Duncan v. Proctor

1. The plaintiffs demurred on the ground that the facts set up in the answer of the taxing officials were insufficient in law to operate as an estoppel on the appeal, which could not be filed until the written notice had been received. Held, that where the plaintiffs were not deprived of their right to appeal, any error in overruling their demurrer was harmless.

2. Section 2 of the homestead-exemption act (Ga. L., Ex. Sess. 1937-38, p. 145; Code Ann. §§ 92-220, 92-221) is not violative of the due-process clause contained in article 1, section 1, paragraph 3, of the constitution of this State. Code, § 2-103.

3. Section 5 of the homestead-exemption act, supra (Code Ann. §§ 92-228 — 92-230), is not violative of article 7, section 2, paragraph 7, of the constitution (Code Ann. § 2-5008), providing for an exemption where property is used primarily as a home.

4. Nor is section 5 of the homestead act, supra, violative of the due-process clause contained in article 1, section 1, paragraph 3, of the constitution of this State. Code, § 2-103.

5. Nor is section 5 of the homestead act, supra, violative of article 6, section 18, paragraph 1, of the constitution of this State (Code, § 2-4501), in reference to the right of trial by jury.

6. The evidence authorized a finding that the property was not used primarily as a home; and accordingly the action of the board of tax-assessors was not arbitrary and confiscatory, and therefore was not violative of the equal-protection clause as contained in article 7, section 2, paragraph 1, of the constitution. Code, § 2-5001.

No. 14456. MARCH 10, 1943. W. W. Duncan, on behalf of himself and wife, made application to T. F. Proctor, tax-commissioner of Grady County, for a homestead exemption of $2000 from state and county taxation, for the years 1941 and 1942, on a described building. The claim was disapproved by the tax-commissioner, and was transferred to the board of tax-assessors for final determination. On May 27, 1942, the board of tax-assessors notified the applicant that they had approved the action of the tax-commissioner in disapproving his claim, because the building was not used primarily as a residence, but on the contrary was used primarily as a boarding, rooming, and lodging house. On June 4, 1942, the applicant filed an appeal to the superior court, alleging that section 2 and section 5 of the act approved December 16, 1937, known as the homestead-exemption act (Ga. L. Ex. Sess. 1937-38, p. 145; Code Ann. § 92-219 et seq.), were violative of stated provisions of the constitution of this State; and further, that the board of tax-assessors and the tax-commissioner discriminated against the plaintiffs, in that they granted the application of other citizens for a homestead exemption where they lived in the dwelling and conducted a rooming and boarding house, which action was contrary to the equal-protection clause of the State constitution.

The tax-commissioner and the board of tax-assessors answered, denying material allegations contained in the appeal; and further stated, that while the application was pending for a homestead in 1941, the plaintiffs conferred with the taxing officials, and were granted a partial exemption; that in view of the above and the mutual understanding of the parties, the plaintiffs are estopped from making the contention that they failed to receive notice from the board of tax-assessors in 1941 that the claim had been disallowed; and that in equity the plaintiffs should be required to pay the full amount of 1941 taxes after getting the benefit of the partial exemption. The plaintiffs interposed a demurrer to the answer, which was overruled, and they excepted pendente lite.

An agreed statement of facts shows in part as follows: The plaintiffs are husband and wife and living together as such. The previous owners of a building known as the "Bell House," conducted a boarding and rooming-house for more than thirty years before the purchase by plaintiffs. After plaintiffs purchased the property, a large two-story building having several entrances for convenient access to rooms and apartments, they proceeded to repair, remodel, and enlarge the same, moved into the building, and have continued to reside therein to the present date. They placed over the front entrance a metal electric sign displaying the words "Duncan Inn," and in 1941 and 1942 the building was known by that name. During 1942 a similar electric sign with the word "Hotel" on it replaced the other sign. After the building was enlarged it contained twenty-five rooms, and during the years in question the plaintiffs conducted a boarding and rooming-house, having a monthly average of ten boarders and roomers; and in addition accepted extra guests for meals, sometimes having as high as thirty guests for lunch on Sunday. The plaintiffs also rented an apartment, consisting of one room and being a part of the twenty-five rooms referred to above. They rented one room on a side wing of the building, with separate outside entrance, for use as a beauty parlor. In addition to having the use of the kitchen, dining-room and living-room, they actually used only one bedroom as their living quarters; and all of the other bedrooms and apartments were used or left available for roomers and boarders. It was admitted that other citizens of the county, who conducted boarding and rooming-houses for personal gain, and especially one named person who had six boarders and roomers, were allowed a homestead exemption of $2000 for the years 1941 and 1942, during which time the boarders and roomers occupied three bedrooms and the family the other three.

After hearing the appeal by consent without the intervention of a jury, the court held that the act in question was constitutional as against the attacks made, and found as a matter of fact that the plaintiffs were not entitled to the homestead exemption. The exception is to an order overruling the plaintiffs' motion for new trial, based on the general grounds, and on the ground that the court erred in holding the homestead act constitutional. The plaintiffs assigned error also on their exceptions pendente lite. The plaintiffs demurred to the answer of the tax-commissioner and the tax-assessors, on the ground that the facts set up were insufficient in law to operate as an estoppel on the appeal, which under the law could not be filed until the written notice had been received.

1. The formal written notice dated May 27, 1942, advising plaintiffs that their claim for a 1942 homestead exemption had been disallowed, further advised them that during its May-June, 1941, session, the board of tax-assessors disallowed the full claim for a 1941 exemption, after conferring with plaintiffs and granting a partial exemption. The agreed statement of facts shows that the above notice was the only one given to the plaintiffs. Section 5 of the homestead act (Code Ann. § 92-229) provides that an appeal must be filed within ten days after receiving notice that a claim has been disallowed. The appeal to the superior court was within ten days after receipt of the above notice, and complained of the refusal to allow a homestead exemption for the years 1941 and 1942. While the plaintiffs were entitled to receive written notice in 1941 that their claim for that year had been disallowed, it appears that the appeal covering both years was heard, after which the court found that the plaintiffs were not entitled to the homestead exemption. It does not appear that the claim for the 1941 exemption was denied because it was not filed in time. In these circumstances any error in overruling the demurrer was harmless. Hudgins Contracting Co. v. Redmond, 178 Ga. 317 (4) (173 S.E. 135); Central of Georgia Railway Co. v. ButlerMarble Granite Co., 8 Ga. App. 1 (6) (68 S.E. 775);Wrightsville Tennille Railroad Co. v. Vaughan, 9 Ga. App. 371 (5) (71 S.E. 691); Bell v. Tucker, 37 Ga. App. 254 (3) (139 S.E. 573).

2. In article 7, section 2, paragraph 7, of the constitution of this State (Code Ann. § 2-5008) it is declared: "Beginning January 1, 1938, there shall be exempted from all ad valorem taxation for state, county, and school purposes the homestead of each resident of this State actually occupied by the owner as residence and homestead, to the value of $2000, and only so long as actually occupied by the owner primarily as such, with the exception of taxation to pay interest on and retire bonded indebtedness. Such value to be determined in such manner and according to such rules and regulations as may be prescribed by law. The General Assembly may from time to time, as the condition of fiscal affairs of the State, counties, or schools may warrant, lower said exemption to not less than $1250." Ga. L. 1937, p. 1122, ratified June 8, 1937. In section 2 of an enabling act (Code Ann. §§ 92-220, 92-221; Ga. L. Ex. Sess. 1937-38, p. 145), it is declared: "The person seeking said exemption shall, on or before April 1st of the year in which exemption from taxation is sought, file a written application and schedule with the county tax-receiver or tax-commissioner charged with the duty of receiving returns of property for taxation. The failure to so file said application and schedule as provided herein shall constitute a waiver upon the part of such person failing to make said application for exemption for said year." Section 5 of the above act (Code Ann. §§ 92-228, 92-229, 92-230) declares: "The official receiving said application shall determine the eligibility of the applicant to claim the exemption provided for herein, and, whether said application is approved or disapproved, he shall then transfer same to the county board of tax-assessors for final determination by said board as to eligibility and value as provided by law. The applicant shall have the right of appeal to the board of tax-appeals in the counties where such board has been established, or superior court of the county in which the land lies, from the decision of the board of assessors upon all questions of law or fact, provided the appeal is filed with the board of tax appeals in the counties where such board has been established, or clerk of the superior court, within ten days from the receipt of written notice from said board of the disapproval of or any change in the application. If, during the pendency of any such appeal, taxes shall become due and payable, the applicant shall pay the amount claimed into a registry designated by said court, to be there held pending final determination of said appeal. Failure to pay said sum within the time fixed by the court shall result in a dismissal of said appeal instanter."

The appellants contended that section 2 of the homestead-exemption act quoted above is violative of article 1, section 1, paragraph 3, of the constitution (Code, § 2-103), which declares that "No person shall be deprived of life, liberty, or property, except by due process of law," because it is an attempt by the legislature to declare a forfeiture of a property right guaranteed to appellants by the constitutional amendment providing for a homestead. There is no merit in this contention. The amendment allowing a homestead provided, "such value to be determined in such manner and according to such rules and regulations as may be prescribed by law," thus contemplating that the legislature would enact necessary rules and regulations to carry out the purpose of the constitutional amendment. Some time limit had to be fixed, and the requirement that the person seeking the exemption should file a written application on or before April 1 of the year in which the exemption from taxation was sought, and that failure to do so would constitute a waiver, did not deprive the plaintiffs of due process of law.

3. The plaintiffs contended that section 5 of the homestead-exemption act supra, is violative of article 7, section 2, paragraph 7, of the constitution (Code Ann. § 2-5008), making provision for the grant of a homestead exemption, for the reason that one who is eligible under the constitution can not be deprived of such right of eligibility by statute, or by a person or board set up by statute to determine eligibility. The constitutional amendment exempted from ad valorem taxation the homestead of each residence actually occupied by the owner, to a value not exceeding $2000, only so long as occupied by the owner primarily as such. It did not grant to each resident a vested right to a $2000 exemption, but declared that such value would be determined in such manner and according to such rules and regulations as may be prescribed by law. The rules and regulations contained in section 5 of the enabling act, providing the manner in which the taxing officials should determine the eligibility of a resident to receive the exemption, are not violative of the constitutional amendment upon which the enabling act was based, for any reason assigned.

4. The plaintiffs contended that section 5 of the homestead-exemption act supra, is violative of article 1, section 1, paragraph 3, of the constitution (Code, § 2-103), declaring that no person shall be deprived of property without due process of law, because said section is vague and indefinite in the manner of determining eligibility, and denies the applicant a chance to be heard on such question before either the tax-commissioner or the board. The act in question is not subject to this criticism. The provision that the official receiving the application shall determine the eligibility of the plaintiffs to claim the exemption, and whether the application is approved or disapproved, and that he shall then transfer the same to the county board of tax-assessors for final determination, does not deny the plaintiffs a chance to be heard before either the tax-commissioner or the board of tax-assessors. The rights of an applicant for a homestead exemption are further safeguarded by the provision allowing the right of appeal from a decision of the board. The provision for dismissal on failure to pay into the registry of the court taxes that become due while the appeal is pending does not require a different result. Section 5 of the enabling act, supra, is not, for any reason assigned, violative of the due-process clause of the constitution.

5. The plaintiffs contended that section 5 of the homestead-exemption act, supra, is violative of article 6, section 18, paragraph 1, of the constitution (Code, § 2-4501), which declares: "The right of trial by jury, except where it is otherwise provided in this constitution, shall remain inviolate." In civil actions the right of jury trial exists only in those cases where the right existed before the first constitution, and the guaranty does not apply to special proceedings not then known or subsequently created or provided by statute. Flint RiverSteamboat Co. v. Foster, 5 Ga. 194 (7) 207 (48 Am. D. 248); Metropolitan Casualty Insurance Co. v.Huhn, 165 Ga. 667 (142 S.E. 121, 59 A.L.R. 719); Hicks v. Stewart Oil Co., 182 Ga. 654 (3) (186 S.E. 802).

6. The plaintiffs further insisted that the taxing officials showed a discrimination, in that they granted the application of other citizens for a homestead exemption where they lived in the homestead dwelling and conducted a rooming and boarding-house for gain, and that such discrimination was violative of article 7, section 2, paragraph 1, of the constitution (Code, § 2-5001), providing: "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." It appears from the agreed statement of facts that the tax-assessors were authorized to find that the property was not used primarily as a residence, but on the contrary that it was used primarily as a boarding-house; and accordingly the action of the board was not arbitrary and confiscatory, and therefore was not violative of the equal-protection clause as contained in article 7, section 2, paragraph 1, of the constitution. Code, § 2-5001.

The court did not err in overruling the motion for new trial.

Judgment affirmed. All the Justices concur.