Vinton v. Board of Sup'rs

BRADLEY, J.

The bonds of the town of Persia were issued pursuant to chapter 907 of the Laws of 1869, as amended by chapter 283 of the Laws of 1871. This action is founded upon the fact that the moneys arising from taxes collected upon the assessed valuation of the railroad in the town were by the treasurer of the county misappropriated and diverted from the purposes to which he was directed to devote their use by the statute, which provided, in effect, that all taxes except school and road taxes collected in any town on the assessed valuation of any railroad within it, for which the town should issue its bonds to aid in the construction of such railroad, should be paid over to the county treasurer; that it should be Ms duty, with the money thus collected and paid over to him, to purchase such bonds, or invest the money in the manner mentioned as a sinking fund for their redemption and payment. Laws 1871, c. 283, § 1. Although the moneys collected on the assessment of the railroad, other than school and road taxes, were annually paid over to the county treasurer, the statutory direction was not observed by him, but those moneys were treated in distribution as were the moneys collected on the assessed valuation of other property within the town, and therefore contributed proportionately to the fund which was annually applied to the payment of state and county taxes. The controversy now relates only to the moneys collected on the assessments of the railroad property in the years 1879 to 1884, inclusive, since the recovery for moneys collected in the years preceding .1879 was, as held by the trial court, barred by the statute of limitations. The moneys derived from such assessments and paid over to the county treasurer were .in 1879 $303.15, in 1880 $314.60, in 1881 $249.74, in 1882 $278.14, in 1883 $305.66, in 1884 $280.02. For the aggregate amount of those sums and interest upon them respectively to June 4, 1894, amounting together to the sum of $2,928.29, judgment was directed for the plaintiff.

The right of a town by its supervisor to maintain an action against the county for the misappropriation by its treasurer resulting from his failure to pursue the direction of the statute before mentioned is well settled by adjudicated cases. Bridges v. Board, 92 N. Y. 570; Strough v. Board, 119 N. Y. 212, 23 N. E. 552; Crowninshield v. Board, 124 N. Y. 583, 27 N. E. 242; Kilbourne v. Board, 137 N. Y. 170, 33 N. E. 159.

The question here has reference to the extent of the recovery. In each of those years a specific sum was collected by assessment upon the taxable property in the town to make payment of the interest and upon the principal of such bonds, and the amount of moneys so collected for such purpose was paid over to the railroad commissioners of the town, and so applied in payment of the interest upon and by way of the redemption of the bonds. The trial court found'that Of the total amount so paid to the railroad commissioners of the town in each year the following sums were the portions thereof derived from the taxes levied and assessed against the railroad company in the town; that is to say, in 1879, $179.25; in 1880, $166.42; in 1881, $124.99; in 1882, $181.49; in 1883, $174.05; and in 1884, $167,—mak-ing together $993.20. To that extent, therefore, the town had the *287benefit of the application to the payment of its bonds of the moneys collected during those years upon the assessed valuation of the railroad property. It is true that it was not paid upon those obligations by the county treasurer, nor was the money derived from such assessment, and paid over to him, as before mentioned, set’ apart as directed by the statute, but the beneficial effect to the town to the extent of such payment through its railroad commissioners was practically the same, and no good reason appears why the county should not have credit for it in this action.

The trial court also found that of the whole taxes levied and assessed in the town for those years there was paid to the town officers for local town purposes the following amounts of the taxes levied and assessed against the railroad company, to wit, in 1879, $22.71; in 1880, $43.73; in 1881, $44.49; in 1882, $31.42; in 1883, $57.26; and in 1884, $27.49,—making together $207.10; and that of the taxes so levied and assessed against the railroad company in those years the proportion thereof paid to the county treasurer and applied to the payment of state and county taxes was as follows: In 1879, $101.19; in 1880, $103.93; in 1881, $80.26; in 1882, $65.23; in 1883, $94.35; and in 1884, $85.83,—making together 530.79. On this state of facts it appears that the town of Persia thus had the benefit of all the moneys levied and collected as taxes upon the property of the railroad company in the town during the years in question, except the sum last mentioned. The question arises whether, by reason of the failure of the county treasurer to pursue the direction of the statute in respect to the money collected upon the assessment of the railroad property, the county should be denied credit in this action for a sum equal in amount to the portion of the money so collected of the railroad company which went to the railroad commissioners and the officers of the town for its local purposes. The answer given by counsel to this suggestion is to the effect that the receipt by the town of what was due to it on one demand did not pay what was due to it on another, and that the default in duty of the treasurer was in not applying or investing the specific taxes, as he was required to do it for the benefit of the town. It is true that in not so applying the money derived from the assessment of the railroad property the treasurer clearly disregarded his duty. But, if he had done as the statute directed, the tax levied (assuming the amount which was had been annually levied) upon the assessed property of the town in each of those years, there -would have been a deficit in the amount requisite to answer the purposes for which the tax levy was made as represented by the tax roll and warrant delivered to the collector. It seems that the tax was levied each year without any reference to the requirement of the statute before mentioned; and it may be assumed that it was not contemplated, in making the tax roll, that any money would be set apart by the county treasurer for the redemption of the bonds, or that any moneys derived from taxes other than those expressly levied generally upon the assessed property of the town for such purpose would be applicable to the payment of the bonds; otherwise it would have been necessary to have collected during those years the further surq of $737.89 upon the assessed valuation of property in the town other *288than that pf the railroad company. The company would by the tax on its property have been charged with its proportion of the sum requisite to produce that amount from levy on the other property in the town, and the sum applicable to the redemption of the bonds would have been increased in amount equal to that so realized from the company. So that, while the town was relieved from the levy of taxes to the amount of the deficiency in the fund applicable to the state, county, and town taxes, it failed to derive from the railway company the amount which should have been collected from it to apply upon the town bonds. But the latter fact requires no consideration, as the inquiry in the present action relates only to the moneys which were actually derived from the taxes levied upon the assessed valuation of the railroad property.

While it may be said that the town in some sense was benefited by the application of the money collected from the railroad company to the payment of the state and county taxes, since the assessable property in the town was chargeable with the payment of its quota of those taxes, there is a distinction in the beneficial nature to the town of the moneys thus applied and those which were appropriated to the payment of its bonds and local town expenses. The moneys expended for the latter purposes were devoted to the use of the town, and it is difficult to see any reason founded upon equitable considerations why the assessable property in the county should be charged with the payment to the town of the amount of those moneys which have been thus applied to its use and benefit. Nor does the adoption of such an arbitrary rule seem justified by any principle applicable to the present case. In Bridges v. Board, 92 N. Y. 570, and in Strough v. Board, 119 N. Y. 212, 23 N. E. 552, it was said that an action as for money had and received was a proper remedy for relief of a town for the cause upon which this action is founded. Whether strictly so or not, such is the nature of an action at law brought in behalf of a town to recover the amount misappropriated by the county treasurer in the manner alleged in the case at bar. In the complaint in this action equitable relief was demanded, but the facts were specifically alleged, and, as the defendants answered the complaint, the form of relief demanded became immaterial, and judgment was directed and entered as in action at law for a specific sum. This was regular, in view of the facts as alleged and determined. Code Civ. Proc. § 1207. The principles applicable to an action for money had and received are no less applicable to the present one as such in its nature and purpose. In that view it is to be determined upon equitable considerations consistent with the legal rights of the parties, and the question as between them is, what amount, according to equity and conscience, is the plaintiff entitled to recover against the defendant? Wright v. Butler, 6 Wend. 284; Eddy v. Smith, 13 Wend. 488; Buell v. Boughton, 2 Denio, 91; Cope v. Wheeler, 41 N. Y. 303; Hathaway v. Town of Cincinnatus, 62 N. Y. 434. The application of this doctrine to the present case requires the court to look beyond the mere fact of the failure of the treasurer to perform the statutory direction, to see the consequences resulting to the town by reason of such default; and, as it appears that a portion of the sum in question *289was actually appropriated and applied to the use and beneficial purpose of the town, it would be contrary to equity and conscience to include the amount of such portion in the recovery against the county, and, in the view here taken, the plaintiff: is not entitled to recover it in this action. In Clark v. Sheldon, 134 N. Y. 333, 32 N. E. 23, neither the town, by its supervisor, nor the county, by its board of supervisors, was a party. The proceeding was instituted by a taxpayer of the town of Sodus against the treasurer of Wayne county, pursuant to the statute, to compel him to apply, as there directed, the moneys derived from the taxes upon the railroad property there mentioned. Laws 1871, c. 283, § 1. That case, therefore, has no necessary application to the question in this one.

These views lead to the conclusion that the judgment should be reversed, and a new trial granted, costs to abide the event, unless the plaintiff stipulates to reduce the recovery, exclusive of costs, to $530.79 and interest on $101.19 from June 1, 1879, on $103.93 from June 1, 1880, on $80.26 from June 1, 1881, on $65.23 from June 1, 1882, on $94.35 from June 1, 1883, and on $85.83 from June 1, 1884. If the plaintiff so stipulates, the judgment be modified accordingly, and, as modified, affirmed, without costs of this appeal to either party.