Home Owners Loan Corp. v. Polk County

I am unable to concur with the opinion of the majority and respectfully dissent. It seems to me that the trial court correctly decided this case and that its decree should be affirmed.

I cannot reconcile the majority's interpretation of section 7235 of the Code, 1939, with the interpretation which we made of this statute in the case of Hewitt Sons Co. v. Keller, 223 Iowa 1372,1378, 275 N.W. 94. We there point out that a taxpayer has no right to recover taxes irregularly assessed but does have a right to recover taxes erroneously and illegally exacted even though the payment thereof was not made under protest. In support of this holding, we quote the interpretation this court made in the case of Slimmer v. Chickasaw County, 140 Iowa 448,118 N.W. 779, 17 Ann. Cas. 1028, of section 1417 of the Code, 1897, and point out that this section is now section 7235 of the present Code. Some of the authorities relied upon in that case are referred to by the trial court herein.

In Hewitt Sons Co. v. Keller, supra, we held that, where taxes were assessed in violation of the provisions of section 7164 of the Code, the taxes collected pursuant to such assessment were erroneously and illegally exacted and paid and that the excess could be recovered even though the taxes were not paid under protest. Here the basis upon which taxes were assessed and collected was found by this court to be excessive and an adjustment was ordered. The taxing authorities, however, have either ignored the judgment of this court or have deliberately refused to comply with its terms. It seems to me that under such circumstances the taxes exacted and paid were not merely irregular but were erroneous and illegal and that the taxpayer is entitled to a refund of the excess paid. The trial court's decree so determined. I think it was right.

It is suggested in the opinion of the majority that the taxpayer's remedy was to appeal to the board of review and secure a second adjudication there. The trial court determined this was unnecessary, stating in its ruling as follows, "I am of the opinion that the proceedings before the State Board in which the entire assessment was contested were just as effective as a hearing before the Local Board would have been, and accomplished the same result as if plaintiff had followed the procedure suggested by plaintiff and had received the same reduction." It seems to me that this holding is sound. If the taxpayer had appealed to the board of review, the adjudication, to all practical intents and purposes, would be identical with that which was made by the judgment of this court. It is only necessary to have a matter adjudicated once. A second adjudication of the same issue would, in my opinion, be mere surplusage.

The opinion of the majority suggests that, if the taxpayer had appealed to the board of review and secured an adjudication of the same matter that was adjudicated by the judgment of this court and the board of review had ignored or refused to comply with such judgment, then we might hold that the taxes exacted and paid would be erroneous and illegal so that the remedy here sought might be available. It seems to me that the taxes exacted and paid are just as erroneous and just as illegal when the taxing body refuses to comply with the judgment of this court as would be the case if they had refused to comply with a subsequent judgment made in accordance with the judgment of this court.

There is also a practical side of the question. It is a matter of common knowledge that appeals by taxpayers in Polk County are very numerous. These appeals tend to postpone the collection of taxes and deprive the government of a part of its revenue. It seems to me that the evil of such litigation should be reduced, not aggravated. The effect of the opinion of the majority herein is to stimulate litigation in tax cases and postpone the collection of needed revenue for the maintenance of the government. I do not think that such a rule should be announced unless absolutely necessary. The rule applied by the trial court is much to be preferred from a practical standpoint and, since I think the decree is reasonable and just, I would affirm.