellor sustained a general demurrer to the petition, and dismissed the action.
In Underwood v. Brockman, 34 Ky., 318 (29 Am. Dec., 407); Ray v. Bank, 42 Ky., 514 (39 Am. Dec.) 479, and a number of subsequent cases it has been held that, where money is paid under a clear mistake of law or fact, which in equity and good conscience should not be retained by the party receiving it, a recovery may be had. This may be regarded the settled law of this State, although the rule, so far as mistakes of law are concerned, is denied in many other States. But, while this rule has been consistently maintained by the court, it has not been applied ■to taxes or public dues which have been voluntarily paid where they were only collectible by action. Thus, in City of Louisville v. Zanone, 58 Ky., 151, the plaintiff sought to recover from the city money he had paid to a contractor for the improvement of the street in front of his property, on the ground that the ordinance under which the improvement was made had been passed by only one board of the general council, and was therefore invalid. It was held that, as he had voluntarily paid the assessment, he could •not recover. In Hubbard v. Hickman, 67 Ky., 204 (96 Am. Dec., 297), the plaintiff sued1 to recover municipal taxes which he had paid for ten years. It was held that the law does not imply a promise on the part of the city to make • restitution for taxes levied and paid under a mistake of law. This ruling was followed in Moore v. Bath Co. Ct., 70 Ky., 177. In City of Louisville v. Anderson, 79 Ky., 343, a recovery was sought of taxes paid under a; void ordinance. A recovery was had. But the court said: “Where a party is entitled to a day in court, and can litigate the. demand about to be enforced against him, but, instead of doing so, yoluntarily pays it, he is without remedy. *61When he can plead and make his defence, a payment under protest will be regarded as voluntary; or, if he has an option either to litigate the question or submit to the demand and pay the money, in all such cases there is no compulsion, and relief will be denied.” In Louisville & N. R. Co. v. Hopkins Co., 87 Ky., 613 (10 R. 806) 9 (S. W., 497) suit was brought to recover county taxes paid by the railroad company, for which it was not liable in law. But the rule laid •down in the cases abbve referred to was held to preclude a recovery. The court said: “In all the cases wherein it has been decided by the court, taxes illegally paid might be recovered back, including Fecheimer Bros., & Co. v. City of Louisville, 84 Ky., 306 (8 R., 310) (2 S. W., 65) referred to by counsel, the payments were regarded as involuntary, because the tax collector had authority to levy and sell on the refusal to pay. As said by this court, “The process is summary, and in the hands of the party making the demand, and the taxpayer must submit to the levy or pay the money. The only exception, under the statute of this State, exists in respect to railroad corporations, whose property from considerations of public convenience and necessity, can not toe levied -on and sold to pay taxes, and the collection must be enforced by judicial proceedings.” “The payment by the L. & N. Railroad Co. of the taxes which it now seeks to recover back from the counties of Christian and Hopkins was made voluntarily, and in no sense under compulsion, and, .such being the fact, we see no reason to make in these cases an exception to the general rule, laid down in City of Louisville v. Anderson, that the party paying taxes, who is entitled to a day in court, and can litigate the demand about to be enforced against him, tout, instead of doing so, voluntarily pays it, is without remedy.” In Louisville & N. R. R. Co. v. Marion Co., 89 Ky. 531 (12 R. *62961) (12 S. W., 1064), these cases were approved, and, after discussing the rule at some length, the court said “Considerations of public policy require this rule, and the taxpayer can not complain with grace, because he has, by his own neglect, missed the opportunity afforded him by law for his protection.” The doctrine o,f these cases was applied' to an assessment for local improvement which had' been voluntarily paid, and was sought to be recovered from the city, in Henderson v. Breckinridge, 3 Ky. Law Rep., 387. These cases are in accord with the authorities elsewhere. See Desty, Tax’n., p. 790; Dill. Mun. Corp., section 944; Cooley, Tax’n, 565-567. It is ably insisted for appellants that these authorities do not' apply, for the reason that the property owners were under neither a legal nor moral obligation to pay for the repair of the. street in front of their property for five years, and that, as this was solely the debt of the city, it should not be allowed to place upon them a( burden for which the law did not make them liable. There is great force in the argument that in equity the city should be held liable to the property owner for the amount paid ■by him to the contractor on’ the order of the city by mistake, in ignorance of his rights, when the amount so paid was purely the debt of the city. But the court is of opinion that the reasons of public policy which sustain the cases above cited apply with equal force to the case before us. Reduced to its last analysis, the case comes to this: The city assessed against the appellants’ property ■for the improvement of the street in front of it an amount larger by ten per cent, than it should have assessed. If a recovery can be had in this case; then one may be had in every case where the burden is wrongfully apportioned, although the assessment has been voluntarily paid. Such a rule would involve the city government in inextricable *63confusion. The council couhl not know what liabilities anight be anticipated, or what taxes should be levied. Under the Constitution, the levy of taxes must specify the purpose for which the tax is to be used, and a tax levied for one purpose can not be applied to another. The reason for the rule denying a recovery of taxes voluntarily paid is, after all, the security and efficiency of the city government; and every reason which forbids the recovery of municipal taxes that have been voluntarily paid seem to us to apply with equal force to assessments for municipal improvements. The city is required to make the apportionment. If an error is made, it is the duty of the property owner, no lc-ss than the city officials, to detect and correct it. If, instead of doing this, he voluntarily pays the assessment, and the city makes other contracts and assumes other obligations on the idea that these matters are all settled, it seems to us that sound public policy requires the loss to fall on the taxpayer who has acquiesced in the assessment and voluntarily pai'd the money rather than litigate the right. Judgment affirmed. "Whole court sitting.
Judge Guffy dissents.