State Tax Commission v. County Commissioners

Boyd, C. J., delivered the opinion of the court. The Commerce Trust Company of Baltimore City had a capital stock consisting of 10,000 shares, of which 9,685 were transferred to T. Edward Hambleton of Baltimore County, William G. Baker, Jr., and Virginius G. Dunnington of Baltimore City, trusteesi under a voting trust agreement, dated' June 12, 1919. There is some difference in the statements in the briefsi as to the exact number of the 9,685 shares which are held by non-residents of the State¡ — that of the Attorney General stating that there were 3,551 and that of the appellee that there were 3,590 shares — but that is immaterial for the purposes of this opinion. The shares were valued by the State Tax Commission at $62.50 each, and it passed the following order: “In Be Commerce Trust Company: “It is, this 15th day of September, 1920, ordered by the State Tax Commission, that the distribution of the assessment of the shares of the Commerce Trust Company for 1920 be corrected, and that the assessment on said shares be entered and certified to the respective localities of the residences of the respective shareholders, and that, so far as the 9,685 shares standing in the names of voting trustees are concerned, the same be ⁶⁷¹ treated as tlie taxable property of the shareholders represented by said voting trustees, and not of the voting trustees. “(Sgd.) Oscar Leser, “(Sgd.) J. Enos Eay, “Commissioners.” On the 13th of October, 1920, the County Commissioners of Baltimore County filed in the Circuit Court for that county an “appeal from the State Tax Commission.” The petition quotes the above order of the State Tax Commission, alleges that Baltimore County was entitled to one-third of the aggregate assessment represented by the 9,685 shares and also 50 other shares at $62.50 per share, but that the commission had only certified to that county for the year 1920 the sum of $2,812.50, being for 45 shares.

The case was, set for hearing and on November 6, 1920, the Attorney General, representing the State Tax Commission, filed a motion to dismiss the appeal, the principal reason assigned therefor being that the County Commissioners had no right of appeal. On the 18th of February, 1921, the Circuit Court passed an order dismissing that motion, reversing the order of the State Tax Commission, and directing it to pass an order correcting the distribution of the assessment of the shares of the Commerce Trust Company “and that the assessment on shares be entered and certified by the State Tax Commission to the places of residence of the respective shareholders and that sio- far as, the assessment representing the 9,685 shares of capital stock of said company standing in the name of the three trustees is concerned, one-third of the total amount represented by 9,685 shares: shall be certified to the respective place of residence of each trustee.” From that order this: appeal wasi taken. The questions presented are: First — As to the right of the County Commissioners of Baltimore Comity to appeal; second — -Whether the residences of the voting trustees or of the owners of the share® transferred to them fix the situs for the taxation of such shares. ⁶⁷² 1. The State Tax Commission was created by the Act of 1914, Chapter 841, and large powers were conferred on it.

The act provided for the appointment by the commission of a supervisor of assessments in each county of the State and in Baltimore City, abolished the office of State Tax Commissioner, and all of the duties imposed on him or powers given him devolved upon the State Tax Commission. The provisions for appeal by that Act are contained in what are now Sections 239 and 245 of Article 81 of the Code. It is clear that the right to take this appeal cannot be sustained under Section 239, as it provides that “any taxpayer, taxpayers or city, town or village may demand a hearing before the C'ounty Commissioners or Appeal Tax Court of Baltimore City, as to the assessment of any property or any unit of tax value,” and that “any taxpayer, taxpayers or city, town or village having been assessed by the order of the County Commissioners or Appeal Tax Court of Baltimore City, as hereinbefore provided, may appeal to the State Tax Commission; or the supervisor may appeal from any decision,” hut, of course, it could not have been intended to give the County Commissioners the right of appeal from their own order, and it did not give them an appeal from the State Tax Commission. The third paragraph of that section, in providing that “there shall be an appeal to court on questions of law only from decisions of the State Tax Commission,” etc.j cannot properly be construed, as contended by the appellee, to mean that there could be appeals on all questions of law, regardless of by whom they were taken, as it had provided in a previous paragraph by whom appeals could he taheu.

It is likewise clear that Section 245 does not authorize the county commissioners to appeal to court from the action of the State Tax Commission, as the Act of 1910, Chapter 430, referred to in that section, only provides that “any person or persons, or corporation claiming to be aggrieved because of any assessment made by county commissioners! of any one of the counties of this 'State, or because of tbe failure to reduce or abate an existing assessment, may, by petition, appeal,” ⁶⁷³ etc. If “any person or persons, or corporation” takes an appeal from the county commissioners to the Circuit Court, then an appeal to this Court can be taken by the petitioner or petitioners or by the county commissioners. Xow, by virtue of the provision in Section 24-5, that the State Tax C'ommisr sion shall he substituted for the court, the appeal is to that commission, instead of the Circuit Court, but there is no authority given in that section, or any other that We have found, for an original appeal by the county commissioners to the State Tax Commission, and there is no appeal by them provided for from the action of that commission. Under the Act of 1908, Chapter 167 (Section 18 of Article 81) the original appeal in Baltimore was from the Appeal Tax Court of Baltimore, and hence the Mayor and City Council was given the right of appeal, as well as any person or persons or corporation claiming to he aggrieved by the action of the Appeal Tax Court. The appellee, after contending that the last paragraph of Section 239 is unlimited, and provides for appeals from a decision of the State Tax Commission as regards any assessment or question of law, and arguing from that that the county commissioners could appeal, said in its brief: “This contention of the appellee and the view of the Judge below are borne out by all of the cases in the Court of Appeals from action of the State Tax Commission,” and cited Baltimore v. Ches. & Pot.

Tel. Co., 131 Md. 50 ; Postal Tel. Co. v. Harford County, 131 Md. 96 ; Hyattsville v. Ches. & Pot. Tel.

Co., 131 Md. 589 ; Baltimore v. German Fire Ins. Co., 132 Md. 380 ; and Baltimore v. Machen, 132 Md. 618 . Those authorities do not support that contention. In the first one mentioned the telephone company appealed to the State Tax Commission from an assessment made by the Appeal Tax Court of the physical structures of the company in Baltimore City.

The State Tax Commission reversed that assessment and an appeal was taken to the Baltimore City Court by tbe city, which it was expressly authorized to do- by the Act of ⁶⁷⁴ 1908, Chapter 167, continued in force by Section 245. In the Postal Tel. Co. case the company applied to the county commissioners to abate an assessment, which they refused to do, and the company appealed to the State Tax Commission, which increased the assessment. The company then appealed to the Circuit Court for Harford County, which dismissed its appeal, and an appeal to this Court was taken by it and the lower court was affirmed.

In the Hyattsville case the telephone company appealed from an • assessment of the personal property made by the municipality, which it was not authorized to make, as the State Tax Commission took such ■property into consideration in assessing the shares of stock of the company. The point was made that there was no' provision for an appeal in such case to the State Tax Commission, but we held that, regardless of whether it_ was technically an appeal, the commission had control over the assessments of corporations and they had the right to apply to- it for relief against an unauthorized assessment. In the German Fire Insurance Company case, an application was made by the company to the State Tax Commission to deduct the amount invested by it in certain mortgages, in computing the value of its shares of stock, which the commission refused to do, and the company appealed to the Baltimore City Court, which reversed the action of the State Tax Commission. In the Machen case the assessment was made by the Appeal-Tax Court and was annulled by the State Tax Commission.

The Baltimore City Court, on appeal to it, affirmed the action of the commission, and an appeal was taken to* this Court by the city, as was clearly authorized by the Act of 1908. It will thus he seen that in each of those cases the question originally arose at the instance of a taxpayer, but there is nothing in any of them or other cases decided by this Court-, or in the statutes, which authorizes the aonmty commissioners of a county to take an appeal from the action of the State Tax Commission in such a matter as this. Under cur decision in the Hyattsville case the corporation and the shareholders, so. far as they are affected, can apply to the State Tax ⁶⁷⁵ Commission to correct an error in an assessment or apportionment and can appeal from its decision on questions of law, or the supervisor of assessments could apparently do so under Section 236, but if the county commissioners have rear-son to believe that an apportionment of the shares of stock assessed by the State Tax Commission is not authorized by law and injuriously affects the county they represent, they must adopt some other proceeding to have the question tested, as no appeal by them is provided in such a ease. In addition to what we have said, the record does not disr close that there was an application by the County Commissioners of Baltimore County to the State Tax Commission, to change or correct the apportionment.

The mere fact that Mr. Girdwood appears for the county commissioners, as one of the attorneys in this appeal, is not sufficient to enable us to assume that it did apply to the State Tax Commission. The appeal was taken by Mr. Burke, described in the petition for appeal as attorney for the county commissioners', and his name is also in the brief with Mr. Girdwood, but in the correspondence in the record, while it does not definitely appear whom he represented, it is indicated that Mr. Girdwood was representing the trust company, which might have sought relief in court. On request of the commission he furnished the list of stockholders! of the trust company and the form of the voting agreement, and also wrote to the commission correcting information given as to the residences of the trustees named in the voting trust at the time the trust company reported its list of stockholders. While the proceedings before the State Tax Commission are informal, it would be more than “informal” to permit a party who had never made any complaint, or applied to the State Tax Commission for the correction of a supposed error, to- take an appeal from its action, in the absence of some statute authorizing such a proceeding.

So without pursuing this question further, we are of the opinion that the lower court- should have dismissed the appeal of the county commissioners'. ⁶⁷⁶ 2. Although we have reached the conclusión above' announced, as the question was fully argued and it is important that it be decided without unnecessary delay, we will, determine whether the State Tax Commission was right in passing the order of the 15th of September, 1920. There has been some conflict between the decisions of different