Eastman v. Thayer

We have not found it necessary to consider the objection of multifariousness. The only question then is, whether the bill states a case against the defendants Jackman and Aldrich. We are of opinion that it does not.

The allegations against Jackman, so far as they relate to the tax title, are, substantially, that he has been in possession of the mortgaged premises since December, 1878, receiving the rents and profits, and ought to have paid the taxes in question, but that he permitted the premises to be sold for their non-payment, and the *Page 412 consequent tax title to become an incumbrance on the property and a cloud upon the title. But there is no allegation that he had knowledge that the taxes were unpaid, or of the sales before the time of redemption bad expired. Neither is it alleged that there was or is any collusion between Aldrich and him, nor that he claims any interest in the tax title, nor that there have been any rents or profits from which the taxes could have been paid or the land redeemed.

It follows, then, that no actual, positive fraud is charged upon Jackman; and we think that his alleged negligence cannot be held to amount to constructive fraud, for while it would seem that there was negligence as to the payment of the taxes, he is no more chargeable with it than are the plaintiffs. Both had a like interest to preserve their respective mortgage liens, and, so far as appears, Jackman had no more knowledge of the assessment and sale than the plaintiffs had, and no better facilities for obtaining such knowledge; and not having acquired possession of the mortgaged premises until more than six months after their sale for the taxes, and knowledge of the sale not being charged, there was no more obligation on him to redeem than on them. Had the assessment and sale been after he got possession and was receiving an income, his obligation would have been quite different.

Relative to the matter of redemption, the bill does not allege that there is any controversy as to the amount due on the Jackman mortgage, or that the plaintiffs have ever offered to redeem, or that they are willing to pay the amount due upon it. On the contrary, without alleging any wrong on the part of Jackman touching the foreclosure of his mortgage or its redemption, and with no averment of their readiness to pay the mortgage debt, the plaintiffs invoke the aid of the court to stay the foreclosure for an indefinite period, until they ascertain whether it will be for their interest to redeem or not; and this, of course, will depend upon the validity of the tax title, the value of the mortgaged premises, and the result of their suit-at-law against Thayer.

We are aware of no precedent for the bill in this respect, nor of any principle of equity by which it can be held that Jackman should be subjected to expense and protracted litigation, when, for aught that appears, he is ready and anxious to receive the amount justly due to him. Courts can only decide upon the rights of parties as they exist, and have no jurisdiction to enable parties to try experiments (Alexander v. Colcock,58 Tenn. 282, 284); and it is therefore sufficient to say, that this court has no jurisdiction to decide beforehand whether the plaintiffs can acquire a valid title to the land but the redemption of the Jackman mortgage, nor will it entertain a bill which seeks to keep the question of redemption open until various other litigated matters are determined, and until all the embarrassments and clouds around and upon the title are removed. The plaintiffs must decide the question of redemption *Page 413 for themselves: asking for equity, they must do equity. The demurrer of Jackman is sustained.

The case made against Aldrich is, in some respects, one of more difficulty.

The bill charges in general terms that the proceedings connected with the tax sale "were in fraud, and were an attempt to unjustly deprive the plaintiffs of their rights." But it is not sufficient to charge fraud in such general terms. Sto. Eq. Pl. (9th ed.), ss. 251, 252; Pearson v. Tower,55 N.H. 36-38. If fraud is charged in a bill, and the facts constituting it are not specifically set forth, it is not admitted by a demurrer. Flewellen v. Crane, 58 Ala. 627. If, however, the charge of fraud was well alleged, no fraudulent acts are pointed out on the part of Aldrich or alleged to be within his knowledge. There is no allegation whatever that he procured the tax title by his own fraud, or by his violation of legal duty or public policy. The only charge against him in this respect is, that he bought the premises at the tax sale for the purpose of enabling him to procure a title against Thayer so that he might collect a debt of him which was unsecured. This was neither illegal nor inequitable, but simply the exercise of proper vigilance: the laws serve the vigilant, not those who sleep upon their rights. If, therefore, the bill can be maintained against Aldrich, it must be by reason of the proceedings upon which his title is based.

Waiving the question whether a party out of possession can maintain a bill to remove a cloud to the title of land (see Campbell v. Allen,61 Mo. 581, McLean v. Presley, 56 Ala. 211, Polk v. Pendleton, 31 Md. 118, Barron v. Robbins, 22 Mich., 35, Shaffer v. Whelpley, 37 Wis. 334, Herrington v. Williams, 31 Tex. 448, Douglass v. Nuzum, 16 Kan. 515, and Company v. Bedford, 8 Nev. 399), the true inquiry is whether the tax deed in question constitutes a cloud which equity ought to remove. We hold that it does not.

A tax deed is not the title itself, nor even prima facie evidence of it, unless made so by statute. No presumption arises, from the mere production of it, that the facts upon which it is based had any existence. Black. Tax Tit. 430; 2 Wn. R. P. 545. They must be proved aliunde. The claimant must show affirmatively that the prerequisites of the statute authorizing the sale and conveyance have been strictly complied with. Cahoon v. Coe,57 N.H. 556, and cases cited. The deed itself, at most, can give color of title only: by the mere sale, the purchaser takes no color of title. Annan v. Baker, 49 N.H. 161. The sale of land for taxes by a collector, being but the exercise of a naked power, not coupled with an interest in the land, his deed of it, from its very nature, does not necessarily cast a cloud upon the title: it is but a single link in the chain of title which must be preceded by many other equally vital links, which must appear by the record. It is *Page 414 obvious, therefore, that the deed of a collector, or any deed given in the exercise of a mere power, stands upon very different ground than ordinary deeds which are coupled with an interest. Nevertheless, taxes in this state being a lien upon lands may undoubtedly constitute a cloud upon the title, which a court of equity, for good cause, may and will remove. Brooks v. Howland, 58 N.H. 98.

What, then, is a cloud upon title? "A cloud upon one's title is something which constitutes an apparent encumbrance upon it, or an apparent defect in it. — something that shows prima facie some right of a third party either to the whole, or some interest in it." Cool. Tax. 542. The deed of a collector of taxes may or may not constitute such a cloud. It depends entirely upon circumstances. When its invalidity appears upon its face, or the proceedings upon which it is based do not show a compliance with the statute requirements, so that an inspection of the record, and a comparison of it with the law, will furnish a decisive test of its illegality, it does not constitute an encumbrance or apparent defect of title, and in no just sense can it be said to constitute a cloud. Ib. 542, and cases cited. "And, accordingly, it is now fully established that in such cases courts of equity will not interpose their authority to order a cancellation or delivery up of such instruments." Sto. Eq. Jur. (12th ed.), s. 700 a. When, however, the illegality or defect does not appear upon the record, but must be shown by evidence aliunde, so that the record would make out a prima facie right in one who should become a purchaser, and the evidence to rebut this case may possibly be lost, or be unavailable from death of witnesses or other cause, or when the deed given on a sale of the lands for the tax would by statute be presumptive evidence of a good title in the purchaser so that he might rely upon it until the illegalities were shown, courts of equity will exercise jurisdiction and extend relief on the ground that a cloud on the title exists or is imminent. Cool. Tax. 543, and Sto. Eq. Jur., s. 700, and numerous cases cited, to which many others might be added.

In the case before us, all the alleged defects in the tax title appear upon the record, and would necessarily be exposed by the proof requisite to establish it; and consequently equity will not take jurisdiction to try its validity.

The demurrer is sustained; and, as to Jackman and Aldrich, the entry is

Bill dismissed.

STANLEY, J., did not sit: the others concurred.

Upon the announcement of the opinion, the plaintiffs filed a motion as follows:

"The plaintiffs move for a rehearing, so far as the decision is inconsistent with the following positions:

"1. The plaintiff in a suit in equity to foreclose a mortgage may join a prior mortgagee as party. In such case, as to him, the bill *Page 415 is a bill to redeem. If there is any defect in the statement of his case, it should not be dismissed till the plaintiff has had an opportunity to amend.

"2. The plaintiff may also join any one who has acquired the rights of the mortgagor subsequent to his mortgage.

"3. When real estate is taxed as resident, it may be sold after the year of lien has expired, so far as the interest of the person taxed is concerned. Such a sale of mortgaged real estate, taxed to the owner of the equity, carries the right to redeem to the purchaser. He is therefore in the place of the mortgagor, and is a proper party defendant to proceedings to foreclose.

"4. Being once properly in court, if he also claims by other title hostile to the plaintiff, he must assert it and defend it, or be foreclosed."