Balock v. Town of Melstone

No. 14650
IN THE SUPREME COURT OF THE STATE OF MONTANA
1980

JOHN BALOCK, JR., and HEATHER J. BALOCK,
Plaintiffs and Appellants,

THE TOWN OF MELSTONE, MONTANA et al.,
MARGAEET REIGHARD , ROBERT HAGSTROM, and
MUSSELSHELL COUNTY,
Defendants and Respondents.

Appeal from: District Court of the Fourteenth Judicial District,
Honorable Nat Allen, Judge presiding.
Counsel of Record:
For Appellants:
K. Robert Foster, Lewistown, Montana
For Respondents:
John L. Pratt, County Attorney, Roundup, Montana

Submitted on briefs: January 16, 1980
Decided : FEB 2 $ 1-@j
Mr. J u s t i c e J o h n Conway H a r r i s o n d e l i v e r e d t h e O p i n i o n o f
t h e Court.

Appellants f i l e d t h i s a c t i o n i n t h e D i s t r i c t Court of

t h e F o u r t e e n t h J u d i c i a l D i s t r i c t i n M u s s e l s h e l l County. ~ p -

p e l l a n t s requested t h e D i s t r i c t Court t o e n j o i n t h e respondents

from t a x i n g c e r t a i n p r o p e r t y t h e y owned a t t h e r a t e s p r e v a i l i n g

f o r p r o p e r t y l o c a t e d i n t h e town o f M e l s t o n e and t o r e f u n d

M e l s t o n e c i t y t a x e s on t h e p r o p e r t y p a i d u n d e r p r o t e s t . The

Honorable Nat A l l e n h e a r d t h e case s i t t i n g w i t h o u t a j u r y .

J u d g e A l l e n c o n c l u d e d t h a t a p p e l l a n t s ' p r o p e r t y was w i t h i n

t h e b o u n d a r i e s o f t h e C i t y o f M e l s t o n e and d e n i e d t h e r e l i e f

p r a y e d f o r by a p p e l l a n t s . This appeal followed.

The town o f M e l s t o n e i n c o r p o r a t e d i n 1913. The a r e a

i n c l u d e d i n t h e o r i g i n a l p l a t o f t h e town i s shown on t h e

map, a t t a c h e d t o t h i s o p i n i o n f o r c l a r i f i c a t i o n . The a r e a

o r i g i n a l l y i n c o r p o r a t e d a s t h e town o f M e l s t o n e i s e n c l o s e d

by t h e d o t t e d l i n e o n t h e map.

Over t h e y e a r s , t h e t a x a s s e s s o r a p p a r e n t l y o n l y t a x e d

t h e s e c t i o n s o f M e l s t o n e i n c l u d e d i n t h e a r e a marked o f f

i n t o l o t s and b l o c k s a s i n s i d e t h e C i t y o f M e l s t o n e . Prior

t o 1976, t h e map used by t h e County A s s e s s o r t o d e t e r m i n e i f

a p i e c e o f p r o p e r t y was i n t h e C i t y o f M e l s t o n e f o r t a x

p u r p o s e s i n c l u d e d o n l y t h e a r e a marked o f f i n l o t s and

blocks. The a r e a i s marked by t h e d o u b l e s o l i d l i n e on t h e

a t t a c h e d map.

I n 1973 a p p e l l a n t s J o h n and H e a t h e r Balock p u r c h a s e d a

p i e c e o f p r o p e r t y i n s i d e t h e c i t y l i m i t s o f M e l s t o n e as

i n c l u d e d i n t h e o r i g i n a l p l a t o f t h e town b u t o u t s i d e t h e

a r e a t r a d i t i o n a l l y c o n s i d e r e d i n s i d e Melsone by t h e County

Assessor f o r t a x purposes. The a p p r o x i m a t e l o c a t i o n o f t h e

p r o p e r t y i s marked by x ' s o n t h e a t t a c h e d map. Before
purchasing t h e property, M r . Balock went t o t h e County

A s s e s s o r ' s O f f i c e t o see i f t h e p r o p e r t y was t a x e d a s b e i n g

w i t h i n t h e C i t y of Melstone. The M u s s e l s h e l l County A s s e s -

sor told Mr. Balock t h a t t h e p r o p e r t y was o u t s i d e t h e c i t y

l i m i t s of Melstone. The County A s s e s s o r a l s o showed M r .

Balock t h e map o f M e l s t o n e t h e n b e i n g u s e d t o d e t e r m i n e i f

p r o p e r t y was w i t h i n t h e c i t y l i m i t s . T h a t map o n l y i n c l u d e d

t h e p a r t o f M e l s t o n e t h a t had been marked o f f i n t o s t r e e t s

and blocks. The map d i d n o t i n c l u d e t h e p r o p e r t y M r . Balock

w a s about t o purchase.

I n 1 9 7 6 , t h e town o f M e l s t o n e r e a l i z e d t h a t a p o r t i o n

of t h e a r e a included i n t h e o r i g i n a l p l a t of t h e c i t y w a s

n o t being taxed a s a p a r t of t h e c i t y . The County Commissioners

decided t o r e c t i f y t h e s i t u a t i o n . The 1976 t a x a s s e s s m e n t

n o t i c e s r a i s e d t h e r a t e s of t h e a r e a i n s i d e t h e o r i g i n a l

town p l a t b u t n o t p r e v i o u s l y t a x e d a t c i t y r a t e s t o t h e c i t y

r a t e s . T h i s i n c l u d e d t h e p r o p e r t y p u r c h a s e d by t h e B a l o c k s

i n 1973. I n c l u d i n g t h e p r o p e r t y i n t h e c i t y f o r t a x p u r p o s e s

c a u s e d t h e t a x e s on t h e p r o p e r t y t o g o from $700 t o $800 p e r

y e a r t o a p p r o x i m a t e l y $1,500 p e r y e a r . The B a l o c k s p a i d

t h e i r i n c r e a s e d t a x e s under p r o t e s t and f i l e d a n a p p e a l w i t h

t h e S t a t e Tax A p p e a l s Board. The A p p e a l s Board d i s m i s s e d

t h e c a s e f o r lack of j u r i s d i c t i o n . The B a l o c k s t h e n i n i t i a t e d

t h i s s u i t i n D i s t r i c t Court.

A p p e l l a n t s r a i s e t h e f o l l o w i n g i s s u e s on a p p e a l :

Did t h e D i s t r i c t C o u r t err i n c o n c l u d i n g t h e B a l o c k s '

p r o p e r t y was w i t h i n t h e town o f M e l s t o n e f o r t a x p u r p o s e s ?

Did t h e ~ i s t r i c C o u r t err i n f a i l i n g t o f i n d t h a t t h e
t

r e q u i r e d p r o c e d u r e s f o r r e a s s e s s m e n t w e r e n o t f o l l o w e d by

t h e town o f M e l s t o n e ?
 The d o c t r i n e o f a c q u i e s c e n c e i s a l o n g e s t a b l i s h e d

t e n a n t o f common law. See 2 McQuillin, Municipal Corporations

5 7 . 0 9 , pp. 294-297 (3rd rev. ed. 1979). The b a s i c p r e m i s e

o f t h e d o c t r i n e i s t h a t l o n g a c q u i e s c e n c e between p a r t i e s a s

t o municipal boundaries e v e n t u a l l y e s t a b l i s h e s those boundaries.

2 M c Q u i l l i n , s u p r a a t 294. The r a t i o n a l e f o r t h e d o c t r i n e

h a s b e e n c i t e d by v a r i o u s c o u r t s a s e s t o p p e l and l a c h e s . La

P o r t o v . V i l l a g e o f P h i l m o n t ( 1 9 7 6 ) , 39 N.Y.2d 7 , 346 N.E.2d

503, 505; S c o t c h P l a i n s Township v . Town o f W e s t f i e l d ( 1 9 6 4 ) ,

83 N . J . Super. 323, 1 9 9 A.2d 673, 676. The U n i t e d S t a t e s

Supreme C o u r t u s e s t h e a c q u i e s c e n c e d o c t r i n e i n s e t t l i n g

b o u n d a r y d i s p u t e s between s t a t e s . Ohio v . Kentucky (1973),

410 U.S. 641, 651, 93 S . C t . 1 1 7 8 , 1 1 8 4 , 35 L.Ed.2d 560, 568;

M i c h i g a n v . W i s c o n s i n ( 1 9 2 6 ) , 270 U.S. 295, 308, 4 6 S . C t .

290, 294, 70 L.Ed. 595, 601. Other c o u r t s have a p p l i e d t h e

d o c t r i n e t o s e t t l e b o u n d a r y d i s p u t e s between a d j o i n i n g

c i t i e s , C i t y o f W h i t i n g v . C i t y o f E a s t C h i c a g o ( 1 9 7 7 ) , 266

I n d . 1 2 , 359 N.E.2d 536, and t o d e t e r m i n e i f d i s p u t e d a r e a s

s h o u l d b e i n c l u d e d i n o r e x c l u d e d from m u n i c i p a l c o r p o r a t i o n s .

- P o r t o , s u p r a , 346 N.E.2d
La 503.

P e r h a p s b e c a u s e o f t h e p a u c i t y o f a u t h o r i t y on t h e

d o c t r i n e , no c a s e s e t t i n g o u t t h e e l e m e n t s o f a c q u i e s c e n s e

c o u l d b e f o u n d . F a c t o r s c o n s i d e r e d by v a r i o u s c o u r t s i n

determining t h e a p p l i c a b i l i t y of t h e d o c t r i n e i n c l u d e :

w h e t h e r o r n o t p r o p e r t y i n t h e d i s p u t e d a r e a was t a x e d by

t h e c i t y , G r i f f i n v . Town o f P i n e B l u f f s (Wyo. 1 9 6 2 ) , 368

P.2d 1 3 2 ; L e a r y v . Mayor a n d Aldermen o f J e r s e y C i t y ( 3 r d

Cir. 1 9 1 3 ) , 208 F . 854, 856; t h e e x e r c i s e o f p e r s o n a l a n d

c i v i l r i g h t s s u c h a s v o t i n g by r e s i d e n t s o f t h e d i s p u t e d

-
a r e a , La P o r t o , s u p r a , 346 N.E.2d a t 505; S t a t e e x r e l . C i t y

o f M i n o t v . W i l l i s ( 1 9 0 8 ) , 1 8 N.D. 76, 1 1 8 N.W. 820, 822;
t h e r e c o r d s on f i l e p e r t a i n i n g t o t h e b o u n d a r i e s o f t h e

m u n i c i p a l i t y , G r i f f i n v . Town o f P i n e B l u f f s (Wyo. 1 9 6 1 ) ,

366 P.2d 993; Town o f S t e p h e n s C i t y v . Zea ( 1 9 6 3 ) , 204 Va.

82, 129 S.E.2d 1 4 ; provision of municipal s e r v i c e s t o t h e

-
d i s p u t e d t e r r i t o r y , C i t y o f W h i t i n g s u p r a , 359 N.E.2d a t

539; and t h e e x e r c i s e o f p o l i c e and r e g u l a t o r y powers o v e r

t h e p r o p e r t y , -t-o f W h i t i n g , s u p r a .
Ci y

The p r e s e n c e o r a b s e n c e o f any o n e o f t h e s e f a c t o r s

does n o t n e c e s s a r i l y r e q u i r e o r preclude t h e a p p l i c a t i o n of

t h e d o c t r i n e . Courts consider t h e t o t a l i t y of t h e circumstances

i n determining i f t h e d o c t r i n e should apply. City of Whiting,

359 N.E.2d a t 539.

The t h r e s h o l d q u e s t i o n w e f a c e i s w h e t h e r o r n o t t o

a d o p t t h e a c q u i e s c e n c e d o c t r i n e i n Montana. W e recently

r e c o g n i z e d t h e d o c t r i n e i n Gregory v . C i t y o f F o r s y t h , No.

14584, d e c i d e d F e b r u a r y , 1980. The common law i s t h e law i n

Montana where i t d o e s n o t c o n f l i c t w i t h Montana s t a t u t e s .

S e c t i o n 1-1-108, MCA. On t h e b a s i s o f Gregory and s e c t i o n

1-1-108, MCA, w e s h o u l d a d o p t t h e a c q u i e s c e n c e d o c t r i n e

i n s o f a r a s i t d o e s n o t c o n f l i c t w i t h Montana s t a t u t e s .

The n e x t l o g i c a l s t e p i n a n a l y z i n g t h e problem h e r e

would b e t o c o n s i d e r t h e e l e m e n t s o f t h e a c q u i e s c e n c e d o c t r i n e

i n l i g h t of t h e f a c t s involved i n t h i s case. However, o n e

i m p o r t a n t c a v e a t t o s e c t i o n 1-1-108, MCA makes t h i s s t e p

unnecessary. The s e c t i o n s t a t e s i n p a r t : "In this state

t h e r e i s no common law i n a n y c a s e where t h e l a w i s d e c l a r e d

by s t a t u t e . " T h i s l a n g u a g e h a s been i n t e r p r e t e d i n t h e

c o n t e x t o f t h e i n c l u s i o n o f p r o p e r t y w i t h i n a c i t y on a

p r i o r o c c a s i o n i n P o o l v. Town o f Townsend ( 1 9 2 0 ) , 58 Mont.

297, 1 9 1 P. 385. I n Pool, t h e p l a i n t i f f sought an i n j u n c t i o n

r e s t r a i n i n g t h e town o f Townsend from e n f o r c i n g t h e payment
of a s p e c i a l improvement t a x l e v i e d on p r o p e r t y he owned.

A t t h e t i m e t h e C i t y s o u g h t t o impose t h e t a x , the property

had n o t been p r o p e r l y annexed i n t o t h e c i t y . The C i t y

a r g u e d t h a t , e v e n t h o u g h t h e p r o p e r p r o c e d u r e had n o t been

f o l l o w e d i n a n n e x i n g t h e d i s p u t e d p r o p e r t y , a common l a w

d e d i c a t i o n and a c c e p t a n c e o f t h e s t r e e t s and a l l e y s i n t h e

a r e a including t h e p r o p e r t y brought t h e p r o p e r t y w i t h i n t h e

town l i m i t s . The C o u r t r e j e c t e d t h e C i t y ' s argument. I n s o

d o i n g , t h e C o u r t c i t e d l a n g u a g e from a s i n c e r e p e a l e d s t a t u t e

i d e n t i c a l t o t h e above-quoted l a n g u a g e i n s e c t i o n 1-1-108.

Based o n t h e d i r e c t i v e o f t h e s t a t u t e n o t t o a p p l y t h e

common law where s u p e r c e d e d by s t a t u t e , t h e C o u r t r e a s o n e d

that:

" I f , t h e n , t h e Codes p r o v i d e t h e means by
which a n a d d i t i o n becomes a p a r t o f a c i t y
o r town and s u b j e c t t o i t s j u r i s d i c t i o n , t h e
means s o p r o v i d e d must b e h e l d t o b e e x c l u s i v e . "
P o o l , s u p r a , 58 Mont. a t 304. (Emphasis a d d e d . )

The C o u r t went on t o h o l d t h a t s i n c e a n n e x a t i o n p r o c e -

d u r e s w e r e p r o v i d e d f o r i n t h e Code, t h e p r o p e r t y c o u l d n o t

b e i n c l u d e d i n t h e Town o f Townsend u n l e s s t h o s e p r o c e d u r e s

w e r e followed. Gregory, s u p r a , a f f i r m s P o o l ' s conclusion

and r a t i o n a l e .

Greqory and P o o l r e j e c t a common law method o f i n c l u d i n g

p r o p e r t y i n a m u n i c i p a l i t y and e s t a b l i s h a n n e x a t i o n a s t h e

e x c l u s i v e means o f b r i n g i n g p r o p e r t y i n t o a town o r c i t y .

The n e g a t i v e i n f e r e n c e l o g i c a l l y drawn from t h a t r u l e i s

t h a t Montana's de-annexation s t a t u t e s , i.e. s e c t i o n s 7-2-

4801 t o 7-2-4810, MCA, p r o v i d e t h e e x c l u s i v e means f o r
e x c l u d i n g p r o p e r t y from m u n i c i p a l i t i e s . Under t h i s a n a l y s i s ,

t h e common l a w d o c t r i n e o f a c q u i e s c e n c e c a n n o t b e a p p l i e d i n

t h i s case t o s u p e r c e d e t h e a n n e x a t i o n s t a t u t e s and t h e

d i s p u t e d p r o p e r t y s h o u l d b e c o n s i d e r e d a p a r t o f t h e town o f
Melstone.

W e r e a c h t h i s same c o n c l u s i o n by a p p l y i n g t h e a c q u i e s -

cence d o c t r i n e . I n Gregory w e s a i d , ". . . ' T h e -u- - t o
- r le a s
establishment - municipal boundaries
of & acquiescence does

n o t a p p l y where t h e p e r i o d o f a c q u i e s c e n c e i s s h o r t o r where

t h e boundary i n v o l v e d - c l e a r l y o t h e r w i s e t h a n c l a i m e d . '
is
2 McQuillin, supra, 5 7.09 a t 308 ( e m p h a s i s a d d e d ) . " Gregory

O p i n i o n a t p . 8. H e r e , a s i n Gregory, t h e b o u n d a r i e s i n

dispute are clear. None o f t h e p a r t i e s d i s p u t e t h e f a c t

t h a t i n 1913 t h e Town o f M e l s t o n e i n c o r p o r a t e d and i n c l u d e d

w i t h i n i t s b o u n d a r i e s t h e p r o p e r t y now owned by t h e B a l o c k s .

No o n e c o n t e n d s t h e p r o p e r t y h a s been de-annexed from M e l s t o n e

since t h a t t i m e . The d i s p u t e h e r e c e n t e r s a r o u n d t h e e f f e c t

on t h e Balock p r o p e r t y o f t h e m i s t a k e n b e l i e f t h a t t h e

p r o p e r t y was o u t s i d e t h e town. T h a t b e l i e f h a s no e f f e c t o n

t h e p r o p e r t y ' s s t a t u s , even applying t h e d o c t r i n e of acquiescence

where t h e b o u n d a r i e s a r e c l e a r . We therefore affirm the

judgment o f t h e D i s t r i c t C o u r t on t h i s i s s u e .

Moving t o a c o n s i d e r a t i o n o f t h e s e c o n d i s s u e , v a r i o u s

s t a t u t e s a p p l i c a b l e t o t h i s s i t u a t i o n and i n e f f e c t a t t h e

t i m e appellants i n i t i a t e d t h i s s u i t required notice t o

t a x p a y e r s by o f f i c i a l s b e f o r e c h a n g i n g p r o p e r t y t a x a s s e s s -

ments. S e c t i o n 84-602, R.C.M. 1947, which was r e p e a l e d i n

1977, r e q u i r e d w r i t t e n n o t i c e t o a t a x p a y e r by t h e County

Board o f E q u a l i z a t i o n o f i t s i n t e n t i o n t o i n c r e a s e o r l o w e r

h i s assessment s o a s t o e q u a l i z e t h e assessment of t h e

p r o p e r t y t o conform w i t h i t s t r u e v a l u e . The County Board
o f E q u a l i z a t i o n was a l s o r e q u i r e d t o n o t i f y i n t e r e s t e d

p e r s o n s b e f o r e d i r e c t i n g t h e County A s s e s s o r t o t a x p r o p e r t y

t h a t had e s c a p e d a s s e s s m e n t u n d e r pre-1977 law. s e c t i o n 84-

609, R.C.M. 1947. The S t a t e Board o f ~ q u a l i z a t i o nwas
s u b j e c t t o s i m i l a r n o t i c e requirements. S e c t i o n 84-710,
R.C.M. 1947, r e p e a l e d i n 1977, r e q u i r e d n o t i c e b e f o r e a n y

change i n a s s e s s m e n t . S e c t i o n 84-711, R.C.M. 1947, which

was amended i n 1977, r e q u i r e d t h e S t a t e Board t o g i v e n o t i c e

before reassessing property previously assessed incorrectly.

These s t a t u t e s c l e a r l y i n d i c a t e a p p e l l a n t s s h o u l d have

been n o t i f i e d b e f o r e t h e County r e a s s e s s e d t h e i r p r o p e r t y .

The C o u r t must t h e r e f o r e r e v e r s e t h i s c a s e u n l e s s t h e C o u r t

f i n d s a p p e l l a n t s waived t h e i r r i g h t t o n o t i c e . Here i t c a n

be a r g u e d t h a t a p p e l l a n t s waived s u c h r i g h t by a p p e a r i n g

b e f o r e t h e S t a t e Tax A p p e a l s Board t o c o n t e s t t h e i r p r o p e r t y

reassessment.

I f t h e s t a t u t e a u t h o r i z i n g a change i n p r o p e r t y a s s e s s -

ment r e q u i r e s n o t i c e b e f o r e t h e E q u a l i z a t i o n Board c a n

change a n a s s e s s m e n t , t h e n o t i c e i s a p r e r e q u i s i t e t o t h e

j u r i s d i c t i o n o f t h e E q u a l i z a t i o n Board t o c h a n g e t h e a s s e s s -

ment o f t h e p r o p e r t y . Montana O r e P u r c h a s i n g Co. v . Maher

(19051, 32 Mont. 480, 487, 8 1 P. 1 3 , 14-15; W e s t e r n Ranches,

L t d . v . C u s t e r County ( 1 9 0 3 ) , 28 Mont. 278, 281, 72 P . 659,

660. An a p p e a r a n c e by a p a r t y t o c h a l l e n g e a change w i t h o u t

n o t i c e d o e s n o t c o n s t i t u t e w a i v e r of t h e n o t i c e r e q u i r e m e n t .

Western Ranches, L t d . , s u p r a , 28 Mont. a t 282. I f , however,

the applicable s t a t u t e requires notice a f t e r the property

h a s been r e a s s e s s e d , n o t i c e i s n o t c o n s i d e r e d j u r i s d i c t i o n a l .

An a p p e a r a n c e by a t a x p a y e r u n d e r t h i s t y p e o f s t a t u t e d o e s

c o n s t i t u t e a waiver of t h e n o t i c e requirement i f t h e tax-

p a y e r h a s a c h a n c e t o p r e s e n t t h e m e r i t s o f h i s case.

Anaconda Copper Mining Co. v . R a v a l l i County ( 1 9 1 9 ) , 56

Mont. 530, 532-535, 186 P . 332, 333-334.

Here t h e a p p l i c a b l e s t a t u t e s r e q u i r e d n o t i c e b e f o r e re-

assessment. The n o t i c e i s j u r i s d i c t i o n a l u n d e r t h e above
cases. The appearance by appellants to contest the reassess-
ment does not constitute waiver of the jurisdictional notice

requirement. The reassessment should therefore be considered

void as entered without jurisdiction and the District Court
reversed on this issue.
As a practical matter, finding the improper procedure
was followed by the respondents does not prohibit the collec-

tion of the disputed taxes. Section 15-8-601, MCA allows
the Department of Revenue to reassess property erroneously

assessed within the preceding ten years. The section sets
up procedural guidelines for correcting past improper assess-
ments. The respondents here can follow the statutory proce-
dures and collect the taxes on appellants' property for the
years in question.
To summarize, Montana's annexation and de-annexation

statutes provide the method for including or excluding
property into or from cities and towns. That procedure is
exclusive under Gregory and Pool, supra. Appellants should
not, therefore, be permitted to de-annex their property from
Melstone under any other procedure. Neither does the

doctrine of acquiescence allow the exclusion of the property
since the boundaries of Melstone are clear. Gregory,
supra. The District Court should be affirmed on this issue.

Appellants did not receive proper notice of the reassessment
of their property. The lack of notice is a jurisdictional

defect rendering the reassessment void. Appellants' appearance
in this matter did not represent a waiver of the notice require-
ment. See Montana Ore Purchasing =. and Western Ranches,

- supra.
Ltd., This defect warrants reversal.
The judgment of the District Court is reversed.
W e concur:

%&&&-
Chief J u s t i c

Q . 8 9
Justices