Opinion
No. 7475.
December 14, 1950. Rehearing Denied February 8, 1951.
APPEAL FROM FIFTH JUDICIAL DISTRICT COURT, PARISH OF FRANKLIN, C. J. ELLIS, J.
Warren Hunt, John C. Morris, Jr., Rayville, for appellants.
Anders Anders, Winnsboro, for appellee.
Plaintiff brought this suit for the purpose of setting aside a tax sale which was made by the Sheriff of Franklin Parish on November 5, 1938. Plaintiff alleges he occupied the property as a homestead prior to the sale and that a homestead exemption which was executed before April 15, 1937, relieved him of all obligations for taxes due. In further support of his position plaintiff alleged that no notice of the advertisement and proposed sale of the property for taxes was given; that there was an overcharge in the cost of advertising and in the amount of interest collected by virtue of the tax sale, and, finally, and most important, that the sale was made on the assessment of a tenth of the taxes due for the year 1930, in view of which the lien for same had prescribed.
All of plaintiff's claims as above outlined were denied by defendants, who have further pleaded the constitutional preemption of five years.
After trial there was judgment annulling the tax sale from which defendants have appealed.
The facts are that under the provisions of Act No. 5, § 2, of the Extra Session of 1927, Dart's Statutes, § 8425, providing for the postponement of taxes in the event of a public calamity which would burden a taxpayer with unwarranted hardship, plaintiff made application for postponement of his taxes for the year 1930. The Police Jury of Franklin Parish had authorized the postponement of the taxes for the said year and plaintiff's application for extension was granted. In accordance with the provisions of the Act of 1927 the Tax Assessor for Franklin Parish assessed one-tenth of the 1930 taxes against plaintiff's property for the years subsequent to 1930.
In consideration of plaintiff's homestead exemption, application for which was made and approved in 1937, the only assessment for taxes against plaintiff's property for the year 1937 was the one-tenth installment of the taxes which had been levied in 1930.
The homestead exemption was incorporated in the constitution of the State of Louisiana by amendment in 1934. Accordingly, plaintiff contends that the constitutional exemption as provided by paragraph 9, Section 4, Article 10 of the Constitution was retroactive to the extent that the one-tenth installment of taxes for the year 1930, which was assessed in 1937, was included in the homestead exemption provision, as the result of which plaintiff owed no taxes on his property of any nature, kind or character for the year 1937.
The record in the case before us convinces us with respect to plaintiff's other claims that he did receive notice with respect to the advertisement and proposed sale of his property for the tax assessed in 1937 and that the Sheriff of Franklin Parish followed the prescribed statutory procedure with respect to the advertisement, adjudication and sale. Nor does the record bear out plaintiff's claims as to the overcharge in cost of advertising and interest.
These findings of fact dispose of all questions involved with the exception of the one noted above bearing upon the effect of the constitutional exemption.
We do not think plaintiff's position is well taken. There is nothing in the constitutional provision bearing upon homestead exemptions which indicates that it was intended to have retroactive effect. Article 8 of the Civil Code declares:
"A law can prescribe only for the future; it can have no retrospective operation, nor can it impair the obligation of contracts."
It is quite true that under the modifications of our jurisprudence laws may be applied retrospectively provided such application does not result in impairing the obligation of contracts nor the abrogation of vested rights. But it appears to be well established that the intention of the lawmakers to give retroactive effect to a statute must be expressed in clear and unambiguous terms. City of New Orleans v. Vergnole, 33 La. Ann. 35; City of New Orleans v. Poydras Orphan Asylum, 33 La. Ann. 850.
The constitutional amendment of 1934 does not in any sense even imply an intention of retrospective effect. In our opinion it would be a strained and exceedingly tenuous construction to hold that the amendment abrogated and annulled the right of the State to collect taxes which had been deferred by a beneficent act of the legislature in the interest of the taxpayer long prior to the adoption of the constitutional amendment.
We think the point has been particularly well covered in the opinion of the Supreme Court in Louisiana New Orleans Ice Co. v. Parker, Tax Collector, 42 La. Ann. 669, 7 So. 898. The cited case was an action by plaintiff company to enjoin the seizure of its ice factory by the State Tax Collector for taxes due in the year 1888 on the ground that the amendment to Article 207 of the Constitution exempted said property from taxation and was in force when the tax was levied. The facts showed that due to a delay by the Assessor in filing the tax rolls the constitutional amendment exempting the property from taxes was promulgated prior thereto. The court specifically held:
"The amendment to article 207 of the constitution did not operate retroactively and exempt the property for the tax which rested on it prior to its exemption. State ex. rel. Stern's Fertilizer Chemical Mfg. Co. v. City of New Orleans, 40 La. Ann. 697, 4 So. 891."
The above, in our opinion, is a correct and appropriate expression of law. In the instant case the taxes against plaintiff's property for the year 1930 were levied and payment was due in said year. The fact that plaintiff was accorded the consideration of postponement of the taxes under a provision which spread the payment in installments over a period of ten years did not change the status of the tax nor plaintiff's liability therefor. And since there is not the slightest indication that the constitutional amendment providing for homestead exemption was intended to be retroactive, we cannot conceive that it should be accorded the effect of relieving plaintiff of any taxes except those which might be levied subsequent to the adoption of the amendment.
In view of the conclusion we have reached on the point above discussed, which we think definitely disposes of the case, it seems unnecessary to undertake the consideration of defendant's alternative contention bearing upon the asserted impairment of the obligation of contracts.
As to defendant's plea invoking the constitutional preemption of five years, we call attention to the fact that this plea is appropriate only for the purpose of overcoming the effect of irregularities or informalities in connection with tax sales. Since we have found that all requirements of law were followed, this plea has no application.
For the reasons assigned the judgment appealed from is reversed, annulled and set aside and there is now judgment in favor of defendants, rejecting plaintiff's demands at his cost.
KENNON, J., dissents and assigns written reasons.
I agree with the majority opinion in the findings of fact, but not as to the legal effect of adoption of the 1934 homestead exemption amendment to the Constitution of Louisiana.
The record shows that plaintiff did receive notice that the 1/10th installment of his 1930 taxes due for the year 1937 was unpaid; and that the Sheriff of Franklin Parish followed the procedure prescribed by law in connection with the advertisement, adjudication and sale of plaintiff's property to Dan McEacharn. It is likewise established by the record that during the year 1937 the premises were occupied continuously by his aged father and mother and occupied sufficiently by the plaintiff to support his application for homestead exemption as authorized by the 1934 amendment to the Constitution of Louisiana.
Act No. 5, § 2, of the Extra Session of 1927, Dart's Statutes, § 8425, provides that when there has been a public calamity in any parish of a sort which makes the forcible collection of taxes an unwarranted hardship, the taxpayer upon application may have his taxes for that year postponed. The act further provides that the taxes thus postponed shall be divided into ten equal parts; that 1/10th shall be "assessed" against the immovable property affected for each of the ten subsequent years. In 1930 the Police Jury of Franklin Parish authorized the postponement of that year's taxes in accordance with this 1927 act. Plaintiff's application for extension was granted. In 1937, after plaintiff had made his homestead exemption application, the assessor of Franklin Parish made no assessment against plaintiff's property except for the 1/10th portion of the 1930 taxes, in the same amount as had been collected for the 1/10th installment for the years subsequent to 1930 and prior to 1937. As amended in 1934, the Louisiana Constitution with reference to tax exemption reads as follows:
"From state, parish and special taxes, the homestead, * * * owned and occupied by every head of a family, * * * and the State Treasurer shall be authorized and is directed to reimburse the general or special funds of the State and any of its political subdivisions, police juries, boards, commissions or offices and the City of New Orleans, for any sums which may be lost to the State, its general or special funds and any of its political subdivisions, police juries, boards, commissions, offices and the City of New Orleans, occasioned by reason of the homestead tax exemption herein provided for, out of funds which shall be established and provided for by the Legislature in the Property Tax Relief Fund, said reimbursement to be made pro rata out of said Fund."
My opinion is that the constitutional exemption of taxes, provided by Paragraph 9 of Section 4 of Article 10 of the Louisiana Constitution, applied to the 1/10th taxes of 1930 which had been postponed as authorized by the Franklin Parish Police Jury in accordance with Act No. 5 of the Extra Session of 1927. Therefore, I cannot agree with the holding in the majority opinion that the postponed amount due for the 1930 taxes was not included in the exemption provided in the 1934 amendment for the reason that the 1930 taxes were already due and fixed by virtue of the 1930 assessment, and that the homestead exemption amendment was not retroactive in effect.
Defendants in brief pointed out that all things necessary for the levying of the 1930 taxes had been done during that year; that there was no new determination or evaluation of tax liability or additional tax levied during the ten subsequent years, and that the application for exemption and its acceptance by the state in effect set up a contract between each tax debtor and the state, and that this contractual liability was thereby taken out of the class of a tax liability, and since the obligation was contractual in nature, it was not effected by the homestead exemption providing for exemption of tax liabilities. If this Court should accept defendants' theory that the obligation due by plaintiff for the postponed 1930 taxes was based on contract, and was no longer a tax liability, it would follow that the tax sale would be a valid divestive of plaintiff's title, since a contractual obligation, even in favor of the state, cannot be enforced except through the usual court processes.
My opinion is that the effect of the 1927 act and the postponement procedure for the 1930 taxes was basically nothing more than a changing of the date due, and, since the 1937 installment was a tax liability, the constitutional amendment providing that plaintiff's homestead should be exempted from state, parish and special taxes was applicable to this installment.
Defendants further contended that, since the Police Jury of Franklin Parish had borrowed money from the State Board of Liquidation in 1930, accompanied by a pledge of the postponed taxes, and the Board of Liquidation in turn had issued obligation of the state, the inclusion of these postponed taxes as an exemption under the 1934 amendment would be contrary to the provisions of the Constitution of the United States, which prohibits the passing of any laws which impair the obligation of contracts. I concede the correctness of counsel's contention that state constitutional provisions are laws within the meaning of this provision of the Federal Constitution. However, this provision of the Federal Constitution has not, to my knowledge, been interpreted to mean that the various states of the Union cannot pass laws changing the classification or exemption status of property within the bounds of the state or its political subdivisions, even though there may be outstanding debts and bonds secured by pledge of the receipts from property taxes which are necessarily, to some degree, lessened by the creation of any new class of exempted property or the enlargement of existing exemptions. In the absence of a showing that the inclusion of the postponed portions of the 1930 taxes in the later homestead tax exemption had a real, rather than a theoretical, effect upon the ability of the Parish of Franklin and the State of Louisiana to meet the obligations secured by the pledge of the postponed portion of the 1930 taxes, I believe that the inclusion of the unpaid portion of the 1930 postponed taxes in the taxes exempted by the 1934 constitutional amendment is not violative of the Federal Constitution prohibiting the passage of laws impairing the obligations of contracts.
Being of the opinion that the facts are such as not to make applicable defendants' plea of the preemption of five years, and that the record supports the finding of the District Court that there were no valid taxes outstanding and due against plaintiff's property at the time of the purported tax sale, I believe the judgment setting same aside should be affirmed, and I respectfully dissent from the majority opinion.
Rehearing denied; KENNON, J., dissents.