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Siegal v. City of Newark

Decided: June 29, 1962.

JACOB SIEGAL, MARY WEINSTEIN, ELI WALLACH AND MAY RAVITT, PLAINTIFFS-APPELLANTS,
v.
CITY OF NEWARK, RESPONDENT-RESPONDENT, AND DIVISION OF TAX APPEALS, DEPARTMENT OF THE TREASURY, RESPONDENT



For reversal -- Chief Justice Weintraub, and Justices Jacobs, Francis, Proctor, Hall, Schettino and Haneman. For affirmance -- None. The opinion of the court was delivered by Weintraub, C.J.

Weintraub

Appellants claim their property was assessed for 1958 and 1960 above the "common level" of assessments of other real property. In answers to interrogatories the city stated that "residential" property was assessed in those years at a "common level" of 40% of true value while "commercial and industrial" properties were assessed at a "common level" of 70%. Appellants' property is in the latter category. The Division of Tax Appeals ordered a reduction to 70% of true value. We certified the further appeals to the Appellate Division.

Appellants' right to relief from the original assessments is not disputed. The sole issue is the measure of it. The city contends, and the Division of Tax Appeals agreed, that the reduction may not go below the level of assessment of other properties in the same class, whereas the taxpayers urge the assessments must be reduced to the level of the favored class, "residential," i.e., 40%. We are unable to agree with either view.

The city's position was heretofore advanced in In re Kents, 34 N.J. 21 (1961). We had no occasion to decide its validity, but what we said anticipated what we now hold. We there observed (at pp. 30-31):

"* * * Other suggestions are advanced by amici curiae who, upon their application made after the argument of the case, were permitted to file briefs. It is urged that where the assessor uses different ratios for different classes of property, a reduction should not be ordered below the ratio the assessor applied to the class in which the parcel in litigation belongs. So also, they suggest that

if land is generally assessed at a uniform level while improvements are assessed at another and even sundry levels according to classifications of such improvements, the several existing ratios should be separately applied to the component parts of the challenged assessment. Thus they urge that existing classifications, although contrary to law, should be recognized for the limited purpose of litigation of this kind. We know of no authority to support these proposals, see Bemis Bros. Co. v. Claremont, 98 N.H. 446, 102 A. 2 d 512 (Sup. Ct. 1954); Chastain's Inc. v. State Tax Commission, 72 Idaho 344, 241 P. 2 d 167 (Sup. Ct. 1952); Anderson's Red & White Store v. Kootenai County, 70 Idaho 260, 215 P. 2 d 815 (Sup. Ct. 1950); Sears, Roebuck & Co. v. State Tax Commission, 214 Md. 550, 136 A. 2 d 567 (Ct. App. 1957), but we need not now pass upon the questions thus hypothetically projected. We do however stress the principle that relief from unequal treatment will be granted, and this upon an appropriate basis requiring the individual taxpayer to prove no more than sensibly can be expected of him."

We think it plain that to limit relief to the level of assessment of properties in the same category would be to join in the very illegality which the Constitution prohibits. Taxable real property must be assessed on the same standard of value and at the same local rate. Art. VIII, ยง I, par. 1 of the Constitution of 1947. The Constitution thus bars classification of such property for preferential treatment. Switz v. Kingsley, 37 N.J. 566 (1962), decided this week. The judiciary is bound equally with the other branches of government to honor the constitutional mandate.

The taxpayers' position errs on the other side, for under the facts a reduction to 40% would accord them a preference, no less violative of the constitutional rule.

It is true that these taxpayers are entitled to be treated equally with all others whose real property is taxable for local use. A remedy to enforce that right exists in the form of an action to compel the local assessor to assess all taxable property at the statutory standard of full true value. Switz v. Middletown Township, 23 N.J. 580 (1957); Ridgefield Park v. Bergen County Board of Taxation, 31 N.J. 420 (1960), appeal dismissed 365 U.S. 648, 5 L. Ed. 2 d 857 (1961). That remedy, however, can be

prospective only. As to assessments already made, such relief would require vacating all assessments for the years in question and ordering the work redone. We have eschewed that course because of the public injury which would ensue if local government were denied or delayed in the receipt of operating revenues. In re Kents, supra (34 N.J., at p. 30); Ridgefield Park, supra (31 N.J., at pp. 427, 433); Baldwin Construction Co. v. Essex County Board of Taxation, 16 N.J. 329, 343 (1954); cf. Taylor v. Louisville & N.R. Co., 88 F. 350, 374 (6 Cir.), cert. denied 172 U.S. 647, 43 L. Ed. 1182 (1898). We note, as a matter of interest, that in Bettigole v. Assessors of Springfield, Mass., 178 N.E. 2 d 10 (Sup. Jud. Ct. 1961), the court enjoined a city-wide assessment before it was actually made, but upon a finding that time remained for a proper assessment without the public hurt to which we referred.

Hence, as to assessments made, the injured taxpayer is remitted to a different remedy, to wit, a reduction of his assessment to the "common level" of assessments in the taxing district. The thesis is that the taxpayer is injured by so much of the tax bill as exceeds his pro rata share of the burden of local government. True, there may remain some residual harm in that the dollar value of the reduction may be recaptured in another year from all properties including that of the successful appellant. But perfect relief is inherently impossible. If the taxpayer pays no more than his fair share for the year in question, practical justice is achieved. Surely, if the taxpayer who appeals is permitted to pay less than his fair share, the injustice to those who were overassessed but did not complain would be compounded. Hence we held in Kents that an excessive assessment should be reduced to what it would have been if all taxable real property had been ...


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