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District Court of Appeal, First District, Division 1, California.


Civ. 9950.

Decided: February 27, 1937

Everett W. Mattoon, Co. Counsel, and Beach Vasey, Deputy Co. Counsel, both of Los Angeles, for appellant. Livingston & Livingston and Richard Wagner, all of San Francisco, for respondents.

By this action appellant, County of Los Angeles, attempted to collect from respondents, a copartnership and its members, unsecured personal property taxes. The following facts as found by the court sufficiently depict the controversy: Respondents owned money, merchandise, store fixtures, and equipment, which were subject to taxation. The assessor, in accordance with a method deliberately adopted, systematically assessed the several kinds of personal property owned by merchants at percentages of their book value, which varied as to each kind. In disregard of this method and for the purpose of subjecting respondents to an excessive tax, the assessor willfully and intentionally assessed the several kinds of respondents' property at higher percentages of their book values than he used in such method. This unequal assessment was made by the assessor with the intent and purpose that respondents' property should be assessed upon a different basis and at different valuations than assessments made upon similar property of all other merchants similarly situated in the county. His acts disclosed such discrimination between respondents' property and similar properties of other merchants as to evidence willful disregard of law and to amount to fraud. Subsequently respondents filed with the county board of equalization a verified protest, stating the true value of their property, its assessed value, and requesting that it be assessed at it true value, upon the ground that there had been an unequal valuation of such property. After a hearing, at which respondents presented evidence showing that the assessment was arbitrary although they had given the assessor a statement and other information as required by law, the board, in disregard of such evidence and for the purpose of compelling them to pay an excessive tax, denied the protest, with full knowledge of the discriminatory manner, above outlined, in which their property had been assessed. The tax subsequently levied was illegal and not due or owing. The judgment decreed that appellant take nothing and that respondents recover their costs.

Section 3674 of the Political Code reads as follows: “No reduction must be made in the valuation of property, unless the party affected thereby or his agent makes and files with the board a written application therefor, verified by his oath showing the facts upon which it is claimed such reduction should be made.” (Italics ours.) A property owner cannot defeat the collection of a tax, or recover its amount if paid under protest, upon the claim that the assessment was excessive and discriminatory, unless he was applied for its reduction under this section. Luce v. City of San Diego, 198 Cal. 405, 245 P. 196; Southern California H., etc., Co. v. Los. Angeles County, 49 Cal.App. 712, 194 P. 62; City of Los Angeles v. Glassell, 4 Cal.App. 43, 87 P. 241. A county board of equalization has no jurisdiction or power to reduce any assessment except upon an application under this section. Garretson v. Board of Sup'rs of County of Santa Barbara, 61 Cal. 54. Power, analogous to that conferred by the above section, was formerly granted by section 23 of the revenue law of 1861 (Stats. 1861, p. 427), reading as follows: “The Board of Equalization shall have power to determine all complaints made in regard to the assessed value of any property; and may change and correct any valuation, either by adding thereto, or deducting therefrom * * *.” Under this section it has been consistently held that a board did not have jurisdiction to increase an assessment unless a complaint had been filed. People v. Reynolds, 28 Cal. 107; People v. Flint, 39 Cal. 670; People v. Goldtree, 44 Cal. 323. Where a municipal ordinance required the filing of a complaint before the board could raise an assessment, such filing is a jurisdictional prerequisite to any increase. Mayor, etc., of Los Angeles v. Los Angeles W. W. Co., 49 Cal. 638; Rickard v. Council of Santa Barbara, 49 Cal.App. 58, 192 P. 726.

In order for the application to confer jurisdiction on the board it must contain the matters required by statute. An application lacking the required verification is insufficient to authorize the board to reduce an assessment. Garretson v. Board of Sup'rs of County of Santa Barbara, supra. A complaint which fails to state facts is entirely nugatory for any purpose. People v. Flint, supra. The italicized portion of said section 3674 requires that the application shall show “the facts upon which it is claimed such reduction should be made.” The present application (erroneously called a protest in the answer and findings) merely states “that the grounds upon which such change is asked and should be made are as follows, to–wit: unequal value.” In considering a similar application upon indentically worded grounds, as shown by the record, the Supreme Court in Rittersbacher v. Board of Supervisors, 220 Cal. 535, 540, 32 P.(2d) 135, 137, said: “The petitions filed with the board alleged an overvaluation of the described real estate and improvements and nothing more and the prayer was for an equalization of the value. ‘To equalize is to make equal, to cause to correspond, or be like in amount or degree, as compared with something.’ Wells, Fargo & Co. v. State Board of Equalization, 56 Cal. 194, 196. What the petitioners before the board were entitled to was that their property be placed ‘on the same basis of valuation as that applied to other property of like character and similarly situated.’ Birch v. County of Orange, 186 Cal. 736, 200 P. 647, 649; Los Angeles, etc., Co. v. County of Los Angeles, 162 Cal. 164, 166, 121 P. 384, 9 A.L.R. 1277.”

“As above indicated the petitions for equalization filed with the board made no reference whatever to the claim of the petitioners that their properties were assessed on an unlawfully discriminatory basis. The petitioners failed then to advise the board of ‘the facts upon which it is claimed such reduction should be made,’ as required by section 3674 of the Political Code.” Rittersbacher v. Board of Supervisors, supra, 220 Cal. 535, at page 540, 32 P.(2d) 135, 137. The deficiency of the present application is readily apparent when it is compared with the following one, conceded to be sufficient in Birch v. County of Orange, 59 Cal.App. 133, 135, 210 P. 57, 58: “It set forth as the particular grounds that the ‘assessed value of said property is unfair, unjust, and excessive as compared with other property of substantially the same character and value and similarly situated in said county, and imposes an unequal burden upon the applicant,’ and that the assessment was ‘arbitrary, discriminatory, oppressive, erroneous and illegal.”’

The lack of jurisdiction arising from the insufficiency of the application was not cured by the action of the board in hearing and determining it. People v. Reynolds, supra; People v. Goldtree, supra. The power of the board to reduce an assessment comes solely from section 3674 of the Political Code, and this section permits the exercise of the power granted only upon the filing of an application containing the specified matters. If the board could acquire jurisdiction by hearing an application, insufficient in its statement of facts, its jurisdiction would then arise from its own acts rather than from the section. If it could waive part of the statutory requirements, it could waive all and thus nullify the entire section. The judgment must be reversed because of the lack of a valid application for reduction. Arapahoe County Board of Commissioners v. Denver Union Water Co., 32 Colo. 382, 76 P. 1060; Northern Pac. Ry. Co. v. Clatsop County, 74 Or. 250, 145 P. 271.

Since their property was admittedly assessable, respondents owed taxes in an amount which could be computed by applying the rate to a fair and equal assessment. Mayor, etc., of Los Angeles v. Los Angeles W. W. Co., supra. In order to constitute a good defense to this action, it was essential that the answer allege either payment or an offer to pay what was due upon a fair valuation of their property as conceded or fixed by the court. County of Los Angeles v. Ballerino, 99 Cal. 593, 32 P. 581, 34 P. 329; Mackay v. San Francisco, 113 Cal. 392, 45 P. 696. The answer in a defective manner attempts to allege a tender and refusal of the correct amount of the tax. The defect, however, is of the kind that could be cured by the findings (San Francisco v. Pennie, 93 Cal. 465, 29 P. 66), but no evidence was presented on this issue nor did the court find thereon. Instead the findings and the judgment exonerated respondents from the payment of any tax. Obviously this unjust result cannot stand.

The judgment is reversed.

GRAY, Justice pro tem.

We concur: TYLER, P. J.; KNIGHT, J.

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