Casey Development Corp. v. Montgomery County

Prescott, J., delivered the opinion of the Court. The appellee, Montgomery County, Maryland, filed a statutory suit in assumpsit under Art. 81, Sec. 204, of the Annotated Code of Maryland (1951) in the Circuit Court for Montgomery County against the appellant, Casey Development Corporation, for taxes claimed to be due by the appellant for improvements on real estate for three-fourths of the taxable year, July 1, 1953, to June 30, 1954. The appellant filed three pleas: (1) the general issue; (2) that the plaintiff had not levied the tax alleged to be due, against the property of the defendant; and (3) the purported authority for said tax is in violation of Art. 15 of the Declaration of Rights of Maryland. The plaintiff filed a motion for a summary judgment upon the certificate of the Director of Finance for Montgomery County, the authority charged with the collection of the tax, and an affidavit of the Supervisor of Assessments for said County.

The certificate of the Director of Finance contained all of the requirements of Art. 81, Sec. 209, of the Code (1951), and the affidavit of the Supervisor of Assessments disclosed that notice of the proposed assessment of improvements on land owned by the appellant, had been given to the taxpayer, it had been protested and a hearing had been held on this protest. The result of the hearing was an assessment of the improvements in the amount of $61,000. Written notice of this conclusion was given to the ¹⁴³ taxpayer, and this notice contained the following information and admonition: “Under article 81, section 191 of the Laws of Maryland you may appeal this assessment to the State Tax Commission, 31 Light Street, Baltimore 2, Maryland. This must be done within thirty (30) days of the date contained upon the notice.” A hearing was held on the motion for a summary judgment, an order was signed granting the same, and a judgment was duly entered.

The correctness of the court’s ruling on this motion is the subject of this appeal. The facts are brief and undisputed. The appellant is the owner of land, to wit, Lot 7, Block 6, Russell & Brooks Addition, 9th Election District, Montgomery County, Maryland, which appeared on the assessment rolls of Montgomery County as unimproved property on May 1, 1953, the date of finality as provided by Section 22-1 of the Montgomery County Code (1950), and on June 30, 1953, the date on or before which the annual levy for the taxable year was required by section 22-4 of the Montgomery County Code (1950) to have been made. On the aforesaid dates, the proposed improvements on the said land were not substantially completed.

A tax was properly levied on June 30, 1953, by the Montgomery County Council for the taxable year of 1953-1954 on the land as unimproved real property, and the tax was duly paid by the appellant. Between July 1 and September 30 of 1953, and after both the date of finality and the levy, the improvements on the property were substantially completed. Under the authority of Section 22-2 of the Montgomery County Code (1950), notice of a proposed assessment on the aforesaid improvements was sent to the appellant on September 14, 1953. After protest and hearing before the Appeal Tax Court, the assessment was entered on the assessment books on October 1, 1953.

On November 10, 1953, the appellant was given final notice by the Appeal Tax Court of an assessment on the aforesaid improvements for tax purposes for the year 1953-54. The assessment was not thereafter appealed to the State Tax Commission by the appellant. Appellee claims the tax ¹⁴⁴ to be due under the authority of Section 22-2 of the Montgomery County Code (1950), and the amount of the tax claimed equals three-fourths (¿4) of the regular County rate and not three-fourths (¿4) of the sum of the State and County rates. The appellant contends there are two questions involved in this appeal: (1) .

May the defendant in an action to collect taxes interpose as a defense the question of the validity of a levy, when he did not appeal the assessment to the State Tax Commission; (2) . Is section 22-2, Montgomery County Code (1950), the law under which the assessment was made, invalid for want of a provision for a valid levy and/or because it is in violation of Art. 15 of the Declaration of Rights? The appellee maintains that said section 22-2 of the Montgomery County Code is a valid and constitutional enactment by the Legislature of Maryland, and is self-executing so as to require no new or additional levy; but, whether it is or not, the appellant is precluded from contesting the same in this case, because it failed to appeal to the State Tax Commission under the statutory appeal procedure set out in Secs. 251-255 of Art. 81 of the Code. This seems the appropriate place to set forth the laws that control this case.

Sec. 22-2 of the Montgomery County Code reads, in part, as follows: “22-2. All improvements which become substantially completed between July 1st and September 30th in any year shall be assessed for taxes and such improvements shall be subject to taxation in said year at three-fourths of the regular rate levied for State and County purposes for said year * * Art. 81, Sec. 209 of the Code (1951) is, in part, as below: “* * * the certificate of the authority charged with the collection of the tax * * * showing the amount of ¹⁴⁵ tax due * * * shall be prima facie evidence to entitle the plaintiff to judgment * * * and shall cast upon the defendant the burden of proving that the tax has been paid or any other sufficient defense, but this section shall not be construed to permit the defendant to interpose any defense which he might have raised by way of appeal from the assessment upon which such tax was levied.” And Sec. 252 of said Art. 81, provides that: “Any taxpayer, * * * claiming to be aggrieved * * * because of any * * * failure or refusal to increase, reduce, abate, modify or change any assessment * * * by * * * the assessing authorities * * * may by petition appeal to the State Tax Commission * :|; » The court below did not state its reasons for granting the motion for summary judgment, but if the record discloses it was correct in so doing, the judgment should be affirmed. The certificate of the Director of Finance, under the provisions of Sec. 209 of Art. 81, above, made out a prima facie case. The defendant offered no testimony, but contented itself to rest for defense upon the alleged failure of an additional levy, and that Sec. 22-2, above, violated Art. 15 of the Declaration of Rights.

This court has held on many occasions that where a statute provides a special form of remedy for a specific type of case, the statutory remedy in most instances must be followed. American Bank Stationery Co. v. State, 196 Md. 22 , and cases therein cited; Reiling v. Comptroller, 201 Md. 384 ; Miller Bros. Co. v. State, 201 Md. 535, 540 ; Tanner v. McKeldin, 202 Md. 569, 577 ; Pressman v. State Tax Comm., 204 Md. 78, 84 . However, appellant claims it is not precluded under this rule from showing there was no actual levy for the tax attempted to be collected, because the date of finality in Montgomery County, in the first instance, was May 1, 1953, and the levy for that year was made on, or before, June 30, 1953.

It says this levy was upon the assessments made on or before ¹⁴⁶ May 1, 1953, and did not affect any assessments on improvements completed thereafter, such as appellant’s. It, therefore, contends there was no levy for the tax imposed on its improvements, and it would not have been able to avail itself of this fact by appeal to the State Tax Commission, after the hearing on the protest of the assessment. It argues there is an essential difference between an “assessment” and a “levy”, and, while the express language of Sec. 252 of Art. 81, permits an appeal from an “assessment”, no provision is made to appeal an unlawful “levy” or a failure to make a “levy”. Therefore, if it had appealed the “assessment”, it would not have had the right to attack the “assessment” by showing the lack of a “levy”.

As a result, appellant claims that neither the rule above stated, nor the provisions of Sec. 209 of Art. 81, preclude it from offering as a defense in this case the failure of a valid “levy”. Of course, there is a difference between an assessment and a levy. A strict meaning of an assessment is an official estimate of the sums that are to constitute the basis of an apportionment of a tax between the individual subjects of taxation within the district. However, it is more commonly employed to mean that it consists of the two processes of listing the persons, property, etc., to be taxed, and of estimating the sums that are to be the guide in an apportionment of the tax between them.

Consol. Gas Co. v. Baltimore City, 101 Md. 541, 558 . A levy, on the other hand, is the imposition of the tax itself. It “* * * is a legislative function, and includes a determination that the tax shall be imposed, and also the ascertainment of the amount necessary or desirable to be raised, the amount or rate to be imposed, and the subjects or persons to contribute to the tax.” Black’s Law Dictionary, p. 1093.

The assessment and the levy are separate and distinct elements of the taxing process. Sections 251-255 of Article 81, above referred to, are the statutes that provide for an appeal to the Commission. The word “levy” is not to be found therein, while the term “assessment” is used many times. We, therefore, conclude appellant is not precluded by this Court’s previous decisions or the provisions of Sec. 209 from offering as a defense the invalidity, or lack, of a levy or ¹⁴⁷ the invalidity or unconstitutionality of Sec. 22-2 of the Montgomery County Code for failure to appeal his assessment to the Commission.

Appellant has four contentions with reference to said Sec. 22-2, claiming each one renders it invalid: (1) that the phrase “State and County purposes” is indivisible and not separable and therefore the tax rate levied is in error, not being three-fourths of the combined State and County rate; (2) that the statute is in conflict with Sec. 22-4 of the Montgomery County Code of 1950; (3) that the statute is not self-executing and makes no provision for a levy, other than the one annual levy for the entire fiscal year, and the tax is thus invalid for want of a separate levy; and (4) that the tax rate fixed by the statute