Werner v. Riebe , 70 N.D. 533 ( 1941 )

A petition for rehearing has been filed by the defendants and interveners in which several points covered by the opinion have been reargued. In view of the vigor with which these points are pressed, further discussion is appropriate.

The assessing authorities are required to assess and return the property to be taxed at 100 per cent of its value. The final act of the assessing authorities in this regard is the certification of values by the board of equalization to the county auditor. The initiated measure adopted June 29, 1932, quoted at length in the foregoing opinion, requires the county auditor "to make the computations necessary to reduce such assessed value to . . . fifty (50) per cent." The county auditor also receives from the board of equalization the mill levy necessary to apply to the 50 per cent of the assessed value in order to provide the revenue needed by the state. He also has the amounts certified to him by the various taxing districts as being the money that they will require. From the certified amounts and the 50 per cent valuations he figures out the mill levies for the taxing districts. He then adds all the mill levies together including the state levy. The sum thus arrived at is the consolidated levy. The general tax for a specific piece of property is then determined by multiplying 50 per cent of the assessed value of that property by the consolidated levy.

Chapter 225, N.D. Session Laws 1939, pronounces void all tax charges in excess of "the amount that said tax charge would have been had the original final determination of value been limited to the full and true value," and affords relief, by petition to the board of county commissioners and appeal to the courts, that may be resorted to within one year after the certification of assessed values from the board of equalization to the respective county auditors. Under that act an owner of taxable property may apply for and be afforded relief through a reduction of an overassessment of his property after the county auditor has computed and applied the consolidated levy.

Because of the process thus described, it is insistently argued that chapter 225 is in conflict with the initiated measure. The interveners, while admitting that they have no vested rights in excessive assessments and void taxes, contend that they do have vested rights in assessment statutes and procedure that entitle them to the levy of annual taxes for the payment of principal and interest of their evidences of debt as required by § 184 of the North Dakota Constitution.

In State ex rel. Strutz v. Huber, 69 N.D. 788, 291 N.W. 126, we held that chapter 225 does not modify or repeal the provisions of the initiated measure with respect to the duties of the county auditor, we said: "There is nothing to indicate that the lawmakers intended there should be any deviation by him from the performance of the purely ministerial duties imposed upon him by the statute theretofore in effect. The contrary is evident."

Chapter 225 does not interfere with any of the acts required to be performed under the initiated measure. If, however, the provisions of the initiated measure are violated by the assessing authorities so that the resultant valuation is in excess of 50 per cent of the "full and true value," relief is afforded. Chapter 225 does not conflict with, repeal, or modify the initiated measure, but if the valuations which that measure contemplate are exceeded, the taxpayer is afforded relief from the error.

Referring again to the claim of the interveners that their vested rights are disturbed, we fail to see the distinction that they attempt to draw in disclaiming vested rights in overassessments while insisting upon vested rights in a taxing process which permits the exaction of taxes based upon overassessments. The argument seems to be based chiefly upon the practical situation that relief may be widespread. If that be true, it merely indicates that the errors are numerous. It would seem that the same constitutional principles are applied whether there be but one error or many. It would further appear that if the courts have the power to grant relief from an overassessment, as was done in Great Northern R. Co. v. Weeks, 297 U.S. 135, 80 L. ed. 532, 56 S. Ct. 426, cited in the foregoing opinion, without violating the Constitution, that the legislature may likewise exercise that power. The argument that after the levy has been spread, relief cannot be afforded to the property owner because of the vested rights of the holders of evidence of public debt when carried to its logical conclusion would result in precluding relief from levies that were unconstitutional as to the individual taxpayer because they were discriminatory or confiscatory. We are unimpressed by the argument which leads to the reductio ad absurdum that it would be unconstitutional to grant relief from an unconstitutional levy.

The interveners would invoke the rule that the law of the land in existence at the time the contract was made forms a part of the contract. With that rule we wholly agree. Chapter 225 does not infringe upon it. The law of the land at the time the interveners obtained their debt contracts required that property be assessed on the basis of its true value. If the law was being violated at the time the contracts were entered into, no right to continue the violations became a part of their contract.

It is argued that the granting of relief under chapter 225 violates the requirement of § 184 of the North Dakota Constitution, that provision be made at or before the time of incurring an indebtedness, "For the collection of an annual tax sufficient to pay the interest and also the principal thereof when due, and all laws or ordinances providing for the payment of the interest or principal of any debt shall be irrepealable until such debt be paid." That section does not require that an equal amount be collected each year for the payment of a specific debt. Neither is such a result implied. It is the constitutional duty of the taxing officials to levy annually such sums as will be reasonably adequate for debt service. If by reason of errors in assessment or other mistakes, too small a sum is collected, the deficit thus occurring does not necessarily render the laws under which it occurs unconstitutional. The deficit may be made up in succeeding years. There are no limitations, either in amount or in mills, on levies that may be made for debt service applicable either to the state or its subdivisions. Chapter 225 does not repeal directly or by implication any law or ordinance contemplated by § 184. Rehearing denied.

BURR, Ch. J., and CHRISTIANSON, NUESSLE, and BURKE, JJ., concur.