186 Ga. 368 | Ga. | 1938
On November 5, 1937, C. P. Aiken, a citizen and taxpayer, of Eulton County, Georgia, filed a suit in equity against W. B. Harrison, T. Grady Head, and J. B. Jones, composing at the time the State Revenue Commission, and against John Armistead, in which action the plaintiff sought, among other things, to cancel an alleged contract made by Harrison, Head, and Jones as members of the State Revenue Commission, with John Armistead, authorizing him to assess and collect all ad valorem taxes due to the State of Georgia on unreturned <e intangible” property, for the preceding seven years, on the basis of twenty per cent, commission to Armistead; and to enjoin further procedure under the contract. After the allowance of several amendments to the petition, the court, at interlocutory hearing, sustained a general demurrer and dismissed the action, and the plaintiff excepted. In the bill of exceptions error is also assigned upon exceptions pendente lite taken by the plaintiff to the refusal of the judge to grant a temporary restraining order on presentation of the petition, and to his refusal to allow introduction of evidence at the interlocutory hearing. According to our view of the case, any question of error in the intermediate rulings will be controlled by a proper decision as to whether the petition as amended was sufficient to state a cause of action; and therefore no further reference will be made
Petitioner is a citizen and taxpayer of the City of Atlanta, Fulton County, Georgia, and of the United States, and has been for many years. He is vitally interested in the welfare of the people of the State of Georgia and of the United States, and in maintaining intact and unimpaired our republican system of government, as declared in the Declaration of Independence and established by the constitution of Georgia and the constitution of the United States. John Armistead and the other defendants herein named have entered into a contract under which Armistead is to receive at least 20 per cent, commission on the amount of taxes he collects for the State of Georgia. The contract authorizes Armistead to assess and collect state taxes on all unreturned intangibles owned or controlled by citizens of Georgia and the United States, for the next preceding seven years. The defendants anticipate and intend collecting through Armistead the sum of $100,000,000, at least, in alleged taxes due the State of Georgia on alleged unreturned intangibles owned or controlled by citizens of Georgia and the United States during the next preceding seven years, in addition to all other taxes of every kind and nature which have been paid on said intangibles to the various units of government. The said assessments and collections are to be based entirely upon alleged information and statements and assumed and asserted authority of John Armistead. Said contract authorizes and anticipates Armistead’s being in effect the law, the jury, and the judge as to whether said alleged citizens, or any of them, owe the State of Georgia or any municipality or county of Georgia any ad valorem taxes for any or all of the said years, and, if so, how much, upon what basis, upon what theory or authority, and in what amount. Armistead is acting as judge and jury and the law as to what compromise or settlement shall be made of said alleged taxes due by citizens. Armistead is permitted, under said contract and arrangement, to use his own arbitrary discretion in discriminating between said al
Armistead is discriminating in his own arbitrary discretion against the alleged “holders of intangible out-of-state investments” and in favor of holders of investments within the State of Georgia, by assessing and collecting more taxes on the same class of property from the former than the latter under said contract, contrary to amendment 14 of the United States constitution, which declares: “All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside. No State shall . . deny to any person within its jurisdiction the equal protection of the laws.” Code, § 1-815. The said conduct of Armistead is contrary to article 1, section 1, paragraph 2, of the constitution of Georgia, providing that “ Protection to person and property is the paramount duty of government, and shall be impartial and complete.” § 2-102. It is also contrary to the uniformity required by the constitution of Georgia in article 7, section 2, paragraph 1, as follows: “All taxation shall be uniform upon the same class of subjects, and ad valorem on all property subject to be taxed within the territorial limits of the authority levying the tax, and shall be levied and collected under general laws.” § 2-5001. The defendants, especially Armistead, have already discriminated in many instances between holders of intangibles during said seven-year period, in his own arbitrary discretion and that of his confederates, and in the arbitrary discretion of the other defendants herein named, through themselves and their confederates, in open violation of the provisions of the United States and Georgia constitutions just quoted. Armistead personally, and through twenty-five or thirty of his confederates, is spying upon, inspecting, investigating, giving legal advice and opinions in regard to assessing, writing about, demanding returns and payment of taxes upon alleged intangibles claimed by him to have been unreturned by said citizens during said seven-year period while owning, holding, or controlling them, or hav
Armistead is advising the other defendants, the Governor of Georgia, and others as to the law pertaining to said unreturned intangibles and the legal rights of the owners and holders thereof, and is thus practicing law without a license and without paying professional tax as a lawyer and contrary to the State laws defining and regulating the practice of law. Armistead is not a lawyer, and is not admitted to practice law in the State of Georgia. He is not a certified public accountant, and is not qualified as a certified public accountant under the laws of Georgia. He is not paying any license or legal tax to carry on the business and professional work he is doing and attempting to do, as described in this petition. He is representing the other defendants against said alleged holders, owners, and controllers of intangibles, and is advising them concerning the law pertaining to taxes, assessments, intangibles, collections, executions, legal notices, hearings, and court proceedings, in violation of the law of Georgia defining and regulating the practice of law in this State, and contrary to the express provisions of the law regulating the State Revenue Commission. Said contract and arrangement with Armistead provide that the said Armistead shall have a fee of at least twenty per
Many loyal and constructive citizens and taxpayers of Georgia were scared or caused to leave the State by a similar inquisition and drive conducted by John Armistead and his confederates in the County of Fulton and City of Atlanta a few years ago, and the taxes on the several million dollar Hopkins and Scott estates have been lost to the State of Georgia through said procedure. Petitioner also contends that the said actions of the defendants in this case have already caused other fine citizens and taxpayers to remove their residence from this State and to carry their property with them, resulting in great loss in present and future taxes to the State and its municipalities and counties, and still greater loss in splendid citizens who have helped to develop the State. Many large foreign corporations with large investments, property, payrolls, and industrial and business programs in this State are contemplating leaving the State, disposing of their property here, and discharging their Georgia employees, if said contract with Armistead is carried out as intended by defendants, thus shifting millions of dollars in taxes to the backs of the poor, and citizens of moderate circumstances, from the wealthy citizens leaving the State, on account of the said arbitrary, confiscatory, illegal, and unconstitutional contract and program. Petitioner is one of the many thousand poor taxpayers of Georgia, and he has been forced to borrow money to pay his taxes.
It is the information and belief of petitioner that the commerce and industry of the entire State will be permanently and seriously impaired and reduced; that the security and continued operation
Said contract and program would confer upon Armistead the power and duties of the municipal, county, and state tax-assessors and collectors, and many times their compensation combined, contrary to the law and constitution of this State. The contract between the defendants to “farm out” said alleged taxes to Armistead on a contingent-fee basis of twenty per cent, or more, as aforesaid, amounts to a conspiracy between and among the defendants to
In order to prevent the confiscation of' millions of dollars of trust funds belonging to widows, orphans, invalids, children, and aged and disabled persons in alleged taxes due the State and its municipalities and counties, so that said enormous fee of approximately twenty million dollars or more may be paid to said contingent tax investigator, assessor, and collector Armistead, it is essential that the said contract be canceled and said program be permanently and promptly enjoined. Petitioner further contends unless said contract be canceled and said program be permanently enjoined promptly, several million dollars of trust funds in this State will be removed from Georgia, as well as many good citizens who are entirely dependent upon said trust funds.
Said contract confers upon Armistead all legislative, judicial, and executive powers pertaining to said alleged unreturned intangibles and the owners, holders, and controllers thereof in reference thereto, in open violation of article 1, section 1, paragraph 23, of the Georgia constitution, quoted as follows: “The legislative, judicial, and executive powers shall forever remain separate and distinct, and no person discharging the duties of the one shall, at the same
In .June, 1934, petitioner purchased his present home known as 364 Tenth Street N. W., at an agreed purchase-price of $3000, but on which a mortgage or security deed was signed by petitioner in favor of National Florence Crittenton Mission for the purchase-money due. Petitioner has been paying city, county, and state ad valorem taxes on the property since he purchased it, and had to borrow money to pay ad valorem taxes for 1936, which amounted to $68. Said property is being used by petitioner as a home for his wife, his two minor children and himself. The said mortgage or security deed provides that the plaintiff shall pay all taxes and assessments that may be liens on said premises, as they may become due; that any tax or assessment not paid when due by plaintiff may be paid by said mortgagee .or assigns, and that any sum so paid by the latter may be added to the amount of said.prin
The plaintiff amended his petition by adding the following allegations: This action is brought against W. B. Harrison, T„ Grady Head, and J. B. Jones, individually, and.not in their official capacity as members of the State Revenue Commission. The acts charged against them in the petition as amended, while done
Said illegal contract grants a donation or gratuity to Armistead, in violation of article 7, section 16, paragraph 1, of the Georgia
Unless the prayers of this petition are granted, petitioner alleges that Armistead will secure said fee and abscond, as no action whatever has been taken by any one to prevent the illegal payment of said twenty-million-dollar fee. Petitioner has two minor children in the public schools of the City of Atlanta, Georgia; and it is his information and belief that payment of said twenty-million-
The contentions made in the brief filed for the defendants may be summarized as follows: (1) The plaintiff as a citizen and taxpayer has no such interest in the subject of the contract or in, its effect upon the State funds as to authorize him to maintain the action. (2) The action is in essence a suit against the State, instituted without its consent) which is not permissible under the law. (3.) The possibility of injury to the plaintiff or other citizens and' taxpayers is too remote and speculative to justify the relief sought. A fact worthy of note in this connection is that in this brief there is no effort whatever to sustain the validity of the contract. Being of the view that the judgment should be affirmed partly for the¡ reason indicated in the third contention, and for others to bel given in the course of this opinion, we do not deem it necessary: to pass upon the first or the second contention of the defendants.: Nor, in the view which we take' of the case, is any decision required as to the validity of the contract. Consequently nothing said herein shall be taken -as an expression or intimation in regard to its validity. The writer, however, speaking for himself alone,J desires to make some further reference to the first and second contentions, before proceeding with, the opinion of the court touching the questions upon which, it is thought, the case must, in any view of other questions, be determined adversely to the plaintiff.
In support of the two contentions just stated, the defendants rely mainly upon the decision in Ramsey v. Hamilton, 181 Ga. 365 (182 S. E. 392), and cit. The writer concurred specially in that decision, thinking that the judgment was correct, regardless of the reasons given by the majority. The decision as written was thus not concurred in by all the Justices. While the questions therein dealt with are not necessarily involved in the case at bar, and final opinion thereon should therefore be deferred, it may not be amis^ to call attention to some additional authorities, for future refer-) enee by any one who may be interested, and incidentally to make some observations regarding such authorities. The statements now
First, as to the interest of the taxpayer: This court has many times held that citizens and taxpayers of counties and municipalities have such interest as will authorize them to maintain actions to enjoin the unlawful disbursement of the public funds of such counties or municipalities. State ex rel. Fulgram v. Johnson, 40 Ga. 164; Blake v. Macon, 53 Ga. 172; Keen v. Waycross, 101 Ga. 588 (3) (29 S. E. 42); Wells v. Ragsdale, 102 Ga. 53 (29 S. E. 165); Koger v. Hunter, 102 Ga. 76 (29 S. E. 141); Mayor &c. of Leesburg v. Putnam, 103 Ga. 110 (29 S. E. 602, 68 Am. St. R. 80); Mayor &c. of Macon v. Hughes, 110 Ga. 795 (36 S. E. 247); Mitchell v. Lasseter, 114 Ga. 275 (4) (40 S. E. 287); Mayor &c. of Americus v. Perry, 114 Ga. 871, 884 (40 S. E. 1004, 57 L. R. A. 230); Clark v. Cline, 123 Ga. 856, 864 (51 S. E. 617); Fluker v. Union Point, 132 Ga. 568 (64 S. E. 648); Tolbert v. Long, 134 Ga. 292 (67 S. E. 826, 828, 137. Am. St. R. 222); Henry v. Means, 137 Ga. 153 (2) (72 S. E. 1021); Renfroe v. Atlanta, 140 Ga. 81, 99 (78 S. E. 449, 45 L. R. A. (N. S.) 1173); DeVaughn v. Booten, 146 Ga. 836 (92 S. E. 629); Dancer v. Shingler, 147 Ga. 82 (2) (92 S. E. 935); Brumby v. Board of Lights & Waterworks, 147 Ga. 592, 596 (95 S. E. 7); Board of Lights & Waterworks v. Dobbs, 151 Ga. 53 (3) (105 S. E. 611); Cheney v. Ragan, 151 Ga. 735, 741 (108 S. E. 30); Bennett v. LaGrange, 153 Ga. 428 (112 S. E. 482); Mitchell County v. Cochran, 162 Ga. 810, 817 (134 S. E. 768); City of Fayetteville v. Huddleston, 165 Ga. 899 (142 S. E. 280); McGinty v. Pickering, 180 Ga. 447 (179 S. E. 358).
There is some authority, however, to the effect that the same doctrine does not apply to state officers having the management and control of state funds. The distinction was first drawn by the Supreme Court of Washington, in Jones v. Reed (1891), 3 Wash. 57 (27 Pac. 1067), where, in discussing the difference between a State and a county, it was said: “The county is a quasi corporation; the State is a sovereignty. The county only possesses such powers as the legislature of the State confers upon it. Its revenue, its property, its very existence, depend upon statutory enactment. It can be enlarged, dismembered, or annihilated at
Since the decision in Asplund v. Hannett, supra, was delivered by the Supreme Court of New Mexico in 1926, the courts of other jurisdictions have continued in the great majority of the cases to uphold the right of the taxpayer to enjoin an illegal expenditure of state funds. For instance, the Alabama case of Turnipseed v. Blan, supra, was decided in 1933. The court in that case referred to Asplund v. Hannett, but stated that “a great majority of the States which have considered the subject have applied such right of suit [meaning the right of the taxpayer], though it relates to a
So far as the writer has been able to ascertain, only one other decision besides Ramsey v. Hamilton, supra, has approved the doctrine expressed in Asplund v. Hannett, supra, since the decision in the latter case’in 1926. In 1934 it was held by a Federal district court in Massachusetts that the rule allowing a taxpayer to enjoin a wrongful expenditure of municipal funds does not apply to agencies of the State or Federal Government, and that a taxpayer has no standing to enjoin officers from a breach of public duty, without showing that he will suffer peculiar injury not suffered by the public at large. O’Brien v. Carney, 6 Fed. Supp. 761. That, however, was a suit against a Federal officer, and reference to an agency of the State was clearly obiter. The decision in Massachusetts v. Mellon (1923), 262 U. S. 447 (43 Sup. Ct. 597, 62 L. ed. 1078), was based on relation of the taxpayer to the Federal Treasury, and not to state funds. As bearing on the question of special injury to the citizen and taxpayer by a wrongful diversion of public funds, see Frame v. Felix, 167 Pa. 47 (31 Atl. 375, 27 L. R. A. 802); Pierce v. Hagans, 79 Ohio, 9 (86 N E. 519, 36 L. R. A. (N. S.) 1); Gaston v. State Highway Department, 134 S. C. 402 (132 S. E. 680); Donaldson v. Police Jury, 161 La. 471 (109 So. 34); Woodruff v. Welton, 70 Neb. 665 (97 N. W. 1037); Weatherer v. Herron, 25 S. D. 208 (126 N. W. 244); Terrell v. Middleton (Tex. Civ. App.), 187 S. W. 367; White Eagle Oil &c. Co. v. Gunderson, 48 S. D. 608 (205 N. W. 614, 43 A. L. R. 397); Farrell v. Oliver, 146 Ark. 599 (226 S. W. 529); Green v. Jones, 164 Ark. 118 (261 S. W. 43); Fergus v. Russel, 270 Ill. 304 (110 N. E. 130, Ann. Cas. 1916B, 1120);
Second, as to whether the action is a suit against the State: In Re Ayers, 123 U. S. 443 (8 Sup. Ct. 164, 183, 31 L. ed. 216), it was said that the rule as to immunity of the State does not “forbid suits against officers in their official capacity, either to arrest or direct their official action by injunction or mandamus, where such suits are authorized by law, and the act to be done or omitted is purely ministerial, in the performance or omission of which the plaintiff has a legal interest.” In Ex parte Young, 209 U. S. 123 (28 Sup. Ct. 441, 52 L. ed. 714), it was stated that when it appears that the officer is acting contrary to law, “he is in that case stripped of his official or representative character and is subjected in his person to the consequences of his individual conduct.” In White Eagle Oil &c. Co. v. Gunderson, supra, it was said: “The distinction between suits against state officers may be expressed as follows: Those cases in which the decrees require, by affirmative official action on the part of the defendants, the performance of an obligation which belongs to the State in it§ political capacity, are suits against the State; whilé those actions at law or suits in equity maintained against defendants who, while claiming to act as officers of the State, violate and invade the personal and property rights of the plaintiffs under color of authority unconstitutional and void, are not suits against the State. In these latter cases the defendant is sued, not as or because he is an officer of the government, but as an individual; and the court is not ousted of jurisdiction because the defendant asserts authority as an officer of the State. To make out his defense, he must show that his authority was sufficient in law to protect him.” See also Cannon v. Montgomery, 184 Ga. 588 (192 S. E. 206); Stanley v. Sims, 185 Ga. 518 (195 S. E. 439); Dennison Manufacturing Co. v. Wright, 156 Ga. 789 (120 S. E. 120); Poindexter v. Greenhow, 114 U. S. 270 (5 Sup. Ct. 903, 962, 29 L. ed. 185); Smyth v. Ames, 169 U. S. 466 (18 Sup. Ct. 419, 42 L. ed. 819); Public Service Co. v. Corboy, 250 U. S. 153 (39 Sup. Ct. 440, 63 L. ed. 905); Goltra v. Weeks, 271 U. S. 536 (46 Sup. Ct. 613, 70 L. ed. 1074); Sterling v. Constantin, 287 U. S. 378 (53 Sup. Ct. 190, 77 L. ed. 375); Pennoyer v. McConnaughy,
While, as may be inferred from the foregoing, the writer would be inclined to the view that a citizen and taxpayer is not without remedy in equity for a waste or unlawful expenditure of state funds, and that in a case like the present, if the contract is unlawful, the action could not be properly classed as a suit against the State, yet, as indicated above, it is the view of the entire court, including the writer, that a decision upon these questions is not required in the present case; and such being the case, the writer desires to repeat that final opinion thereon is reserved for the time being and until such time as an adjudication is necessary. Should that occasion ever arise, it will be interesting to consider again the bearing of the following decisions by this court: Mayor &c. of Gainesville v. Simmons, 96 Ga. 477 (23 S. E. 502); Peeples v. Byrd, 98 Ga. 688 (25 S. E. 677); Sanders v. Ballard, 160 Ga. 366 (127 S. E. 851); Holt v. Fayetteville, 169 Ga. 126 (149 S. E. 892); Perkins v. Madison, 175 Ga. 714 (165 S. E. 811). They may be distinguishable, and some of them may contain obiter dicta. Nothing that has been said thus far shall be taken as implying anything as to the views of any other member of this court. Now, having cleared the preliminaries and expressly laid aside the questions that are not decided, we will proceed with the opinion of the court.
The petition as amended alleged that the plaintiff himself has for several years past failed to return “intangible” property owned by him and showed that he is indebted to the State for taxes thereon. It further alleged that Armistead is “preparing” to force petitioner to pay him a large percentage of said intangible taxes, and under his contract with members of the revenue commission will keep at least twenty per cent, of the amount he collects.' As to this phase of the petition, it fails to state a cause of action, for the following reasons: (a) The plaintiff is seeking relief in a court of equity, and should do equity. Code, § 37-104. He alleges no tender of the amount of the taxes due by him; and even if it should be considered that the sum is uncertain, he does not offer to do
“The general rule of law is, that when a person is required to do a certain act, the omission of which would make him guilty of a culpable neglect of duty, it ought to be intended that he has performed it, unless the contrary be shown.” Mauldin v. Southern University, 126 Ga. 681, 683 (55 S. E. 922, 8 Ann. C. 130). “The
So far as the petition may allege duress, intimidation, inquisition, extortion, and other unlawful acts in relation to other citizens, with consequent injury to them and general exodus of people and capital, the plaintiff has no standing in court in the present action. Let those directly affected speak for themselves, if they desire to do so, offering to do equity so far as may be required by the circumstances. The plaintiff as an individual can not speak for them. Picquet v. Augusta, 64 Ga. 254; Reid v. Eatonton, 80 Ga. 755 (6 S. E. 602). If the defendants in this respect have created a public nuisance, the State through its proper officers would be the party to sue. The same is true as to the illegal practice of law by Armistead, as related to other citizens or the general public. Code, § 72-202; American Legion v. Miller, 183 Ga. 754 (189 S. E. 837).
In no view of the ease did the petition state a cause of action. The court properly sustained the general demurrer and dismissed the suit. Judgment affirmed.