Thornton v. Road Imp. Dist. No. 1

SANBORN, Circuit Judge (after stating the facts as above). The object of the assessment of benefits and of the taxation challenged by this suit was to collect moneys to pay the cost of the construction of the 26 miles of the Nix Eerry Road from the Arkadelphia and Okolona Road easterly through Gurdon to Nix’s Eerry. If lands sufficiently benefited could have been found along the 26 miles of that road, such an assessment and taxation might have been lawfully made under Public Act No. 338 of the Acts of Arkansas of 1915, which is the general law of that state for the construction of improvements by means of the assessments of benefits to property abutting upon or in the vicinity thereof and which provided for the formation of a proper road district and for the addition in a proper way of lands benefited — 524 — to a district already formed and authorized, and required the assessors and commissioners to assess the benefits to and levy the taxes on each of the particular tracts of land along the 26 miles of such a road as the Nix Ferry Road proportionately to the benefits conferred upon the respective tracts abutting upon or in the vicinity thereof by the improvement. Under such an assessment and taxation, a tract of 40 acres of land abutting upon the roa.d 7 miles west of Gurdon and of approximately the same value as a tract of 40 acres of land abutting on the road 7 miles east of Gurdon would naturally have been assessed approximately the same amount of benefits and subjected to approximately the same amount of taxes. But in this case the assessors and commissioners did not make such an -assessment or taxation. On the other hand, they assessed sufficient benefits and levied sufficient taxes based thereon against the lands along the east 11 miles of the road to pay the entire cost of the construction of the 26 miles of the road and assessed no benefits and levied no taxes against any of the lands along the westerly 15 miles of the improvement .on account thereof, although the latter lands lie in the same county and bear approximately a similar relation to the road and apparently could not fail to be benefited to some extent thereby if the lands along the east 11 miles thereof were so benefited. Why did the assessors and commissioners so radically depart from the proportionate assessment of benefits and levy of taxes prescribed by the General Laws of Arkansas? Undoubtedly it was because they interpreted and understood Special Act No. 374 of March 26, 1919 (Road Acts), which added to their road district certain lands east of their district and authorized and required them to build the Nix Ferry Road, to require them to assess on the added lands along the east 11 miles of that road sufficient benefits, and to impose upon them sufficient taxes to pay the entire cost of the 26 miles of the road and to let the lands along the west 15 miles of that road go free of assessment and taxes therefor. And, after thoughtful consideration of this special act and of the general law found in Public Act No. 338, the conclusion is that their interpretation of this special act was correct. It provided .that they should “proceed as provided in said Act 338 of 1915 to make the assessments of benefits and their assessments shall embrace all the property added to the district by this act. The assessments shall be controlled and governed by the said Act No. 338 of the Acts of 1915.” If the express provision of this act just quoted had not been inserted therein the provisions of the general law, Act No. 338, would have applied and would have required them to assess against the lands along the west 15 miles of the road as well as against the lands along the east 11 miles thereof, the proportionate benefits derived from the improvement by the respective tracts. The special act,-however, expressly required them to assess “all the property added to the said district by this act,” that was to say, all the land along the east 11 miles of the road. But it did not require them to assess under it, as the general law in the absence of this act would have done, any of the lands benefited by the Nix Ferry Road along the west 15 miles of it, which were in the original district. The expres — 525 — sion of one thing is the exclusion of the other. The requirement that they should assess all lands added to the district and the exclusion of a requirement that they should assess any of the lands in the original district was in effect a mandate of the Legislature that they should not assess the latter. And where a special act and a general law are inconsistent, they must, if possible, stand together; the former as the law of the particular case, and the latter as the general law of the land. King v. Pomeroy, 121 Fed. 287, 294, 58 C. C. A. 209; Christie-Street Commission Co. v. United States, 136 Fed. 326, 333, 69 C. C. A. 464. The result is that the true construction of Special Act No. 374 (Road Acts) is that it required the assessment of benefits under it against all the lands added to the district thereby and excluded the lands in the original district along the west 15 miles of the improvement from any assessment of benefits or taxation thereunder. Such undoubtedly was the purpose, object, and effect of the passage of that act. The provisions of the act that the assessors shall proceed as provided in Act 338 of 1915 were necessarily restricted in their application by the other provisions of the act to the assessment of the property added to the district thereby. The assessors and commissioners subsequently added to the lands specified in Act 374 two tiers of sections of land south of a line parallel to and 3 miles south of the proposed line of the Nix' Ferry Road which were largely composed of the plaintiffs’ lands and in which the major portion of their lands involved in this suit were situated. There was and had been for 12 years a good road known as the Kansas Road, which extended from Gurdon east of it splitting the lands in these two tiers of sections. There were some residences occupied by their owners and some cultivated lands along this road. It was the most direct and convenient means of travel and transportation for the owners and occupants of these lands to and from Gurdon. There was no way they could use the Nix Ferry Road between their land and Gurdon without traveling several miles more than they did travel to go or come by the direct Kansas Road, and the building of a parallel road 4 to 6 miles north of the Kansas Road would naturally diminish rather than enhance the value of the lands along and within 2 or 3 miles of the latter so that the physical facts practically prohibited any special benefit to the lands within 2 or 3 miles of the Kansas Road from the construction of the Nix Ferry Road. Nevertheless the assessors and the commissioners in making their assessments of benefits and the taxes founded thereon gave no consideration or effect to the existence of this Kansas Road, but assessed special benefits against the lands abutting and within 2 miles thereof on account of the construction of the Nix Ferry Road by the same hard and fast zone system that they would have used if there had been no Kansas Road there. In view of these facts, this assessment of benefits and the taxation based upon it seem at first sight to be grossly disproportionate between the lands benefited by the construction of the Nix Ferry Road, arbitrary and excessively oppressive. Counsel for the defendants below, however, argue that this assessment of benefits and taxation of the lands along the east 11 miles — 526 — of the Nix Ferry Road, while-no benefits were assessed to or taxation imposed upon lands along the west 15 miles thereof on account of the construction of this road, effects no discrimination or disproportionate assessment or taxation, because all lands within 1 mile of any of the main roads or of any of the lateral roads in the original district was put in the first zone, and lands further away in the second zone, etc., and those lands were assessed and taxed by the zone system. Conceding this to be the fact, it is immaterial here, because none.of the assessments or taxes on lands in the original district, hence none on the lands along the west 15 miles of the Nix Ferry Road, were assessed for benefits or taxed on account of the construction of the Nix Ferry Road. All those assessments and taxes were on account of the construction of the four main roads radiating from Arkadelphia. All the assessments of benefits to lands in that district were made and confirmed before the construction of the Nix Ferry Road was authorized, and those assessments and taxes have never been modified. It was indispensable to the taking of the property of the plaintiffs by due process of law by means of the assessment of benefits to it on account of the construction of the Nix Ferry Road and by means of taxation based thereon that the assessment of benefit to it should be just and fairly proportionate to the assessment of benefits to other property benefited by that improvement. The plaintiffs’ property was heavily assessed for benefits and taxed over $20,000 to pay the cost of the construction of the 26 miles of that road, while the property of other landowners abutting to and in the vicinity of the west 15 miles of that road was assessed nothing for benefits and subjected to no taxes on account of its construction. In Gast Realty & Investment Co. v. Schneider Granite Co., 240 U. S. 55, 59, 36 Sup. Ct. 254, 60 L. Ed. 523, taxes for the paving of a street were levied on all the property fronting on the street on the basis of one-fourth of the cost according to frontage, and three-fourths of the cost according to acreage; the area to .be ascertained by a rule, prescribed in the ordinance which authorized the tax. That rule, when applied, resulted in disproportionate taxation of the lands fronting on the street. The Supreme Court, speaking of the ordinance which prescribed the basis according to which the taxes were laid, said: “If the law is of such a character that there is no reasonable presumption that substantial justice generally will be done, but the probability is that the parties will be taxed disproportionately to each other and to the benefit conferred the law cannot stand against the complaint of one so taxed in fact.” Kansas City Southern Ry. Co., et al., v. Road Improvement District No. 6 of Little River County, Arkansas, 256 U. S. 658, 660, 661, 41 Sup. Ct. 604, 605 (65 L. Ed. 1151). If the Supreme Court could not sustain taxes assessed under a law or ordinance which resulted in the taxation of all property abutting on an improvement because the lots so abutting were taxed disproportionately between themselves, this court ought not to sustain an assessment of benefits and taxation based thereon under a law which required and has resulted in the assessment of benefits to and the taxation of all the lands within 5 miles on each side of the east 11 miles of a road 26 miles long for the entire cost of the road and the exemption — 527 — of all the lands on either side of the west 15 miles of that road from any assessment of benefits whatever and from the payment of any taxes on account of that improvement. Under such a law there is no reasonable presumption that substantial justice will be done, but there is not only the probability but also the certainty that the parties in interest and their lands will be taxed disproportionately. Nor could this disproportionate, clearly excessive, and arbitrary assessment and taxation stand if the statutes of Arkansas had authorized or permitted the assessors or commissioners to make a just, fair, and equitable assessment upon and taxation of all the property benefited, or if this court is mistaken in its interpretation of the statutes and they did empower those officers to make such an assessment and taxation. And that because those officers have made and the defendants are proceeding to enforce this disproportionate, arbitrary, and excessive assessment and taxation, and— “Though the law itself be fair on .its face and impartial in appearance, yet, if it is applied and administered by public authority with an evil eye and an unequal hand, so as practically to make unjust and illegal discriminations between persons in similar circumstances, material to their rights, the denial of equal justice is still within the prohibition of the Constitution.” Tick Wo v. Hopkins, 118 U. S. 356, 361, 369, 373, 374, 6 Sup. Ct. 1064, 1073 (30 L. Ed. 220.) Counsel for the defendants contend that this assessment and taxation may be sustained because the Legislature of Arkansas subsequently enacted several laws whereby it in effect declared this assessment and taxation to be just and fair, and that all irregularities and defects therein were cured. But this grossly disproportionate, arbitrary, and excessive assessment of benefits and the taxation based upon it does not constitute that due process of law without which the Constitution of the United States prohibits the taking of the property of the owner without compensation for public use, and no approving acts or fiats of the Legislature of a state enacted without notice to the owners of the property and without opportunity to be heard before any tribunal upon the merits of the issue could constitute such assessments and such taxation or the act or acts which approved them due process of law or relieve the assessment and taxation from the grossly disproportionate, arbitrary, and excessive character which brings them under the ban of the Fourteenth Amendment to the Constitution. Road Improvement District No. 2 v. Missouri Pacific Railroad Co. (C. C. A.) 275 Fed. 600, 604. Counsel earnestly contend that the plaintiffs are estopped from maintaining an original suit in the federal court for relief from this excessive and discriminatory assessment and taxation because their land was adjudged benefited by the county court of the state to the amount specified in the reports of the commissioners after the notice of hearing upon that question had been published, as directed by the statutes of Arkansas and the formal proceedings for the assessment and taxation conformed to the provisions of those statutes. In support of this contention, they have cited, and the court has carefully read and considered, the opinions of the Supreme Court in Spring Valley Water-Works v. Schottler, 110 U. S. 347, 4 Sup. Ct. 48, 28 L. Ed. — 528 — 173; Fallbrook Irrigation District v. Bradley, 164 U. S. 112, 17 Sup. Ct. 56, 41 L. Ed. 369; Hibben v. Smith, 191 U. S. 310, 24 Sup. Ct. 88, 48 L. Ed. 195; English v. Arizona, 214 U. S. 359, 29 Sup. Ct. 658, 53 L. Ed. 1030; French v. Barber Asphalt Paving Co., 181 U. S. 340, 341, 21 Sup. Ct. 625, 45 L. Ed. 879; Briscoe v. Rudolph et al., 221 U. S. 547, 31 Sup. Ct. 679, 55 L. Ed. 848. But the plaintiffs were residents and citizens of Illinois. The legal proceedings pursuant to the statutes of Arkansas for the assessment and the publication of the notice of the hearing thereon, the judgment of confirmation thereof, and the expiration of the time to appeal therefrom, occupied less than two months. The plaintiffs had no actual notice of any of these proceedings until more than five months after their time to appeal had expired. The only notice of the hearing required to be given was the publication of a notice thereof twice in a newspaper published in Clark county, Ark., and the question is: Were these citizens of the United States estopped from all relief by an original suit in a federal court from this discriminatory and excessive assessment and taxation because the proceedings therefor were in accord with the statutes of Arkansas ? The question is not entirely novel. The Fourteenth Amendment to the Constitution of the United States contains this prohibition: “Nor shall any state deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.” By the Constitution and the laws of the United States the power is conferred and the duty is imposed upon a federal court to relieve, by its decree, injunction, or other process, a citizen of the United States who properly invokes its aid from an arbitrary discriminatory or excessively oppressive exercise of the legislative power of a state which, without due process of law or compensation, deprives or threatens to deprive him, of a part or all of his property, or of the equal protection of the laws in violation of this amendment to the Constitution. In Norwood v. Baker, 172 U. S. 269, 271, 276, 277, 19 Sup. Ct. 187, 43 L. Ed. 443, the owner of a lot of land in the village of Norwood brought a suit in equity against the village to enjoin the enforcement of an assessment upon her lot for the opening of a street through it, upon the ground that the assessment was so excessive that its threatened collection would deprive her of property in violation of the Fourteenth Amendment. The proceedings for the opening of the street and the making of the assessment were in conforihity to the statutes of the state providing’ for such an opening and assessment, and the village pleaded this fact in answer to the complaint. But the Circuit Court adjudged the assessment violative of the Fourteenth Amendment and perpetually enjoined its enforcement, and the Supreme Court affirmed its decree and said: “There is a point beyond which the legislative department, even when exerting the power of taxation, may not go consistently with the citizen’s right of property. As already indicated, the principle underlying special assessments to meet the cost of public improvements is that the property upon which they are imposed is peculiarly benefited, and therefore the own — 529 — ers do not, in fact, pay anything in excess of what they receive by reason of such improvement.” That court further said: “In our judgment, the exaction from the owner of private property of the cost of a public improvement in substantial excess of the special benefits accruing to him is, to the extent of such excess, a taking, under the guise of taxation, of private property for public use without compensation.” In Myles Salt Co. v. Iberia Drainage District, 239 U. S. 478, 479, 482, 483, 484, 485, 36 Sup. Ct. 204, 60 L. Ed. 392, L. R. A. 1918E, 190, the plaintiff brought a suit in the federal court for an injunction against the collection of a tax of $2,000 upon its land on the ground that its land was not benefited by the drainage improvement and that the tax was violative of the Fourteenth Amendment. The statutes of the state empowered its police jurie.s to determine what lands were so benefited by the improvement that they should be included in the drainage district and subjected to taxation for the improvement, and the juries, pursuant thereto, had included the plaintiff’s land therein. The proceedings for the creation of the district and the levy of the tax were regular and in accordance with the provisions of the statutes of the state. The United States District Court dismissed the plaintiff’s suit on the ground that it was estopped from challenging the taxation by the proceedings therefor by the state officers in accordance with the state laws. The Supreme Court reversed that decree and directed the rendition of a decree for the relief sought by the plaintiff. The purpose and effect of the inclusion of the plaintiff’s lands in the district and the imposition of the tax upon them in that case and in the case at bar appear to have been strikingly similar, if not identical. In Gast Realty Co. v. Schneider Granite Co., 240 U. S. 55, 59, 36 Sup. Ct. 254, 60 L. Ed. 523, proceedings in strict accordance with the laws of the state and with the ordinance of the city had resulted in the levy of a tax for street improvement upon the property of the defendant and in a judgment of the state court for the amount thereof. The assignee of that judgment brought an action upon it, and the defendant insisted that the tax on its property was disproportionate to the taxes assessed upon the property of others benefited by such improvement, and the Supreme Court sustained that defense in the face of that judgment of the state court. In Abernathy v. Fidelity National Bank & Trust Co. (D. C.) 274 Fed. 801, 802, 804, 805, 806, 807, a bill in equity was presented to the United States District Court by the complainants, for a perpetual injunction against the collection of taxes based on an assessment of benefits to their property on account of the grading of Meyer Boulevard in Kansas City, Mo., on the ground, among others, that the assessment and taxation of their property were violative of the Fourteenth Amendment because they were arbitrary and .greatly in excess of the benefit conferred. The defendants presented, insisted upon, and argued the defense that the plaintiffs were estopped from obtaining any relief by that original suit in the federal court, by the assessment and taxation proceedings and the previous judgment of the state court therein that the respective tracts of lands involved should be charged — 530 — with the liens of the taxes based upon the challenged assessment. The proceedings for the assessments of benefits and taxation were regular and in conformity with the relevant state statutes, but the court overruled the defense and granted the decree sought because the assessment and taxation of the plaintiffs’ land were so greatly in excess of the special benefits accruing to it from the improvement as to be violative of the constitutional prohibition of the taking of private property for public use without compensation. In Thomas v. Kansas City Southern Railway (C. C. A.) 277 Fed. 708, 709, 711, 712, 713, the plaintiffs presented to the federal court below a bill in equity for an injunction against the sheriff and collector of Sevier county, Ark., and the directors of a drainage and levee district of that state from collecting certain assessments of benefits to their property on account of drainage and levee improvements. The proceedings for the assessment were regular a'nd in conformity with the pertinent statutes of the state. Nevertheless, the District Court sustained the suit and enjoined the collection, and this court affirmed the decree on the ground that the assessment of benefits against the property of the plaintiff was so grossly disproportionate to the assessment of the benefits to other property assessed for the improvement that it constituted “a discrimination so palpable and arbitrary as to amount to a denial of the equal protection of the law.” And the conclusion is that the plaintiffs were not estopped by the regularities of the proceedings in making the assessment and taxation under consideration of the assessors and commissioners of the road district and the county court, from maintaining this original suit in the federal court for just and equitable relief from the violation of the Fourteenth Amendment committed and threatened by the enforcement of the discriminatory and arbitrary assessment of benefits and taxation of which they complain. An assessment of benefits to property from a local improvement and taxation based thereon grossly disproportionate between the parties interested in the property benefited by the improvement pursuant to a basis of assessment prescribed by law or ordinance “of such character that there is no reasonable presumption that substantial justice will be done, but the probability that the parties will be taxed disproportionately to each other and to the benefit conferred cannot stand against the complaint of one so taxed.” Such an assessment and taxation deprives the victim of the equal protection of the laws. Norwood v. Baker, 172 U. S. 269, 276, 278, 279, 19 Sup. Ct. 187, 43 L. Ed. 443; Gast Realty Co. v. Schneider Granite Co., 240 U. S. 55, 58, 36 Sup. Ct. 254, 60 L. Ed. 523. Private Act No. 374 of 1919 (Road Act), in accordance with which the assessment and taxation here challenged were made, prescribed such a basis of assessment, and upon that basis the assessment and taxation were made. Although the law or ordinance, pursuant to which an assessment of benefits and taxation. thereunder are made authorizes or permits a fair and just assessment of benefits and levy of taxes, nevertheless, if the officers executing and applying that law make an assessment of benefits and a taxation thereon, that is oppressively excessive, — 531 — arbitrary or confiscatory, or grossly disproportionate, or palpably discriminatory between the parties and property benefited thereby, that assessment and taxation cannot stand against one so assessed or taxed to his injury. Kansas City Southern Railway v. Road Improvement District No. 6, 256 U. S. 658, 660, 661, 41 Sup. Ct. 604, 65 L. Ed. 1151 ; Thomas v. Kansas City Southern Ry. Co. (C. C. A.) 277 Fed. 708, 709, 711; Myles Salt Co. v. Iberia Drainage District, 239 U. S. 478, 482, 483, 484, 485, 36 Sup. Ct. 204, 60 L. Ed. 392, L. R. A. 1918E, 190. One so assessed or taxed to his great injury is not estopped from maintaining an original suit in the proper Federal Court for relief therefrom on the ground that such a taxation or assessment is violative of the Fourteenth Amendment to the Constitution by the fact that the proceedings for the assessment or taxation may have been in accordance with the provisions of the statutes of the State. Norwood v. Baker, 172 U. S. 269, 271, 276, 277, 19 Sup. Ct. 187, 43 L. Ed. 443; Myles Salt Co. v. Iberia Drainage District, 239 U. S. 478, 479, 482, 483, 484, 485, 36 Sup. Ct. 204, 60 L. Ed. 392, L. R. A. 1918E, 190; Gast Realty Co. v. Schneider Granite Co., 240 U. S. 55, 59, 36 Sup. Ct. 254, 60 L. Ed. 523; Abernathy v. Fidelity National Bank & Trust Co. (D. C.) 274 Fed. 801, 802, 805, 806, 807; Thomas v. Kansas City Southern Ry. (C. C. A.) 277 Fed. 708, 709, 711, 712, 713, affirmed by the Supreme Court, opinion filed April 9, 1923, 43 Sup. Ct. 440, 67 L. Ed. —. The assessment and taxation involved in this suit are grossly disproportionate and deprived the plaintiffs of the equal protection of the laws in that they burdened the property along the east eleven miles of the Nix Ferry Road with the cost of the west fifteen miles thereof, while they imposed no burden whatever on any of the property along the west fifteen miles of the road on account of its construction. They are arbitrary and grossly excessive bécause they burden the property along the east 11 miles of the Nix Ferry Road with the cost of the construction of the 11 miles of that road west of Guidon, which is of no special benefit to the property east of Gurdon for the reason that the main road north and south from Arkadelphia passes through Gurdon, and because they substantially burden the property along side of and in the immediate vicinity of the Kansas Road upon which the construction of the Nix Ferry Road confers no special benefits.' Ret the decree below be reversed, and let this case be remanded to the court below, with directions to render a decree to the substantial effect that the assessment of benefits to the plaintiffs’ lands involved in this suit and the taxes based thereon are violative of the Fourteenth Amendment to the Constitution and void, that the cloud placed upon those lands by the proceedings for that assessment and for those taxes be removed, that the defendants and their successors in office be perpetually enjoined from enforcing such assessment and the taxation based thereon against the plaintiffs or any of their lands or any part thereof, and that the defendant road improvement district — 532 — Xo. 1 of Clark county, Ark., pay to the plaintiffs the $1,032.16 which the latter paid under .protest, with interest thereon from the time the plaintiffs paid that sum until it is repaid to them, and that the defendants pay the costs of this suit in this court and in the District Court.