with directions to enter judgment dismissing | tors of the last will of Samuel T. Hauser, dethe complaint, and for defendant's costs. Reversed and remanded.

BRANTLY, C. J., and SANNER, J., concur.

(54 Mont. 479)

ceased, against the County of Lewis and Clark. Judgment for plaintiffs and defendant appeals. Reversed and remanded.

S. C. Ford, of Helena, and Frank Woody, of Missoula, for appellant. Ashburn K. Barbour and A. P. Heywood, both of Helena, for

HILL et al. v. LEWIS AND CLARK COUN- respondents.
TY. (No. 3892.)
(Supreme Court of Montana. March 16, 1918.)
1. TAXATION 345 UNDISTRIBUTED PROP-
ERTY-STATUTE.

The purpose of Rev. Codes, § 2522, providing that undistributed property of deceased may be assessed to the heirs, etc., is to assure that notice shall be given of taxes to some interested

person.

2. TAXATION 345-PROPERTY OF DECEDENT -DIRECTORY STATUTE-"MAY."

Rev. Codes, § 2522, providing that undistributed property of deceased "may" be assessed to the heirs, etc., is permissive and directory, rather than mandatory.

[Ed. Note.-For other definitions, see Words and Phrases, First and Second Series, May.] 3. TAXATION 363-PROPErty of DecedeNT -CONSTRUCTIVE NOTICE OF TAX.

An assessment made otherwise than as provided by Rev. Codes, § 2522, as to assessment of undistributed property of estate to heirs, would not of itself be notice, and would be void able if the party sought to be charged had no notice.

SANNER, J.

The respondents, as executors of the last will of S. T. Hauser, deceased, filed their complaint against the county of Lewis and Clark, alleging:

there was embraced in the assets of and was "That on the first Monday in March, 1915, owned by the said estate of Samuel T. Hauser, deceased, within the county of Lewis and Clark, certain real and personal property of the appraised value of $19,055," which property was thereafter by said executors listed for assessment, and was in due course assessed by the assessor of said county, taxed at $420.27, and the taxes duly paid; that on December 8, 1915, "the said assessor of Lewis and Clark county claimed to have discovered certain other additional personal property as belonging to and being part of the assets of said estate of Samuel T. Hauser as omitted property," which he appraised at $37,505 and added or attempted to add to "the assessment aforesaid against the said estate"; that said change and addition were made by the assessor "long after the assessment books of said county had passed from under his jurisdiction" and without notice thereof to the respondents and without any opportunity Under Rev. Codes, § 2522, providing that fore the board of equalization or elsewhere; given to them to contest or oppose the same beundistributed property of deceased persons may "that the said personal property so entered upon be assessed to the heirs, guardians, executors, or said assessment book as an addition to the asadministrators, and that a payment of taxes sessment against said estate was a part and pormade by either binds all the parties in interest tion of the undistributed property of said esfor their equal proportions, an assessment of tate of Samuel T. Hauser, deceased, and said undistributed property of H.'s estate was tan- assessment was made to or against said 'S. T. tamount to an assessment to the heirs or execu- Hauser estate,' and not to the heirs, or the extors, and where the property was subject to tax-ecutors of said estate, as prescribed by law;" ation in the amount imposed, executors, who that the additional taxes thus and thereby imtook cognizance of the assessment and paid the posed amounted to $826.99, which the respondtax to which the county was justly entitled, can- ents paid under protest; wherefore judgment is not recover the tax, although payment was made demanded for the recovery of the sum so paid, under protest.

4. TAXATION 542 TAXES PAID UNDER

PROTEST-RECOVERY.

-

5. TAXATION 542 TAXES PAID UNDER PROTEST-RECOVERY

Assuming that under Rev. Codes, § 2542, as to assessment of property discovered to have escaped assessment, the assessor was powerless to assess undistributed property of estate, not listed by executors after assessment roll had passed out of his hands, where the executors took cognizance of the tax thus imposed and paid the same, though under protest, they cannot recover; the property being subject to taxation in amount imposed, so that there was nothing to contest before board of equalization in view of sections 2742 and 2743, as amended by Laws 1909, c. 135, as to recovery of taxes paid under protest, and as to notice of added or changed assessments. 6. TAXATION 363

ASSESSMENT-NOTICE.

CHANGING OR ADDING

Rev. Codes, § 2742, as amended by Laws 1909, c. 135, requiring notice where assessment has been added to or changed, is available only to the person who has delivered to the assessor a sworn statement of all his property subject to taxation with the estimated value thereof.

with interest and costs.

To this complaint the county of Lewis and Clark interposed a general demurrer, which was overruled, and the county, declining to plead further, suffered the judgment from which this appeal is taken.

The propositions submitted by the respondents as explanatory of the judgment and as ample to sustain it are: (1) That the assessment is void because made to "S. T. Hauser estate"; and (2) that the assessment is void because made by the assessor long after the assessment roll had passed out of his hands and long after the board of equalization had adjourned. In support of these propositions are cited thirty-four decisions, three of which

are by this court, and one by the federal court for this district; the remainder are from other jurisdictions. In an abstract way they furnish such support; but in truth none of them is a precedent for this case.

Appeal from District Court, Lewis and The Montana decisions which involve raises Clark County; R. Lee Word, Judge.

Action by George H. Hill and others, execu

without notice were in suits to recover taxes
paid under protest, and are thus the only

For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes
171 P.-59

citations procedurally in point (Western | statute to defeat, the raising of public reveRanches v. Custer County, 28 Mont. 278, 72 nue. Of course, no such construction as this Pac. 659; Matador L. & C. Co. v. Custer County, 28 Mont. 286, 72 Pac. 662; Western Ranches v. Custer County [C. C.] 89 Fed. 577); and it is notable that in all of them great care was taken to allege and prove that the party aggrieved did not own the property so additionally listed or that it was not of the value placed upon it, and therefore the taxes sought to be recovered back were not justly or lawfully collectable.

According to this complaint, the property originally assessed was "embraced in," that is to say, was not all, the assets of the Hauser estate taxable in Lewis and Clark county; the property which the assessor 'claimed" to discover was discoverable because it was in fact "a part of the undistributed property of said estate," and there is no suggestion that it was not taxable as such; this property the executors had not listed, though it was their duty to do so; no complaint is made of the amount levied; the executors took cognizance of the assessment and paid the tax; they do not claim that any injustice was done to them or their trust; and no wrong is charged save the naked procedural defects above asserted. That such a case differs materially from those cited to support it, wherein the taxing power sought to enforce rights based upon void assessments, or sales of the property to pay void taxes were threat.ened, or tax titles to property based on void assessments were involved, or statutory proceedings were had before payment to annul assessments, or unjust and excessive assessments without notice were presented, is fectly clear; and the question is whether such a case presents a right to the return of moneys honestly payable merely because of defects in the mode by which payment was induced.

was intended by the Legislature; on the contrary, and notwithstanding the cases cited from other jurisdictions, we think an assessment to the "estate of A," is tantamount to an assessment to the heirs, guardians of heirs, executors of the will, or administrators of the estate of A., as the case may be, if they have actual notice of it. So it eventuates here that respondents' first proposition would have value if it appeared that because of the assessment to "S. T. Hauser estate" no notice of it had come to any of the persons to whom in technical precision the property should have been assessed, and thus it had become delinquent, subject to penalty and threatened with sale. Such, however, is not the situation. The respondents, as executors, persons in control of the juridical entity called the S. T. Hauser estate, took cognizance of the assessment and paid the tax, and if, as the complaint itself shows, the property assessed was in fact "undistributed property of the estate of S. T. Hauser, deceased," if it was subject to taxation in the amount imposed, it seems a refinement to say that the county, justly entitled to the money, must now refund it merely because of a misprision that hardly amounts to a misnomer.

[5] 2. The same considerations make for avoidance of respondents' second proposition. The authority for the assessment asserted by the appellant is section 2542, Revised Codes, to wit:

"Any property discovered by the assessor to have escaped assessment may be assessed at any per-der the control of the same person who owned time, if such property is in the ownership or unor controlled it at the time it should have been assessed."

[1-3] 1. As we understand the purpose of section 2522, Revised Codes, it is: To assure that notice to some interested person shall be given of the charge for taxes upon property still in course of administration, and to provide that payment, when made by heirs, guardians, executors or administrators, as the case may be, shall bind all the parties in interest, in proportion to their interest. The statute is by its terms permissive and directory rather than mandatory, and in this respect it differs from sections 2510 and 2517, Revised Codes, applied in Birney v. Warren, 28 Mont. 64, 72 Pac. 293; hence an assessment made otherwise than as directed by section 2522 would not of itself be notice, and would be voidable if, as a consequence, the party sought to be charged had no notice of it.

[4] But to adopt the rigid construction here urged would be to void an assessment to administrators if as a matter of fact the estate was in charge of executors, and would con

Let it be assumed for present purposes that this section does not mean what it says, that the assessor is powerless to do anything after the roll comes into the hands of the treasurer, and that, if one is clever enough to conceal his taxable property until that event, he may escape taxation upon it and thrust.the burden which he ought to bear upon the shoulders of others; the facts nevertheless remain that according to the complaint this property was taxable. It stood charged with that debt to the county, and the executors could have properly paid it without any formal assessment. Had they done so, neither they nor their trust would have suffered any actionable wrong. If this be true, what is the actionable wrong in the present instance? Certainly not that the respondents have fairly met a just demand. The asserted wrong is that this just demand, fairly met, was not properly formulated; its collection was not preceded by certain modal requirements designed to benefit persons who might be injured by the absence of them. But the absence of them was of no consequence to these respondents or to their trust, because there

before the board of equalization or elsewhere." That under these circumstances the tax was not illegal so as to authorize a recovery in this kind of an action may be gathered from the very sections invoked to sustain it (Rev. Codes, §§ 2742, 2743, as amended by chapter 135, Session Laws 1909).

*

[6] The provision found in section 2743 that, "if the assessment * * has been added to or changed, either by the assessor or by the county board of equalization, and such person has not been notified thereof and given an opportunity to contest the same before the county board of equalization, the tax of such increased value or added property shall * be adjudged by the court to be void," is, by its terms, available only to the "person who has delivered to the assessor a sworn statement of his property subject to taxation" with "the estimated value" there of. This means all of his taxable property, according to his best knowledge and belief, and the fact that, notwithstanding such list, the assessor or board may increase the value or add other property, implies that an honest controversy must exist between the public and the taxpayer as to what property should have been taxed, or what value should have been placed upon it.

The judgment is reversed, and the cause remanded, with directions to sustain the de

murrer.

Reversed and remanded.

BRANTLY, C. J., and HOLLOWAY, J.,

concur.

(177 Cal. 704)

CHAMBERS, State Controller, v. GALLAGHER. (S. F. 7899.) (Supreme Court of California. March 12, 1918. Rehearing Denied April 11, 1918.) 1. TAXATION 905(1) INHERITANCE TAXES -LIMITATIONS.

Inheritance Tax Law 1893 (St. 1893, p. 193) provided for appraisement and computation of the tax by the probate court. Section 14 provided that the court should cite persons owning the property to show cause why the tax should not be paid, and that hearing, judgment, and its enforcement should proceed in the manner prescribed by Code Civ. Proc. §§ 1704-1724, inclusive. Section 15 provided that if the tax was unpaid, the district attorney, on notice from the County treasurer, should prosecute the proceedings authorized by the previous section. Held, that an executor proceeded against by petition for the collection of the tax may demur to the petition, and thereby present the question of the statute of limitations.

2. LIMITATION OF ACTIONS ANCE TAXES.

34(7)-INHERIT

Inheritance Tax Law of 1893 provided for appraisement and computation of the tax by the probate court. Section 4, as it existed in 1902, provided that, if the tax was not paid within 18 months, interest should be charged thereon. Section 6 provided that the executor should deduct the tax on distribution, or collect the same before property was distributed. Section 1 provided that administrators, executors, etc., should

be liable for all taxes not collected. Section &
provided that moneys retained by an executor
for any such tax shall be paid by him within
30 days thereafter to the county treasurer. The
amendment of 1913 (St. 1913, p. 1068) to section
4 provided that the provisions of the Code of
Civil Procedure relative to the limitation of time
of enforcing a civil remedy shall not apply to
any proceeding or action taken to levy, appraise,
or collect inheritance taxes. Code Civ. Proc. §
338, subd. 1, prescribes a limitation of 3 years
Defendant's intestate died January 27, 1902,
for actions upon liability created by statute.
and his will was duly probated and the estate
administered in the same year. More than 12
years after the decree of final distribution, the
state controller filed a petition for the collection
of such tax. Held, that the proceeding was bar-
red by the statute of limitation at the time the
amendment of 1913 to section 4 was enacted.
3. TAXATION 859(7)-INHERITANCE TAXES

-LIMITATIONS.

Inheritance Tax Act, § 4, as amended in 1913 (St. 1913, p. 1068), making inapplicable to suits thereunder the provisions of the Code time for enforcing a civil remedy, is inoperative of Civil Procedure relative to the limitation of as to suits to enforce payment of inheritance taxes which were barred at the time of its passage.

Department 1. Appeal from Superior Court, Fresno County; George E. Church, Judge.

Petition by John S. Chambers, State Controller, against James Gallagher, executor of the estate of Richard Hedinger, deceased, for the collection of an inheritance tax. From a judgment based on an order sustaining defendant's demurrer, plaintiff appeals. Affirmed.

Robert A. Waring and J. Paul Miller, both of Sacramento, for appellant. James Galla gher, of Fresno, in pro. per.

SHAW, J. The plaintiff appeals from a judgment in favor of the defendant.

The petition of the plaintiff shows the following facts: Richard Hedinger died on January 27, 1902. His will was duly probated, the executor appointed, the estate administered, and on July 29, 1902, a decree was duly made, distributing to August. Hedinger, the residuary legatee and devisee, the property remaining in the estate after the payment of $1,500 in charitable bequests. On September 25, 1914, more than 12 years after said decree of final distribution, the state controller filed a petition in the court which made said decree, alleging that no inheritance tax had been paid on the property so distributed to Augustus Hedinger, and pray. ing that the court appoint an appraiser to appraise said property and ascertain the amount of such tax; that a citation be issued to the executor to appear before such appraiser and be examined, under oath, and show cause why he should not be held chargeable for the payment of said tax, and for judgment that the executor be declared liable for the payment, and be directed to pay such tax to the treasurer of the county.

For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes

the payment of such tax and interest. Section 6 provided that the executor should deduct the tax from any money to be paid on

To this petition the executor filed a demur- upon such executor should give a bond for rer, based upon the ground that the proceeding was barred by the statute prescribing 3 years as a limitation for actions upon a liability created by statute. Code Civ. Proc. | distribution, or, if the property distributed § 338, subd. 1. The demurrer was sustained, and thereupon the judgment was given for the defendant.

was not money, should collect the tax thereon from the person to whom it was distributed, before such distribution, and that “he shall not deliver, or be compelled to deliver, any specific legacy or property subject to tax to any person until he shall have collected the tax thereon." Section 1 provided that:

"All administrators, executors and trustees shall be liable for any and all such taxes until the same shall have been paid, as hereinafter di

rected."

Section 8 provided that moneys retained by an executor for any such tax "shall be paid by him, within thirty days thereafter, to the treasurer of the county in which the probate proceedings are pending"; that the treasurer should transmit the money to the state controller, who should receipt therefor under seal; and that “an executor, administrator, or trustee shall not be entitled to credit in his accounts, nor be discharged from liability for such tax, nor shall said estate be distributed unless he shall produce a receipt so sealed and countersigned by the controller, or a copy thereof, certified by him." Prior to 1913 the inheritance tax

[1] The inheritance tax act in force at the death of Hedinger in 1902 was the act of 1893 (St. 1893, p. 193). Some amendments thereto were made prior to 1902, but they do not affect the questions arising in this case. The act provided for an appraisement of the property subject to such tax, and that the court in which the administration of the estate was pending should therefrom compute the tax to be paid. Section 14 provided that when it appeared to the court that such tax had not been paid within the time allowed, it should cite the persons owning the property to show cause why the tax should not be paid, and that the hearing, the judgment of the court, and its enforcement, should proceed in the manner prescribed in the chapter of the Code of Civil Procedure embracing sections 1704 to 1724, inclusive. Section 15, as amended in 1895 (St. 1895, p. 33), provided that if the tax became due and was unpaid, the district attorney of the county, on notice of that fact from the county treasurer, should prosecute the proceeding authorized by section 14, as aforesaid, for the enforcement and collection of such The sections of the Code referred to provide for a citation to the parties proceed-relative to the limitation of time of enforcing a ed against, its personal service and return, the trial of the issues found in the proceedings, for judgment thereon, and for its enforcement by execution, and that the rules of practice prescribed in ordinary civil actions should be followed except as otherwise provided. It follows that the parties proceeded against, following the practice in civil actions, may demur to the petition filed against them, as provided in the Code (section 430, Code Civ. Proc.), and that the ques-distribution of the estate. The scheme of tion of the statute of limitations was properly presented by the demurrer.

tax.

The appellant claims: First, that the provisions of the inheritance tax act in force at the death of the testator operated to continue the liability of the executor indefinitely and beyond the statutory period of limitation: and, second, that even if the statute would otherwise apply, that a provision in section 4 of the revised inheritance tax act of 1913 (Stats. 1913, p. 1068) removes the bar of the statute of limitations with respect to taxes which were barred at the time of this enactment. Section 4 of the act, as it existed in 1902, provided that the tax imposed thereby should be due and payable at the death of the decedent; that, if not paid within 18 months thereafter, interest should be charged thereon at the rate of 10 per cent. per annum

was not declared to be a lien upon property. The amendment to section 4, enacted in that year and here relied on, is as follows:

"The provisions of the Code of Civil Procedure civil remedy shall not apply to any proceeding or action taken to levy, appraise, assess, determine, or enforce the collection of any tax or penalty prescribed by this article, and this section shall be construed as having been in effect as of date of the original enactment of the inheritance tax law."

the act as it stood prior to 1913 show an in[2] 1. We do not think the provisions of tent to prevent the running of the statute of limitations in favor of the executor after the

the act was that the executor should see that the taxes were paid before he had made

final settlement of his estate, or within 30 days thereafter. His obligation became matured at the expiration of such 30 days at all events. The intention was that the court having charge of the administration should not order the settlement of the estate or the discharge of the executor until such tax had been paid. Nothing is said in the law regarding the operation of the statute of limitations or purporting to prevent it from running against such demand, or to differentiate it from any other matured obligation to the state. The act of 1913, expressly declaring such intent, is a strong indication that the Legislature itself did not suppose that it had previously done so. Doubtless the liability of the executor, under the terms

of this work. It is, however, opposed to the great weight of authority in this country, and to question that the Legislatures of the several the policy of these statutes. There can be no states by the passage of the statute of limitations intended a permanent divestment of a right of action in all matters to which the statute relates, when it had run against them, and they had thereby become barred. And while it may be, as already suggested, that the reasonpre-ing of the court is correct, yet the wisdom of the doctrine announced is questionable." Wood on Limitations (4th Ed.) § 11, p. 46.

It

the estate, if the tax was not previously
paid, and could be enforced in a proper pro-
ceeding by the district attorney for that pur-
pose under the provisions of the act. But
there is nothing in the language of the act
which declares that the statute does not run
against such liability, as in other cases.
is the duty of every person to pay his debts,
but the existence of that duty does not
vent the running of the statute of limita-
tions in his favor, upon his failure to pay
them when due. The duty to pay this tax
is no greater than the duty of every citizen
to pay his ordinary taxes on property.
is, perhaps, even less burdensome, since the
inheritance tax at the time in question was
not a lien upon property, as in the case of

It

where the law also allowed a personal action to be maintained for the recovery of such taxes, we have uniformly held that the stat-5 Colo. 80; Bradford v. Shine's Administraute of limitations applies to such actions; that such tax is a liability created by statute, which, under section 338, subdivision 1, aforesaid, is barred after the expiration of

"Statutes of limitation relate only to the remedy, and may be altered or repealed before the statutory bar has become complete, but not after, so as to defeat the effect of the statute in extinguishing the rights of action. * It has been held in a case decided by a majority of the Supreme Court of the United States (Campbell v. Holt, 115 U. S. 620, 6 Sup. Ct. 209, 29 L. Ed. 483), that, in actions upon debt, contract, or any class of actions in which a party does not become invested with the title to property by the statute of limitations, the Legislature may by a repeal of the statute of limitations, even after the right of action thereon is barred, restore to the plaintiff his remedy thereon, and divest the other party of the statutory bar. The doctrine of this case is undoubtedly technically correct, and was suggested in the first edition Judge, pro tem.