I dissent from the conclusion that the demurrer to the first cause of action was properly overruled. I think an allegation that the money had been paid under protest was a necessary ingredient of the cause of action. The opinion seems not to have sensed the real distinction made by *Page 149 Neilson v. San Pete County, 40 Utah 560, 123 P. 334, 337, between Secs. 80-11-11, R.S.U. 1933 (then sec. 2684, C.L.U. 1907) and 80-10-17, R.S.U. 1933 (section 2642, C.L.U. 1907). Sec. 80-10-17 deals with a situation where there is no color of warrant for the assessment — a failure to follow law resulting in an erroneous or double assessment where even by any purported law, no tax as paid was due. Sec. 80-11-11, on the other hand, deals with a situation where what at least purports to be lawcommands the officer to collect a tax or license fee. If the statute is invalid of course he has acted without warrant of law but not without color of warrant. The purpose of Sec. 80-11-11, is clear. It puts the officer on notice that his collectionunder the law as it purports to be will be questioned. He may then protect himself and the governmental unit he represents by earmarking the collection. The statute, it is said, was void at its inception, hence it is as if Sec. 80-10-17 applied and all taxes or license fees collected by the county may within four years of payment be recovered against the county even though the county had no opportunity to protect itself by segregating the funds collected. It was innocent of the invalidity of the statute and was doing its duty under the law as it thought it to be. Certainly a payment under protest is of the very essence and is a condition of recovery under such circumstances. It is an element in the cause of action. We concede for the purposes of this argument that Neilson v. San Pete County, supra, was correct in deciding that a statute which reads "may by order of the board of county commissioners be refunded by the county treasurer" means "must" be refunded and if not refunded can be collected by suit. Whether such construction was correct we need not discuss. But the Neilson case did not hold that taxes collected illegally but by color of warrant of law could be recovered by suit under Sec. 80-10-17. Its language seems to import just the opposite — viewed in light of the facts. Mortgages were entirely exempt from taxation by an amendment to the Constitution. *Page 150 The tax assessed and collected on them was, therefore, not only unwarranted and illegal but without color of warrant. There was in effect a prohibition against their taxation and not a command having color of law, however illegal, to assess a tax thereon. The court there says:
"Giving the language used in both of those sections [the present 80-10-17 and 80-11-11] its ordinary meaning, it is clear that the purpose of section 2684 [Sec. 80-11-11] is to give the taxpayer an opportunity to contest the right of the county to collect certain taxes, licenses, or demands for revenue, or any portion thereof, by paying the whole under protest, and then sue to recover all or any portion that he may be entitled to. It is also clear that the taxes, licenses, or demands referred to in that section are such as are `deemed unlawful' by the taxpayer before payment is made. Such taxes, licenses, or demands may, however, not be deemed unlawful by the officers who are required to collect them, and hence the taxpayer is required to indicate to the officers what portion he deems unlawful, and thus pay such part under protest for the purpose of laying a foundation for an action to test their legality. Under such circumstances, it is but fair and just that the taxpayer be required to indicate what portion of the tax he will contest on the ground of illegality, so that the officers can govern themselves accordingly in making the proper apportionment of the taxes.
"Section 2642, however, does not deal with any such taxes or demands. The taxes mentioned in that section are such only which it is clear the county had no authority to collect, and, in casethey are collected, has no legal right to retain them. Moreover, it is obvious that in adopting section 2642 [Sec. 80-10-17] it was not contemplated that the taxpayer need or should contest the payment thereof. Will any reasonable man contend that any one would knowingly pay taxes twice, or that he could pay the same erroneously and be cognizant of the fact at the time of payment? Again, under our system of collecting taxes, a tax could be `illegally collected' by selling property without the owner's knowledge or consent. It is therefore easy to perceive whypayment under protest is required for taxes specified undersection 2684, and why none is required for those mentioned insection 2642." (Italics added.)
This language seems clearly to indicate that only taxes collected without color of warrant by entirely extra-legal action, in contradistinction to those collected by color of warrant which by apparent law the officer was required to *Page 151 collect, are covered by Sec. 80-10-17. Therefore, the language of the opinion stating:
"Thus, this is not a case that falls under Sec. 80-11-11, R.S.U. 1933. It is true, that at the time the payment was made, the Smith v. Carbon County case had not been decided, but, the invalidity of the part of the statute requiring the fee based upon the estate valuation does not date merely from the date of the decision. When determined invalid, it is invalid from its inception. Thus a payment under and pursuant to its terms is an illegal payment, the illegality of which is unquestioned; andmay be recovered even though not paid under protest, as stated inthe Neilson v. San Pete County case. An allegation of payment under protest is not necessary under the circumstances." (Italics added.)
seems not only to fail to make the distinction set out in the Neilson case, but to obliterate it entirely.
Again in the Neilson case it is said:
"The board of county commissioners may thus readily adjust the matter and order the treasurer to refund the tax illegally or erroneously collected or paid. This the board may do without requiring the taxpayer to resort to an action, as is the case under section 2684. Under that section, the illegality of the tax must first be established in a court of competent jurisdiction before it can be refunded, while under section 2642 the illegality of the tax is absolutely assumed." (Italics added.)
Here the distinction between tax collected without color of warrant and one collected with apparent authority is again made. Under Sec. 2684, C.L.U. 1907 (Sec. 80-11-11, R.S.U. 1933) the "illegality of the tax must first be established in a court of competent jurisdiction." Why? Because there is apparent authority. Something in the nature of a law exists which commands the collection. The officer cannot refuse to collect except at his peril if the law should prove constitutional. It is not the case "under section 2642" where "the illegality of the tax is absolutely assumed."
Again the distinction:
"* * * would it not be a travesty of justice to say that the taxpayer is given the right to sue the county in case he merely *Page 152 `deems' the tax unlawful, but that he may not do so in a case where the tax is clearly unlawful, and is admitted to be so by the demurrer?"
It was on this basis that the court construed the word "may" to mean "must." And again revealing that the mind of the court caught the distinction between moneys collected under color of warrant and without such apparent authority, the court says:
"In the case at bar it is confessed by the demurrer that the tax in question was at least erroneously collected, since it is admitted that the tax was assessed and levied without authority of law."
The language of the court that the demurrer admits that the tax has been erroneously collected shows it to be a case where the illegal or erroneous collection depended on a question of fact and not on an interpretation of law or the constitutionality of a statute, for certainly on a suit brought in pursuance of a protest to have declared invalid a tax statute, the very way to raise the law issue would be by demurrer. Such demurrer would not admit that the tax had been "erroneously collected" or there could be no issue of law.
Any other conclusion would work an unbalance. As to the county an action could be brought to recover moneys collected under a null law without founding it on a protest, but as to moneys collected under an apparent legal authority by representatives of other governmental units there could be no recovery except under Sec. 80-11-11, which requires a previous payment under protest.
If we permit our minds to range over the whole matter of exactions we can readily see how Secs. 80-11-11 and 80-10-17 fit together. The latter section deals with ad valorem property taxes. It is in the chapter dealing with the "collection" of such taxes — Chap. 10 of Title 80. These taxes are collected year after year by the county officers for all governmental units for whose benefits they are levied. If a tax was collected twice or without any apparent legal warrant there was no reason why on request and *Page 153 inspection they should not be ordered paid back from the fund in the hands of the county derived from the ordinary property taxes, and such repayment charged against each unit's share in subsequent years if the erroneously collected taxes had been distributed. And, therefore, this was a duty specially placed on the county and no other unit because the county, as collection agent, had custody of the funds year after year. But for some special tax or fee collected under color of warrant of law Sec. 80-11-11 must apply. Here, unless paid under protest, the county nor any other unit for that matter, would be put on notice that there would be any demand for repayment. As a consequence the county or such other unit collecting, as seemingly by law required to do, might — indeed would — expend the funds for the purposes to which the law designated them. Within four years of any payment if the law was finally declared invalid, hundreds of payers under the prevailing opinion might sue the county for payments far beyond any power to repay. It might require a levy up to the limit in order to repay exactions under a law subsequently declared illegal. No such result was contemplated. What was contemplated was that here and there a double or erroneous or utterly unwarranted collection of an ad valorem tax would be made, and that without materially disturbing the revenue for governmental purposes it could in equity be repaid.
In consequence of what is above said, I must dissent from the ruling which affirms the overruling of the demurrer to the first cause of action.
I agree that a claim for a repayment of the tax as meant by Sec. 19-11-10, R.S.U. 1933, is not necessary to a recovery under Sec. 80-11-11 because such claim is already bottomed on a demand in the form of a protest. I further agree that under the Neilson case it is not necessary to make the formal claim for erroneously collected taxes recoverable under Sec. 80-11-11. As suggested by the opinion there is a great deal of difference between a demand necessary *Page 154 to mature an action or make it "accrue," — State Tax Commission v. Spanish Fork, 99 Utah 177, 100 P.2d 575, 131 A.L.R. 816 — and one for courtesy merely. Failure to give the latter would not affect the cause of action as it itself is a demand and the party sued could save further costs by settlement. Hence I agree that the statute of limitations runs in this case from the time of payment of the exaction, and that in any case, causes two and three were barred.