*1 al. et HANSEN, v. WILDER Relator al., rel. et Plaintiffs v. HALLOCK ex SCHAEFER STATE al., et Defendants (80 306) N.W.2d 1957) (Files January 7, Opinion filed 9643. Nos. *2 No. 9642: Palls, Sioux for Plaintiff. Stordiahl, May Bee, & Atty. Atty. Gen., Saunders, Asst. Phil Thompson, Olin C.
Gen., for Defendants. 9643: No. Falls,
Boyce, Warren, Murphy McDowell, Sioux & E. W. Stephens, Pierre, for Plaintiffs. Gen., Atty, Saunders, Thompson, Atty. Asst.
Phil Dlin C. Gen.,for Defendants.
RUDOLPH, J. This is an original proceeding certi- Equalization. orari to review the action State Board of meeting that at the appears the valuation of all classes returned counties state was $1,800,000,000 $2,500,000,000 approximately increased *3 This increase in valuations as made the Board is State the the of relators’ claim that State Board exceeded basis jurisdiction entirety. and that its action is void in its its First, three principal
The relators make contentions. Equalization that the Board of is prohibited State any way the total valuation of raising 57.0415 from in the the state as returned State Board Second, Board is by the several counties. that State apart pro- to increase valuation from power without Third, by increasing hibition contained in SDC 57.0415. $2,500,000,000 $1,800,000,000 the total valuations arbitrarily and in capriciously Board acted State of its jurisdiction. excess briefly first the function of this court
We consider Obviously, sitting we are not as State proceeding. in this nor are in this proceeding per Board of we irregularities, any, if mitted to review mere errors or com only function is to inquire mitted Board. Our State determine whether the State Board acted without into and of the conferred jurisdiction or in excess jurisdiction v. Express Company ex rel. American law. State 338, 53 Equalization, Assessment and 3 S.D. N.W. Board of 192. holding our preface subsequent think it essential
We and function of the history of the duties with a brief 1897, 44, pre- Laws of Ch. Equalization. § Equaliza- powers duties scribed tion as follows: duty “It shall be of said board to examine compare the returns of the assessment of the
property of state, the several counties of the proceed same, so that all the taxable state shall be assessed at its true and proportionate value; but said board shall reduce aggregate state, in the but may aggregate increase said valuation in an such may reasonably necessary amount as be to obtain a just and true value and of all the property in the state.” provides: Sec. of the same Act
“Said board has the and shall: Equalize “First. assessment of land adding thereof, assessed value every county value to raise may in which said board believe per low, be rate such centum will proper proportionate same its value by deducting from the assessed value every county thereof, in in which said board high believe the valuation to be too (pro- proper centum as will reduce same to (shall portionate) city value. Town and lots equalized provided manner as herein for) equalizing option lands, and, at the of said equalized combined and with lands.” paragraph *4 provides The second of 45 Section for the personal property of the assessment of in substantially provided equaliza- the same manner as for the paragraph tion of provides: land and the third of this section making equalization, may board, “Said in such aggregate add to or deduct the assessed valu- city any lands, tion of town or lots or other class personal property throughout of state, the such (be) per may by centum as the deemed board equitable just, to be and but in all cases of addition to or deduction from the assessed valuation of through- of counties, class the several state, the out the rate of cent addition or deduction shall even be and not fractional.” provisions quoted The 45 the Sec. 1897 Act above practically unchanged referred to have remained in our law present part the until time are now found as of SDC it We think clear 57.0420. that 1897 wherein it was 442 valua-
provided the “believed the 45 that if Board in Sec. to was basis belief the tion be low” provided the 44 of that Act Sec. founded was be * “* * aggregate language: following said but increase necessary reasonably in such an amount valuation just equalization of all the value and true to obtain a appears words, at that In other in the state.” make the Board was to on which that time the basis State “just of the true value” the its determination was property. provisions Sec. 1897 were modified of the law 44, of the
2, Laws of 1901. duties State Ch. prescribed as follows: were therein duty of “It shall be the examine said compare the assessment of the and property returns state, of the several of the counties proceed property equalize the same so the taxable of the counties shall assessed several proportionate value, at increase but said board shall aggregate valuation in the assessed equalized the boards state as commis- * * dollars, *”. sioners more than three million although noted, however, that It duties should be changed provisions of the Board were somewhat quoted 1903, 45 of the Act remained. In above Sec. changed 65, $3,000,000 Laws c. limitation was $100,000,000 so under this 1903 Act valuation as returned could increase assessed $100,000,000 extent of time and at a counties the total assessed state was when Report,- Department $186,973,276. See Thirtieth Annual page following words, Finance, In other 129. $3,000,000 amendment which increased the limitation from permit- $100,000,000 was ted to valuation of state increase by something also should be noted more than 50%. *5 empowered Act the Board to that this 1903 State necessary.” equalize if the valuations but to “assess “Any provided, of assess- 1903 law further This county, city township state, ment of or and of hereby required equalize power, to to shall have and is necessary any property individual, if assess or the of association corporation by required so that shall be assessed provision of law.” This the 1903 law has been carried in present among time, our until the law is now found the powers of the State Board contained in 57.0420 SDC wherein provided, [State Board] power it is “It shall have the required equalize necessary, assess, and to if the any person, partnership, company corpora- of association, or by required tion that it shall so be assessed as law.” 352, 1913, Ch. Laws of the created Tax Commission State powers and transferred to such commission and duties Equalization. of the among Act, Board of Sec. of that things, provided other the Tax Commission »* * * haye power equalize the assessment of all persons, corporations in this state between firms townships assessment-district, of the same between cities and of the same and between different counties of state, said commission in the powers possessed instance; first to be said commis- regardless sion of limitation fixed now law regard of the increase valuation which * * board, be made said appears, upon therefore, that in 1913 all limitation Equalization increasing ag- action of the gregate valuations as returned the counties was removed present at and there is no limitation State Board respect in this unless such limitation be found in SDC 57.0415, which will be hereinafter discussed. Ch. Laws power equalize of 1933 transferred the of assessment property state -the Tax Commission to Equalization. Presently powers, State Board and duties jurisdiction Equalization of the State Board of are parts 57.0420, found in 57.0419 and SDC material quote. of which we Equalization: general “57.0419. State Board of
jurisdiction; notice for increase indivi- dual assessment. shall have property assessment ships assessment all persons in the state between -the district, towns, cities, between and town- the same between different *6 by property and assessed of the state counties Equalization the first instance. in the State persons equalizing “In the assessment between any of district no increase of the same assessment shall be made without notice individual assessment to the person name the asses- in whose place specify sed,which hearing may and shall a time of notice proposed on the increase in assessment and given personal thereof or service be registered mail. specific Meeting of date State Board: “57.0420. prescribed equaliza- powers duties; for and methods of shall sit as tion. The State August Monday commencing in on the first of such year until duties are continue its each and shall majority completed. constitute Board shall A may may quorum for the Board. and act by public adjourn from time announcement time to keep adjournment. and file It shall at time of the. a record of duplicate, proceedings in one with the its Secretary Fin- one with Auditor and State ance, times at all records shall either of which public inspection. open to required to and is “It shall have necessary, any assess, if company, partnership, person, association, or cor- poration so shall be assessed as that it law. specific general its “In with connection among things
powers duties, other it shall: “(1) Equalize of land and struc- assessment aggre- adding separately, thereon, tures every county gate thereof, value in in which the low, too such believe the to be proper per raise the to its rate as will same cent by deducting proportionate value, from the every thereof, in value assessed the value to be too believe which high, as will reduce the such cent city proportionate proper lots value. Town equalized as herein same manner shall be equalizing provided lands; for “(2) pro- personal Equalize the assessment of perty adding value every personal class low, valuation to it believes such *7 per proper rate proportionate gregate cent as will raise the to its by of ag- deducting value, and from the any personal assessed value class of property, every county in in which the Board high, per believe the valuation to be such cent proper proportionate as will reduce the same to its value; “(3) making equalization, Board, Such in such may valuation add to or from deduct city lands, lots, town, or and structures any separately, personal pro- thereon, perty throughout or class of state, such cent as equitable just, be deemed but in all cases of addition to or the Board deduction the in the any assessed valuation of class of throughout counties, state, several per or the rate cent addition or deduction shall even not fractional.”
We consider now SDC 57.0415 been which has protesting taxpayers argue referred to above. stren uously that the clause in this section of our law which states “* * * thg any state Board of shall not in way raise the total within the places upon state” a limitation the State Board it has which exceeded in this instance. This section of our came Code part into our law as a of Ch. Laws of 1931. This Act is entitled “An Act for the Classification and Evaluation Providing Counties, of Land in Procedure Therefor.” provides petition signed by This Act of the resident for a at least 20% county,
freeholder electors action on petition by County this the Board Commissioners and certification of such action to the Director of Taxation. appoint Thereafter the some is Director of Taxation directed to person competent classify lands subject procedure detailed, to taxation. The is rather it is with reference to land classified and valued under provisions Act, of the 1931 has been carried over commencing 57.0412, our into Code with that raising limitation with reference to values the State applies. appears that no' land been has classified provisions or valued under the of this 1931 either before Act adoption us, after our Code and seems clear to application therefore, this limitation has no whatsoever present proceeding. stated, As the limitation relates this particular valued and classified in a manner and to lands are no so classified or valued in state there such lands this present time. at Legislature are convinced that when the
We regard to 1913 abolished all limitation in the increase of the in the state valuation of the State exactly having Board it intended to subsequently provided it said and do what limitation regard increasing valuations there is no' such limita with entirely existing tion now and the matter left *8 subject only to the State Board of discretion of constitutional limitations. important note, believe, to we the
It is that provides 57.0420, statute, the no method which State adopt equalizing property shall in values. Board simply provides statute to
that if the Board “believe the valuation high”. be too low” or “believe the valuation to too Cer be tainly language the Board a this State with broad leaves upon judgment its in the the discretion which to base wide equalization. process is made that contention provides a that it that after determination statute wherein the lower high, shall or too Board raise is low its provides proportionate proper “the value” same equalize upon But it which to the assessments. basis a seems proper phrase to its that “raise us meaning standing proportionate It is value” no alone. has determining low”, the “valuation to be too after whether meaning. proportionate phrase To a be that the assumes something. proportionate to us that to It seems must give first deter effect whole the Board must section the valua determine whether mine a standard tion be to that according high low, raise or lower too standard so that the or too and then property in bear one will proper proportionate in other value to a counties. always history
Throughout tax it has laws our contemplated in state should be this been purposes its true and full value for of taxation at valued provided presently This is standard in SDC 57.0334. as purposes which our law has for fixed taxation provides when the law that if Board “believe the only- low”, valuation to be too true and full value is the Legislature provided upon standard has which the might base belief. Unless the State Board has equalizing property used as a for method or basis a standard value, in excess of true arewe convinced that there no complaint for above, basis is may case. As this stated the Board any vested with wide discretion and reasonable method accomplish purpose provided be used to its true and full Cooley Taxation, value is not As exceeded. stated on empowers 3, Edition, Fourth Vol. § “Where a statute taxation, Board to valuations for but does point mode, out the reasonable and mode efficient adopted. Such boards take a standard the particular judgment, which, roll assessment most nearly represents valuation, a true conform others to it.” proceedings
At the outset of its adopted a resolution as follows: impossible “Whereas, it is determine percentage assessment records what represent;
of full and true value their assessments *9 and dependable “Whereas, ratio studies have been made from counties; official records in the various and “Whereas, such studies disclose some in- stances the assessments exceed the true and value, full “Now, Therefore, Be It Resolved that it is the adopted policy of the South Dakota State Equalization to “(A) By comparison with full true and values by as the studies, shown aforementioned ration during equalization determine the course of the the average percentage or mean of full and true value representative at which a number of those counties approaching nearest the full and true value have by required been assessed as the South Dakota statutes; and “(B) percentage this Use as a factor standard or coefficient.
“(C) Equalize assessments between counties throughout applying this factor State equalization contemplated arrive at law. “(D) meetings that all official open public, shall be tO' and invited.” Press be policy expressed It is contended that as in this by the Board is not a resolution reasonable efficient mode or method on which property arrive at appears in this state. from resolution that judgment the exercise of its concluded that the Board in the ratio “dependable”. it before were It was the studies best Board’s function to determine from the information judgment of its available and the exercise own whether or the valuations as returned the assessors were too low imperative high. In its determination it was that the operate standard which as have some appears it basis or resolution selected this “average percentage of full and true value at standard the representative number those counties nearest which a approaching true value have been assessed as the full and * * statutes, Dakota We believe the South entirely recognized justified. It of the Board was action recognized goal full value was the but also true and recognizing realities, selected a realities and in those approached representative number of counties which nearest statutory requirement true full value and this form the basis of a or standard to means obtained factor nothing equalization. process find We its action arbitrary, capricious in the method thus unreasonable adopted. range Board wide vest in the statutes
Our among equalized. We values to be are of entities many large of cases considered number have read jurisdictions have found no statute statutes of various *10 equalize permits on such broad Board to the State provides: 57.0419 this state. SDC the statutes of scale as do Equalization have of shall Board “The State property power the state equalize all assessment of persons assessment of the same between townships towns, cities, of district, and between of the same and between different counties property state and the assessed State Board of in the first instance.” defining powers of the SDC 57.0420further provides: equalize have and is “It shall necessary, assess, and to if company,
person, partnership, association, or cor- poration law.” required by shall be assessed as so that it statutory jurisdiction provisions As we read these practically other than Board is without limitation State constitutional statutory requirement of and the limitations notice. It is the assessment of directed district, assessment between individuals between in the same and assessment districts between and also between the different counties of the state of Revenue the State Board or Commissioner appears, process therefore, that the in the first instance. complicated one and the State is a process contemplates ex- should be left which the law body clusively no one else. to that and light of the Board considered action powers comprehensive held to cannot be
of its broad jurisdiction. excess questions raised relators have other We considered questions none these defeat and have concluded that jurisdiction Board. of the State is dismissed.
The writ of certiorari J., J.,
ROBERTS, RENTTO, P. concur. Judge, sitting HANSON, J., BAKEWELL, Circuit SMITH, J., for dissent. (dissenting).
HANSON, I am J. unable concur. Equalization is a creature statute beyond expressly powers do not extend those dele- whose powers gated must, therefore, it. of those The extent application interpretation present of our come from an statutory provisions. The laws of the constitutional determining meaning helpful past their but are not are *11 controlling legislative present. as to the intendment of the undergone change Our tax have laws constant and drastic present fragmentary since statehood. Our statutes are but culling process. Companion retained in the out to some of our bits statutes gave meaning present that once are laws longer no in effect. Our constitution too has twice been formerly provided XI, amended since 1900. Art. § “All taxes to be raised in this state shall uniform on all personal property, according money, real and to its value * * rp^g *>>_ amen¿ments placed thereto in 1912 and 1917 uniformity emphasis equality on of taxation. The constitution now directs that “Taxes on shall be uniform * property provides class, all *.” It further “* ...... purposes the valuation of for taxation shall provision never exceed actual value thereof.” is Such against property- a limitation confiscation of is not a —-it equalization. standard of either or assessment statutory A of our entire careful review tax structure my clearly legislative opinion, design indicates, in defined keep separate “equali- functions “assessment” and subjects separately zation”. The are treated in our Code. govern application Different standards two. assessing property place The function of is to a valuation purposes requires for thereon of taxation. This an intimate knowledge particular parcels property. items and process performed by ais which can be familiar with valuations in the local assessor and the local boards respective legislature wisely
their communities. Our logically placed responsibility assessing and evaluat- ing property upon ing govern- assessor and local townships, towns,
bodies of the local and cities. Their guiding “full and standard it to assess all at its always true That do not conform value”. such officials recognized. judicially However, there that standard compel stringent provided our are methods laws to con- not assessed formance to that standard. That justification, basis, true value is for an at its full and no n equalizing that function. assume equalizing Under our laws the function of assessments County Boards is vested in the and in the *12 general purpose Equalization. of State Board “equalization bringing of of assessments” is the the assess- taxing parts ments of different of a district to may parts relative pelled standard so that no one of com- Cooley pay disproportionate part to tax. on of the page Taxation, 3, 1195, § Vol. 2390. performing equalization
In their neither the function County Boards nor the or authoriz- are directed equalize property according ed to true value.” Our statute to the standard of “full and
clearly prescribes a mode or method equalization to be followed the assessment Board. directs * * * “Equalize personal [all it to property] by adding real value, aggregate every thereof, in in which the believe the to be per low, such rate as raise cent will the same proper to>its by deducting proportionate value, from the every county thereof, assessed value the Board high, believe the value to be too as re- such cent will duce 57.0420(1) same to its proper proportionate Value.” (2) combined. standard of is The' clearly “proper proportionate thus directed to be value.” Dictionary International Webster’s New defines word “proportion” portion another, to be “The relation of one to or * * * thing degree; whole, another, or to of one to or magnitude disposition arrangement; relative size or or comparative proportion parts relation; ratio; as, the building, body.” of or of the This is in with the accord meaning “equalization”. “equalize” historical of the words or “equalize” equal, correspond, To to make to to means cause degree compared something. or be alike in amount or to logically p. Phrases, 14A Words and 439. It follows that in equalizing property accordance with standard of “proper proportionate required value” Board is the State throughout bring compare valuations and to process all valuations to the same relative level. In the the have to be lowered and the necessarily high must valuations necessarily valuations must have to be raised to some
low doing level. In so the total relative intermediate property, of some or of some assessed valuations counties, classes might extent decreased increased reasonably necessary equitable same was to achieve equaliza- tion of all at its value. proper proportionate necessarily State Board is to find the scale of valuation from the of assessments proper abstracts of the various places logical counties. This a natural and power equalize. limitation on their To hold otherwise Board the grant unlimited inherent power assess, statutory in addition to their limited equal- Territory Supervisors, ization. v. Board of 9 Ariz. P. 519. *13 State of no to power has values, merely
increase for the of valuations. purpose raising Howe, As the court stated in the case of Hacker v. 72 Neb. 255, page N.W. at 260: “* * * ^gy authority have only to equalize, and to adjust difference value so toas standard, bring all to a common and to the end all property assessed shall bear its just pro- portion of the of taxation. burdens Where equal- object, ization is the main increase result- incidental, ing therefrom is think we the action is undoubtedly legitimate exercise of the powers conferred the board. If the object appeared of aggregate be to raise the total assessed valuation, would, judgment, such action in our have to be condemned as an unwarranted exercise of the authority to equalize.” Equalization generally increased 1956 assessed valuations on all classes of in the property state. It raised the total assessed valuation of all $1,800,000,000 $2,500,000,000 property approximately raise of per substantially —a at least 40 cent. raised the property, total valuation of all real of all personal every county and of state. No class of real property, per or was lowered. The rates cent of personal property and not largely additions and deductions were fractional 57.0420(3). even as The rate of cent considerably and decreases varied within the increases on various taxing property. district classes same my In the record State Board’s action opinion valuation affirmatively changes shows that made necessary, equitable equaliza- incidental, to an not were of their actions The result valuations. of the assessed tion “proper proportionate at was many over- cases of Instead, result in it can value.” existing inequalities. aggravation It fur- percentage of valua- ratios out of balance ther throws shifting original thus assessments tions contained property to another one class of taxation from burden of taxing varying degrees re- district. The within same Board constituted evaluation power limited in excess of its re-assessment equalization. considering powers Board it should of the State
In levy body power to has the remembered this . good proceeded present in the utmost taxes. The They merely applied However, an erroneous standard. faith. property, power revalue unlimited Board has the if such a certainly levy taxes, then with combined destroy”. surely they potential power possess I “to any legislature to sire a ever intended believe cannot powers from unrestrained such enormous and Board with statutory appeal. there is no *14 Judge (dissenting). WELL, BAKE Circuit opinion. in the I am unable to concur Court’s county equalization of the assessments In the several duty Equaliza- power of the Board of and (2) (3). 57.0420(1), limited tion is defined and Equalization a creature of the statute is upon granted powers as are conferred it has act, which it assumed to it the statute by statutory support its action must be able to such board authority exercised If it had authorization. question equalization here, it of the assessments in in the must Campbell v. Minnehaha from the statute. derived 133, 10; Bank, v. 11 S.D. 76 N.W. Orr Nat. Meeker,
Equalization, 416; 190, Bell v. Hasb. 28 P. 3 Idaho Ind.App. Bosson, 641; v. 189 Ind. 224, Fesler 78 N.E. 39 Jones, 145; v. 28 Land Grant Co. 484, 128 N.E. Maxwell 427, 1034. 213 P. N.M.
454 practically
An statute Idaho identical with our SDC except provide equalization 57.0420 that it does for personal property classes, was construed in v.Orr Equalization, Idaho, Hasb., 190, 416, Board 28 P. 420. - proceeding In a certiorari review action of the State “* ** Equalization, power Board of given the Court said: no is property. it to fix assess or the value of kind of * * * profitless multiply It is words show what the empowered they is not to do. What can do given They may words. add to or few deduct from the aggregate personal property real valuation of of a county by percentage. having specified statute, a certain they may necessarily every power.” do, what excludes other only going While to show a strict limitation to be applied equalization Board, to the of assessments this Campbell Bank, v. Court Minnehaha Nat. S.D. authorizing 10, 11, 76 N.W. held that statute under a State Board of to consider certain classes of “ personal property one of ‘the total which was value of ”, stocks or shares’ the Board was not divide authorized to so classified and raise the value of bank stock increasing without that of other stocks and shares. In the assessments the Board power property. has no under our statutes That to assess equaliza- equaliza- is the exclusive function of the assessor and local power tion boards. The Board’s to the restricted equalized tion of the assessments made and counties with the total value of the no increase key property as shown such assessments. The words phrases “deduct”; in this statute are “raise” and and the “proportionate high” “too low” and value”. The “too empowers Board, if the valuation statute shown in a it believes high
particular iow, be too or too assessment to value of that to deduct such rate and add *15 percentage or reduce the same to its as will raise only proper proportionate by method value. And this may effected. The sum total all which may equalized assessments of the several counties materially The test of whether or decreased. increased respect performed in is best deter- its duties this the Board .by records as disclosed results attained mined personal pro- eighteen of the counties show in which $7,208,904, perty total sum in a were decreased values This in four counties. were decreased real estate values represents $4,754,636.' total of a real estate values reduction of personal to- taken of real and reductions These Adverting $11,963,540. to the gether to a total amounted counties, the four in these in real estate made reduction County of in Buffalo reduction Board shows a record County County Campbell $347,967, in Hamlin $274,973, in County $622,811. over-all $3,508,885, in Mellette personal property real and the values of total increase in figure $700,000,000,a sum in excess in an was requires it is far to show that no demonstration which necessary assessments excess of increase provided statute. mode opinion true and full value I the Court’s As understand only the Board base standard which is the high l'ow. value is too or too the assessed belief as whether proportionate value true but it is I to be since This rather than true concede ultimately to be and full value which is than as a achieved, used further true value not be adjustment value in each of of assessed in the factor counties. several yard-
If, however, use true and full value as we the true to establish the ratio between stick with which county property value of the value and county pursue applies, and, to each to which plan, average percentage all the assessments which proper of full value becomes a factor or fall short exceed necessary to raise the rate cent to determine each properly county to an amount assessment or lower county proportionate assessments. to other provided by equalizing statute for the mode This is proper proportionate value. Such assessments at equalized proportionate value of the value is every total in the state and the other substantially cannot be values will not and of the assessed county valuations. of the total of excess *16 county The fact that the total is in excess of the totals by county $700,000,000 more than shows that it not the was equalized, assessments which were but some other value nearly approaching more true value. question purported
The here is not whether in its equalization the Board has used a standard in excess equalized value, true but is rather whether has at a value properly proportionate county assessments, which is required by the mode statute. power necessary, assess, and to if any person, partnership, company association, corporation provided by so that it be assessed as
law, as is vested in the Board SDC 57.0420 relates to powers original appellate possessed by other the Board power and is not a to be exercised in the assessments between different counties of the state. Equalization county applied assessments is to abstracts County furnished Auditors of the several counties no show individual assessments of the entities before power mentioned. As to Board is restricted as assessments the (1), (2), provided by Subdivisions (3) (4) named SDC 57.0420. last subdivision provides certify County that the Board shall Auditor equalized value of “all within such the State Board of specify and, law” centum added to or deducted in addition thereto shall rate the value of each class personal property. of real and plainly greatly
It is evident that the Board has exceeded jurisdiction of this vested in it laws by undertaking, power, state in the absence of to reassess respect it dealt. Its action in with which this nullity fully opinion Judge is a and void. I concur HANSON.