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Switz v. Township of Middletown

Decided: March 11, 1957.

OLIVIA WRIGHTSON SWITZ, PLAINTIFF-RESPONDENT,
v.
TOWNSHIP OF MIDDLETOWN, IN THE COUNTY OF MONMOUTH, A MUNICIPAL CORPORATION, WILLIAM C. JOHNSON, ASSESSOR OF THE TOWNSHIP OF MIDDLETOWN, AND MONMOUTH COUNTY BOARD OF TAXATION, DEFENDANTS-APPELLANTS



On certified appeal from the Appellate Division of the Superior Court.

For modification -- Justices Heher, Oliphant, Burling and Weintraub. For affirmance -- Chief Justice Vanderbilt, and Justice Jacobs. For reversal -- Justice Wachenfeld. The opinion of the court was delivered by Heher, J. Weintraub, J. (concurring). Wachenfeld, J. (dissenting). Vanderbilt, C.J. (dissenting). Mr. Justice Jacobs has authorized me to say that he joins me in this dissent. Jacobs, J. (dissenting). Weintraub, J., concurring in result.

Heher

By summary judgment for the plaintiff entered in the Superior Court in this proceeding in lieu of the prerogative writ of mandamus, the defendant assessor of the Township of Middletown was directed to "value and assess" all taxable real property in the township for the year 1957 and subsequent years "by uniform rules and according to the same standard of value, which standard shall be the full and fair value of such real property and at the price at which, in his judgment, such property would sell for at a fair and bona fide sale by private contract on October 1st of the preceding year"; and the defendant Monmouth County Board of Taxation was enjoined, "by May 1, 1956 in accordance with law, to investigate, revise, correct and equalize all assessments made" by the defendant assessor of taxable property in the township for the tax year 1956 "and subsequent years" and, in particular, to revise, correct and equalize all such assessments by "uniform rules and according to" the given standard of "full and fair value."

And the assessor was directed, in the event the county board "should require him so to do," "in accordance with R.S. 54:4-16 and other applicable statutes," to "make up and prepare corrected tax lists and duplicates for the tax year 1956 under the supervision of said board, * * * in which corrected tax lists and duplicates he shall comply with the directions of said board and shall value and assess all real property subject to taxation" in the township by the same standard of "full and fair value."

The defendant township was ordered to "appropriate in accordance with law, such monies as may reasonably be necessary and required by it and by" the defendant assessor "to comply with the foregoing."

By way of cross-claim, the township and the assessor alleged that on September 28, 1955 the Director of the Division of Taxation, "in the further performance of his duties under N.J.S.A. 54:1-35.1, determined the average ratio of assessed value to true value of the real property in each of the other 51 municipalities in the County of Monmouth";

that the "percentages in each case were less than 100% of true value," and there was no appeal from this determination by any of the municipalities, and the time for appeal had expired; that the assessors of the other municipalities of the county "are now preparing or shortly will prepare and file" their respective real property assessment lists and tax duplicates for 1956, and in the event of judgment in accordance with the prayer of the complaint, "these defendants will be required to bear a disproportionate and excessive portion of the taxes and tax burden" of the county; and that "it is the duty" of the county tax board to investigate, revise, correct and equalize "all assessments in all taxing districts" in the county "so that all tax assessments are determined by uniform rules and according to the same standard of value, and annually to ascertain and determine, according to its best knowledge and information, the general ratio or percentage of full value at which the real property of each taxing district is assessed" and to "prepare an equalization table showing the assessed valuation of the real property in each district and the ratio or percentage by which the assessed valuation shall be increased or decreased in order to correspond to true value"; and there was a demand that if judgment be entered against the township and the assessor in accordance with the complaint, the county tax board be ordered to "investigate, revise, correct and equalize" "all assessments made by the various assessors and assessing agencies of taxable property" in the several taxing districts of the county for 1956 and thereafter, "so that the valuation of real property in each district, as equalized, shall be determined to be the true valuation of such property in computing the total ratables of each district for all apportionments of County and State taxes for distribution of money."

The cross-claim was dismissed.

On defendants' joint appeal the Appellate Division, 40 N.J. Super. 217 (1956), affirmed the judgment, save as modified (a) "to relieve all parties of its mandate" for the year 1956; (b) to vacate the "mandatory order to compel

fulfillment of the [county] board's statutory duty in the future"; and (c) to "show a dismissal" of the cross-claim "without prejudice."

We certified the judgment for appeal on defendants' motion.

It was stipulated in the trial division: (1) the defendant assessor had filed with the county board of taxation "his 1956 Tax List and Duplicate for the defendant Township," "prepared in accordance with the same general practice and procedure that was employed by said assessor for 1955 and prior years," and "In making such assessments" he "believed that he was following the practice of other tax assessors throughout the County and State"; (2) the "assessments therein contained are less than 100% of the full and fair value of the assessed properties as of October 1, 1955 and less than 100% of the prices at which the assessed properties would have sold for at a fair and bona fide sale by private contract on October 1, 1955"; and (3) on September 28, 1955 the Director of the Division of Taxation, "in the further performance of his duties under N.J.S.A. 54:1-35.1, et seq., determined that the average ratio of assessed value to true value of the real property in the Township is 15.45%," as alleged in paragraph 10 of the complaint, and in his investigation resulting in this determination, the Director "considered 862 current sales of property made in said Township reported to him by the defendant assessor," the "total amount of all such sales" being $9,268,037, and "the total amount of the assessments upon the properties so sold," but $1,385,575, as alleged in paragraph 11 of the complaint, and these averments "are admitted with respect to the 1955 assessments, and the determinations of the Director [are] also generally applicable to the aforesaid 1956 assessment list."

The complaint also alleged: (1) the Sixth Report of the Commission on State Tax Policy "disclosed that residential property" in the township "was assessed at 14% of true value," and "commercial and industrial property * * * at 18% of true value"; (2) the Director, in fixing the amount of school aid to which the township was entitled, "had, on October 1, 1954, determined that real estate in

the Township was being assessed at 16% of true value"; (3) the county board, "in the performance of its duty to equalize 1955 assessments in the various separate taxing districts" of the county "had determined that for the year 1955 no change should be made in the assessments made by the defendant assessor"; and (4) 124 of the 862 current sales considered by the Director in his determination of September 28, 1955 represented sales of vacant land, and the 1955 assessments on such lands varied from 6.04% of the sales price to 80% thereof; 728 sales involved residences, and the 1955 assessments thereon varied from 3.08% of the sales price to 80%; 5 concerned farms, the assessment variation here being from 10.43% of the sales price to 35.16%, and 5 real estate of other classifications, the assessments varying from 10.10% of the sales price to 30.97%.

The complaint further declared that plaintiff's property was assessed at $31,000 for 1955, and had "all real property in the Township been assessed by uniform rules, then, by applying the Director's ratio of 15.45%, the true value of plaintiff's property would be in excess of $200,000"; that the property "was not worth such sum," and plaintiff "was the subject of discriminatory assessment" and was "being required to bear a disproportionate and excessive share of the taxes and tax burden of the Township."

I.

The appellants contend at the outset that the "mandatory judgment to compel assessment on a true value basis constitutes an abuse of legal discretion because such action is likely to operate to the detriment rather than the benefit of the public."

It is said in argument that, generally, mandamus issues to "compel a public official to perform a ministerial act or duty prescribed by law," to "compel the doing of a specific thing," while here the purpose is to require the adoption of a "course of official action," albeit a "course required by statute and imposed upon the official by law," that would call for the court's general supervision of "official conduct"

and in "numerous instances" a determination whether the particular officer has, "to the extent of his power, carried out the mandate of the court," -- in a word, a continuous superintendence of duty performance for an "indefinite time," involving a "general course of official conduct for a long series of continuous acts to be performed under varying conditions" and "recurrent yearly controversies as to whether the order has been complied with," a course alien to the nature of mandamus, citing 34 Am. Jur., Mandamus, section 74; Hawkes v. Gates, 129 N.J.L. 5 (Sup. Ct. 1942); and that there is the even more compelling "substantive reason," as distinguished from the "procedural" and the "discretionary," that the process is designed to remedy rather than promote a wrong, "to compel the performance of a duty which ought to be performed, not to direct an act which will work a public or a private mischief, or which will be within the strict letter of the law, but in disregard of its spirit," and may not be had "under the guise of enforcing a public right," "if in fact it will operate to the detriment rather than to the benefit of the general public, or cause great disorder and confusion in the fiscal affairs and duties of the officers of a public or quasi -public corporation," or if "public injury or embarrassment might" otherwise "result from the issuance of the writ," again citing 34 Am. Jur., Mandamus, section 35.

The reasoning denies the thesis that the "century old practices of assessors of assessing property at less than true value throughout the State can thus now," by this proceeding, "be readily remedied because tax assessors now have the tools at hand, through the data collected by the Director of the Division of Taxation, to achieve this objective," of which more hereafter; and it is said that "In considering the ramifications and complexities of the assessment problem," it is to be borne in mind that "widespread inequities are not confined to disparities in assessment ratios between the various taxing districts of each county, and between the individual property owners," and "Much greater dislocations in the economy of the State may result from the process

of equalizing disparities as between assessment ratios applied to different classes of properties by various municipalities," e.g., "* * * it seems generally conceded that many urban municipalities traditionally assess industrial property at substantially higher percentages of value than residential property," sometimes explained, it is said, as a device employed by "urban municipalities * * * to delay, if not prevent, the gradual exodus of their residential population to the rural and suburban areas," in which category "probably falls the practice of assessing railroad property at 100% while using a different and lower percentage for other property," although, on the other hand, it has been said that "rural and suburban communities often seek to attract industrial enterprises from the cities through tax concessions."

Conceding such practices are indefensible, and "it would be folly to deny they have existed and have been tolerated," it is nevertheless insisted that it "would be dangerous to assume" that these usages "which have been embodied in tax policies can be removed without a violent shock to our economy," and the question raised is stated to be whether the "major surgery required to eliminate such wholesale inequities can be accomplished through judicial fiat, and whether, if it can be accomplished, this Court should undertake the task."

In none of the 567 municipalities of the State is real property assessed at full value. This is not a recent development; it has always been thus. And the Director of the Division of Taxation has found, as the result of a sales-price study, that the assessment ratio for 1956 ranges from a high of 70.8% to a low of 7.8%.

The generally accepted limitations upon the exercise of the ancient extraordinary remedy of mandamus obtain in New Jersey. It is a coercive process that commands the performance of a specific ministerial act or duty, or compels the exercise of a discretionary function, but does not seek to interfere with or control the mode and manner of its exercise or to influence or direct a particular result. Mandamus lies to compel but not control the exercise of

discretion. Roberts v. Holsworth, 10 N.J.L. 57 (Sup. Ct. 1828); Benedict v. Howell, 39 N.J.L. 221 (Sup. Ct. 1877). Unless the particular duty be peremptory, the fair use of judgment and discretion is the province of the functioning authority. The right of the relator and the public duty sought to be enforced must be both clear and certain. Uszkay v. Dill, 92 N.J.L. 327 (Sup. Ct. 1919); Edward C. Jones Co. v. Town of Guttenberg, 66 N.J.L. 58 (Sup. Ct. 1901), affirmed Id., 66 N.J.L. 659 (E. & A. 1901); Clark v. City of Elizabeth, 61 N.J.L. 565 (E. & A. 1898). Mandamus issues "to compel the performance, in a specified manner, of ministerial duties so plain in point of law and so clear in matter of fact that no element of discretion is left as to the precise mode of their performance, but as to all acts or duties depending upon a jurisdiction to decide questions of law or to ascertain matters of fact, on the part of the officer or body at whose hands their performance is required, mandamus will not lie." Mooney v. Edwards, 51 N.J.L. 479 (Sup. Ct. 1889).

Mandamus is a legal remedy for the protection of purely civil rights. Time has worked changes in the early commonlaw concept of mandamus as a prerogative writ. The modern tendency is not to treat it as a prerogative writ save when invoked in matters of direct concern to the public, but as an ordinary writ of right to remedy official inaction. In New Jersey, prior to the adoption of the 1947 Constitution, the issuance of the writ ordinarily involved the exercise of a sound discretion; but in the enforcement of private rights the lawful exercise of discretion excluded mere caprice or arbitrary action and required that the rights of the parties in the particular case be declared and enforced according to law.

Yet, for the furtherance of essential justice, the allowance of the remedy of mandamus is governed by well-defined considerations of policy. The process issues to redress and not to promote a wrong; to command the performance of a duty which ought to be performed, not to coerce an act which will work a public or private mischief,

or will be within the strict letter of the law, but in disregard of its spirit. It may be refused where the result will be "disorder and confusion, * * * or where the rights of third persons will be injuriously affected"; and, controlled as it is by equitable principles, and by due regard to the public interest, mandamus will ordinarily be refused where compliance with the writ would "work a public injury or embarrassment, just as in its sound discretion a court of equity may withhold relief where it would be prejudicial to a paramount public interest." Beronio v. Pension Commission of City of Hoboken, 130 N.J.L. 620 (E. & A. 1943). See McCormick v. City of New Brunswick, 89 N.J.L. 117 (Sup. Ct. 1916). Although the remedy of mandamus is at law, "it may be refused for reasons comparable to those which would lead a court of equity, in the exercise of a sound discretion, to withhold its protection of an undoubted legal right"; and the court, "in its discretion, may refuse mandamus * * * to give a remedy which would work a public injury or embarrassment, * * * just as in its sound discretion, a court of equity may refuse to enforce or protect legal rights, the exercise of which may be prejudicial to the public interest." United States ex rel. Greathouse v. Dern, 289 U.S. 352, 53 S. Ct. 614, 77 L. Ed. 1250 (1933).

The essential nature of the extraordinary remedy of mandamus has not been altered by the 1947 Constitution. By Article VI, Section V, paragraph 4, prerogative writs "are superseded" and, "in lieu thereof, review, hearing and relief" shall be afforded in the Superior Court, on terms and in the manner provided by rules of the Supreme Court, "as of right, except in criminal causes where such review shall be discretionary." (Italics supplied) The writs themselves are superseded; but the substantive jurisdiction remains the same.

In historic perspective, the significance of the constitutional provision is clear. At the common law, until the statute of 9 Anne, c 20, the award or refusal of a peremptory writ of mandamus on the return to an alternative writ was not

reviewable on error, for reasons which need not be set down here. See Kenny v. Hudspeth, 59 N.J.L. 504, 527 (E. & A. 1896); also Reg. v. Lambourne Valley R. Co., L.R. 22 Q.B. Div. 463, 16 Eng. Rul. Cas. 788. By statute and the practice in New Jersey, the award or refusal of a peremptory mandamus was deemed discretionary and not subject to review on error unless, by a moulding of pleadings on an alternative writ, return and judgment, as in personal actions, the rights of the parties were determined, and then a writ of error would lie according to the course of the common law. Kenny v. Hudspeth, supra; for the practice, see Silverthorne v. Warren Railroad Co., 33 N.J.L. 173 (Sup. Ct. 1868).

Save where the constitutionality of a statute was involved, R.S. 1937, 2:83-15, the award or refusal of a writ of peremptory mandamus on the return of a rule to show cause, and not by judgment on pleadings moulded under an alternative writ, was not reviewable on error or by the later appeal. Trinkle v. Donnelly, 98 N.J.L. 298 (E. & A. 1922); Mannino v. Moffett, 108 N.J.L. 545 (E. & A. 1932); Layton v. State, 28 N.J.L. 575 (E. & A. 1860); City of Camden v. Public Service Ry. Co., 84 N.J.L. 309 (E. & A. 1913). The proceedings on mandamus were then "largely within the discretion and control of the court," and the court could "decline to hear the application for a writ unless in the alternative form, and the power of the court on the hearing of a rule to show cause and, after the decision, to direct an issue by proper pleadings to provide for a review by writ of error [was] unquestionable." Clark v. City of Elizabeth, supra. And the granting of leave to proceed to judgment by the alternative form also involved the exercise of judicial discretion. Roberts v. Hetrick, 125 N.J.L. 633 (E. & A. 1941); Piaget-Del Corporation v. Kulik, 134 N.J.L. 147 (Sup. Ct. 1946); Kenny v. Hudspeth, supra.

Such was the character and quality of mandamus under the 1844 Constitution and before, although, as indicated in Beronio v. Pension Commission of City of Hoboken, supra, there was even then a tendency so to regard the proceeding

only when the subject-matter was of direct concern to the public, and otherwise as an ordinary writ of right.

So also, the allowance and refusal of the prerogative writ of certiorari, and the vacating of an allocatur, involved the exercise of judicial discretion not reviewable on error. State v. Wood, 21 N.J.L. 682 (Sup. Ct. 1847); State v. French, 24 N.J.L. 736 (E. & A. 1853); Daniel B. Frazier Co. v. Long Beach Township, 110 N.J.L. 221 (E. & A. 1933); Post v. Anderson, 111 N.J.L. 303 (E. & A. 1933); Strobel Steel Construction Co. v. Sterner, 128 N.J.L. 379 (E. & A. 1942), certiorari denied 317 U.S. 656, 62 S. Ct. 53, 87 L. Ed. 527 (1942); Burlington County v. Martin, 129 N.J.L. 92 (E. & A. 1942); Staubach v. Cities Service Oil Co., 130 N.J.L. 157 (E. & A. 1943); Gallena v. Scott, 1 N.J. 430 (1949). No matter how meritorious the cause, the denial of the writ was final. It was the inadequacy of the state remedy that moved the federal court to take jurisdiction in Hillsborough Township, Somerset County, N.J. v. Cromwell, 326 U.S. 620, 66 S. Ct. 445, 90 L. Ed. 358 (1946).

And granting or refusing leave to file an information in the nature of a quo warranto also concerned the exercise of discretion not subject to review, although by statute it became a writ of right in certain cases. State ex rel. Mitchell v. Tolan, 33 N.J.L. 195 (Sup. Ct. 1868); Clark v. Searing, 70 N.J.L. 517 (Sup. Ct. 1904); Conover v. Old, 80 N.J.L. 535 (Sup. Ct. 1910); Robibero v. Hillery, 137 N.J.L. 96 (Sup. Ct. 1948); Pellecchia v. Mattia, 118 N.J.L. 512 (Sup. Ct. 1937). See R.S. 1937, 2:84-1; N.J.S. 2 A:66-6.

In short, the constitutional regulation concerns the right to invoke this extraordinary jurisdiction, but not the substantive principles governing the right to relief, such as, e.g., the time-honored dictates of equity and the limitations imposed in the essential public interest. See Evans v. Villani, 19 N.J. Super. 86 (App. Div. 1952).

II.

We come now to the ultimate question of the propriety of directing the local assessor to assess the taxable real property

of the municipality at "full and fair value" and at the price at which, in his judgment, such property "would sell for" at a "fair and bona fide sale by private contract on October 1st of the preceding year."

"All property real and personal" within the jurisdiction of the State, save as otherwise expressly provided, is subject to taxation annually "at its true value, and shall be valued by the assessors of the respective taxing districts," R.S. 54:4-1, as amended. The taxable personal property shall include "only tangible goods and chattels," except as otherwise provided by R.S. 54:4-20, 54:4-21 and 54:4-22. Omitted property is assessable by the county board of taxation. R.S. 54:4-47.

The local assessor is ordered to identify the owners of all real property situate in the taxing district, and to determine "after examination and inquiry" the "full and fair value of each parcel of real property * * * at such price as, in his judgment, it would sell for at a fair and bona fide sale by private contract" on the prior October first. R.S. 54:4-23, as amended.

The "tax on all tangible personal property," except as otherwise provided, "shall be assessed in and for the taxing district where the property is found." R.S. 54:4-9, as amended. The assessor "shall annually ascertain by diligent inquiry and by the oath of the persons to be assessed and others" the names of all the persons taxable in his district and the "true value of all the personal property therein." R.S. 54:4-12.

This standard of "true value" did not have its genesis in legislative discretion; it was a mandatory rule of action by force of the amendment to the 1844 Constitution adopted in 1875, Article IV, Section VII, paragraph 12, directing that "property" "be assessed for taxes under general laws, and by uniform rules, according to its true value." But now, by the 1947 Constitution, Article VIII, Section I, paragraph 1, it is ordained that property shall be "assessed for taxation under general laws and by uniform rules," and "All real property assessed and taxed locally or by the State

for allotment and payment to taxing districts shall be assessed according to the same standard of value," and "taxed at the general tax rate of the taxing district in which the property is situated, for the use of such taxing district."

But there has been no alteration in the peremptory statutory assessment criterion of true value. Yet the basic concept is the same. The dominant principle of the new constitutional mandate is equality of treatment and burden; and this was the genius and spirit of the old provision as well. The standard of true value is but a means of realizing uniformity and equality, the preeminent consideration in the apportionment of the tax burden in virtue of the constitutional guaranties of due process and the equal protection of the laws. Were the rule of the State Constitution of a radically different import, the equal protection clause of the Fourteenth Amendment would prevail, for the right of equal treatment thereby secured protects the individual from state action making for discriminatory imposts not laid on others of the same class. Baldwin Construction Co. v. Essex County Board of Taxation, 16 N.J. 329 (1954). As there observed, one of the statutory provisions implementing the true value standard of the old Constitution, R.S. 54:3-13, enjoined the county board to "secure the taxation of all property in the county at its true value, in order that all [taxable] property * * * shall bear its full, equal and just share of taxes."

The framers of the 1947 Constitution had this basic principle in view. It is mathematical truth that in this regard there can be no essential difference between true value and a common ratio of true value applicable alike to all in the same class. In either event, the base is true value, and the assessments are in fact made according to the same standard of value. The question is whether there are variations of ratio making for substantial inequality in the distribution of the burdens of government violative of basic right. "Common" ratio imports equality in the incidence of the tax, the equality of burden that is of the essence of the constitutional precept. As said in Baldwin, the common assessment ratio was from the beginning given recognition

under the old constitutional and statutory standard of "true value." The direction for the assessment of property "under general laws, and by uniform rules, according to its true value," the standard laid down in the 1875 amendment to the 1844 Constitution, "requires, and is fulfilled by such regulations as should impose the same percentage of its actual value upon all the taxable property in the township for township purposes, in the county for county purposes, and in the state for state purposes." Stratton v. Collins, 43 N.J.L. 562 (Sup. Ct. 1881), Dixon, J. See State Board of Assessors v. Central R. Co., 48 N.J.L. 146, 307 (E. & A. 1886), Dixon, J.

But this is not true of the "average" assessment ratio of true value, an arithmetical mean of varying ratios of true value, necessarily making for unequal proportions of value between the individual property owners and thus for the inequality of treatment and burden obnoxious to basic principle.

The general disregard of the full true value standard has given rise to problems that cannot be solved overnight. Sudden and drastic changes in the long-established practice could work great detriment to community fiscal life; the everlasting temptation to spend may be given free reign; and care must be taken that the mandamus process shall not be made the instrument of confusion and the unsettling of the local economy and even greater intra- and inter-county inequality.

The problem is now one of deep public concern. There is evident apprehension of harsh economic dislocation that may be averted by an orderly and systematic approach to the basic administrative deficiencies in the assessment process, such as are not remediable at one fell swoop but rather by specialized and considered judgment after full inquiry, bearing in mind the new constitutional principle of assessments according to the same standard of value.

The Legislature has taken cognizance of the essential fault and the public need, and is seeking for the remedy. December 20, 1956, a concurrent resolution jointly introduced

by seven Senators, Messrs. Jones, Dumont, Crane, Shershin, Forbes, Murray and Fox, was adopted by the Legislature requesting the Commission on State Tax Policy to "undertake a special study of the impact of enforced assessment of real property at 100% of its true value upon tax rates, the taxation of personal property, municipal and school debt limits, State aid formulas, special taxes based upon real property assessments, existing exemptions and general tax revenue requirements of counties and municipalities," and to "report specially to the Governor and the Legislature its findings and recommendations for temporary, transitional and permanent changes, if any, in the entire State tax structure which the results of its study dictate to be desirable or necessary for equitable distribution of the total imposition of State and local taxes," not later than the first week of December 1957, and such interim reports "as its study shall dictate."

These are the recitals embodied in the resolution: "Recent developments relating to the taxation of real property in respect to the assessment thereof according to its value have again called attention to the imperative necessity for a re-examination of the state of the law upon this subject"; "Large numbers of the citizens and taxpayers of the State are deeply concerned over the potential requirement that assessments of real property be substantially raised in many taxing districts"; "Concern exists as to whether assessment of all real property throughout the State at full true value may create a redistribution of the tax burden not readily foreseen"; and "Many citizens and taxpayers have petitioned the Legislature to give consideration to the need for a revision of the statutory law in respect to the assessment of real property according to the standard of true value."

We respect these findings of the lawmaking branch of the government; the problem is basically legislative and administrative.

And, moreover, a hurried general assessment at full true value would not be conducive to common and individual right. A sales-assessment ratio study cannot for obvious

reasons be determinative of true value in the statutory sense. Furthermore, the market value is evidential but not the exclusive criterion; it is not the invariable test of true value. Special circumstances may "increase or depress market value without affecting true value or vice versa." Harborside Warehouse Co., Inc., v. Jersey City, 128 N.J.L. 263 (Sup. Ct. 1942), affirmed 129 N.J.L. 62 (E. & A. 1942); Universal Insurance Co. v. State Board of Tax Appeals, 118 N.J.L. 538 (Sup. Ct. 1937); Newark v. Tunis, 82 N.J.L. 461 (E. & A. 1911); North Bergen Township in Hudson County v. Bergen Boulevard Holding Co., 133 N.J.L. 569 (E. & A. 1946); L. Bamberger & Co. v. Division of Tax Appeals, 1 N.J. 151 (1948). "Value for the purposes of taxation has some measure of permanency which renders it secure against general temporary inflation or deflation." City of Newark v. West Milford Township, 9 N.J. 295 (1952).

The sales-assessment ratio data do not provide the basis for an intra-municipal true value assessment of individual parcels of real property. Division Director Neeld, a perspicacious public servant in this intricate field of government, in an article published in New Jersey Municipalities, January 1956, " The Gibraltar Case -- Full True Value Assessments," affirmed that "Sales-assessment ratio data are usable for two basic purposes: a -- To test the quality of the assessment roll of a district, and b -- To approximate the aggregate true value of real property within a district for various apportionment purposes," and "are not intended nor considered to be useful for the purpose of making full value assessments against specific parcels of real property." He demonstrated that "* * * sales ratio data are [an] inappropriate source material for the development of assessment rolls on a full-true-value basis," for, he said, "in the taxing districts different classes of real property, such as vacant land, residential property, farm land and commercial and industrial property are assessed at different percentages of true value," and, moreover, "if a district's ratio is 20%, a multiplier of 5 applied to the aggregate assessed valuation will produce an approximate aggregate full true value for the district,

it does not follow that the application of such a multiplier to individual items will move the assessment on each property in the district to full true value," since this would be so "only in the event that each assessment was already at precisely 20% of true value," and the 20% in fact "represents merely the average ratio of assessed to true value of all of the properties on the roll which necessarily means that there are many with ratios far above and many with ratios far below this average," and while such data "will have value in aiding the administrative agencies to determine the existence of inequalities within a district, and may even assist the courts in dealing with cases involving alleged discrimination, nevertheless, such data cannot be employed as a substitute for the expertness, judgment and discretion required in formulating an original assessment for each parcel of property on a full true value basis."

The sales-assessment ratio data have been used for equalization by the aggregate method for the apportionment of county taxes among the municipalities, and the proportional distribution of state school aid. See Gibraltar Corrugated Paper Co. v. North Bergen Township, 20 N.J. 213 (1955); City of Passaic v. Passaic County Board of Taxation, 18 N.J. 371 (1955); Borough of Totowa v. Passaic County Board of Taxation, 5 N.J. 454 (1950).

Recognizing the complexities of inequality in the sharing of the tax burden, the public exigency, and the inadequacy of local assessing facilities, 99 of the State's municipalities have had professional "revaluations" made since 1950 of their taxable real property by outside specialists in the field and "new assessment rolls prepared," 20 taxing districts now have underway such "revaluation programs," as distinguished from "reassessment" procedures, and 15 others are about to engage in revaluation projects. This, according to a recent report of the Local Property Tax Bureau of the State, which declares also that "it is worthy of note that assessors in several districts have personally carried out extensive reassessments in an effort to eliminate inequalities to the best of their ability and judgment," but "(t)hese are

not considered a satisfactory basis for a revision of an assessment roll at a distinctly different ratio than is in effect at present." Newark, for instance, has contracts for this professional service at a cost in excess of $430,000. See Alboum v. City of Newark, 22 N.J. 571 (1956). By L. 1956, c. 48, N.J.S.A. 40:50-9, the municipalities are now empowered to enter into contract for the "preparation and execution of a complete program for revaluation of real property for use of the local assessor, * * *." Revaluation is not a mere arithmetical process.

Certainly, the court would not direct a mandamus to the assessors of the several municipalities who have undertaken a revaluation program; and the defendant municipality should not be treated differently, nor denied the time thus given to others for the same purpose. Yet we shall not vacate the judgment. The inquiry as to true value shall proceed, but the mandate otherwise shall not apply to the tax years 1957 and 1958, thereby to afford the Legislature the opportunity to take such measures and provide for such administrative procedures as its own inquiry may prove to be essential to the public interest, and to allow the Township time needed for the fulfillment of the project. It is shown that the municipality comprises 38 square miles and has 12,306 individually assessed properties, of which 800 represent new subdivisions, new buildings, and so on, and the directed "reassessment" would be an "obvious physical impossibility" within the time allotted.

Neither local debt limitations nor the impact upon revenue of assessments at true value in relation to the public utility gross receipts tax is of major concern in this inquiry, for the Legislature has full power to provide for an immediate adjustment of the particular statutes to the altered local economy. It is the magnitude of the task of revaluation and the danger of windfall inflationary spending that counsels so strongly against drastic and abrupt action -- the likelihood of even greater discrimination by hasty and ill-considered assessments and the disposition to spend when "new" revenues are at hand, measured by the old tax rate, restrainable only

by a statutory tax ceiling or "freeze" in accordance with the old rate mathematically readjusted, a measure that could prejudice local fiscal action and work serious injury to the individual taxpayers and hardship in other directions, but one that at all events calls for the studied consideration of the legislative authority when all the facts and circumstances are known.

The readjustment will take time, but it should not be unduly prolonged; and so the inquiry as to true value should proceed meanwhile, for, whatever the ratio, the base of real property assessments for taxation is generally its value, and prompt action to this end will not be wasted effort or useless expense.

And the local authorities are admonished that the current assessment statutes, ante, place real and personal property in the one category, to be assessed at "true value." The assessment of real property at full value and tangible personal property at less would violate the statutory rule of equality. And we allude again to the element of inequality attending the fulfillment of the judicial mandate in but one municipality of the county, and the obvious need of joint action under the one standard by all such municipalities when the time arrives, requiring that they be made parties to the action, if need be to secure the requisite uniformity.

The plaintiff will have her remedy in the statutory tribunals for transgressions meanwhile of her ...


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