People ex rel. County Collector v. First National Bank of Marissa
Docket: No. 39188
Court: Illinois Supreme Court; November 19, 1965; Illinois; State Supreme Court
An action was initiated by the St. Clair County collector against the First National Bank of Marissa to recover personal property taxes for the years 1957 to 1960, totaling $17,169.78 in taxes and interest. The bank appealed the judgment against it. It had filed capital stock tax returns for the relevant years, detailing its financial status and shareholder information. The assessed value per share was determined at various amounts for those years. The complaint focused on the levy of taxes on “personal property,” which was identified as capital stock taxes. The bank denied the allegations and claimed the assessments were excessive and invalid. The court's primary inquiry was whether the collector could legitimately pursue this lawsuit. Under Illinois Revenue Act provisions, bank stockholders are responsible for taxes on their shares, and the collector may pursue actions to collect unpaid taxes, provided certain conditions are met, such as the authorization of dividends by the bank’s board. Historical precedent established that stockholders, not the bank itself, bear the tax responsibility, and no legal action can be initiated against a bank without proof of declared and paid dividends. Since the complaint did not address dividends and there was no evidence of any declared dividends, the court concluded that the collector failed to meet the necessary burden of proof to maintain the suit. The bank also raised a defense regarding the assessment method, arguing that the Revenue Act's guidelines were not followed in determining share value. However, the court opined that the bank bore the burden to show that the method used was incorrect. Consequently, the circuit court's judgment was reversed due to the lack of evidence of declared dividends, which was essential for the collector to proceed with the action.