Judicial Views On Tax Administration

• Author: Charles F. Conlon
• DOI: 10.1177/106591296301600101
• Published date: 01 March 1963
• Date: 01 March 1963

JUDICIAL VIEWS ON TAX ADMINISTRATION
CHARLES F. CONLON
National Association of Tax Administrators, Chicago
N
OUR day-to-day operations we are prone to act routinely; and too often
~ habit, rather than a conscious application of fundamental principles, deter-
mines the manner in which we discharge our functions. For that reason, it
might be well to preface this discussion with a few statements from the decided
cases in order to indicate the essential nature of tax collection procedures in the
light of Anglo-American judicial concepts.
First of all, a tax as such is quite different from an ordinary debt due the
state, and the collection of taxes is not limited by the judicial procedures pre-
scribed for the collection of debts. Historically, the legislature is free to establish
summary procedures for the collection of taxes through the executive branch of
the government and without recourse to the courts; and even where there is re,
course to the courts, there is no right to a jury trial on the part of the delinquent
or recalcitrant taxpayer. Here are a few excerpts from judicial opinions in which
the nature of the tax collection process is described:
Taxes have not, as a general rule, in this country since its independence, nor in England before
that time, been collected by regular judicial proceedings. The necessities of government, the na-
ture of the duty to be performed, and the customary usages of the people, have established a dif-
ferent procedure, which, in regard to that matter, is, and always has been, due process of law.’
The collection of taxes is not, however, the mere collection of a debt, but is a sovereign act
of the state to be exercised as may be prescribed by the legislature. Whether the tax is collected
by an action in court, or by summary sale by the tax collector, is immaterial. The state through
its legislature can avail itself of the judicial power as the means by which it will collect the tax,
and in such proceedings it may prescribe such procedures as may best avail for that purpose,
irrespective of the mode of procedure provided for the determination of controversies between
individuals, just as it may avail itself of the executive branch of the government by authorizing
the sheriff to sell the property upon which the taxes are delinquent, without requiring him to
pursue the same course as is required in sales upon judgments between individuals.’
At common law in this country and in England taxes were not collected by regular judicial
proceedings. Since a judicial proceeding to collect taxes was not even a recognized form of action
at common law, it follows that the designation by the legislature of such a proceeding as an
&dquo;action at law&dquo; does not carry with it the right of a trial by jury.’
it is well settled in other
...
jurisdictions that there is no right under the general consti-
tutional provisions to a jury trial in statutory or summary proceedings for the collection of taxes.
(Citations.) 4
Finally, there is that well-known declaration of the United States Supreme Court:
But taxes are the life-blood of government, and their prompt and certain availability an imperious
need. Time out of mind, therefore, the sovereign has resorted to more drastic means of collec-
NOTE : This paper was presented at the annual meeting of the Western States Association of Tax
Administrators, Sun Valley, Idaho, October 4, 1961.
1

Kelly v. Pittsburg, 104 U.S. 78, 80 (1881).
2

People v. Central Pacific R.R. Co., 105 Cal. 576, 589, 38 P. 905, 908 (1895). People v. Skinner, 18
Cal.2d 439, 115 P.2d 488 (1941) is the modern leading California case on this subject.
3
Sonleitner v. Superior Court of Los Angeles County, 158 Cal. App.2d 258, 262, 322 P.2d 496,
499 (1958).
4

Ibid., pp. 260, 497.
5
5

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tion. The assessment is given the force of a judgment, and if the amount assessed is not paid
when due, administrative officials may seize the debtor’s property to satisfy the debt.5
I trust you noticed the careless reference in this opinion to a debt rather than a tax.
This is the sort of slip that makes life bright for the lawyers and no doubt both the
winner and his opponent duly noted it for possible use on another day.
It is an interesting point that the first of the statements quoted above was
made in a case decided by the United States Supreme Court more than eighty
years ago while the comments with reference to regular judicial proceedings and
jury trials appeared in a state court case decided about three years ago. During
this period we have passed from an era when taxation was a relatively simple
matter -
customs duties and a few internal excises at the federal level and most-
ly property taxes at both the state and local levels -
to one where it is com-
plex, burdensome, and all-pervasive. Yet, remarkably enough, the statement of
the underlying principle governing tax collection procedures in 1958 is not sub-
stantially different from that handed down in 1881.
This recital is not intended to give the impression that the courts do not play
an important role in the field of taxation. Far from it -
they do, as we all know.
Even though the legislature has a free hand, within constitutional limitations, in
prescribing assessment and collection procedures, the courts exercise the primary
functions of interpreting the legislative mandate and seeing to it that administra-
tive officials discharge it properly. In some states, the courts may in fact be an
important element in the assessment process, for example, where review of a
determination of the tax administrator lies in a proceeding de novo in a district
or county court or other lower court of general jurisdiction. Thus both directly,
through interpretation of the law, and indirectly, by reviewing administrative
determinations, the courts do have a significant influence on the administration
of tax laws.
DISCRIMINATORY ASSESSMENTS
The impact of the judicial power on tax administration has been amply
demonstrated in recent years in the property tax field where a number of state
courts have recognized the right of a property owner to some specific relief from
a discriminatory assessment even though his assessment is not in fact in excess of
the legal standard. Rulings to that effect have been handed down in Illinois,
Kansas, Minnesota, Missouri, Nebraska, New Jersey, Oregon and South Dakota,
among other state.
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5

Bull v. United States, 295 U.S. 247, 259-60 (1935).
6
ILLINOIS: People ex rel. Hillison v. CB&Q
R. Co., 22 Ill-2d 88, 174 N.E.2d 175; People ex rel.
Kohorst v. GM&O
R. Co. and People ex rel. Kohorst v. CNW Ry. Co., 22 Ill.2d 104, 174
N.E.2d 182 (1961). Cf. People ex rel, Callahan v. GM&O
R. Co. 8 Ill.2d 66, 132 N.E.2d
544 (1956) and CB&Q
R. Co. v. Department of Revenue, 17 Ill.2d 376, 161 N.E.2d 838
(1959).
KANSAS: Kansas City Southern Railway Company v. Board of Commissioners of Cherokee
County, 183 Kan. 675, 331 P.2d 899 (1958).
MISSOURI: Koplar v. State Tax Commission, 321 S.W.2d 686 (Mo. 1959).
MINNESOTA: Hamm v. State, 95 N.W.2d 649 (Minn. 1959) overruling State v. Cudahy
Packing Co., 103 Minn. 419, 115 N.W. 645, 1039 (1908).

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One may surmise that the judiciary decided to emphasize uniformity (equal-
ity within the class) over the legal standard because it finally became apparent
that discriminatory assessment practices flourished and became even more...