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Superior Court of Cincinnati.



Section 5850, provides that * * "actions to recover back taxes and assessments must be brought against the officer who made the collection, or, if he is dead, against his personal representative."

These sections have been construed in Stephan v. Daniels, 27 Ohio St., 527, and Wilson v. Pelton, 40 Ohio St., 306, and have been held to confer a right of action, having only an imperfect existence before their enactment, to recover from the collecting officer taxes illegally levied and collected by authority and process of iaw. To such a right of action, however, it is a good defense that the taxes were so paid as to be a voluntary payment. At common law, a recovery of taxes illegally collected could only be recovered on an allegation thai they were collected under duress of person or property. In other words, the only difference which I can see between the recovery of taxes illegally cried, under the statute now, and at common law, when the latter right of action existed at all, is that it is not an essential elemeut of plaintiff's case under the statute that the taxes were paid involuntarily, and voluntary payment is a defense, whereas at cominon law the declaration and plaintiff's proof must have shown the payment to have been involuntary. Under the statute taxes illegally levied, where collected by process of law, are presumed to be involuntarily paid, and the burden of proof to show that they were voluntary is on the defendant. At common law there was a presumption that taxes were voluntarily paid, and the burden to show compu sion was on the plaintiff. In this view, the allegation of the plaintiffs that the taxes now sought to be recovered, were illegally placed upon the duplicate of the county, and the defendant as county treasurer, required them to pay the same, would be a sufficient statement to entitle the plaintiffs to recover the taxes so paid, and the demurrers must be overruled unless the petition contains facts which make out the defense of voluntary payment. The only additional facts pleaded are that when the taxes were paid a protest was entered on the ground tlıat they were collected in violation of the constitution of the United States; and that payment was made to avoid the heavy penalities imposed by law for failure to pay them, on the officers and agents of the company, amounting to a complete destruction of its business. Certainly these facts do not make out a defense of voluntary payment to rebut the presumption of involuntary payment from the preceding allegations. The demurrers must be overruled and the defendant given leave to answer, when he can set up the defense of voluntary payment. But if it be admitted that I am wrong in my deductions from the cases of Stephan v. Daniels and Wilson v. Pelton, and that the common law rule prevails requiring the plaintiffs to make out a case of involuntary payment, I am still of the opinion that the petitions state a good cause of action. The language of the petitions is that the plaintiffs were "required by the defendant to pay the tax." Construing this language in its ordinary sense it would mean that the treasurer had made demand of the plaintiffs with the duplicate as his warrant authorizing him to seize the personal property of the plaintiffs, and summarily sell tbe same for taxes. Section 2838. Paynieut on such a demand would be an involuntary payment. Preston v. Boston, 12 Pick., 14; Nichodemus v. East Saginaw, 25 Mich., 456; Atwell v. Zeluff, 26 Mich., 118; Glass Co. v. Boston, 4 Metc., 181. But even if it be admitted that the construction most favorable to the defendant must be given to the petition, and it means that the plaintiffs after making the return of their gross receipts as required by sec. 2778, went to the treasurer's office and without demand made payments of

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Express Co. v. Rattermann.

the taxes assessed thereon, protesting against them as in violation of the constitution of the United States, and paying them only to avoid the penalties and consequent destruction of their business imposed in sec. 2843 for a delinquency in payment, I am of opinion that this payment as made was involuntary.

In Mays v. Cincinnati, 1 Ohio St., 268, it was stated as a general rule, that “to make the payment of an illegal demand involuntary, it must be made to appear that it was made to release the person or property of the party from detention or to prevent the seizure of either by the other party having apparent authority to do so, without resorting to an action at law."

This rule was modified in Baker v. Cincinnati, 11 Ohio St., 534, where Judge Gholson shows that the authorities warrant broader language, and that a payment may be involuntary if there be au immediate and urgent necessity, or the payment is made for the purpose of redeeming or preserving one's person or property. In that case, the city exacted from the plaintiff, as a charge for a license to give theatrical exhibitions for six montlıs, $63.50, and a fee of $1.00 for issuing the license. Plaintiff alleged that the $63.50 was illegal, but fearing prosecution for violating the ordinances of the city, by giving theatrical exhibitions in the city without license, and moved by the heavy penalities for violating the same, paid the whole amount, under protest against the right of the city to exact the sanie. This payment was held to be involuntary, as made under an immediate and urgent necessity. Judge Gholson says: "These cases sliow that money may be properly held to have been paid involuntarily or under coercion, where the position or interests of a party were such as co require from another the performance of a duty enjoined by law, and he was illegally compelled to pay the money to induce such a performance. Undue advantage is not to be taken of the party's situation.” Now, in the case at bar, the tax imposed on the gross receipts of a foreign express company, is a required payment for the privilege of doing business in this state, and a delinquency of twenty days in the payment thereof, excludes the company from the state, and makes all agents and railroads doing its business thereafter, liable to fine and imprisonment. Telegraph Co. v. Mayer, 28 Ohio St., 521. Payment of the tax required for such a purpose, is exactly like the purchase of the license in Baker v. Cincinnati.

Without a hearing in court upon the question of legality of the tax, the business of the company must cease, or its employees run the risk of being wrongdoers and criminals. It seems to me that under such a section of penalties, payment of the tax, however illegally levied, is made under an urgent and immediate necessity.

In Catoir v. Watterson, 38 Ohio St., 319, where by the Pond Law a saloon keeper was required to pay a tax at a certain time, and give bond, or his continuance in business thereafer without doing so would make him subject to fine and imprisonment, it was held that his payment under protest of the tax to avoid these penalties was involuntary and entitled him to recover the tax so paid, the Pond Law being unconstitutional

In Western Union Telegraph Co. v. Mayer, supra, the plaintiff sought to recover taxes paid under the very sections we are considering (sec. 2778 and 2843) accompanied by a protest against their legality, to avoid the penalties of sec. 2843, and the Supreme Court held that such

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Superior Court of Cincinnati.


payment was not voluntary because of the total exclusion of the company from business on default of payment without a day in court.

It is claimed by counsel for the state that the case of Western Union Telegraph Co. v. Mayer is distinguishable from the one at bar for two reasons: 1st, because the return here was made without protest, while there it was made under protest; 2d, because the protest covered the whole tax in the Mayer case and the hypothesis of the court was that the whole tax was illegal, while at bar the protest covers the whole tax and only part is illegal, the treasurer having no means of dividing the receipts to receive what was lawfully due. I can not see how the voluntary making of a return can reflect upon the character of the payment made thereafter. A commendable desire to comply with the law as far as possible without making payments whose enforcement was unconstitutional might very well induce such voluntary return. The protest in this case was against the whole tax on receipts on the ground that it was in violation of the constitution of the United States. Part of the tax was sound illegal on that ground. Judge Johnson says in Stephan v. Daniels, supra. "It is said the object of a notice of such suit, or of payment under protest, is that the officer may protect himself. If, on inquiry, he finds the demand illegal he may decline to proceed, or if he collects, he may withhold the money from payment until the question is settled.” Was the protest in this case not enough to call the attention of the defendant to the fact that the plaintiffs relied on the very ground upon which they have urged their suit i. e. the conflict of the tax with the federal constitution, and thus to enable him if he considered the ground doubtful to withhold the payment of the money received until the question was decided? It would be unreasonable to require that a protest shall state the objection to the tax with as much particularity as a petition for injunction. Even in such a petition the failure to separate state and interstate receipts has not made the petition bad on demurrer. The question of voluntary payments is to be determined by the law of Ohio. The decisions of the Ohio Supreme Court on this subject are not entirely in accord with each other. When we look at decisions in other states, we find even a wider conflict. An examination of all the Ohio cases, however seems to me to clearly show that the payment at bar was involuntary. Counsel for the county treasurer relies on the case of McKean v. Whitbeck, in which our Supreme Court held, by a divided court, two judges dissenting, that plaintiff who had paid the Scott Law tax under protest could not recover it back after the law had been declared uncon. stitutional. The case is not reported, presumably for the reason that three members of the court constituting the majority did not agree upon the ground for their conclusion. It is certain that two of the majority, Judges McIlvaine and Johnson, regarded the Scott Law as constitutional, (see Butzman v. Whitbeck, 42 Ohio St., 223), and on that ground they might well have refused to give judgment for the recovery of the tax paid. The judgment in the case, therefore, can have no weight as an authority upon the question of voluntary payments. Moreover the Scott Law, unlike the Pond Law, and the statutes imposing a tax on foreign tele. graph and express companies now under discussion, did not make a fail. ure to pay the tax and subsequent conduct of the business a misdemeanor punishable by fine and imprisonment. As to the second ground urged in support of the demurrer, namely that the change in the decisions of the United States Supreme Court gives rise to an estoppel against recovery of the tax, it can not apply to the June, 1887, tax, because the


Express Co. v. Rattermann.

decision in the Philadelphia Steamship Co. v. Pennsylvania, 122 U. S., 326, in which the court reversed its former decision and declared the tax on interstate receipts unconstitutional, was rendered in May, 1887. As to the December, 1886, tax, it is sufficient to say that it does not appear from the petition that the tax received by the defendant has ever been turned over to the various public corporations entitled to it, or that they have ever incurred expense relying on this tax as a means of defraying it. If these facts can raise an estoppel as to which I find it unnecessary to express an opinion, they should be raised by answer. The demurrers to the petitions will be overruled.

Lawrence Maxwell, Jr., for the Express Companies.

Thomas McDougall, and Wm. A. Davidson, county solicitor, for Rattermann.



[Hamilton Common Pleas, April Term, 1889.) JAMES O'DONNELL ET AL. V. MARY M. HOLDEN ET AL. A tract of land having been conveyed to John B. Purcell, Archbishop of the Cin

cinnati Diocese of the Roman Catholic Church, for a nominal consideration, and the evidence showing the plot was so conveyed for the use and benefit oi a particular congregation, to-wit, The St. Gabriel's Church of Glendale, and that they have taken possession of it, occupied, improved and used it for church and school purposes. Held, that the archbishop could not mortgage

it to secure his individual debt. MAXWELL, J.

The history of the case is briefly as follows: John B. Purcell, the late Archbishop of the Roman Catholic Diocese of Cincinnati, was individually indebted to John T. Hooper in the sum of one thousand dollars, upon a promissory note, made, as was shown by the testimony, for money borrowed prior to March 3, 1878. The affairs of the archbishop being in a desperate condition, Hooper through his attorneys made an effort to obtain security. The result of this effort was that on March 5, 1879, the archbishop, executed a mortgage, dated on the third. I do not know that the fact of apparent discrepancy between the date and the execution of the mortgage cuts any figure in this case, in the way I view it. I do not assume that it reflects in any way on the manner in which the mortgage was given. The mortgage itself was dated on the third and the note corresponding with it was also dated on the third. The archbishop's assignment or conveyance to his brother was made on the fourth, and the mortgage was not actually acknowledged and I may assume executed until the fifth; but whether there had been a valid assignment or not, in my view of it, makes no difference. This mortgage covered lots 7, 8, 10 and 11 in Gross and Dietrich's subdivision in Glendale, and was made to secure a note payable in one year after date, which was in effect a renewal of the old note. The note and mortgage were not paid when due, and on March 6, 1880, that would be, I assume, the last day of grace, Mary C. Holden claiming to be the assignee of the note and mortgage, brought suit in case 61694 against John B. Purcell, Edward Purcell and John B. Mavnix, assignee for the benefit of credit

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ors, to fureclose the mortgage, and such proceedings were had that on April 16, 1880, immediately after default was made, a judgment and order of sale were taken. July 23, 1880, after the expiration of the term at which the judgment and order of sale were taken, the plaintiff in this case moved to set aside the judgment and order of sale. The plaintiff in this case was the pastor of what was known as St. Gabriel's church, at Glendale, which claimed to be in occupation of this property, and the other plaintiffs joining with him in the case were trustees or acting in some such capacity with reference to the church. On June 22, 1881, the plaintiff in case 61694, that is, Mary G. Holden, assigned the decree in that case to William F. Goodrich. October 9, 1886, a new motion to set aside the judgment in 67694 was filed, and upon that a number of new parties representing the St. Gabriel's church were brought into the case. December 2, 1886, the order of sale was returned and nled, and a motion to confirm was made; also a motion to set it aside. December 31, 1886, an entry was made confirming the sale and overruling the motion to set it aside. This case was appealed to the circuit court and there the judgment was affirmed evidently upon the ground that the motion to set aside the judgment was filed after the term, and that 110 remedy could be had in that way.

William F. Goodrich, purchased the property at the sale, and assigned his bid to W. Austin Goodnan, who took the title, as he claims, as trustee for himself and Goodrich. That is to say, when the case was finally closed, the deed to the real estate was made to him, and he held it for himself and for Goodrich, to whom the decree had been assigned by Mary G. Holden.

The case at bar is number 63460. It was brought November 20, 1889. It was brought by James O'Donnell, the plaintiff in this case and others claiming to be interested in the church on behalf of the Roman Catholic church of St. Gabriels, to set aside the mortgage above described, and the proceedings in foreclosure upon it, upon the ground that John B. Purcell as archbishop held the lands in controversy in trust for the St. Gabriel's church, and had no right of authority to mortgage or convey them for his individual benefit; and further claiming, that the mortgage was made to secure his individual debt. Issue was joined upon this claim by the point answer of W. Austin Goodman and William F. Goodrich, and the case was submitted upon the issue so made up.

There was no controversy, as I understand the case, with reference to the claim made by O'Donnell and others, that the debt of Hooper was an individual debt of John B. Purcell. At any rate, there is no testimony to show that this debt was in any way connected with this church, or was incurred for the benefit of this church, or in any way connected with the property.

It was a matter of public notoriety that Edward Purcell was carrying on what might be called a banking business, and it would appear that John B. Purcell was to some extent connected with that business, and in the course of time a very large indebtedness was incurred which, whether or not it had been incurred originally for the benefit of the diocese, became finally an individual indebtedness' of John B. Purcell and Edward Purcell by the manner in which they transacted the business. So I assume in this case that this Hooper claim was an individual liability of John B. Purcell.

In disposing of the case I shall assume certain facts to be proved; and I shall assume certain propositions of law to be settled by the late

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