National Bank of Chemung v. Elmira. own decision. Besides, if there was no special act for taxing shares of stock, the assessors might assess them against the owner under the general power to assess personal property. If so, they had jurisdiction over the subject-matter, and if they erred in assessing it at too high a rate, either because a part of the capital was invested in government bonds, or for any other reason, it was an error merely. This is confirmed by BACON, J., who, in delivering the opinion, said: "That the determination of the assessors to impose the tax, at the rate specified by them, was a judicial determination." At all events, the case is not an authority for protecting officers in the assessment of property contrary to an express statute, and if such a doctrine is inferable from it, I have no hesitation in saying that it should not be followed. While there is some apparent conflict in the application of settled principles to particular cases, I am confident that no adjudged case can be found which will relieve the defendants from liability. The distinction is between an erroneous and an illegal assessment. The former is when the officers have power to act, but err in the exercise of the power; the latter where they have no power to act at all, and it does not aid them to decide that they have. It is argued that they have jurisdiction to determine what property is taxable in the town. This is a mistake. The Legislature determines that question, and the officers have no power over it. The statute requires the assessors to "ascertain, by diligent inquiry," two things: 1. The taxable inhabitants. 2. The taxable property. Where they decide erroneously as to a taxable inhabitant. it is conceded, and the Mygatt Case, 15 N. Y., holds that they are liable as trespassers. Why not when they err as to taxable property? The duty is precisely the same, and the power conferred in the same language. Assessors must have jurisdiction over the person and subject-matter. The person must be an inhabitant of the town, and the property must be taxable. Otherwise, the assessment is illegal and void. The Legislature has declared that the capital of National banks is not taxable property. Bank shares are not capital. 3 Wall. 573. The assessors have therefore no jurisdiction over it. In this case they exercised no judgment; there was none to be exercised. There was no dispute about the facts. There was no pretense of mistake even. They simply decided to violate the statute; and while bad faith will not be imputed, we must assume that they did so voluntarily and intention National Bank of Chemung v. Elmira. ally, and yet such an act is claimed to be judicial, and therefore exempt from collateral attacks. The remedy by certiorari is not adequate. It is dilatory, and rests in the discretion of the court to give it or not. It is appropriate to review erroneous assessments. Taxation for public purposes is a conceded power of government, but it must be enforced strictly according to law, or it becomes the most obnoxious means of confiscation. The rights of the citizen should be sedulously guarded and protected against the lawless imposition of burdens, and the principle involved in this case is vital to the protection of private property from the grasp of irresponsible power. The plaintiff's property has been forcibly taken from it in violation of law, and it would be discreditable to the proper administration of justice not to give an effectual remedy. I think, also, that the deputy county clerk had no authority to take the affidavit of the assessors. The county clerk and his deputy are, with other officers, authorized to administer oaths and take affidavits, with some specified exceptions; and, except when such oaths are required to be taken by particular officers. The oath of the assessors is required to be taken before a justice of the peace of the city, which is a particular officer within the meaning of the statute. The plaintiff can only recover the amount collected by the defendant for city taxes. The city is not liable for the amount collected by the county. The judgment must be reversed and a new trial granted, unless the plaintiff stipulates to reduce the recovery to the amount collected by the city, and, if so modified, the judgment upon the report of the referee affirmed without costs to either party. All concur except GROVER, J., who dissents. NOTE. As to when an injunction will be granted to restrain the collection of a tax, see City National Bank v. Paducah, ante, p. 300; St. Louis National Bank v. Papin, ante, p. 326. In Dows v. City of Chicago, 11 Wall. 108, the Supreme Court of the United States held the collection of a tax would not be restrained on the sole ground that the tax was illegal, but that there must exist, in addition, special circumstances, such as that the enforcement of the tax would lead to a Judgment accordingly. multiplicity of suits or produce irreparable injury, or throw a cloud upon the title to real property. See, also, Heywood v. City of Buffalo, 14 N. Y. 534; Susquehanna Bank v. Supervisors, 25 id. 312; Cook County v. Chicago, etc.. R. R. Co., 35 Ill. 465; First National Bank v. Cook, 77 id. 622. In order that a tax shall constitute an incumbrance or cloud upon the title to real estate the tax must be apparently regular and valid, for if it appear upon the face of the proceedings that National Bank of Chemung v. Elmira. the tax was wholly unwarranted by law, or is for any reason void, or if one knowing the law and every man is conclusively presumed to know the law would be able to see that the tax was invalid, it is no cloud on title. Cooley on Taxation, 542; Detroit V. Martin, 34 Mich. 170; S. C., 22 Am. Rep. 512; Peyser v. Mayor of New York, 16 Alb. Law Jour. 253. Thus a tax under an unconstitutional law is not a cloud upon title and its collection will not be restrained nor will an action lie to recover it back if paid to prevent a sale of the land. Detroit v. Martin, supra. .. It may be stated as a general principle that one who has voluntarily paid a tax cannot recover it back although it was illegally assessed; but that money involuntarily paid on an illegal assessment may be recovered. What constitutes voluntary or involuntary payment? A payment is not generally rendered "involuntary" by a protest of the payer (Flower v. Lance, 59 N. Y. 603); there must be in addition some coercion either in fact or law. Coercion in fact was defined by FOLGER, J., in Peyser v. Mayor of New York, supra, to be that duress of person or goods where present liberty of person or immediate possession of goods is so needful and desirable as that an action or proceedings at law to recover them will not at all answer the pressing purpose." Coercion by law was defined thus: "Where a court having jurisdiction of the person and the subject-matter has rendered a judgment which is collectible in due course. There the party cast in judgment may not resist the execution of it. His only remedy is to obtain a reversal, if he may, for error in it. As he cannot resist the execution of it when execution is attempted, he may as well pay the amount at one time as at another, and save the expense of delay. It may be well to say, that if the judgment is not afterward reversed, but is invalid for any collateral reason, or the process issued upon it is illegal, payment with knowledge of the fact would, perhaps, be voluntary, which seems a sound distinction taken by EMOTT, J., in Lott v. Sweezy, 29 Barb. 87-92." To each case of coercion by law, as is above given, are to be added those quasi adjudications of inferior tribunals, such as assessors of taxes or assessments where their proceedings are regular on their face or on presentation make out a right to have and demand the amount levied, and to collect it in due course of law by sale of goods or municipal lease of real estate." Unless void on their face, they have the force of a judgment; the party is legally bound to pay, and has no lawful mode of resisting. The only remedy is a reversal of the adjudication. Until reversed, they give the collector of the tax the right to take and sell goods, and the assessment remains a prima facie valid lien upon real estate. Thus where a tax was paid in order to prevent the issuing of a warrant of distress with which he was threatened and which would issue of course, unless the tax was paid, the payment was held to be involuntary. Preston v. Boston, 12 Pick 7. And in Boston Glass Co. v. Boston, 4 Metc. 181, it was held-following the above case-that "payment of taxes to a collector who has a tax bill and warrant in the form prescribed by law, is to be regarded as compulsory payment, and if such taxes were assessed without authority, they may be recovered back in an action for money had and received although the party made no protest before payment.' In Grim v. School District, 57 Penn. St. 434, it was said to be settled that "a party who, when threatened with a distress, pays an illegal tax under protest and notice of suit may maintain an action to recover it back; and in Hendy v. Soule, Deady, 400, it was decided that when taxes are paid on demand of an officer having authority to collect them by distraint, there is sufficient duress of the property to make the payment involuntary. But it is to be observed that in these cases the payment was held involuntary because the collector had authority to directly enforce his demand by levy and seizure of property. See further as to voluntary payments, Cooley on Taxation, 566; Burroughs on Taxation, 266; Broom's Legal Maxims.-REP. Van Leuven v. First National Bank. VAN LEUVEN v. FIRST NATIONAL BANK. (54 New York, 671.) Right of National banks to deal in government securities.* Semble, that National banks can deal in and exchange government securities. A CTION to recover the value of United States securities alleged to have been delivered to defendant to be exchanged for other United States securities. The plaintiff having on deposit with the defendant United States 7-30 notes and desiring to exchange them for 5-20 bonds, went to the bank and told Hasbrouck, defendant's president, of his desire. Hasbrouck said: "We will do it. We are doing it for a great many." Plaintiff thereupon got his 7-30 notes from the bank vault and delivered them to Hasbrouck, who gave a receipt therefor, written upon the ordinary bank letter paper, which read : "This is to certify that I have received from C. F. Van Leuven U. S. 7-30 notes, $10,000, which I am to exchange for same amount of U. S. 5-20 bonds and deliver to him. "10,000." J. H. HASBROUCK.” It appeared on the part of defendant, that before the organization of defendant as a bank, Hasbrouck was doing business as a private banker, and that plaintiff then dealt with him in reference to bonds. It also appeared that, prior to the transaction above stated, plaintiff at one time went to the bank and inquired for Hasbrouck, who was out. He then inquired of the cashier in reference to certain bonds which he said were in the bank vault, and showed the cashier a receipt signed by Hasbrouck, the precise form of which did not appear; the cashier informed him that it was the individual business of Hasbrouck, with which the bank had nothing to do. The court, upon these facts, directed a verdict for plaintiff. *In First National Bank v. Ocean National Bank, post, the Court of Appeals of New York said: "No general principle was decided in Van Leuven v. First National Bank, 54 N. Y. 671." This decision was there explained. A memorandum of the case only is given in the 54 New York Reports. Platt v. Beebe. Held (REYNOLDS and JOHNSON, CC., dissenting), no error; that the receipt being given as a part of the transaction and as a voucher merely, and no evidence appearing of an intent to alter the effect of what had been before said, imported simply, when read in the light of the surrounding circumstances, a transaction with the bank, and that it mattered not how Hasbrouck understood it, but the question was how plaintiff did and had the right to understand it; also held, that the dealings between Hasbrouck and plaintiff, before the former became defendant's financial officer, were immaterial, as was also the evidence in regard to the prior receipt. That the business of exchanging government securities was such as a National bank, through its officers, could properly and legally engage in, was held in the prevailing opinion, and was concurred in by all. F. L. Westbrook, for appellant. Samuel Hand, for respondent. EARL, C., for affirmance. LOTT, Ch. C., and GRAY, C., concurred. REYNOLDS and JOHNSON, CC., read for reversal. Judgment affirmed. PLATT V. BEEBE. (57 New York, 339.) Evidence of appointment of receiver of National bank The certificate of the Comptroller of the Currency duly made is sufficient evidence of the appointment of the receiver in an action brought by him.* A CTION by Platt, as receiver of the Farmers and Citizens' Na tional Bank, upon a promissory note belonging to the bank. Upon the trial the plaintiff to prove his title as receiver gave in *See Thatcher v. West River National Bank, ante, p. 622; Tapley v. Martin, ante, p. 611. To the same effect, also, is Merchants' National Bank v. Cardozo, 3 Jones & S. 162. |