Opinion
No. 32498.
January 11, 1937. Suggestion of Error Overruled, February 22, 1937.
1. TAXATION.
State tax collector held not personally liable to city for commissions paid to collector by virtue of his office and paid by collector to state treasurer, even though the commissions were unlawfully paid to collector (Code 1930, secs. 2915, 6986, 6998, 6999, 7180).
2. TAXATION.
City held not entitled to recover from state tax collector amount paid by city for audit of its books in order to obtain data upon which to institute suit against collector for commissions unlawfully paid to him (Code 1930, secs. 2915, 6986, 6998, 6999, 7180).
APPEAL from the chancery court of Hinds county. HON. V.J. STRICKER, Chancellor.
S.L. McLaurin, of Brandon, and May Byrd, of Jackson, for appellants.
The payment of money to the city tax collector by the taxpayers, pursuant to notices sent to the taxpayers by the State Tax Collector, was forced by the State Tax Collector just the same as if it had been paid over by the taxpayer to the State Tax Collector and by him handed over to the City Tax Collector, as indicated on the receipt described as aforesaid in the bill of complaint. And after such payment, at the instance of the State Tax Collector, the State Tax Collector had earned and was entitled to receive his lawful commissions on the collections.
Adams v. Bolivar County, 75 Miss. 154.
The matters sought to be litigated in this suit are res adjudicata. A suit against a person whose claim has been allowed and paid by the city is different from a suit against a member of the city commission for having paid a claim. The circuit court or the chancery court has original jurisdiction of a suit against members of the city commission because as to them no judicial body has passed upon the question of their liability. But as between the city and a person whose claim has been allowed and paid by the city, the matter is res adjudicata because it has been acted upon by the city commission acting as a judicial body.
Paxton v. Baum, 59 Miss. 531; Section 61, Code of 1930; Wilson v. Wallace, 64 Miss. 131, 8 So. 127.
When an appeal is not taken from the allowance of a claim, as authorized by the code section, supra, the judgment of the city commission allowing the claim is final as between the city and the claimant.
Yalobusha County v. Carbry, 3 Sm. M. 529; Attala County v. Grant, 9 Sm. M. 77; Carroll County v. Board of Police, 28 Miss. 38; A.H. Arthur, Clerk, v. Adam Speed, 49 Miss. 404; State Board of Education v. City of West Point, 50 Miss. 646; Board of Supervisors of Lawrence County v. City of Brookhaven, 51 Miss. 68; Klein v. Board of Supervisors of Warren County, 51 Miss. 879; Klein v. Board of Supervisors of Smith County, 54 Miss. 254; Taylor v. Chickasaw County, 74 Miss. 23; Madison County v. City of Canton, 171 Miss. 547.
In the case at bar, the question of "coercive effort" on the part of the State Tax Collector, and all other questions of fact, were forever closed when the city commission allowed and paid the claim of the State Tax Collector. No appeal having been taken, the judgment of the city commission allowing the claim has the same binding effect as if an appeal had been taken to the circuit court and on to the Supreme Court and judgment rendered in the Supreme Court.
19 R.C.L. 1047, par. 335; 38 Am. Rep. 205; H. Arthur, Clerk, v. Adam Speed, 49 Miss. 404.
The only way in which claims allowed by a city commission can be attacked is by appeal to the circuit court in the manner provided by statute.
Section 61, Code of 1930.
This particular method of procedure to assail the validity of the claim, being the particular method prescribed by the statute, is the exclusive method.
Loposser v. State ex rel. Gause, 110 Miss. 240, 70 So. 345; Warren v. State ex rel. Barnes, 163 Miss. 817.
In the case at bar, appeal (section 61, Code of 1930) was the exclusive remedy and the allowance of the claim by the city commission could not be contested in any way except by appeal.
The City of Biloxi accepted the services of the State Tax Collector, received the fruits of his efforts, treated the money collected as taxes, applied and used it as taxes due the city, recognized and adjudicated the State Tax Collector's right to his commissions on the collections allowed him by statute, and adjudged and allowed and paid the State Tax Collector's claim as commissions, and is estopped to repudiate such action by the city.
10 R.C.L. 712; 3 McQuillin Municipal Corporations, sec. 1398; Vicksburg v. Marshall, 59 Miss. 563; City of Jackson v. Merchants Bk. Trust Co., 112 Miss. 537, 73 So. 573.
State Tax Collector is authorized to collect delinquent taxes even though municipal tax collector had same power.
Section 6986, Code of 1930; McClelland v. Gully, 172 Miss. 431, 160 So. 567.
The State Tax Collector is agent of the state and not individually liable.
Section 7180, Code of 1930; Adams v. Saunders, 89 Miss. 784.
Obviously, the statute cannot be reasonably interpreted to command a public official to pay back to a municipality fees which the municipality had paid to him, there being no allegation or charge of any fraud, collusion or mistake in the settlement made by the city with the State Tax Collector.
City of Okolona v. Chickasaw County, 171 Miss. 424, 157 So. 690; Coahoma County v. Knox, 173 Miss. 789, 163 So. 451.
The city council was the only tribunal having any authority or jurisdiction to pass upon the State Tax Collector's claim for commissions, which could only be allowed upon a showing that the State Tax Collector made the collections, which are tolled by the statute at twenty per cent of the amount which the city commission found had been so collected. The city council having rendered its judgment and issued its warrants in payment thereof, there can be no recovery back.
Ford Ford, of Pascagoula, for appellee.
At the outset the court will observe that there was filed to the bill of complaint a general demurrer. Necessarily if there is any equity on the face of the bill whatsoever a demurrer to the whole bill must be overruled.
Griffith's Chancery Practice, sections 291 and 293.
The court will observe that discovery is sought by the complainant of certain items under proper allegations set forth in the bill of complaint as to the necessity of this discovery. The demurrer does not raise the question of a sufficiency of these allegations. It must therefore be presumed that the allegations are true and that the complainant is entitled to this relief. This alone is sufficient to bring the case into equity.
Griffith's Chancery Practice, sec. 428.
Since discovery alone is sufficient to bring a case into equity for full, final and complete relief and since the bill does state grounds for relief on discovery alone, it is manifest that the general demurrer should have been overruled and the chancellor was eminently correct in so doing.
In the case of Howe v. State, 53 Miss. 57, wherein the report of the county treasurer had been approved by the board of supervisors and the report distinctly showed that a claim to excessive and illegal commissions had been made and had been allowed by the board, it was held that the same was not a conclusive adjudication which would protect the county treasurer and the sureties on his bond against recovery of same, and that the board could maintain a suit and was entitled to recover. This was based on the theory that public officials can only receive such fees, salaries and commissions as are authorized by law.
We believe that the principles stated in the above case are the applicable law as to the right of a municipality or county to recover illegal commissions, fees or salaries paid to a public officer and it is manifest that the State Tax Collector is a public official of the state of Mississippi.
City of Okolona v. Chickasaw County, 171 Miss. 429.
In construing section 6986, Code of 1930, this court, in the case of Robertson v. Shelton, 127 Miss. 360, reaffirmed the principle of law, that in order to be entitled to a commission the payment of the taxes must have been due to the coercive action of the State Tax Collector against the taxpayer and that only lawful coercion may be used by him to earn such a commission.
It is manifest from the Shelton case that the court declared in favor of upholding the principle that public moneys should be kept intact, and that large commissions be not taken therefrom unless absolutely necessary.
Sections 2584, 2915, 2903, 3229 and 6995, Code of 1930.
It is manifest, therefore, from reading the above sections of the code that the reason the law requires that the State Tax Collector must proceed by suit to recover delinquent taxes before being entitled to a commission is that if the Tax Collector is at fault for his failure to have collected the taxes that he must pay the commission of the State Tax Collector and the public funds thus kept intact.
The court will observe that the bill of complaint specifically states throughout, both with reference to each item or class of the taxes on which commissions were paid the State Tax Collector, that no suit was brought by him against any taxpayer for the collection of same, and no lawful coercive methods used to enforce payment.
This then brings us to the question of the effect of the order passed by the mayor and commissioners of the municipality which order is set forth in the bill of complaint. In the first place, we say that this order did not in any manner, by its verbiage, attempt to enlarge or increase the authority of the State Tax Collector, if the taxes were delinquent he had the right to exercise his lawful authority even against the protest of the municipality and could even have sued the officers charged with the duty of collecting the taxes. If the taxes were not delinquent it is manifest that he could bring no suit for the collection of same, nor could the City have taken any action. The order only authorizes him to enforce all powers granted him under chapter 168 of the Mississippi Code of 1930, in regard to delinquent taxes. As we view it, this order was a mere nullity, a mere scrap of paper. We also contend that, should this order be construed as an attempt on the part of the mayor and board of commissioners of the City of Biloxi to turn over all tax collections to the State Tax Collector, that same was ultra vires, void and of no binding force or effect on the city.
Sections 2532, 2484, Code of 1930.
The statutes in Mississippi require that each municipality shall have an officer whose duty it shall be to collect and pay over the taxes assessed and levied by the city. This, of course, is a duty delegated by the municipality to the officer. It is a fundamental principle of law that a delegated duty cannot be delegated to another and the courts apply this to public officials.
22 R.C.L. 539, par. 236; Murphy v. Swanson, 198 N.W. 116, 32 A.L.R. 82.
Another question also presents itself on this order, namely, that its sole effect in appointing the State Tax collector to collect past due taxes would be to give him the office as Tax Collector of the City of Biloxi. Of course, he could not hold this office being already a public officer of the State of Mississippi. This would be in violation of section 267 of the Constitution of our State, which says, that no person shall hold office or employment without personally devoting his time to the performance of his duties.
Kierskey v. Kelly, 80 Miss. 803; Hendricks v. Lowndes County, 49 Miss. 612; Patty v. Sparkman, 58 Miss. 76.
We respectfully submit that since the statute fixes the compensation of the State Tax Collector, and since the statute also states under what circumstances and how he may earn the same, that any attempt of the Board of Mayor and Councilmen of the City by which it agreed to pay him compensation, unless he had earned the same, in the manner provided by law, is utterly void.
Appellant also questions the right of the present Board of Mayor and Commissioners to question the acts done by the previous officials of the City of Biloxi in making the contract and paying out the funds. That they are not bound by these acts is well established in Mississippi.
Jefferson County v. Grafton, 74 Miss. 435; Section 2540, Code of 1930.
The various items of commissions sued for were not earned, were unlawful and are recoverable.
McLauren v. Moore, 60 Miss. 376.
The appellee exhibited an original bill in the court below against the appellant, the State Tax Collector, and the sureties on his official bond, by which it sought to recover, approximately, fourteen thousand dollars alleged to have been unlawfully paid by appellee to the Tax Collector as commissions on municipal taxes paid direct to appellee by the taxpayers without coercion so to do by the Tax Collector, and for the recovery of two other items which will hereinafter appear.
A demurrer to this bill was overruled, and an appeal was granted under section 14, Code of 1930.
The bill is too lengthy for a complete abstract thereof to be set forth, but its allegations, in substance, are as follows:
In 1934 the City owned land purchased by it at tax sales, the period for the redemption of which had expired; that the City executed quitclaim deeds thereto to several named persons, for stated considerations, on which the City paid the Tax Collector twenty per cent. commission; that the Tax Collector did not, in any way, coerce the making of these payments for the land, and could not legally have done so, "but your complainant would show that when said sales were made, or redemption allowed by the City of Biloxi, that a receipt was issued for the amount of the consideration paid by the purchaser, and said receipt was unlawfully and illegally marked `Collected at the instance of the State Tax Collector.'"
In September, 1932, and 1933, the City purchased land at tax sales for the collection of taxes due to the City thereon. In 1934, before the period for the redemption of the land expired, the owners thereof paid the taxes due thereon to the City, receiving receipts therefor marked, "Collected at the instance of the State Tax Collector," on which the city paid the State Tax Collector twenty per cent. commission, although no coercive steps had been taken by him for the collection of the taxes.
In September, 1933, land situated within the City was purchased by individuals at sales thereof for taxes due the City, "they bidding and paying at said tax sale an amount in excess of the taxes, cost and damages due at the time of said sale. . . . After said sale, and before the expiration of the redemption period, redemptions were made by the owners of said properties or persons lawfully interested therein . . ." and that "a substituted receipt was issued by the Tax Collector of the City of Biloxi to said person redeeming, and that same was unlawfully and illegally marked `Paid at the instance of the State Tax Collector,' and that thereafter a commission of twenty per cent. on the amount paid by the said persons redeeming said properties was paid to the defendant, State Tax Collector," although the payment of the taxes was in no way coerced by him.
On September 17, 1934, some of the lands in the City on which the taxes were due were omitted from the sale then made for delinquent taxes, and were thereafter "by the Tax Collector of Biloxi listed in the tax sales record with a notation that `taxes on same were to be collected by M. Adams, Deputy State Tax Collector.'"
In November, 1934, taxes on these lands were paid to the City, and "substituted receipts were issued showing a payment of said taxes as in the cases of the redemptions of the lands hereinabove referred to." Twenty per cent. commission was paid by the City to the Tax Collector on the taxes so collected, although he had, in no way, coerced the payment thereof. In 1934, before the time for the sale of land for delinquent taxes, various persons paid the City the taxes due thereon, on which the City paid the Tax Collector twenty per cent. commission although he had, in no way, coerced the payment of said taxes.
In 1934 taxes were paid to the City on other land for the taxes of 1929 to 1933, which the municipal tax collector failed to sell therefor, and receipts were issued by the City, being marked "Collected at the instance of the State Tax Collector," who was paid by the City twenty per cent. commission thereon, although he had, in no way, coerced the payment of such taxes.
"In March, 1934, Myrant Adams, a Deputy State Tax Collector, mailed notices to delinquent tax payers of the City of Biloxi, and that the cost of typing said notices, having the forms printed, postage and stationery, amounted to the sum of $483.92, and that although the said cost and expense of sending out said notices, under the law, should have been borne by the State Tax Collector, that he unlawfully and illegally collected the same from the City of Biloxi. Complainant attaches hereto marked Exhibit L., a statement showing the cost of sending the said notices, the warrant number, the date of issuance in payment thereof, the person to whom said money was paid, the services rendered, and the amount of same; . . . included in said schedule is an item of $1.25 which shows the issuance of warrant No. 59,116, on March 25, 1934, to the Brown Printing Company, which complainant avers was in payment of a rubber stamp bearing the legend `Collected at the instance of the State Tax Collector.'"
The bill of complaint then avers that in several instances, in some of which the Tax Collector was legally entitled to his commission, he was paid, in some, an amount in excess thereof, and in others he was paid twice therefor.
In order to obtain the data on which to institute this suit, the City incurred an expense of one thousand five hundred dollars for the audit of its books, for which a recovery is also sought.
The bill then alleges that, "in addition to the commissions which were unlawfully collected and retained by said State Tax Collector, as hereinabove set forth, and in addition to those which were lawfully paid, collected and retained by him, that numerous other payments were made to him by the City of Biloxi, the validity of which is doubtful to your complainant, and, in many instances, the reason for said payments, that is, what the same were for, is unknown to your complainant and to the City of Biloxi, although due demand has been made by the said City of defendant, State Tax Collector, or his lawful Deputy, for information relative to same. And your complainant would further show that, in other instances, commissions were paid to the said State Tax Collector for which commission had theretofore been deducted by the said State Tax Collector in his settlement with the City of Biloxi, or which had already been paid to the said State Tax Collector by the said City of Biloxi, and for all of which your complainant avers that it is entitled to a discovery as to why the said commissions were paid in cases where the same are unknown, and to the refund of same where the same were twice paid by the City of Biloxi to the State Tax Collector. Complainant avers that said items will be more specifically set forth hereinafter."
It appears from the bill that in April, 1934, the City of Biloxi adopted the following order: "Whereas, there is a large amount of taxes past due and delinquent for the year 1933 and preceding years, which taxes the City has been unable to collect in the ordinary course, and, Whereas, the City is in need of such funds to meet outstanding and past due obligations, and, Whereas, it is the opinion of the Board that it would be wise and proper for the State Tax Collector to proceed as he is authorized by law to take steps to collect said taxes. It is, therefore, Ordered, that the State Tax Collector, or his Deputy, be authorized to collect all past due and unpaid taxes due the City of Biloxi, of any kind whatsoever, and he is also authorized to make adjustments, where said adjustments are necessary, and he is hereby authorized by the Board to enforce all powers granted him under chapter 168 of the Mississippi Code of 1930 [section 6984 et seq.], in regard to delinquent taxes."
The bill alleges that this order did not constitute a contract between the City and the Tax Collector, and did not enlarge his powers or add to his right to receive commissions on taxes, the payment of which was coerced by him.
This, the appellant seems to concede, and therefore the order will be left out of view.
Counsel for appellants says that the demurrer should have been sustained for several reasons, among which are the following: (1) That the Tax Collector was legally entitled to the commissions paid him; (2) that the payment thereof by the City is res judicata of the Tax Collector's right thereto; (3) that the City is estopped from collecting the money so paid to the Tax Collector; and (4) that all of the money here sought to be recovered came into the hands of the Tax Collector by virtue of his office, and that, consequently, he must account therefor to the State, and not to the City.
We will pretermit any discussion of the first three of these contentions, and come, at once, to the fourth, for the reason that we have arrived at the conclusion that no decree for a personal judgment can be here rendered against the State Tax Collector.
Under chapter 168, Code of 1930, the State Tax Collector is a State officer charged with the duty of collecting "all past due and unpaid taxes of any kind whatever, whether of the state, county, municipality, drainage, levee or other taxing district, or any subdivision thereof." Section 6986.
Section 6998 thereof requires him to "settle with the proper officers, and pay over all moneys collected by him as required by law; and he shall make a report to the auditor of public accounts at the end of each fiscal year, giving a full account of all collections by him for the preceding year and of whom and on whose account collected."
The State, counties, and municipalities are not "chargeable with any such fees or expenses on account of any investigation or suit made or instituted by the state tax collector," such fees and expenses being deducted from the money collected by him, section 6999 providing that "The state tax collector shall retain twenty per centum of all amounts collected and paid over by him, and of the purchase money of all lands bid in for the state by him and sold by the land commissioner. Out of the twenty per cent. commission allowed by law to such state tax collector, he shall pay all the expenses incident to the discharge of the duties of his office, and all attorney's fees, and retain the sum of five thousand dollars ($5,000.00) per annum for his salary," etc.
Section 7180 of chapter 172, Code of 1930, provides that "All taxes, fees and penalties that may be hereafter collected for or in the name of the state of Mississippi shall be paid direct to the treasurer of the state, as now provided by law, by the officer charged with the duty of collecting the same, with an itemized statement to be filed with the state auditor, showing from whom collected and to what account to be credited, and all fees and commissions that may be due to any officer for collecting same shall be paid to such officer by the state treasurer on a warrant issued therefor by the state auditor, and the said warrant shall recite the section of law authorizing the payment thereof."
Under section 6998, the twenty per cent commission received and retained by the State Tax Collector on taxes collected by him, or at his instance, for a municipality, vests not in him personally, but as an officer of the State, and under section 7180 must be paid, by him, to the State Treasurer.
But it is said by the appellee that the commissions here paid to the State Tax Collector had not been earned by, and were unlawfully paid to, him. For the purpose of the argument, we may concede this to be true. Nevertheless, when the commissions were paid to him, it became his duty to account therefor to the State. Section 2915, Code of 1930, provides that "Any officer, state, county, municipal or district, or any other custodian of public funds or property, who shall improperly withhold same from the state or county treasury or other authority whose duty it is to receive same, or who shall fail to turn property over to the proper custodian, or who shall in any wise be in default as to any money or property held by him as a public official in this state, or in any other capacity as custodian of such funds or property, which may come into his hands by virtue of his official position, whether in the proper performance of his official duties, or otherwise, shall be liable on his bond for all cost of collection or recovery of money or property, including in such costs the commissions, if any, of the state tax collector or the attorney-general, and all other costs connected therewith, including interest on funds improperly withheld, for such time as such funds have been withheld, and reasonable rental and damages where property belonging to the public is so withheld."
Under this section, it is incumbent on a State officer to account to the State for all money "which may come into his hands by virtue of his official position, whether in the proper performance of his official duties, or otherwise."
We are not here concerned with what the appellee's rights would be if the State Tax Collector has failed to pay this money to the State Treasurer, for the bill of complaint does not allege that he has not done so; consequently we must presume that he obeyed the statute and paid the money to the State Treasurer.
The appellee seems to admit that payment to the State Treasurer would absolve the appellants from liability, for it says that, under its prayer for general relief, "The court, if it should deem proper, could direct the issuance of a warrant on the State Treasurer, in payment of the sums found by it to be due to the appellee." No authority is cited therefor, and we know of none.
If the money paid by the appellee for services in, and supplies for, notifying delinquent taxpayers was paid to the State Tax Collector, it also came into his hands by virtue of his official position, but it seems to appear from an exhibit to the bill that it was not paid to him, but direct to the persons to whom it was due.
No authority is cited by the appellee in support of its claim to recover from the appellants money paid by it for the auditing of its books, and we know of none.
The demurrer should have been sustained.
Reversed and remanded.