GULLY v. MATTHEWS

Maynard, Fitzgerald Venable, of Clarksdale, for appellant.

The question for decision in the case is whether or not the state revenue agent, having instituted suits for the collection of delinquent taxes against certain defendants, and having joined the tax collector, as required by Section 6995, Code of 1930, the tax collector has the authority to bring in his own name independent suits against the same delinquent taxpayer defendants. The Chancellor was of the opinion that he did have such authority. The Circuit Judge was of the opinion that he did not. Our thesis is that he lacked such authority.

Chapter 20, Laws of 1935.

In the taxation of ordinary property, specific property is assessed and described on the rolls, and the amount of tax fixed. With respect to privilege taxes, this is not possible. The ordinary tax assessor, busy with his other duties, is not capacitated to keep up with privilege taxes, and where men are going into business or quitting business, or taking on new branches of business at all times during the year, it is absolutely necessary to have some officer charged with the duty of finding out who is liable for the privilege tax and with the duty of collecting it. By the privilege tax laws, this duty is imposed upon the sheriff and tax collector of the county, and his duty is an active continuing one.

Sections 246, 247 and 261, Laws of 1935.

There could be no negligence and failure to collect without negligence in failing to ascertain who was liable, this from the very nature of the case.

Sections 248, 250 and 263, Laws of 1935.

It is seen from these various provisions that the law requires the sheriff and tax collector to be continuously active to find out who is liable for privilege taxes and to collect them, and that it is the purpose of the statutes to see to it that no person shall conduct a taxed business without paying the proper privilege. This duty is an active, continuous and continuing one and for failure to perform it the officer becomes liable for the tax, together with the penalty.

Appellee says that it never occurred to him that slot machines, which were gambling devices, were subject to privilege tax, until he talked to Mr. Mayrant Adams, Deputy Tax Collector. This is somewhat remarkable since the privilege tax law itself says that the illegality of slot machines shall not be a defense against paying privilege tax, and the legality of such a tax on an unlawful business has been decided to be valid.

State v. Romback, 112 Miss. 737.

It is respectfully submitted that according to the testimony of appellee himself, he knew that these slot machines had been operating in Coahoma County and the City of Clarksdale for many months, in fact for many years. It is admitted that he took no sort of steps or action to collect the taxes; that the taxes were due under the law. He says he did not know that he could collect them, but if this could be true it grew out of his negligent failure to acquaint himself with the duties of his office, and he took no steps of any kind, shape, form or fashion to collect the tax or to prevent the operation of the machines without their payment by instituting prosecutions. It is impossible for us to see how, under such circumstances, there was not either a wilful or negligent failure to collect the taxes.

When the state tax collector files his suit against a delinquent taxpayer, and joins the tax collector therein, or does not join him, the only rule by which the efforts of the state tax collector can be guarded against frustration is by giving the state tax collector exclusive right to bring suit and to deny to the alleged negligent sheriff and tax collector the right either to control the suit instituted by the state tax collector, or institute a similar one in his own name against the same defendant.

Robertson v. Bank of Batesville, 116 Miss. 501; Robertson v. Monroe County, 118 Miss. 541.

The policy of the law is that the citizen shall not be harassed by unnecessary suits about the same matter. Upon this notion of fairness and justice is based the right to plead a first suit in abatement of the second, to be exercised for the protection of the citizen, and also the rule in equity which allows certain procedure in order to prevent a multiplicity of suits, all reflecting the general notion that where one suit is adequate, others shall not be brought.

Robertson v. Monroe County, 118 Miss. 541.

If it be admitted for the sake of argument that the appellee as sheriff and tax collector of Coahoma County was an officer authorized to sue for the collection of privilege taxes, though the privilege tax statutes do not confer such power, it was never contemplated that he should have such privilege or authority after suit for such taxes had been filed by the tax collector.

Section 6996, Code of 1930.

Wherever the state tax collector sues a taxpayer under the command of the statute, he must join as defendant the assessor and tax collector, and in the case of privilege taxes, since the tax collector is also the assessor and becomes liable for a tax negligently omitted to be collected, he and the delinquent taxpayer are jointly and severally liable for the amount of the tax.

Assuming a case where a tax had not been collected because of wilful default or negligence, and the state tax collector should bring suit against the delinquent taxpayer and the sheriff, the cause of action against the sheriff and his liability for the amount of the taxes and fifty per cent damages under the privilege tax statute, has already accrued. To permit him to bring a separate suit, after he himself is sued, against delinquent taxpayers and to recover judgment would be against the policy of the statute. In the first place, if judgment which he had obtained against the taxpayer was not collected, assuming that he prosecuted the suit in good faith and obtained a judgment, such judgment would not be res adjudicate of the fact that if he had proceeded promptly with the collection of the tax when due, he could not have collected it, and hence could not serve as a defense to him in a suit by the state tax collector. The delinquent taxpayer, in our opinion, could not plead the judgment against him as a defense in a suit by the state tax collector, because a second suit cannot be plead in abatement of a first one.

U.S.F. G. Co. v. Dedaux, 168 Miss. 791.

If we be correct that the bringing of the first suit by the state tax collector withdraws the authority of the sheriff to bring suit for the same tax against the same defendant, then a judgment obtained by the tax collector could not be plead in the suit by the state tax collector, because the agent, the sheriff and tax collector, in bringing his suit was acting beyond the scope of his employment.

Pico v. Webster, 12 Cal. 140; 34 C.J., sec. 1448.

Nor could the judgment obtained by the sheriff serve as a bar to the proceedings against him by the state tax collector for wilful or negligent failure to collect the tax when due.

Section 261, Laws of 1935.

The tax collector under the statute does not become a surety for the delinquent taxpayer but a co-debtor, so no right to bring an independent suit can be based on the reasoning that the suit is justified on the ground that the tax collector being made secondarily liable, he has a right to compel the delinquent taxpayer as one primarily liable to discharge the debt.

Certainly, where a tax collector has been guilty of wilful default or negligence in the collection of taxes to such an extent that he is made a party defendant to a suit and has become by force of law co-debtor for the tax, he is not a proper officer to conduct litigation for its collection.

It is respectfully submitted that the sound rule is, and we believe that this court has already in effect announced it in the cases cited, that the first officer who brings the suit gains exclusive control, not only of the suit brought but of the cause of action so that other suits cannot be brought by other officers to collect the same tax.

Roberson, Cook Luckett, Brewer Montgomery, and Charles A. Sisson, all of Clarksdale, for appellee.

The institution by the state tax collector of suits against the county tax collector and certain individual defendants did not divest the county tax collector of authority to institute suits against those same defendants. The statute unquestionably gives the county tax collector authority to institute the suits now pending in the county court.

The case before the court does not present a situation wherein an officer is seeking to interfere or intervene in a suit previously brought by another officer. The appellee did not seek to inject himself in the suits filed on behalf of the appellant. The complaint is that he brought suits against certain citizens of Coahoma County in an effort to collect the taxes which the appellant says are owing to the State of Mississippi and its subdivisions. The chancellor of the lower court found that, in bringing such suits, the appellee was acting in good faith and in an honest effort to collect such taxes. No wonder the chancellor refused to enjoin the appellant from performing what is plainly his duty under the law. What reason can be advanced why this court should stop the appellant in the prosecution of his suits? It makes no difference to the State of Mississippi whether such taxes are collected by the appellant or the appellee. It should applaud the efforts of both. It should do everything it can to furnish appellee's litigation to the end that it may receive all taxes due to it.

Griffin v. Board of Miss. Levee Com'rs., 71 Miss. 767; 1 American Jurisprudence, page 27.

This court will understand that licenses such as are being sought to be collected are different from ordinary taxes. They are not assessed by the tax assessor and never appear on the rolls. The law does not provide any machinery whereby an individual alleged to owe the tax can protest the assessment, and if his protest is denied, appeal to a court. In other words, the individual charged with the tax has no day in court to protect himself against a wrongful assessment. To levy a distress warrant under such circumstances would be, to say the least, unfair, unjust and probably illegal.

McBride v. Adams, 12 So. 699, 70 Miss. 716.

It should make no difference to the court or to the State of Mississippi whether the taxes owing to it are collected by the county tax collector or the state tax collector. If there is any choice between the two, it seems to us that the State would prefer that the taxes be collected through the ordinary channels. Certainly the court should not enjoin a tax collector from attempting to collect taxes unless constrained so to do by a statute or the prior decisions of this court. The appellant points to no statute. The cases he points to hold no such thing. We, therefore, submit that the decree of the lower court should be affirmed.

Argued orally by W.W. Venable, for appellant, and by Charles A. Sisson and Semmes Luckett, for appellee.