
    PEOPLE ex rel. WALKILL VALLEY R. R. CO. v. KEATOR.
    
      N. Y. Supreme Court, Third Department; General Term,
    June, 1885.
    Certiorari to review Assessment; practice; appeal.—Taxation op Real Estate of Railroad Company; test of value.
    The rule that in estimating the value of the real estate of a railroad corporation for assessment, the test should be its earning capacity, rather than its cost of construction,—approved and applied.
    
      It seems, that the provisions of Code Civ. Pro. § 2140, as to the review of questions of fact to be determined on certiorari, do not apply upon the hearing of an appeal from a judgment of the special term based upon the returns to a certiorari issued under L. 1880, c. 269, to review an assessment of the relator’s real estate, made for the purpose of taxation by the town assessors.
    If section 2140 be deemed to apply in such case, the court should not reverse the judgment because of an error in the finding of fact by the special term, unless it was clearly against the preponderance of proof.
    
    Errors of the referee in the admission of evidence taken by him for the use of the court on the hearing of the case are not available upon appeal from the judgment of the special term, unless the trial judge is called upon to make rulings as to the admissibility of the evidence by objection to it, or by motion to strike it out; and the record should show that this was done.
    Such proceeding to review the assessment, being a special proceeding, authorized to be taken under a special statute, should not be limited by an application of the strict legal rules which prevail on trials and proceedings in courts of law.
    Judgment should not he reversed on account of the admission of irrelevant and immaterial evidence, unless the appellate court is satisfied that the decision of the trial judge was improperly influenced by it. ■
    
    The exemption of the officers proceeded against under the act of 1880 (c. 269), from costs, unless it appears to the court that they acted with gross negligence, in bad faith, or with malice, does not apply in the case of an unsuccessful appeal by them from the judgment of the special term in favor of the relator.
    
      Appeal from a judgment in favor of the relator, the Walkill Valley Railroad Company, based on returns to a certiorari, issued under L. 1880, c. 269, to review an assessment of the relator’s real estate, made by the defendants, Nathan Keator and others, as assessors of the town of Rosendale.
    The material facts appear in the opinion.
    
      
      See the preceding case.
    
   Bockes, J.

—This proceeding was taken under and pursuant to chapter 269 of the Laws of 1880, to review an assessment of the relator’s real estate, made for the purpose of taxation by the assessors of the town of Rosendale, in the county of Ulster.

The case comes before the court on an appeal from the judgment of the special term, based on returns to a certiorari, made by the respective officers to whom the writ was directed, with testimony relating to the subject taken before a referee, as authorized by section 4 of that act; which section provides that such testimony shall constitute a part of the proceedings upon which the determination of the court shall be made (People ex rel. Ulster, &c. R. R. Co. v. Smith, 24 Hun, 66).

No point is now urged against the proceeding because of any irregularity in it, prior to the taking of testimony before the referee, but the case is argued and submitted on the merits, with some objections to rulings on questions óf evidence.

A great mass of testimony was taken by the referee and laid before the court for its consideration in determining the question whether the relator’s property was unfairly assessed, that is, assessed at a higher proportionate value than other property appearing on the assessment roll. This question is within the provision of the act of 1880, which has in view the redress of an injury occasioned by an “ illegal, erroneons, or unequal assessment,” made for the purpose of taxation (§§ 1 and 8).

The proof submitted was diffuse and elaborate in a very great degree, if not to excess. It varied in kind and cogency, extending, as it would seem, to every point of possible materiality. It consisted of the opinions of witnesses on estimates of value as to various pieces of property, such as farms, large and small; village property, consisting of dwellings and small lots ; property used in various industries ; also railroad property and the expense of its construction and use 5 the productive qualities of the various kinds of property $ also the prices for which property had been sold and conveyed, as evidenced by actual contracts of sale and by deeds of conveyance to purchasers; expenses incurred in building; reputation of value as a basis for securing loans and making insurance, in so far as such evidence was admitted ; and also prepared and verified tables of value.

From all this proof, the special term was required to determine the fact of the fair and just value of the property in question, as compared with other property on the assessment roll of the town. On this great volume of proof, extensive in scope and varied in character, the learned judge found in favor of the relator. He found that the defendants (assessors) had valued and assessed, on the assessment roll, the relator’s real property at a higher proportional valuation than they did the other real property in the town, to an extent causing injury to it for the year 1880, in the . sum of $870.59, and ordered judgment because of such injury, as provided in the act under which the proceeding was taken.

There is certainly much evidence in support of his conclusion. After a patient, and, as is believed, a * thoughtful examination of the testimony, we cannot say that Ms conclusion is wrong. Indeed, we think the proof made it quite apparent that the relator’s property was valued and assessed quite too high as compared with other property on the roll; showing an “unequal assessment,” deserving of and requiring correction. Of course, we cannot say that it was actually wrong, which we should be able to do, before ordering a reversal of the judgment.

It does not appear that the special term violated any rule of law in reaching the conclusion declared in the record.

There was no error in making the test of value of property for assessment to consist in its earning capacity, rather than to adopt for such purpose its cost of construction. So it has been decided (People ex rel. &c. v. Weaver, 34 Hun, 331; People ex rel. &c. v. Pond, 13 Abb. N. C. 1; People ex rel. &c. v. Barker, 48 N. Y. 70; Smith v. Mayor, &c. of N. Y., 68 N. Y. 552, 555). Not that the test of value should be absolutely its earning capacity, but that this should bean element ■in the problem safer and more just as a guide than its cost of construction, especially when estimating the value of a road of no great intrinsic value as compared with its original actual cost (People ex rel. &c. v. Weaver, 34 Hun, 321).

Now, in this case, mathematical precision in determining the question before the court is simply impossible ; at best there can be but an approximation to absolute right, even under the most critical line of reasoning. In such case, when evidence is to be weighed and contrasted, the court of review will disturb a finding of fact certified to it, only on clear, conviction that the finding is erroneous.. If we were to apply tile test given by subdivision 5 of section 3140 of the,Code of Civil Procedure, in reviewing questions of fact to be determined on certiorari, we could here reverse the judgment appealed from. Probably the section cited does not, however, have application to the case in hand. Still, before we should reverse because of an error in the finding of fact by the special term, we should clearly see, and be able to show, tha:. the finding was against the preponderance of proof. This we are here unable to do. We are satisfied from the proof that with a view to a fair, just and equal assessment, the value of the relator’s property set down on the roll should be reduced, and we are unable to say that the redaction determined upon by the special term was greater than it ought to have toeéh to answer the ends of justice and right.

It is urged that error was committed in the admission of evidence, offered and put in on the part of the relator.

The evidence was taken by a referee for the use o the court on the hearing or trial of the ease ; and the rulings complained of were made by the referee. It does not appear that any motion was made to strike out or expunge the evidence challenged as objectionable ; nor does it appear that the trial judge was called upon to pass upon its admissibility, or that he did in fact make any ruling in that regard. According to the principle of the decision in Arnold v. Parmelee (97 N. Y. 652), the rulings of the referee cannot be considered on this appeal. As there said, if the defendants had intended to rely upen the objections taken before the referee, it should have been so stated, and the judge at special term should have been called upon to make rulings as to the admissibility of the evidence by objecting to it, or by motion to strike i out. Not having done so, the objections must be deemed to have been waived. The record should show that the trial judge made the rulings complained of, or, what would be equivalent to that, adopted as Ms-own those made by the referee, in order to make them available as ground of error on appeal.

There is one instance where it may seem that the ruling was “by court.” But in this instance vie think, the ruling was entirely right. In no other instance does it appear in the record, that the. court made a ruling on the admissibility of evidence or adopted the rulings made by the referee ; and even in the instance cited, that the ruling was by the trial fudge is rather a matter of inference than otherwise.

But it may be suggested that the case was considered before-the trial judge as if the rulings by the referee were accepted and adopted by him ; in view of which possible fact, and of the further fact that the appeal has been argued by counsel on that hypothesis, we are constrained not to hold the appellants concluded by the omission in the record alluded to.

Now this is a special proceeding—a proceeding authorized to be taken under a special statute ; it is not an action or proceeding to be conducted according to the strict rules of the common law, either in the admission of evidence or otherwise. It is like the case of People ex rel. Flanagan v. Police Comm’rs of N. Y. (93 N. Y. 97). As there said, in regard to that case, having in view the special powers conferred and the purpose to be attained by the proceeding, it is not to be limited or trammeled by an application of strict legal rules which prevail on trials and proceedings in courts of law.

Now, if it can be seen that evidence that was harmful was received, and was actually made influential in the determination of the case, then its admission and use would, doubtless, constitute substantial ground of error ; not otherwise in a case like the present. On looking over the whole case, we are satisfied that the result would not or should not have been different had the evidence subject to just exception been excluded. There is very little, if any, material evidence belonging to this class ; and none, as we think, particularly and essentially influential in character. A very considerable portion of the evidence objected to, we think was competent as bearing directly or remotely upon the subject of inquiry ; as one instance, the deeds of conveyance of sundry pieces of property, giving presumptively the consideration of the sales; also, estimates as basis for security, for loans and the placing of insurance, in so far as this class of evidence was admitted. Most of the objections interposed, indeed, nearly all of them, were for irrelevancy and immateriality. It is entirely manifest that the case is greatly incumbered with evidence objectionable in this respect. But the admission of irrelevant and immaterial evidence will be ground of error, even in common law actions, only when it can be seen to have worked harm actually or presumptively to the party objecting. Now, no sterner rule should obtain than that which prevails in cases of a purely equitable character, in which cases reversals will not be ordered on account of the admission of irrelevant and immaterial evidence, unless the appellate court is satisfied that the decision of the judge who heard the case was improperly influenced by it.

We are unable so to hold in this case. In conclusion, therefore, upon the point of alleged errors in the admission of evidence, we find no just ground which, in oar opinion, requires that the judgment appealed from should be reversed.

This conclusion, with that above reached on the merits of the case, on consideration of all the relevant proof, leads to an affirmance of the judgment.

The act under which this proceeding was taken exempts the officers proceeded against from costs, unless it should appear to the court that they acted with gross negligence, in bad faith, or with malice. This exemption does not, as we think, have application in the case of an appeal by them, like the present.

Judgment appealed from affirmed, with costs against appellants as in case of an appeal in a common law action.

Note.—In People ex rel. Valentine v. Commissioners of Taxes of N. Y. (N. Y. Supreme Court, First District; Chambers, March, 1886), where it was held that section 673 of the New York City Consolidation Act (L. 1883, c. 410), as amended by L. 1885, c. 530,—providing that “no tax or assessment shall, after the passage of this act, be levied, assessed or collected upon any unimproved land included within the lines of streets . . . laid out upon any map or maps filed by the commissioners of the Department of Public Parks, pursuant-to the provisions ” of L. 1874; c. 603,—exempted from taxation such land, although its value had been assessed for the purpose of taxation before the passage of the act, if the tax based upon such valuation was levied after its passage; the term “ assessment ” in the act of 1885, refers merely to assessments upon property for public improvements.

The commissioners of taxes nave power, under L. 1883, c. 315, § 5 (amending section 833 of the Consolidation Act), to remit a tax illegally imposed upon such exempt land, if six months have not elapsed since the delivery of the books to the receiver of taxes, and they may be compelled to do so by mandamus.

Application for a peremptory mandamus, directing the commissioners of taxes of the city of New York to remit the tax imposed on August- 17, 1885, upon certain lots of land of the relators in the city of New York.

The lots were unimproved land, and were included within the lines of Melrose avenue, and laid out upon a map filed by the commissioners of Public Parks in June, 1885, pursuant to the provisions of L. 1874, c. 604. The tax was imposed by an ordinance passed August 17, 1885, and the respondents declined to remit the tax upon the ground that they had no power to do so. The assessment of value for the purpose of taxation for 1885 was made prior to the passage of the act of 1885 (above), which went into effect June 13, 1885, some two months before the levy of the tax based on such assessment.

Benjamin E. Valentine, for the relator, in person.

George S. Coleman (E. M. Lacombe, counsel to the corporation), for the respondents.

Barrett, J.—The relator’s lots were undoubtedly exempted from taxation by the act of 1885 (p. 530). The status of his lots for the purpose of taxation had been fixed prior to the passage of that act, but no tax or assessment had been levied or assessed thereon. The assessment of value for the purpose of taxation must not be confounded with the assessment referred to in the act. The latter refers to assessments upon property for public improvements. These assessments are not, after the passage of the act, to be assessed any move than is a tax to be levied. Nor should the act be rigidly construed against those in the relator’s situation. After substantially impounding such lots by the filing of the map, it was only an act of justice to relieve the property while in that condition from taxation.

As to the power, I see no difficulty under chapter 215, of the Laws of 1883, section 5. Six months have not elapsed since the delivery of the books to the receiver of taxes, and power to remit within that period is expressly conferred. This act was not before the court in People ex rel. &c. v. Com’rs of Taxes, &c. of N. Y. (91 W. 7. 602).

As the commissioners have power, and as the property is plainly exempted, the relator should not be driven to expensive and dilatory proceedings or actions. The tax was levied after the passage of the act, and it should be remitted, not as excessive or as subject to a discretion, but because the law says it shall not be levied at all. It being a pure question of law, without dispute of fact, the mandamus should be granted instructing the commissioners that they have power, and that they should exercise such power in accordance with the statute. Under the circumstances, no costs. 
      
       Amending section 822 of the N. Y. City Consolidation Act, L. 1882, c. 4l'0.
     