94 F. 422 | U.S. Circuit Court for the District of Northern Ohio | 1899
These two bills are filed against Charles Brumfield, treasurer of Richland county, Ohio, and, as they involve acts relating to both cases, we treat them together whenever it is necessary to refer to them in connection with the bills. These bills seek to enjoin the respondent, who is treasurer of Richland county, Ohio, from enforcing the collection of $228,899.79 of taxes and penalties from the Aultman & Taylor Company,, and $162,918 of taxes and penalties from George Brinkerhoff, administrator of the estate of Michael D. Harter, deceased; and the aggregate, with interest claimed, amounts to nearly $500,000, which sums, the bills aver, stand illegally charged against the complainants on account of the taxes alleged to have been unlawfully and fraudulently withheld from the tax duplicate of the said county by the Aultman & Taylor Company and by George Brinkerhoff, administrator of the estate of Michael D. Harter, deceased, for the years 1893, 1894,1895,1896, 1897, and 1898. The Aultman & Taylor Company, in its bill, alleges that for said years
Against, the Aultman & Taylor Company:
For 3893, principal, $3,201,500 00, tax, $35,785 35
3894, 1,204,500 00, “ 35.532 45
1895, 1.204.500 00, “ 35,785 35
1890, 3.204.500 00, “ 30,541 05
1897, 1.204.500 00, “ 37,019 85
1898, 1.201.500 00, “ 37,302 75
Against George Brinkorlioff, administrator:
For 1893, principal, $ 900,000 00, tax, 825,470 00
1894, 900.000 00, 25,290 00
1895, 900,000 00, 25,470 00
1896, 900,000 00, 26.130 00
1897, 900,000 00, 26,370 00
1898, 900,000 00, 20,550 00
The said sums included a penalty of 50 per cent, of the original amount claimed, which penalty was an infliction imposed by the auditor, and the said sums for each year, multiplied by the rate of taxation for each year, provided the basis and means by which said auditor arrived at the taxes claimed. The bills further aver that the said taxes and penalties now stand charged for collection on the
The first contention presented by the issues is whether the notice, as given to the complainants, was such as was dontemplated by the laws of Ohio. The facts show that the complainants were notified by the auditor to appear in his office to explain why certain property was not reported for taxation, and why certain personal property was withheld from the tax duplicate. Said hearing had been carried on, several witnesses had been examined, and it was then understood by the parties that further proceedings would be resumed after due notice was given. The allegations of ttíe bills are (and the facts stated in the affidavits confirm these allegations) that immediately after the last adjournment the complainants were told that «they would be notified if any further proceedings took place, and an opportunity would be given them to present any matters they might choose to place before the authorities before they disposed of this important question. Immediately after this assurance had been given, without waiting to give them additional notice, the respondent proceeded at once by suit against the complainants in the court of common pleas of Richland county. This suit was to recover the large amounts heretofore stated. It is contended on behalf of the complainants that such notices as they had were not sufficient to give them an opportunity to be fully heard, and that the proceedings had under such imperfect notices were not such as contemplated by the constitution of the United States,' and were not due process of law. This court had occasion to examine these statutes very fully in the case of Meyers v. Shields, reported in 61 Fed. 713. In view of the opinion of the court on the second contention to be considered, it will not be necessary to consider any further the sufficiency of this notice. The facts, as they appear from the affidavits, tend to show that the officers charged with the collection of these taxes did not deal fairly with the complainants in their notices and proceedings before the auditor, and evidently intended to take advantage of them in prematurely instituting suits against them; It is but fair to state that the claim on the part of the county officers is that they were advised that the complainants were about to apply for an injunction, and that therefore these suits were instituted. Whether these notices were sufficient or not, we can proceed to the consideration of the second contention presented by the bills. The statutes of Ohio contemplate that after an examination such as the auditor held in these cases that officer was to make a report of the nature of the personal property he found to be withheld by the taxpayer from the tax list and from his report to the assessor, and from such facts
In the case of Meyers v. Shields, heretofore cited, this court had occasion to consider the question as to whether the auditor, vested with those powers, was acting in a judicial capacity, and in that opinion the decisions of the supreme court of Ohio- were cited in the cases of Gager v. Front, 48 Ohio St. 110, 26 N. E. 1013, and State v. Crites, 48 Ohio St. 460, 26 N. E. 105. In such case the court, in referring to the auditor’s proceedings, said:
“Tin; respondent was acting in a quasi judicial capacity. He had assumed jurisdiction, and entered upon the investigation. The law imposed upon him the duty of hearing and weighing evidence and rendering a decision upon it. This necessarily involved the exercise of judicial discretion.”
In the same opinion this court said:
“Having thus shown the judicial character of the duties which the auditor performs in the proceedings which have just been reviewed, how does the law say his direct pecuniary interest in the judgment he renders affects the validity of his proceedings? In Pearce v. Atwood, 13 Mass. 324, Chief Justice Parker said: ‘It is very certain that by the principles of natural justice and of the common law no man can lawfully sit as a judge in a case in which he*426 may have a pecuniary interest. Any interest, however small, has been held to render a judge incompetent.’ Lord Campbell said, in Dimes v. Grand Junction Canal, 3 H. L. Cas. 759: ‘It is of the last importance that the maxim that no man is to be a judge in his own casé should be held sacred, and that it is not to be confined to a cause in which 'he is a party, but applies to any cause in which he has an interest. We have again and again set aside proceedings because an individual who had an interest took part in the decision.’ If one of the judges of a court is disqualified on this ground, the judgment will be void, even though the proper number may have concurred without the disqualified judge. The legislative voice has spoken in equally positive inhibitions against interested persons acting as judges, appraisers, road viewers, or commissioners. In Ohio statutory provisions are in force allowing a change of venue of the suit upon the mere affidavit of the parties of prejudice, bias, or interest.”
In the Meyers Case the court continued its examination of the decisions of other courts, and found abundant authority for holding that a tribunal authorized to render arbitrary and summary judgments against citizens having so large a moneyed interest in the decrees and judgments to be rendered by them, was not such a judicial tribunal as contemplated'by the constitution of the United States, and that the auditor, who was directly interested in the proceeds collected under the assessment, could not be said to be depriving the litigants before him of their property by due process of law. In view of the very lengthy opinion filed in the case of Meyers v. Shields, in which nearly all the law questions now presented were fully considered, I do not feel called upon, in the brief time I have to prepare an opinion in this case, to review the authorities, and state my opinion as to the law. It is sufficient to say that, so far as the claim that the bills in equity in these cases ought not to be entertained because the complainants have a complete and adequate remedy at law is concerned, the supreme court has removed every doubt on that point by its opinion in the case of Cummings v. Bank, 101 U. S. 153, and also by the opinion of Judge Taft, in the United States circuit court of appeals for the Sixth circuit, in Grether v. Wright, 75 Fed. 742, 23 C. C. A. 498. If the statutes of Ohio did not specially provide that a taxpayer against whom illegal taxes had been assessed might secure relief against the collection of the same by a bill in equity and an injunction, the jurisdiction of this court might be in doubt. In view of the urgency under which this opinion is prepared, I can only say that the court adopts and reaffirms the conclusions and opinions announced in the case of Meyers v. Shields. This case has stood on the docket for five years, and the principles announced in it have been affirmed in several of the circuit and district courts of the United States, and until reversed it is authority to which the court can properly refer. A preliminary injunction will be allowed, in lieu of the restraining order- heretofore entered, and the parties may prepare the case for final hearing on an application for a permanent injunction. An order will be entered dividing the 90 days as prescribed by the sixty-ninth rule in equity, so that the parties may have the case ready for hearing on its merits at the fall term.