The opinion of the court was delivered by: FORMAN
Plaintiffs, Sheridanville, Inc., and Fort Dix Apartments Corporation, are New Jersey corporations. Each leased land from the United States for the purpose of constructing an apartment house project on its reservation at Fort Dix, Burlington County, New Jersey. After the structures were completed the Borough of Wrightstown, a municipal corporation, through its tax collector, I. Haines Crowshaw, and the Township of Springfield, through its tax collector, R. J. Beazley, in the case of plaintiff, Sheridanville, Inc., sought to collect municipal taxes from it and in the case of plaintiff, Fort Dix Apartments Corp., the said Borough of Wrightstown and its collector likewise sought to collect taxes. Thereupon each corporation filed a complaint in this court against the respective municipalities and collectors above named, which and who sought taxes from it.
The complaint of Sheridanville, Inc. is in two counts. In the first count it alleges, among other things, that on March 30, 1951, the then Secretary of the Army (now Secretary of Defense) of the United States, through his agent executed a lease agreement with it wherein there was leased to it approximately 35 acres of land for a term of 75 years at an annual rental of $ 1,150, and by the terms thereof it was required to erect and maintain a housing project of 300 units on a site at Fort Dix within the exclusive jurisdiction of the United States; that pursuant to the said agreement it applied for a mortgage under the provisions of subchapter VIII of Title 12 of the National Housing Act of August 8, 1949, 12 U.S.C.A. § 1748 et seq., and after constructing the housing project leased the apartments to military and civilian personnel as designated by the Commanding Officer of the Fort Dix Military Reservation; that the land leased to it was formerly mainly in the Township of New Hanover, and partly in the Township of Springfield, but pursuant to the provisions of the laws of the State of New Jersey that portion of the land lying within the boundaries of the Township of New Hanover was annexed to the Borough of Wrightstown, N. J. Laws of 1951, c. 182; that no municipal benefits, services or utilities for the project are furnished by the defendant municipalities; that certain facilities are furnished by the military authorities at Fort Dix, electric service is furnished by private public utility corporations and the education of the children of the tenants of the housing project is provided by the Board of Education of the Township of Pemberton, which is fully reimbursed by the United States pending the provision of facilities in the future by the Federal Security Agency, Department of Education of the United States; that the Commissioner of Education of New Jersey has denied the said children admission to local schools upon the grounds that the occupants of the project do not reside in the local school district within the provisions of the laws of New Jersey and the occupants of the housing project have been denied the right to vote because of their military status and nonresidence within the jurisdiction of the State of New Jersey; that there have been sought to be collected by the defendant municipalities the following taxes:
Borough of Wrightstown -- Assessment on
Land Buildings Total Tax
//-- //////--- ///-- /--
1952 $ 5,250 $ 307,500 $ 312,750 $ 15,704.55
Township of Springfield -- Assessment on
Personalty n1 Tax
$ 19,500 $ 1,415.70
1. Later corrected by judgment of
Burlington County Tax Board of
November 14, 1953, to a real estate
assessment in the sum of $ 27,375.
that similar taxes have been levied by the said defendant municipalities for the year 1953; that plaintiff has paid to the defendant Borough of Wrightstown $ 10,559.29 under protest and additional moneys for assessments in 1952 and 1953; that the executions of said taxes are illegal and void and the plaintiff seeks recovery of the moneys paid and an injunction restraining the collection of any other moneys alleged by the municipalities to be due and of any other future assessments or taxes.
In Count 2 of the complaint levelled at the Borough of Wrightstown and its tax collector plaintiff, Sheridanville, Inc., among other things alleges that it leased apartment units to military and civilian employees at rental rates governed and determined by the Commissioner of the Federal Housing Administration and approved by the military authorities at Fort Dix; that by the terms of its agreement with the then Secretary of the Army its lease is for the improved land described therein and plaintiff did not lease the improvements which are now erected thereon because they were not in existence at the time of the execution of the lease, by the terms of which they are not a part of the leasehold estate, but title to them is expressly vested in the plaintiff; that the plaintiff is a mere licensee of the United States and because of the limitations imposed upon plaintiff under its agreement it is in effect a management agreement not subject by taxation by the defendants; that by collateral agreements the plaintiff is entitled to a proportionate increase in the maximum rental rates to offset increases in the operating costs of said housing units and the burden of taxes imposed by the Borough of Wrightstown will fall directly on the tenants of said housing project and plaintiff prays for relief against the Borough of Wrightstown similar in nature to that requested in Count 1.
The complaint of the Fort Dix Apartments Corp. is in one count and is similar to that of Sheridanville, Inc. Details of its agreement vary in that its lease was alleged to have been executed April 24, 1952 for approximately 28 acres of land at a yearly rental of $ 100; that title to the buildings which have been constructed remain in the United States and plaintiff owns neither land nor buildings on which the taxes have been levied for the year 1953 in the total sum of $ 18,150.72, representing an assessment on the land of $ 4,050 and on improvements for $ 306,750.
The County of Burlington and the New Hanover Township Board of Education sought and were granted permission to intervene in each case. They and the defendants filed answers and the issues joined came to trial upon stipulations of facts signed by all of the parties and oral testimony offered at a hearing.
Pertinent portions of stipulations filed by the parties in both suits follow:
'For the purpose of alleviating the acute housing shortage which existed at the Fort Dix Military Reservation at Fort Dix, New Jersey, and to increase rental housing accommodations available to military and civilian personnel at said military reservation, the Secretary of the Army (now Secretary of Defense) of the United States of America, through his duly authorized agent, on March 30, 1950 [as to Sheridanville, Inc., and on April 24, 1952 as to Fort Dix Apartments Corp.] executed a lease agreement, pursuant to authority under the Act of August 5, 1947, Chapter 493, Section 1 and Section 6, 61 Stat. 774 and 61 Stat. 775, 10 U.S.C. 1270 and 1270d, and also Subchapter VIII of Title 12 of the National Housing Act of August 8, 1949, 12 U.S.C. 1748 &c., with the plaintiffs wherein the United States of America, among other things, leased to the plaintiff the following described lands:'
'The agreement, a copy of which is attached hereto as Exhibit A, leased to the plaintiff said lands for a term of 75 years from the date thereof at the annual rental of $ 1,150.00, [in the case of Sheridanville, Inc., and $ 100 in the case of Fort Dix Apartments Corp.] and required the plaintiff, among other things, to erect, maintain and operate a housing project, consisting of approximately 300 units, to be located on the Fort Dix Military Reservation at Fort Dix, New Jersey.' (Paragraph 3 in each stipulation.)
'Pursuant to the terms of said Agreement, the plaintiff applied for a mortgage under the provisions of Subchapter VIII of Title 12 of the National Housing Act of August 8, 1949, 12 U.S.C. 1748 &c., and thereafter erected and constructed a housing project consisting of approximately 300 units, and after completion thereof, leased said apartment units to such military and civilian employees as designated by the Commanding Officer of the Fort Dix Military Reservation. At the present time all of said 300 units are leased to military personnel stationed on Fort Dix Military Reservation, and the said units are occupied by the said military personnel and their families.' (Paragraph 4 of Sheridanville, Inc. stipulation and Paragraph 8 of Fort Dix Apartments Corp. stipulation.)
'The land leased to the plaintiff was formerly situate mainly in the Township of New Hanover, County of Burlington, and State of New Jersey, and partly in the Township of Springfield, County of Burlington and State of New Jersey, but pursuant to the provisions of the laws of the State of New Jersey, Laws of 1951, Chapter 182, that portion of the land lying within the boundaries of the Township of New Hanover was annexed to the Borough of Wrightstown.' (Paragraph 5 of Sheridanville, Inc. stipulation and Paragraph 9 of the Fort Dix Apartments Corp. stipulation, in which, however, no reference is made to the Township of Springfield.)
'Title to all or a portion of said lands was acquired by the United States of America by condemnation proceedings in the District Court of the United States for the District of New Jersey entitled United States of America v. Wilbur G. Davis, et al., No. M130a, wherein judgment on the Declaration of Taking was entered on October 16, 1940 and recorded in the Office of the Clerk of Burlington County in Deed Book 926, Folio 446. Judicial notice of said proceedings may be taken by the Court.' (Paragraph 6 in each stipulation.)
'By letter dated December 31, 1941 Honorable Henry L. Stimson, then Secretary of War, notified Honorable Charles Edison, they Governor of New Jersey, that the United States accepted jurisdiction over the said lands acquired by condemnation proceedings effective as of January 8, 1942 at 10:00 A.M. which letter stated that the transfer of such jurisdiction had been authorized by virtue of the provisions of the Act of Legislature of New Jersey appearing as Sections 1, 2 and 3 of Title 52, Chapter 30, Revised Statutes of New Jersey, 1937. By endorsement dated January 2, 1942, Honorable Charles Edison, then Governor of New Jersey, acknowledged receipt of the said letter. * * *' (Paragraph 7 in each stipulation.)
'In 1951, the defendant, Borough of Wrightstown, through its agent, I. Haines Crowshaw, Collector of Texas, for the Borough of Wrightstown, levied a real estate assessment for 1952 against the plaintiff on real estate purportedly owned by the plaintiff and located within the Borough of Wrightstown; the defendant, Borough of Wrightstown, through its tax assessors, evaluated land purportedly owned by the plaintiff for the sum of $ 5,250.00 and evaluated buildings owned by the plaintiff for the sum of $ 307,500.00, for a total valuation of land and improvements in the sum of $ 312,750.00; the total tax assessment by the defendant, Borough of Wrightstown on the property of the plaintiff amounts to the sum of $ 15,074.55 for the year 1952; said defendants in 1952 levied a similar assessment under similar circumstances on real property of the plaintiff for the year 1953 for a total tax assessment of $ 18,264.60.' [The total tax assessment against Sheridanville, Inc. for 1953 amounted to $ 18,150.72] (Paragraph 9 in Sheridanville, Inc. stipulation and Paragraphs 11 and 14 in Fort Dix Apartments Corp. stipulation.)
'The plaintiff has paid to the defendant, Borough of Wrightstown, the sum of $ 10,559.29, under protest, for the tax assessment for 1952, and upon the representation by said defendant that said taxes were valid, the plaintiff has also paid additional moneys under similar circumstances for tax assessments for both 1952 and 1953.' (Paragraph 10 of Sheridanville, Inc. stipulation.)
'In 1951, the defendant, Township of Springfield, through its agent, R. J. Beazley, Collector of Taxes for the Township of Springfield, levied an assessment on personal property owned by the plaintiff in the housing project for the year 1952 and has evaluated the personal property at the sum of $ 19,500.00; the total tax assessment by said defendants amounts to the sum of $ 1,415.70 for the year 1952. Said defendants have levied a similar tax against the personal property of the plaintiff for the year 1953, in the sum of $ 1,388.40, but the plaintiff has made no payment toward either of said personal property taxes.' (Paragraph 11 of Sheridanville, Inc. stipulation.)
'The land upon which the housing project of the plaintiff is located is situated mostly within the boundaries of the Borough of Wrightstown and partly within the boundaries of the Township of ...