State ex rel. National Bank v. Boyd

The opinion of the court was delivered by Mr. Justice Fraser. This case, an original application to the Supreme Court, and the case of the State of South Carolina ex relatione the National Bank of Newberry, South Carolina, v. Wallace C. Cromer, as county auditor of Newberry County, petition for mandamus, being an appeal from the judgment and order of his honor, Judge Hudson, on Circuit, were heard together in this court. These cases grow out of the same matter and involve a discussion of the same principles. The second case is against the auditor, while this one is against the treasurer; and it is claimed that the facts set out and admitted to be true-in the case of the auditor, and now in this court on appeal, are modified by statements made in this case against the treasurer. Separate judgments will therefore be filed in the two cases. A reference to the other case will show all the facts, except so far as they are modified by the statements herein made. The return of the bank for the taxes for the fiscal year commencing November 1, 1890, was duly made and sworn to by the president of the bank, in which the personal property was valued at $150,-000, and on which the tax was $>2,025. This return was passed without objection by the township board and approved by the county board, and was received by the auditor without objection. Subsequently the said personal property was placed by the auditor on his tax list and his tax duplicate at a valuation of $230,-000, and charged with a tax of $3,105. In the case against the county auditor now before this court on appeal, it was admitted that this increase in valuation was made solely on the order of the comptroller general. The return of ■the treasurer alleges “that while the said county auditor believed that he had been ordered by the comptroller general of the State to raise the valuation of the personal property of the petitioner * * * that the said auditor was not actually so directed to do ;” but was directed to follow the general instructions contained in “circular No. 10,” and “that these instructions on the part of the comptroller general, and this action on the part of the county audi — 240 — tor in raising saicl valuation, resulted from the information which both of these officers had received, that the said return as made by the petitioner was below the true value in money of the property so returned.” This statement in the return has not been traversed and must be assumed to be true. It is also an admitted fact that the tax duplicate now in the hands of the treasurer was turned over to him before the writ of mandamus was issued to the auditor in the other case heard with this. The application to this court is' for a writ of mandamus, commanding the treasurer to correct the said “tax duplicate in his hands, to enter the value of the said personal property at $150,-000, and to enter the tax payable on the same for the said fiscal year at $2,025, so as to correspond with the tax duplicate now held by the said county auditor; or if your honors should hold that such said correction should be made by the said county auditor for the said county, commanding the said county treasurer to suffer the said county auditor to make said correction.” The order and judgment of Judge Hudson, under which the said writ of mandamus was issued, have on appeal been this day affirmed by this court.1 That writ commanded the auditor to correct his duplicate. The auditor notified the treasurer of the contents of the writ, authorized him to make the correction in the treasurer’s duplicate, and verbally requested him to allow him, the said auditor, to make the corrections, either of which the treasurer declinSd to do. 1 This case against the auditor having been brought on appeal to this court, and it having been definitely decided, that upon the state of facts appearing in that case, the corrections should be made, and the required corrections having been made in the tax duplicate in the auditor’s office, so as place the valuation of this property at $150,000, charged with a tax of $2,025, it might be a serious question whether the tax duplicate in the treasurer’s office, so far as this property is concerned, and in which it has been put at a valuation of $230,000, and at which it now stands charged with a tax of $3,105, has anything on which it can stand. The duplicate put into the hands of the treasurer is his warrant to collect the tax which has been ascer — 241 — tained in a proper manner to be due, and is represented by what appears in the auditor’s duplicate. AVould not some of the same consequences follow which would follow if an execution were to issue out of the Court of Common Pleas, and an attempt were made to enforce it after substantial changes are made by competent authority in the judgments on which it is founded ? This view of the case has not been considered in argument, and no ruling is made upon it. We will proceed to consider the case as if there had been no writ of mandamus against the auditor and upon the state of facts as now presented to this court. 2 I. This is not a proceeding to interfere with the collection of taxes, with which the courts are forbidden to interfere by sections 171 and 269 of the General Statutes. It is only a question as to the proper mode of arriving at the true valuation and the proper tax chargeable thereon by the officers and in the manner provided by law. Where the officers charged with the duty of assessing property confine themselves to their duties as prescribed by law, this court cannot interfere even without the provisions of sections 171 and 269, supra; but when they do not follow the rules laid down which give them jurisdiction, it is the duty of this court always to be open to the complaints of those who claim to have been illegally dealt with by these officers. The vieivs of this court as to the construction of sections 171 and 269, and their applicability to a case like this, will be found in the case of the State of South Carolina ex relatione the National Bank of Newberry, S. C., v. Wallace C. Cromer, as auditor of Newberry County, heard with this case, and in which the opinion and judgment of this court has been this day filed.1 3 II. Here, as in the case against the auditor, the next question is whether the valuation of this personal property at $150,000, charged with taxes to the amount of $2,025, is valid, or whether the increased valuation at $230,000, charged with taxes to the amount of $-3,105, is the valid assessment. It is not now an inquiry whether the smaller or the larger amount is the true value. That question is not now' in any way before this court; the question is, which is the valuation ascertained by the offi — 242 — cers and in the mode provided by law ? This question is a very important one, because if this assessment raised by the auditor on mere information and belief, the source of which is not stated, is to be held valid and binding on the taxpayers, then the auditor may in the same way, and on any information he may regard as sufficient, raise the valuation of every item of personal property returned for taxation by the citizens, however honestly and truly, and thus increase the public burden to an amount limited only by his own discretion. Banks are not alone involved. It is now denied that the auditor acted on an order from the comptroller general. We will consider the case as though the claim now is that the auditor acted on his own belief as to the valuation of this property, though wre have examined this return of the treasurer, and we do not find it anywhere stated that the auditor believed the information on w'hich he acted to be true. The auditor’s own affidavit in this case only claims that at the time he increased the valuation under what he believed to be an order of the comptroller general, he had reliable information that the property was returned at less than its true value, and there is no statement of any information or belief that $230,000 was the true valuation. Again, it is nowhere stated that there was any exercise of judgment or of discretionary power on the part of the auditor on which he based this increase of valuation, or his belief that not $150,000, but $230,000, was the true valuation. His information, or his belief, whichever it may be, while set up as contemporaneous with, or resulting in, the increase of valuation, is not clearly set up as the ground on which the auditor based his conclusion and his action in this matter. He believes that he was directed to do the act by the comptroller general, and acted on this belief. We will, however, consider the case under the assumption that the auditor believed $150,000 not to be the true value, but that $230,000 was, and that the increase in valuation was his official judgment, based on this information and belief, and thus his own official act. The authority is claimed under sections 239, 240, 241, and 242 of the General Statutes. Section 240 refers only to certain — 243 — criminal proceedings for offences therein stated. Section 242 provides for certain costs and expenses incurred in the investigations provided for in section 239. In section 239 it is provided that the auditor shall notify a party and commence an investigation in these cases : First, where any person has evaded making a return; or, second, made a false return of personal property for taxation ; or, third, has not made a full return ; or, fourth, the valuation returned is less than it should have been. While in any of these cases the auditor may commence an investigation, he is authorized to act on the facts developed by the investigation by section 241 only in the following cases: where the party has, first, failed to make any return for taxation ; or, second, intentionally made a false return ; or, third, intentionally returned property for taxation at less than its cash value. These are all cases of fraud, in which the penalty of 50 per cent, addition to the valuation is incurred, and must be imposed by the auditor. It is not necessary now to consider whether in these cases it is necessary for the boards, or either of them, to pass on the matter of valuation. The only other state of facts on which the auditor can act, when shown to exist by this investigation, is where a party has committed “a merely unintentional mistake,” in which case the auditor may add such amount as may be just, and charge simple taxes only against the party. It is not contended that this case comes within either of the first three classes above stated, and no 50 per cent, penalty has been added, as should have been done, if this case came within either of these classes. _ 4 Now, the word “mistake” has a technical meaning.. It consists of unconsciousness, ignorance, or a forgetfulness, or then it may be a belief of the existence of some fact past or present which did not, or does not, now exist, and on which the party acted. “Where an act is done intentionally and with knowledge of the doing, the act cannot be treated as a mistake.” Pom. Eq., sec. 854. Errors of judgment cannot be called mistakes. One of the purposes for which these boards have been constituted by our tax laws is to correct these errors of judgment on the part of the taxpayers. The valuation in this case was sworn to and passed by one board without objection, — 244 — and distinctly approved by the other. It is hard to see how it can be called a merely ‘‘unintentional mistake.” 5 If, however, this is one of the cases coming within the purview of these sections — -239, 240, 241, and 242 — it is not claimed, and it nowhere appears, that the auditor acquired jurisdiction over this special case by giving to the bank the notice and instituting the investigation prescribed in these sections. Until this notice was given the auditor had no more jurisdiction in this special case than the Court of Common Pleas would have before the service of a summons in an action for relief, or the Court of General Sessions to try, convict, and' punish a man for a criminal offence before he had been arrested on a warrant so as to bring him within the jurisdiction of the court. Even if there had been a notice as required, it should appear that all the proceedings were regularly had, which are prescribed in these sections, including the very important matter of the examination of a. party and such witnesses as may be called under oath, and that the auditor did not act merely on what he considered reliable information. With these views, we conclude that the auditor had no jurisdiction to change the valuation of this property from $150,000 to $230,000, as that entry stood on his duplicate, and though corrected, or that now stands on the treasurer’s duplicate, with no more authority of law than if it had been placed there by himself inadvertently, or by some deck or other person against his consent or without his knowledge. 6 III. The views of this court as to the propriety of issuing a writ of mandamus in cases like this have been given in the case against the auditor, Wallace C. Cromer, heard with this case, and it is not necessary here to repeat them. The order of Judge Hudson and the writ of mandamus issued under it commanded the auditor to correct the duplicates, and this includes the duplicate now in the hands of the treasurer. It will be time enough to consider the question of the treasurer’s liability whenever any attempt is made to hold him responsible for not collecting a tax which once appeared on the duplicate in his hands, and which this court holds to have been placed there without warrant of law. — 245 — It is, therefore, ordered and adjudged, that a peremptory writ of mandamus do issue from this court commanding Calhoun F. Boyd, as county treasurer of Newberry County, to correct the tax duplicate in his hands for the fiscal year commencing November 1, '1890, so as to enter the valuation of the personal property of the petitioner at $150,000, and to enter the tax payable on the same for the said fiscal year at $2,025, so as to correspond with the tax duplicate now held by the said county auditor, Wallace C. Cromer, or that he shall permit the said auditor to make such corrections, which corrections, when so made by the auditor in obedience to the writ heretofore issued in the above stated case against the said auditor, shall be held to be a compliance with the writ hereby ordered. Footnotes [1] Ante, p. 213. [1] Next case ante, p. 213.