Western Beverage Co. v. Hansen Et Ux.

The Western Beverage Company brought an action to quiet title to the North half of Lot 2, Block 7, Plat C, Richfield Townsite Survey in Sevier County, Utah. Plaintiff alleges ownership. Defendant denies plaintiff's ownership and claims The City of Richfield is owner of the lot in question.

The record is brief and uncertain. Appellant has stated the issue. No exception to the statement made is taken. In the words of the appellant, the issue is:

"That after the lien for special improvements had accrued there was duly levied a general tax against said property and that all the proceedings were duly and legally taken to authorize Sevier County to sell the same for delinquent taxes and that the respondent became the purchaser of the tax title from Sevier County * * * that the only question to be presented to the court is whether or not the sale of the property by the county for general taxes extinguishes the lien of The City of Richfield for its special improvement taxes."

When real estate is sold for taxes, after published notice of delinquency, the county treasurer is required to make out and deliver to the county a certificate of sale. Revised Statutes *Page 336 of Utah 1933, Section 80-10-34. Whether redeemed before the time for redemption has expired or "Sold for taxes 1 at private sale," as provided by statute, R.S.U. 1933, Sec. 80-10-36, subsequent taxes must be assessed. While the certificate of sale is held by the county, the treasurer shall not sell for taxes the so assessed property covered by the tax sale certificate, until the time for redemption, under the previous sale, shall have expired. R.S.U. 1933, Sec. 80-10-40. If any property sold to the county and not assigned is not redeemed after the filing of the tax sale record by the recorder, and after the expiration of the redemption period, the county auditor shall make out a deed conveying to the county all such property. R.S.U. 1933, Sec. 80-10-66.

Some argue title passes at the time of the sale for delinquent taxes "subject to redemption." Some that such "sale" lays the foundation for the beginning of the running of the statute of limitations or the period of "redemption" upon the expiration of which time the title of the owner against 2 whom the tax was assessed is extinguished or the right to redeem, reacquire or recover title is lost. In either case, when the auditor's deed is executed and delivered, under certain circumstances, all rights of redemption are extinguished. Under different circumstances, such rights may not be extinguished until the "May Sale." In any event, the tax lien attaches from the date of levy as fixed by the statute. The processes following are matters pertaining to the ultimate maturity of the lien ending in complete transfer of title or the extinguishment of the lien by payment or conformance to requirements necessary to extinguish the lien so attached.

The answer to the question here involved depends upon the construction to be given to Sec. 15-7-48, R.S.U. 1933. The part of the section relating to that question reads:

"Special assessments made and levied to defray the cost and expense of any work or service contemplated by the provisions of this article, and the cost of collection thereof, shall constitute a lien upon *Page 337 and against the property upon which such assessment is made and levied from and after the date upon which the ordinance levying such assessment becomes effective, which lien shall be superior to the lien of any mortgage or other encumbrance, whether prior in time or not, except the lien of general taxes, and such lien shall continue until the tax is paid notwithstanding any sale ofthe property for or on account of a general or special tax." (Italics added.)

The statute provides for superiority of the general tax lien when it is said "which lien [special assessment lien] shall be superior" to other liens "except the lien of general taxes."

The last clause of the section then provides that the special assessment lien continues against the owner "until the tax is paid notwithstanding any sale of the property for or on account of a general or special tax"; but such continuance does not prevent the county or a purchaser other than a 3 redemptioner acquiring good title from the county in pursuance of the maturity of the general tax lien and transfer of title. The lien continues against the owner and his rights in the property; but when the superior general tax lien is made effective in extinguishing the owner's title, one taking title in pursuance of the foreclosure of such superior lien secures a good title.

Had the statute read, "the special assessment `lien shall besuperior to the lien of any mortgage or other incumbrance whether prior in time or not * * * and such lien shall continueuntil the tax is paid notwithstanding any sale of the property for or on account of a general or special tax'" there would have been no difficulty, in so far as language goes, in concluding that the intention was to establish the superiority of the special assessment lien. This statement is subject to what we further say about "lien."

On the other hand, had the statute read, "the special assessment `lien shall be superior to the lien of any mortgage or other encumbrance whether prior in time or not, except thelien of general taxes,'" no one would deny the superiority of the general tax lien. *Page 338

Skeletonized and put into juxtaposition, we have this:

"Special assessments * * * shall constitute a lien * * * which lien shall be superior to any lien or other encumbrances * * * except the lien of general taxes, and such lien shall continue until the tax is paid notwithstanding any sale * * * on account of a general or special tax."

If the provisions of the statute can be harmonized, it is our duty to harmonize them. University of Utah v.Richards, 20 Utah 457, 59 P. 96, 77 Am. St. Rep. 928; 4Lawson v. Tripp, 34 Utah 28, 95 P. 520; Nelden v.Clark, 20 Utah 382, 59 P. 524, 77 Am. St. Rep. 917.

All provisions must be given effect in spite of apparent conflict if it is possible to do so. Buckle 5-7 v. Ogden Furniture Carpet Co., 61 Utah 559,216 P. 684.

"Differences of time are to be disregarded in construing a code, if by disregarding them, and looking at the work as a whole, harmony can thereby be produced; but if this proves impossible, if, after exhausting every scheme of reconciliation, there still remains a palpable and irrepressible conflict, we are compelled, in the absence of any thing else indicative of the legislative will, to determine it by adopting its latest declaration." Gibbons v. Brittenum, 56 Miss. 232.

Where the first provision of a statute conforms to the obvious policy and intent of the legislature, it is not rendered inoperative by inconsistent provisions in the later provision which do not conform to that policy and intent. In such case, the later provision is nugatory and will be disregarded. 6 Am. Eng. Ann. Cas., note p. 860; State ex rel. Patterson v. Bates,96 Minn. 110, 104 N.W. 709, 113 Am. St. Rep. 612; McCormick v.Village of West Duluth et al., 47 Minn. 272, 50 N.W. 128.

If the one interpretation is a more practical solution and gives effect to fundamentals, not present in the other, then that solution should be accepted. The legislative 8, 9 intent is controlling and in the end it is the legislative intent we strive to make effective. *Page 339

It has been suggested that:

"There can be no doubt that unless the legislature plainly specifies otherwise, the county, either at the 10 expiration of four years from delinquency, at auditor's deed or at May Sale obtains title free from liens."

With this statement we are in accord and the following cases support the position: Robinson v. Hanson, 75 Utah 30,282 P. 782; Hanson v. Burris, 86 Utah 424, 46 P.2d 400.

Let us see what the practical situation is: No provision has been made for a joint collection of the special assessments for improvements and general taxes. The legislature might have provided for filing with the county tax officers a statement of special taxes due, for a pro-rata division of the proceeds from the tax sale, or some other adequate or 11 suitable procedure. This has not been done. Nor has any other method been provided whereby the general taxes and special assessments are merged or may be prorata distributed or jointly satisfied. The procedure for each is separate, and joint tenancy is impossible under the procedure provided. Either the general tax lien is superior, and upon its legal foreclosure wipes out all other liens, or the special assessment lien is superior, and when properly and legally foreclosed wipes out all other liens, if the lien, or the results of its foreclosure, remains: "untilthe tax is paid, notwithstanding any sale on account of a general or special tax." The tax sale does not extinguish a mortgage lien or other encumbrance. Neither does a special assessment lien. It is the final foreclosure of the lien and transfer of title that does it.

The right of redemption created by the statute, if exercised before the redemption period expires, leaves the liens in status quo; or if in abeyance and after sale and before redemption, redemption revives them. When the redemption period expires and the further proceedings provided by the statute are taken the lien is made effective and the rights thereunder, when exercised by the county, merge the lien *Page 340 into title. The problem is then one of title and is not one of the existence of or the superiority of the lien. The title of the owner is extinguished and the new title is initiated and unless some lien not extinguished by the exercise of a valid lien persists, clear title goes to the new owner. A title given after a May Sale by the county would be no title at all if another lien could come forward and extinguish that title.

In the event of default in the payment of a special assessment, the property charged therewith is sold for such assessment and costs in the manner provided by law or ordinance as for sales for delinquent general taxes. 12 Thereupon the special assessment lien is extinguished; but the general tax lien is not extinguished because of the sale for a special assessment. It is provided that if no person shall bid at such sale the amount due for the delinquent assessment, the property shall be deemed sold to the city or town for the amount of such assessment and costs.

The city or town holds subject to the right of redemption and the right of redemption may be exercised upon payment of the full amount of the special assessment and such sale does not affect the lien or right to sell for subsequent general taxes. It is provided that the city or town on making the sale 13 for such special assessments shall pay the holder of the warrants or bonds issued against the property charged with the payment of the lien created for such assessments. The city or town is thereby subrogated to the rights of the holders of such bonds or warrants. The period of redemption from special assessment sales, and they are summary, is three years. R.S.U. 1933, Sec. 15-7-48.

The general set up for the collection of special improvement taxes is more nearly analogous to drainage district and irrigation district bonds and warrants, discussed in the case ofHanson v. Burris, supra, than to a general tax lien.

Section 80-10-1, Revised Statutes of Utah 1933, relating to general tax lien provides:

"Every tax has the effect of a judgment against the person, and every lien created by this title has the force and effect of an execution *Page 341 duly levied against all personal property of the delinquent. The judgment is not satisfied nor the lien removed until the taxesare paid or the property sold for the payment thereof." (Italics added.)

It definitely appears that if the language of both sections is to be given effect and both liens are existing until the taxes are paid, the failure to pay the taxes creates a lien in perpetuity. Surely, this result is not intended. If 14 either one must yield, the tax which supports governmental functions on general principles must prevail. SeeRobinson v. Hanson, supra, and Hanson v. Burris, supra.

Section 80-10-3, R.S.U. 1933, also relating to the type of lien for general taxes provides:

"Every tax upon real property is a lien against the property assessed; and every tax due upon improvements upon real estate assessed to others than the owner of the real estate is a lien upon the land and improvements; which several liens attach as of the 1st day in January of each year."

There are further provisions of the statute indicating the legislative intent to make the lien for general taxes superior.

Section 80-10-36, R.S.U. 1933, provides:

"At any time after the sale and before the time for redemption has expired, the county treasurer is authorized and required, at private sale, at his office, to sell and assign the interest of the county in any of the real estatesold to the county for delinquent taxes to any person 15 [and `person' includes bodies politic and corporate, partnerships, associations and companies, Section 88-2-12, sub. (5), Revised Statutes of Utah, 1933] holding a recorded mortgageor other lien against such real estate, upon payment of the amount of the delinquent taxes, interest, penalty and costs thereon; and the county treasurer shall deliver duplicate receipts to the purchaser of such interest, on which he shall write `Sold for taxes at private sale.' Upon presentation of one of such receipts to the county auditor, he shall make out and deliver to the purchaser an assignment of the certificate ofsale made to the county. Real estate sold to the county and afterwards assigned shall be subject to redemption as hereinafter provided, at any time within four years after the date of the original sale." (Italics added.) *Page 342

"Sale" and "sold," as herein used, do not refer to such sale as extinguishes the title of the owner and initiate a new title in the purchaser, either county or otherwise, so as to extinguish the right to redeem, nor prevent revesting 16 of title in the owner upon redemption or the assignee lienholder, upon expiration of the redemption period when assignment of the certificate of tax sale has been made to the recorded lien holder.

The legal issuance of a special assessment bond or warrant creates a right against the property assessed in favor of the city or the holder of the special assessment bond or warrant and runs against the specific property of the 17-18 owner within the special improvement district. The levy is upon the district, the amount of the lien is that specified to be due from each owner as apportioned by the special assessment board, and may be satisfied prorata upon sale of the property of the delinquent against whose property the special assessment runs.

It is further provided, Section 80-10-68, R.S.U. 1933, that whenever a county has received a tax deed, that the board of county commissioners, after notice, shall offer for sale all real property not theretofore sold or redeemed, and in pursuance of that section, supra, and upon such sale which is not a tax sale but a sale of property held by virtue of a tax deed,

"the county clerk is authorized to execute deeds therefor in the name of the county and attest the same by his seal, vesting inthe purchaser all of the title of the state, of the county, andof each city, town, school or other taxing district interested inthe real estate so sold." (Italics added.)

It can be said of the statutory provisions that there is intention on the part of the legislature to make each and all other liens, whether for special assessments or other encumbrances subject to the lien for general taxes and that the lien for general taxes shall persist until the 19 taxes are paid. This construction eliminates the necessity of two liens each persisting until the taxes are paid, with the *Page 343 uncertainty as to whether either one will ever be paid as taxes. The two taxes in question are not of equal rank. That is manifest. The May Sale under the decisions heretofore rendered by this court initiates a new unencumbered title from the sovereign state.

"We are not dealing with claims of intrinsic equality. The claim for the necessary support of government is a higher obligation than the demand for the costs of a local improvement, even though the latter has quasi public features. The first and paramount necessity for social order, personal liberty, and private property is the maintenance of civil government; and government cannot exist without revenues. The necessity and importance of preferring the lien for general taxes over other claims are so impelling that the priority of the sovereign claims of the state will not be depreciated or denied without warrant from the Legislature in clear and unmistakable terms; and we find no such warrant from the Legislature. The provisions of the statute upon the subject are not inconsistent with the priority of the right of the state to its necessary revenues." Robinson v. Hanson, supra [75 Utah 30, 282 P. 784].

The decision of the trial court is affirmed. Costs to respondent.

LARSON and PRATT, JJ., concur.