Commonwealth v. United States Fidelity & Guaranty Co.

Opinion by

Judge Settle

Affirming.

On the 3d day of April, 1901, the fiscal court of Taylor county, by an order entered of record, attempted to levy for the year 1901 a tax of 37% cents on each $100 worth of taxable property and $1.50 on each poll in Taylor county. At the time this was done R. D. Sanders was the acting collector of taxes for Taylor county for that year; his appointment as such having been made by an order of the fiscal court entered January 29, 1901, at which time he accepted the office and executed bond for the faithful performance of his duties with appellee, the United States Fidelity & Guaranty Co., as surety, which bond was approved and accepted by the court. About August 10,1901, the tax books of Taylor county were: received by Sanders as collector, and he at once proceeded to collect, and did collect, the tax for that year, but failed to account for $2,625.50 thereof, as shown by his settlement made with the commissioner of the fiscal court. Thereupon this action was instituted to collect of the surety on his bond, the appellee, United States Fidelity & Guaranty Co., the deficit. The surety filed a general demurrer to the petition, which was sustained by the lower court. Appellant then filed *412an amended petition,.and, appellee insisting upon its demurrer to the petition as amended, it was again sustained by the court, and the action dismissed.

The demurrer to the petition was sustained, and action dismissed by the lower court upon the ground that the order of the fiscal court fixing the county tax rate for the year 1901 was and is voidand this is the only question presented for our consideration on this appeal. The order in question reads as follows: “Ordered by the court, that there be, and there is, a tax of 37% cents levied on each $100 worth of taxable property in Taylor county for the year 1901, and $1.50 on each poll in Taylor county for the said year.”

Section 180 of the Constitution provides: “Every act enacted by the General Assembly and every ordinance and resolution passed by any county, city, town or magisterial board or local legislative body levying a tax shall specify distinctly the purpose for which said tax is levied.”

Manifestly the order of the fiscal court does not conform to the requirements of the section of the Constitution, supra, for not only does it fail to “specify distinctly” the purpose for which the tax Was levied, but it is altogether silent on that subject. "When the Constitution declares in unmistakable terms that a thing must be done in a certain way, it is the duty of those intrusted with the doing of it to observe and conform to the constitutional requirements. The order of the fiscal court, being violative of the provisions of sec. 180 of the Constitution, is void. Therefore the fiscal court was without authority to accept the bond, and it was not the duty of Sanders to collect the tax attempted to be levied, for which reason the surety in his bond is not liable for such part thereof as he may have collected, but failed to account for. (Whaley v. Commonwealth, For Use, *413&c., 110 Ky., 154, 61 S. W., 35, 23 Ky. Law Rep., 1292; U. S. Fidelity & Guaranty Co. v. Board of Ed., 118 Ky., 355, 80 S. W., 1191, 26 Ky. Law Rep., 246; Greenwell v. Commonwealth, 78 Ky., 322; Dawson v. Lee, 83 Ky., 55, 6 Ky. Law Rep., 413; Hammond v. Crawford, 72 Ky., 76; City of Somerset v. Banking Co., 109 Ky., 549, 22 Ky. Law Rep., 1129, 60 S. W., 5; Commonwealth v. Hawkins, 32 S. W., 409, 17 Ky. Law Rep., 743.)

It is insisted for appellants that the provisions of sec. 180 of the Constitution are not mandatory, and consequently the fact that the order of the fiscal court is silent as to the purpose for which the tax was levied does not render it invalid. We are unable to perceive how the framers of the Constitution could have employed language more mandatory in character or meaning than that contained in the section supra. Besides, it has been expressly held by this, court to be mandatory.

In the case of City of Somerset v. Somerset Banking Co., supra, we find this language used in respect to the provision of the Constitution in question: “We think they (the orders making the tax levy under consideration) are clearly in violation of the constitutional requirement above quoted, which is mandatory, and must be obeyed.”

The conclusion is therefore inevitable that the tax collected by Sanders was never legally levied, because-the order attempting to make the levy was void, and, as held in Dawson v. Lee, 83 Ky., 55, 6 Ky. Law Rep., 413, and also the authorities, supra, sureties on am official bond of a collector are not liable for an unconstitutional tax collected by the tax collector.

We are unable to see how the fact, alleged in the amended petition, “that Sanders paid his premium on the bond sued on after appellee knew the scope *414and terms of the bond,” estops the latter from denying’ its liability on the bond from the collections made by Sanders. The payment of the premium "on the bond was purely a personal matter between Sanders and the appellee. If Sanders had not paid the premium at all, that fact would not have affected the liability of the surety, had the order of the fiscal court making the levy conformed to the provisions of sec. 180 of the Constitution. Obviously the surety believed when it signed the collector’s bond that the order fixing the levy was valid, and the bond good-, but that fact can not operate as an estoppel to its denial of liability. The fact of the surety’s liability must be made to depend, not on its good faith in going on the bond, or on the payment of the premium, but on the validity or invalidity of the order making the tax levy. But, while this is true as to the surety, the collector is liable to the county for the money sued for, notwithstanding the invalidity of the levy. (Whaley v. Commonwealth, For Use, &c., 110 Ky., 154, 61 S. W., 35, 23 Ky. Law Rep., 1292.)

Wherefore, the judgment is affirmed.

Petition for rehearing by appellant overruled.