There is much to be said in favor of the doctrine established by the Missouri courts that in tax sales the consideration paid may be so grossly inadequate as of itself to amount to "fraud", requiring that sale and tax deed be set aside. See Johnson v. McAboy, 1943, 350 Mo. 1086, 169 S.W.2d 932.
As to the power of the court of equity in tax cases, we said in the case of In re Trigg, 46 N.M. 96, 121 P.2d 152, 154:
"As said in the Blatt case ([In re Blatt] 41 N.M. 269, 67 P.2d [293] 303, 110 A.L.R. 656): `A court of equity may review upon facts specifically set forth showing the assessment to be soexcessive as to be constructively fraudulent'. (Emphasis supplied.) See also, 61 C.J. `Taxation' § 1128."
It is not readily apparent that if an assessment may be so excessive as to be constructively fraudulent a consideration paid at a tax sale may not be so excessively inadequate as to amount to fraud.
The policy indicated in our law governing sales of real property for delinquent taxes of not selling more than is necessary to realize the tax deed also lends support to this view.
It is true that so far as the express language of 1941 Comp. Sec. 76-704 is concerned, the county treasurer is authorized to sell property for delinquent taxes to the highest bidder provided the minimum proceeds are not less than the amount of taxes, penalties, interest and costs due thereon "except as otherwise provided by law." But as explained in the Missouri decisions, the equitable doctrine against confiscation of property even by the state through the process of selling it for delinquent taxes for a grossly inadequate consideration is superimposed on the statutes.
1941 Comp. Secs. 76-701 and 76-707 indicate that on the fifth day of the sale all property on which no "acceptable bid" has been received shall be sold to the State of New Mexico for the amount of taxes, penalties, interest and costs due thereon.
It is suggested that since the amount of the taxes, penalties, interest and costs due thereon is the minimum which the county treasurer is authorized to accept, it would be within his power to conclude that a bid by a prospective purchaser "other than the state" (§ 76-701) which is so grossly *Page 403 inadequate as to shock the moral sense and outrage the conscience should not be regarded by him as an "acceptable bid" and that the property should be sold on the fifth day to the state. The question might be asked as to why the state should buy for such an inadequate consideration when others may not. The answer to this is to be found in the tax code which provides for the administration of property acquired by the state under tax deeds, and the right of the former owner to have the first and prior right to repurchase such property upon such terms as may be reasonable. It is apparent that there is quite a little difference to the taxpayer as to whether the property has been sold to the state or to one "other than the state." That such a theory of administration of our law relative to tax sales would be just to all concerned is noted by the Missouri Supreme Court in Bussen Realty Co. v. Benson, 1942,349 Mo. 58, 159 S.W.2d 813, 818, where it is said:
"Finally, let us consider how the present law operates in conjunction with the rule. A workable and logical scheme ensues. No party to a sale under the law is hurt, nor do we believe that the effect of the law is minimized. The purpose of the law, of course, is to aid the State in the collection of its taxes. The State is not hurt. When a sale is made it receives its taxes. Additional taxes are collected upon the conveyance. A proceeding to set aside a sale for fraud does not affect these taxes so paid. The purchaser is not hurt. When he purchases at a tax sale he knows he will have to await at least the expiration of the term of redemption before he receives a deed. If the property is redeemed he is reimbursed for all money spent, with interest, higher than the prevailing rate and which may run as high as ten per cent, Sec. 11145. If before a conveyance is made the county collector finds the sale was invalid, he must reimburse the purchaser with interest, Sec. 11155. A person suing to set aside a conveyance both by established principles of equity and also by express statute must make a tender which will reimburse the purchaser, Sec. 11179. And see Hawkins v. Heagerty, [348 Mo. 914], 156 S.W.2d 642. The purchaser is protected under any circumstance. He cannot lose any amount he has paid but is reimbursed with interest. In addition, he may receive rental from the property under certain conditions, Sec. 11135. The purchaser knows that his deed is subject to attack if the provisions of the law have not been complied with. He must also be presumed to have some idea about the value of the property from the fact of his purchase. Consequently, if he is doubtful about the validity of his purchase because of a grossly inadequate consideration, he may, immediately upon receiving a deed, commence a suit to quiet his title, Sec. 11169. On the other hand he may do nothing and await possible action by the owner which the statute says must be brought within three years from the recording of the deed, Sec. 11177. Under the circumstances both the purchaser *Page 404 who buys land at a tax sale for occupation and the purchaser who buys for speculation, have reasonable protection."
All of the foregoing is said more for possible future application than as being important in disposing of the case at bar. While I think the Missouri doctrine heretofore noted has great merit, yet it seems to me that in order for it to work in the manner I have heretofore suggested, the county treasurer would have to know the value of the property offered for sale in order to be charged with the duty of appraising whether the bid made by a prospective purchaser "other than the state" is in fact "grossly inadequate." There are no allegations in the complaint in the case at bar to indicate that the county treasurer had any knowledge of the value of the property except that shown by the tax records which did not disclose any improvements on the property. What makes the great disparity between the amount of the bid and the alleged value of the property rests in the fact that the plaintiff had put, as he says, $1500 worth of improvements on the property. It seems apparent that the plaintiff was at fault in not advising the assessor of these improvements so that the county treasurer might have become informed as to the value of the property. He who would invoke the equitable doctrine of the Missouri courts, as applied to tax sales, as in other cases in equity, should come in with clean hands. Since, though, to my mind the appellant's ground for relief based upon the equitable doctrine heretofore outlined is the strongest he has, yet it is inapplicable because of lack of information in the hands of the county treasurer due to the plaintiff's own fault, I think he cannot prevail, and I therefore concur.