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Rutherford v. Barnes
Citations: 312 Ark. 177; 847 S.W.2d 689; 1993 Ark. LEXIS 120Docket: 92-1083
Court: Supreme Court of Arkansas; February 22, 1993; Arkansas; State Supreme Court
Appellant Bruce Rutherford, county judge of Benton County, seeks to reverse a tax refund of $2,544.94 awarded to appellee Robert W. Barnes, a disabled veteran, arguing that Barnes did not timely claim tax exemptions for the relevant years. Barnes, a resident of Bella Vista Village, has owned his homestead since 1980 and has consistently paid real and personal property taxes. He qualifies for tax exemptions under Ark. Code Ann. 26-3-306 due to his service-connected disability, which has existed since World War II. In 1990, Barnes received a verification letter from the Veterans Administration confirming his eligibility for the exemption and subsequently presented this to the Benton County Collector, who granted an exemption for 1989 and indicated it would continue annually if the VA form was provided each year. Barnes submitted the necessary form for 1990 but was denied a refund for taxes paid in previous years. After meeting with Rutherford, Barnes was granted a refund for taxes paid in 1987 and 1988, totaling $1,181.81, but no other refunds were issued. Barnes then filed a petition for declaratory relief and mandamus, seeking refunds for taxes paid from 1980 to 1986. The county judge contended that Barnes had failed to claim the required exemptions within a three-year limitation period. However, the circuit court granted Barnes summary judgment, stating that there is no applicable limitation period for refunds of property taxes collected during years when the property owner was exempt. The court recognized that all parties acted reasonably and in good faith regarding their actions and legal positions. The court determined that it cannot impose limitations on a right of action unless specifically outlined by the legislature. In this case, a judgment of $2,544.94 was awarded to Barnes without interest. County Judge Rutherford argued on appeal that Barnes had paid taxes for the years in question without claiming any exemptions under Ark. Code Ann. 26-3-306(b)(1)(A). Consequently, the appellant contended that there could be no certainty or finality regarding those taxes. The court highlighted that Barnes voluntarily paid real and personal property taxes from 1980 to 1986 and did not claim any exemptions during those years. Under the common law rule adopted in Arkansas, taxes paid voluntarily are not recoverable, as established in cases such as City of Little Rock v. Cash and Thompson v. Continental Southern Lines, Inc. This rule asserts that voluntary payments cannot be reclaimed unless recovery is explicitly allowed by statute, regardless of the legality or constitutionality of the tax. The principle holds that ignorance of the law does not excuse someone from the consequences of voluntarily making a payment. Since Barnes paid his taxes voluntarily and claimed no exemptions, he is presumed to have understood the law and his rights. Therefore, the circuit court's decision was reversed, and the writ of mandamus was vacated.