Town of Walton v. Adair (96 A.D. 75, 1904)

Smith, J.:

In 1900 this defendant was treasurer of Delaware county. 'As such treasurer, upon the 12th day of January, 1900, he received from the New York, Ontario and Western Railroad Company the sum of $2,640.66, its taxes for all purposes in the town of Walton. By section 12 of the General Municipal Law (Laws of 1892, chap. 685, as amd. by Laws of 1893, chap. 466). it was his duty¿ with the part of such taxes not assessed for school district and highway purposes, to purchase the outstanding unpaid bonds of said toW-n, issued or- substituted for bonds issued to aid in the construction of said railroad where they could be purchased at or below par, and to cancel them; and if such bonds could not be purchased at or below par it was the duty of the treasurer to invest such money in bonds of the United States or of the State of New York or of any town or village or city of such State, and hold such bonds as a, sinking fund for the redemption and payment of the outstanding railroad aid bonds. This statute was a general statute providing for all towns which had issued bonds in aid of the construction of a railroad where said bonds had not been paid. Of such $2,640.66 so received by the defendant, after having deducted the highway taxes and the school district taxes, the sum of $2,062.14 remained for investment. Of this amount the sum of $1,403.68 was the amount assessed as for town purposes; the sum of $415.26 the amount assessed as for county purposes, and the sum of $243.20 the amount assessed as for State purposes. These moneys were all turned over to the supervisor of the town of Walton. Of these taxes which, under the statute, should have been invested, no question is made that that part of it raised for town purposes was wrongfully paid to' the supervisor, and the town clearly has the right to recover the same unless it be shown that the town has already had the benefit of these moneys. The respondent insists that the part of these moneys raised for county purposes was properly paid to the supervisor under another statute, which will be considered hereafter, and that inasmuch as the county has paid in full its State tax, the county will be deemed to have received the benefit of that part of this fund which was Collected for State taxes.

As to the last proposition the argument of the defendant is not convincing. The county treasurer pays from the moneys first received the amount which the State demands of the county as its proportion of tax. These "moneys, although assessed as for State taxes, he would be required to hold for investment, and he did hold them until he paid them over to the supervisor of the town. It cannot be held, therefore, that the county has had the benefit of this payment unless it be shown that these moneys have been applied to some other indebtedness of the county.

The statute requiring these moneys to be held as a sinking fund for the bonds issued in behalf of the railroad was sections 4 and 12 of chapter 907 of the Laws of 1869 (as amd. by Laws of 1870, chap. 789; Laws of 1871, chap. 283, and Laws of 1879, chap.- 62). Section 12 of the General Municipal Law is a re-enactment in substance of that act. At the time of the passage of the act of 1869 the Few York and Oswego Midland Railroad Company, the predecessor of the Few York, Ontario and Western Railroad Company, from the assessment of which these taxes were collected, was exempt from taxation. (See Laws of 1866, chap. 398, § 16.) By chapter 296 of the Laws of 1874-it was provided that all the moneys collected from the said railroad for county taxes- in any of the towns by which bonds had been issued in aid of the construction of said railroad should be paid to the railroad commissioners of such towns, and it was made the duty of the railroad commissioners of the towns to apply said moneys to the payment of the interest of the bonds issued in behalf of said railroad company, or of the principal thereof. It was also provided by said statute that the property of said railroad should be subject to taxation. By chapter 234 of the Laws of-1879 (as amd. by Laws of 1881, chap. 495) it was provided that, the duties of railroad commissioners in the towns of Delaware county should devolve upon the supervisors of the towns respectively, who should act as railroad commissioners. Under that act, which remains unrepealed as far as I have been able, to discover, it was the duty of the collector of taxes to pay the amount collected for county taxes against said railroad to the supervisor of the town rather than to the treasurer of the county, and the payment by the treasurer of the county who had received them without warrant of law to the supervisor will, therefore, be deemed to be in execution of the statute and not a violation of his duty. Of the $2,062.14, therefore, which were properly for the payment of the bonds or for investment-either by the county treasurer or by the railroad commissioner, i.