Minnesota Linseed Oil Co. v. Palmer

By the Court. McMillan, Ch. J. This is an action in the nature of a suit in equity, in which the plaintiff seeks to obtain a decree, declaring void a certain tax assessed upon its — 473 — real estate, and awarding a perpetual injunction, enjoining tbe defendants from proceeding to sell the plaintiff’s said real estate .to satisfy the tax, and for such other and further relief as it may be entitled to, under the complaint. To the general rule, that the correction of errors, mistakes, and abuses in the exercise of the powers of subordinate public jurisdictions, and in the official acts of public officers, is a matter of legal, and not equitable cognizance, three exceptions are recognized and established. First, where the proceedings in the subordinate tribunal, or the official acts of public officers, will necessarily lead to a multiplicity of suits. Second, where they lead, in their execution, to the commission of irreparable injury to the freehold. Third, where the adverse party’s claim to the land is valid, upon the face of the instrument or proceedings sought to be set aside, and extrinsic facts are necessary to be proved, in order to establish the invalidity or illegality. Scribner vs. Allen, 12 Minn. 148, and authorities cited. The present case must fall within the third of the above exceptions, if it comes within either of them. The claim to the land of the plaintiff, in this instance, is a lien thereon for the amount of taxes, levied and assessed by the city of Minneapolis, for a certain local improvement. If the levy of the tax is valid, it is a lien upon the land, which may be enforced by sale of the land, and conveyance thereof to the purchaser by a deed, which is prima facie evidence of a good and valid title in the grantee, his heirs and assigns. Special Laws, (city charter,) 1872, chap. 10, sub. ch. 5; sub. ch. 6 § 1; sub. ch. 8 § 20; Gen. Stat. chap. 11, §§ 115, 119, 122, 124, 127-129, 137-140, 142, 151-153. The complaint, by a proper statement of facts, shows that the defendants have taken all the steps necessary to authorize a sale of the premises for such tax, and threaten to sell, and — 474 — the defendant, Palmer, is now about to sell the same, on account of the non-payment, and for the collection of the said tax, with other taxes stated in the complaint, and concerning which no question is presented in this case. If, then, the proceedings are valid upon the face of the record, and their validity can only be shown by extrinsic facts, tbe lien of the tax constitutes a cloud upon the plaintiff’s title, to remove which, and to set aside and enjoin all proceedings to enforce such lien, is the peculiar province of a court of equity. Conkey vs. Dike, 17 Minn. 463 ; Scribner vs. Allen, supra; Scott vs. Onderdonk, 14 N. Y. 9; Weller vs. St. Paul, 5 Minn. 95; Heywood vs. The City of Buffalo, 14 N. Y. 534; Ward vs. Dewey, 16 N. Y. 519; Crooke vs. Andrews, 40 N. Y. 547. The appellant, in his brief, does not question, in any manner, the position, that the complaint states facts, which show that the proceedings of the city of Minneapolis, in making the improvement, and levying and assessing the tax in question, are apparently within the authority of the city, and, upon the face of the record, valid. We therefore proceed to consider whether the complaint states extrinsic facts, showing that the tax is void.' It appears, from the complaint, that the purpose for which the tax was levied, was to pay the cost of lowering and relaying the water main on Washington avenue, between Rice street, or Ninth avenue south, and Smith street, or Tenth avenue south, in the city of Minneapolis. The charter of the city provides that “ the city council shall have power, * * as respects the west division of said city, a majority of the aider-men of that division concurring, to provide for the apportionment and assessment of taxes, for expenses incurred in * * * works of either a general or local character, upon the whole division, or any portion thereof, without regard to ward lines, — 475 — or partly upon both, in such manner as may seem just, regard being had to the character of the improvement, and the benefits conferred.” Sp. Laws, 1872, chap. 10, sub. ch. 8, sec. 20, p. 89. The power of taxation, in a subordinate municipal corporation, exists only so far as it is conferred by legislative authority. The work for which the tax in this case was levied, was one of a local character, and the power of taxation in regard to it, given by the charter, is to tax for the expense incurred in it. There can be no doubt that the power of the city to tax for the improvement was limited, as to the amount of the tax, and that no power to tax for an amount materially greater than the expenses incurred in the work, is conferred by the charter. 2 Dillon Mun. Corp. sec. 607. The complaint avers that the actual cost and expense of lowering and relaying the water main, on that portion of Washington avenue above mentioned, was three hundred and thirty dollars, and that the amount of tax actually levied and assessed for such purpose, of which the taxes complained of are part, was six hundred and sixty dollars, being just double the amount of the actual cost of the improvement. The tax was therefore void. Section four of chapter five of the charter, is as follows :' “ Taxes may be levied by resolution of the city council, and no tax shall be invalid by reason of any informality in the manner of levying the same, nor because the amount levied shall exceed the amount required to be raised for the special purpose for which the same is levied; but in such case, the surplus shall, if the tax be a general tax, go into the general fund of the city; if it be a bond tax, it shall be kept and used for the future payment of principal and interest of the same class of bonds, or purchase thereof before due; if it be for improvements within either division of said city, it shall be kept — 476 — and used for further improvements in the same division, or used in paying the outstanding debts or obligations of the same division, as the city council, with the assent of the majority of the aldermen elected from such division, shall determine.” Sp. Laws, 1872, chap. 10, sub. ch. 5, sec. 4, pp. 75, 76. The provision of this section, that no tax shall be invalid, because the amount levied shall exceed the amount required to be raised for the special purpose for which the same is levied, does not apply to the tax in question. The terms of the section may perhaps include a general citj^ tax, a “bond tax,” and a tax for improvements in either division of the city, which is to be levied upon all the property of such division. This tax is of a character essentially different from either of these; it is a tax levied upon particular blocks, for an improvement, presumptively, at least, affecting directly only such blocks, and therefore is not within the provision of the section quoted. But if it were within the letter of the section, it would clearly be unconstitutional for the legislature to authorize the levy of a tax exclusively upon a particular block or portion of a division of the city, to pay for an improvement to which all the property of such division should contribute. Such taxation would be grossly unequal, and therefore void, within section one of article nine of the state constitution. Farther, the tax in this case is void, because no power was granted by the legislature to tax to a sum materially greater than the cost of the improvement, and therefore cannot be validated. The charter makes no provision as to the mode in which the expenses of improvements of this character are to be ascertained. The plaintiff is therefore not precluded from averring and showing, by proof dehors the record, the actual cost thereof, nor can we presume that the cost of this improvement — 477 — appears upon the record of the proceedings; but for the purposes of this demurrer, we must assume the truth of the allegation in the complaint, that such cost does not so appear. The only source of relief from the threatened sale and conveyance of his property, which the defendant has, is in chancery ; and the only authority which can remove the cloud upon his title, created by the tax, apparently valid, but really void, is by invoking the interposition of a court of equity, as he has done. Since the cloud of the lien exists, and the sale and conveyance of the land is threatened, a court of equity will not stay its intervention until the proceedings are consummated, and the existing injury increased, but will interpose at once, to remove the cloud, and prevent further injury. The order overruling the demurrer is affirmed.