174 A.D. 702 | N.Y. App. Div. | 1916
Lead Opinion
This is a proceeding by writ of certiorari to review the assessment of relator’s real estate for the purposes of taxation in the year 1915. It comes to us upon an appeal by defendants from an order denying their motion tó dismiss the proceeding for reasons to be hereinafter considered.
Sometime in the year 1914 the president of the relator corporation consulted an attorney, whom he had previously consulted on other matters, with reference to attempting to obtain a reduction of the assessment of relator’s real estate. This attorney, who now represents the relator in this proceeding, had in May, 1914, organized a corporation under the name of the Expert Property Appraisers, Inc., the incorporators being the attorney himself and two clerks in his office. The president of the corporation, though not an incorporator, was one Francis C. Wilde, who had theretofore been engaged in some form of business connected with real estate. The purposes of the corporation as set forth in the certificate of incorporation were very broad. It is only necessary at present to consider the purpose expressed as follows: “ To act as experts and appraisers with respect to the value of real property wherever located and to act as agent, broker, representative or in any other capacity with reference to the reduction of taxes and assessments of real property wherever located and to employ any and all lawful means on behalf of owners of such real property or otherwise in an effort to effect such reductions.”
When relator’s president had consulted the attorney and authorized bim to attempt to obtain a reduction of the assessment, the latter, instead of attending to it personally, turned the matter over to the corporation which he had organized, and a written application for a review and reduction of the assessment was presented to the tax commissioners who in the
Mr. Wilde, who had signed the application to the tax commissioners for a reduction of the assessment, describing himself as agent for the owner of the property, and who at the time was president of the Expert Property Appraisers, Inc., testified before the Special Term that he was not and never had been the agent of the relator, the Trojan Realty Corporation, and had never known any of the officers of that company. He further testified that the Expert Property Appraisers, Inc., above referred to, had been organized at his suggestion, one of the purposes being to engage in the business of obtaining the reduction of taxes upon real property; that the agreement between himself and the attorney was that the fees realized from that business, being fifty per cent of the amount by which any tax was reduced, should be divided equally between himself and that attorney; that it was proposed to employ one Tribelhorn as expert witness who was to testify, as required, both before the tax commissioners, and in case of certiorari proceedings, before the court; that for this service Tribelhorn was to receive a fee ranging from $10 to $100, which was to be paid him only in case a reduction was obtained, and that was to come out of Wilde’s share of the fee.
It is quite clear that the scheme thus devised by Wilde and
One evidence of this fact is found in the circumstance that the application to the tax board was made upon a form which contained a number of questions to be answered by the applicant, so framed that the answers thereto might reasonably be expected to assist the commissioners in arriving at a just conclusion as to the value of the property, and yet not one of these questions was answered. Other evidence is to be found in the fact that the person assuming to represent the owner or its agent refused to appear before the board, when requested so to do, and thus evaded an opportunity to furnish information which might have resulted, if the property was in fact overvalued, in a reduction of the assessment. These circumstances, as we consider, sufficiently establish the fact that this application to the tax board was not made in good faith with the intent and expectation of inducing favorable action by that board. So also it seems to be quite clear that the attorney who sued out the writ did so upon the retainer of the Expert Property Appraisers, Inc., and not upon that of the relator. It is true that he had been consulted by relator’s president and had been by him authorized to take steps to have the assessment reduced. This would have justified him in having his’client appear before the tax board, or perhaps in
We are clearly of the opinion that the principal business which the Expert Property Appraisers, Inc., was organized to do, and the only business which it ever did do, to wit, the reduction of the assessment of real estate for taxation purposes, contemplated and necessarily included the practice of law by the corporation either in person or through attorneys employed by it and under its domination and control. It was, therefore, organized for an illegal purpose, and its practices were illegal. (Business Corp. Law [Consol. Laws, chap. 4; Laws of 1909, chap. 12], § 2a, as added by Laws of 1909, chap. 484; Penal Law, § 280, added by Laws of 1909, chap. 483, as amd. by Laws of 1911, chap. 317;
Another and most objectionable feature of the scheme of those who organized the Expert Property Appraisers, Inc., was the design to use as an expert witness before the tax board and the court, a person whose compensation for his services in testifying would be entirely contingent upon the successful outcome of the endeavor upon which he was employed. (Matter of Imperatori, 152 App. Div. 86, 89.)
We do not hold that a property owner or person assessed may not apply to the tax board for the reduction of the assessment through a lay agent, if that agent be a person properly qualified and duly authorized, and providing that the application is made in good faith with the honest purpose of obtaining favorable action by the board. But this was evidently not such a case. Not only does it appear affirmatively that neither Wilde nor the Expert Property Appraisers, Inc., was ever appointed agent by the relator, but neither of them possessed the prescribed
The obvious purpose of thus qualifying an owner’s agent is that the tax board should be put into possession of reliable information from one. who knows the facts, to the end that it may act intelligently upon the application. A corporation which has had no prior relation to or knowledge of the property assessed cannot in the nature of things be thus qualified, and Wilde, who signed and verified the application in this particular case, confessedly had no personal knowledge on the subject. The application to the tax commissioners, therefore, upon the validity of which all subsequent proceedings depended, was not sufficient under the terms of the statute. It cannot be said that the tax commissioners waived this defect because they acted upon the petition to the extent of looking into the complaint, for the defect did not appear upon the face of the petition.
Furthermore, relator’s proceedings were fatally defective, as the basis for a review by certiorari, because the person who assumed to represent the relator as its agent refused to appear before the tax board for examination when requested so to do. Section 37 of the Tax Law provides as follows: “ If not satisfied that such assessment is erroneous, they [the assessors] may require the person assessed, or his agent or representative, or any other person, to appear before them and be examined concerning such complaint, and to produce any papers relating to such assessment with respect to his property or his residence for the purpose of taxation. If any such person, or his agent or representative, shall wilfully neglect or refuse to attend and be so examined, or to answer any material question put to
The purpose of this provision, as well as of that above quoted, respecting the qualifications of an agent, is to enable the assessors to pass intelligently upon the claim for exemption, or reduction, and if a person claiming such exemption or reduction willfully refuse to appear when summoned he forfeits his right to have his application granted, and cannot obtain a review by certiorari of the refusal so to grant it. (People ex rel. Horton v. Ferguson, 120 App. Div. 563; People ex rel. Brown v. O’Rourke, 31 id. 583.)
There are thus to be found two fatal defects in the proceedings taken in relator’s behalf looking to a judicial review of its assessment, to wit, that the person undertaking to represent it as agent had never been appointed by relator, and had no knowledge of the facts, and that he refused to appear before the tax board when legally summoned so to appear.
The refusal to reduce the assessment under these circumstances cannot be reviewed by certiorari.
These considerations were quite sufficient to call for a dismissal of the writ, but even in a broader view the proceeding should have been dismissed because contrary to the statutes, cited above, forbidding the practice of law by corporations or by attorneys employed by them to act in behalf of others.
If the attorney who was consulted by relator’s president had proceeded to act under that retainer and had himself taken the proper steps by virtue of that retainer, his client’s interests would have been protected. He elected, however, not to do this, but to turn the whole matter over to a corporation which he had organized to do this class of business. As has already been pointed out the application to the tax board was merely perfunctory an& pro forma, made not for the bona fide purpose of getting a reduction from that body, but as a preliminary to this appeal to the court by writ of certiorari. The whole proceeding both before the tax board and before the court was carried on by the corporation, and it is a mere coincidence that the attorney selected by this corporation happened to be the same one who was originally consulted by the relator. His appearance in this proceeding was due to his relation to and employ
It follows that the order appealed from should be reversed, with ten dollars costs and disbursements, and the writ dismissed, with costs.
Clarke, P. J., Smith and Page, JJ., concurred; Dowling, J., dissented.
Since amd. by Laws of 1916, chap. 254.— [Rep.
Since amd. by Laws of 1916, chap. 323.— [Rep.
Dissenting Opinion
The Trojan Realty Corporation was the owner of the premises 60 and 62 Washington street in the borough of Manhattan, city of New York. Its president was Rev. Stephen Corkemaz. For three years his personal counsel had been Lewis F. Glaser, who transacted a general law business for him. In 1914 he retained Glaser on behalf of his company to obtain a reduction of the assessment on its real estate and authorized him to do whatever he thought best to bring about the desired reduction, including the securing of appraisers or experts. Of this retainer there is no question. Instead of making the application to the tax commissioners as agent or attorney for the owner, Glaser used the services of the “Expert Property Appraisers, Inc.,” a corporation, and the petition for a reduction was signed and verified by Francis C. Wilde, its president, who was not a lawyer, but a real estate broker. His examination shows that he did not consider himself the agent for the Trojan Realty Company but was employed by Glaser, who was interested with him in the “Appraisers” corporation. Wilde was told by Glaser that the latter’s client was the Trojan Company and Wilde had no thought when employed of any court
The motion to dismiss the writ was made upon six grounds:
(1) That Glaser in applying for the writ was not acting for the owner, but for the “ Appraisers ” corporation.
(2) That the application filed with the tax board by the “Appraisers ” corporation constituted the practice of law and was in violation of section 280 of the Penal Law (added by Laws of 1909, chap. 483, as amd. by Laws of 1911, chap. 317)
(3) That the initiation of the proceeding by the “ Appraisers ” corporation was in violation of the same statutes.
(4) That Glaser was “without legal authority to represent himself in applying for the writ,” which was “illegally obtained and inadvisedly granted.”
(5) That no application was presented to the tax board by the owner or any duly authorized agent.
(6) That no appearance was made at the hearing before the tax board.
As to the first, third and fourth objections Glaser was regularly and properly retained and authorized to represent the Trojan Realty Corporation and the granting of the order and writ was proper, as the petition was duly verified by the owner and presented by his duly accredited attorney. As to the second and fifth objections, they raise the question whether the “ Expert Property Appraisers, Inc.,” violated the law by acting on behalf of the owner before the tax
As was said by Mr. Justice Cullen in Matter of Town of Hempstead (32 App. Div. 6): “The proceeding before us is not similar to the action of referees in the laying out of a highway, or of assessors and other taxing officers in the levy or imposition of a tax, or of public boards in determining who is the lowest responsible bidder for any proposed improvement. In those cases the action of public officers is judicial only in the broad sense of that term; that is to say, their action is governed by the exercise of judgment and discretion. Nevertheless, though judicial in this sense, their action is unquestionably that of the administrative or executive branch of the govern, ment. Proceedings had before such officers are, therefore, not proceedings in court, and review is by certiorari. But this proceeding is of an entirely different character; it is judicial in the narrowest and strictest sense of that term, that of pertaining to the administration of justice through the courts.” And in Matter of McMahon v. Palmer (102 N. Y. 176) the court said: “ The proceedings by which taxes for governmental purposes have been assessed, levied and collected from the citizen have
I do not think that the fact that the action of the tax commissioners is made by statute (Tax Law [Consol. Laws, chap.
Finally, as to the sixth objection, that no appearance was made by the agent at the hearing set by the tax commissioners, the statute not only requires that the refusal or neglect to attend must, be willful in order to lose the right to a reduction but gives the commissioners power to require the attendance of the owner, which they did not seek to do in this case. The owner’s agent protested that it was not given time to present its views in support of the application of its principals and submitted written statements of their grievances in lieu thereof. The tax commissioners took no further steps to require the presence of either principal or agent and there is no evidence that the latter’s protest against the limited time allowed it was not justified. Where an owner has in good faith employed an attorney to protect his interests and the latter has violated no statute in guarding his client’s rights, I see no reason for depriving the owner of his day in court to secure a judicial review of the assessment upon his property.
I think the order appealed from should be affirmed, with costs.
Order reversed, with ten dollars costs and disbursements, and writ dismissed, with costs.
Since amd. by Laws of 1916, chap. 254.— [Rep.
Since amd. by Laws of 1916, chap. 323.— [Rep.
Since amd. by Laws of 1916, chap. 323.— [Rep.