Appeal from order of Court of Common Pleas of Lehigh County, Jan. T., 1970, No. 406, in re petition of Spurgeon D. Dunbar; appeal of Spurgeon D. Dunbar.
J. Jackson Eaton, III, with him Robert G. Tallman, and Butz, Hudders & Tallman, for appellant.
Donald L. LaBarre, Assistant County Solicitor, for appellee.
Bell, C. J., Eagen, O'Brien, Roberts, Pomeroy and Barbieri, JJ. Opinion by Mr. Justice Roberts. Mr. Justice Jones took no part in the consideration or decision of this case. Dissenting Opinion by Mr. Justice Eagen. Mr. Justice Pomeroy joins in this dissent.
This is an appeal from an order of the Court of Common Pleas of Lehigh County affirming the decision of that county's Board of Assessment and Tax Revision
regarding the assessment and taxation of certain personal property owned by appellant, Spurgeon Dunbar. For reasons hereinafter set forth, we vacate the order of the Common Pleas Court and remand the case to the Board of Assessment and Tax Revision for further proceedings consistent with this opinion.
Appellant is in the business of selling low-cost housing in Lehigh County to low income individuals. The financing is accomplished through the method of articles of agreement for the sale of real estate. Using his own credit, Dunbar mortgages the property prior to the agreement of sale. A person wishing to purchase one of these homes enters into an agreement of sale by which he agrees to pay Dunbar a monthly amount which includes a payment of the principal price plus an interest payment. As payments are made by the buyer, the mortgage is paid off and title passes at the end of such payments.
By a letter dated August 8, 1969, the County of Lehigh notified Dunbar that he was being assessed $48,023.38 in taxes, penalty and interest for unpaid taxes due upon these agreements of sale, pursuant to the Act of June 17, 1913, P. L. 507, as amended, 72 P.S. § 4821, commonly known as the Personal Property Tax Act. The Act empowers counties to levy a tax at the rate of four mills of each dollar of the value of designated personal property. The tax in the instant case was levied on the face value (sale price less principal paid) of the articles of agreement. It is the county's position that such taxes are due and owing for the years 1964 through 1968.
Appellant filed a petition for reassessment with the Board of Assessment and Tax Revision. After argument, the Board entered a decision denying all relief requested in the petition.
Appellant then appealed to the Court of Common Pleas of Lehigh County, which subsequently affirmed the decision of the Board. This appeal followed.
Three basic questions are presented for our determination:
I. Does the Act of April 4, 1868, P. L. 61, as amended, 72 P.S. § 4731, exempt appellant's agreements of sale from the Personal Property Tax Act;*fn1 if appellant is not so exempted, we must also decide:
II. Does the five-year statute of limitations for assessments contained in the Personal Property Tax Act begin to run on the date that the taxpayer is required to file his return or on December 31st of the year for which the tax is imposed; and
III. Does the Personal Property Tax Act require that appellant's agreements of sale be taxed at their face value (sale price less principal paid) or at their fair market value?
It is appellant's contention that Lehigh County is precluded by the terms of the Act of April 4, 1868, P. L. 61, 72 P.S. § 4731 (hereinafter referred to as Act of 1868), from levying a personal property tax on agreements of sale held by private individuals.*fn2
While it is true that the Act of 1868 has never been explicitly repealed, the historical note which follows it in Purdon's strongly suggests that implied repeal has taken place: "Counties, without exception, now tax mortgages, judgments, etc., contrary to the provisions of this section. It has been suggested that this section is impliedly repealed by act 1913, June 17, P. L. 507 (incorporated in this title). The species of property named in this section were subject to taxation for local as well as state purposes by section 32 of the ...