William Skinner & Sons Ship Building & Dry Dock Co. v. Mayor of Baltimore

Boyd, J., delivered the opinion of the Court. This is an appeal from an order of the Baltimore City Court dismissing a petition filed by the appellant which sought to have assessment of its dry dock, at the sum of two hundred thousand dollars, stricken from the tax books of Baltimore City. The assessment was made on the 6th day of January, 1902, by the Appeal Tax Court, after a hearing which was had on the 23 rd of December. The dry dock was commenced in 1899 and was not completed until the fall of 1901.

It was built inside of a coffer-dám, an excavation was made of the size desired, which is sheathed on the two sides and the end next to the shore, and the other end is of stone and concrete and in it there is a gateway in which a gate rests. The dock is floored with heavy beams supported by piles driven into the earth. The gate is described by Mr. Skinner, the president of the appellant, as “a caisson and practically a little ship of itself that floats about in the river, and we bring it in and put it down into the place where the keel and stem-posts are, and this gate makes a water-tight joint, and when the pumping begins the pressure from the outside keeps this little caisson gate up in its place and prevents leakage, while they pump the dock out.” The dry dock structure “consists of buildings, power house, machinery, boilers, a gate, etc.” It is contended by the appellant that by virtue of a provision in the charter of Baltimore, the Appeal Tax Court is confined in assessments made by it to the first day of October, of ³⁶ each year, and that as this structure was not completed on October i st, 1901, that Court had no power to assess it for the year 1902. It is admitted that it cost three hundred thousand dollars and Mr. Skinner in reply to the question, “What are your views of its valuation of $200,000?” said “I would have returned to them at $300,000, as the costs of the improvements we put there.” Its condition about that time was thus described by him : “September 18th, 1901, the water was first permitted to come into the dock.

It took us possibly a week to flood the dock, and after the dock was flooded then this coffer-dam had to be drawn out, and after that was done the dredging had to be done at the entrance. September 18th we only had 10 or 12 feet of water in the entrance, and we had to get that down to 24 feet. After that the sills had to be cleaned off The dredging was finished November 4th, and the gate put in its place November 14th, and the dock first pumped out November 14th, and the blocking for the keel of the ship to set on was finished November 22nd, and we docked the ship on November 25th.” The gate was received November 12th and it cost $22,500, three-fourths of which had been paid on October 1st, but it was not considered the property of the company until placed in position and tested. The construction company which built the dock completed its work on November 23rd.

It is admitted that considerably more than $200,000 had been actually paid out on October 1st, and it cannot be denied that with the exception of the gate and some dredging, the dock was practically finished on that date. It was built on property purchased by the company, known as the Winebrenner and Houghton lots, which were still assessed in the names of those parties — the former at $9,467 for the lot, and $3,000 for improvements, and the latter at $20,167’for the lot, and $17,500 for the improvements. The improvements originally on those lots had been destroyed, partly by fire and the rest being torn down for the dock. The appellant paid the taxes on those assessments on January 31st, 1902, which was after this assessment was made. ³⁷ As was said in Hopkins v. Van Wyck, 80 Md. 15 , “to avoid confusion and uncertainty some definite period had to be adopted as the point of time, in each year, when the valuation or appraisement fixed upon the property actually assessed and charged upon the books to each individual, would no longer be open to question, but would be conclusively ascertained and made binding upon both the city and the taxpayer alike.” That time as now fixed by the charter of Baltimore is the first day of October.

Sec. 171 of Art. 4 of Public Local Laws, known as the charter of the city of Baltimore, provides that “ the valuation of the property subject to taxation in the city of Baltimore, as it shall appear upon the assesment books of said Court on the first day of October, in each and every year, shall be final and conclusive, and constitute the basis upon which taxes for the next ensuing fiscal year shall be assessed and levied,” but an important proviso follows that clause which we will consider later. That section further requires the Appeal Tax Court to make out and deliver to the City Collector and Board of Estimates on the first day of October, or as soon thereafter as practicable, a statement showing the valuation and assessment of all the property subject to taxation in said city, “ as it shall appear upon the assessment books 01 said Court on said first day of October,” and also that “ The said statement shall be known as the taxable basis for the next ensuing fiscal year, and after the levy of taxes, it shall be designated as the tax roll for said year. ” Sec. 36 requires the Board of Estimates to make out, between the first day of October and the first day of November, three lists of monies to be appropriated by the City Council for the ensuing fiscal year. Sec. 40 requires that board on the first day of October, or as soon thereafter as practicable, to send with the ordinance of estimates to both branches of the City Council a report showing the taxable basis for the next year, and the amount which can reasonably be expected to be realized by taxation for that year. That section also provides that the ordinance making the annual levy of taxes shall be passed by the Mayor and City Council in the month of November in each year, and ³⁸ “The taxes levied under said ordinance in the month of November, in each year, shall be the taxes to be collected for the fiscal year next ensuing after the said month of November, and may be paid to the City Collector on or after the first day of January next, ensuing said levy.” Taxes on real estate and chattels real are to be deemed in arrears on the first day of July, and those on personal property on the first day of May.

By sec. 42 the City Collector is required in October, immediately upon the receipt of the statement from the Appeal Tax Court, to begin the preparation of the tax bills on said basis, and after the levy has been made to complete them and have them ready for payment on the first day of the next January, or as soon thereafter as practicable. It will be seen from the references we have thus made to the charter, and other sections we might refer to, that the .first day of October is the day on which the books are expected to be ready for the levy for the ensuing year and from that date those connected with the levy and collection of taxes are required to be actively at work until their respective duties are performed. But the first clause in sec. 171 above quoted is qualified as follows: “Provided that the foregoing provision shall not apply to property in the city liable to taxation, and which may have escaped, or which may have been omitted, in the regular course of valuation, but such property shall be valued and assessed, and the owner or owners thereof charged with all back and current taxes justly due thereon, whenever the same may be discovered and placed upon the assessment books P And sec. 169 reads that “In all cases where discoveries of assessable property are made by the said Appeal Tax Court, either from the returns of clerks, registers or assessors, or in any other way, the said Court shall assess the same and add the same to the amount on which taxes are to be levied.” It is undoubtedly desirable and important that as dar as possible the assessable basis be known and determined by the day contemplated by the charter. But if there be property which is taxable, but is not on the assessment books on that day, it ought not to escape taxation merely because it had not been ³⁹ reported by the owner, or had been overlooked by the tax officers before that date.

We will consider later the question whether this dock was taxable, in the condition it was, on October 1st, but assuming for the purposes of this branch of the case that it was, we think it is clear that the Appeal Tax Court was right in assessing it. Referring to a provision in sec. 5 of Art. 50, of the City Code of 1892, which was very similar to the first clause in sec. 171, excepting that the day there fixed was the first Monday in March, this Court said in Hopkins v. VanWyck, supra, “But it was never designed by this provision to exempt from taxation for a current year the individual who, by adroitness or otherwise, succeeded in eluding the vigilance of the assessors, or who, by inadvertence, was not rated with all his assessable property on the first Monday of March of that particular year. Nor was this provision intended to put a limit or restriction on the power of the municipality to make an-, assessment of omitted or escaped property after the dateindicated.’, The opinion goes on to say that if such had been its purpose it would have been repugnant to the policy and spirit of the or-, ganic law itself, and it was expressly held in that case that the fact that the property was not put on the books until after the levy was made did not relieve it from the tax, it being “omitted or escaped property.” We think the learned Judge below was right in treating this as “ omitted property,” assuming as we have said that it was in such condition on October 1st, as made it taxable. It is true that the land on which the dock was constructed was already assessed — although it was not assessed to the appellant, but to the former owners.

But this is not a case where property already assessed had merely appreciated in value, or where the Appeal Tax Court concluded after October 1st, that it was assessed too low, and then undertook to increase it for taxation during the fiscal year beginning the next January. These lots were assessed some years ago— the record says “On October 1st, 1901, and for the several years prior thereto” — certainly before the appellant procured them, as they were assessed to the former owners, ⁴⁰ and since that assessment these improvements, amounting to a sum well up to $300,000 on October 1st, 1901, had been put on them. The dock was in the course of construction for about two years and a half, and the authorities had not during that time attempted to assess it — probably thinking, if they knew of it, that it would not be just to assess it until it was about completed. The charter shows that assessments of improvements are specially provided for.

Sec. 148 requires every assessor to inform himself of all property “ which may have been omitted in the assessments, and all buildings and improvements and all property created or acquired since the last asssessment,” and to value and return them to the Court. Sec. 150 provides for the method to be pursued by the Court before increasing an assessment of property already assessed, or adding new property not valued and returned by the proper