No. 13766
IN THE SUFREME COURT OF THE: STATE OF MONTANA
1977
BENITO STEWART and ANGELA STEWART,
husband and wife,
Respondents and Plaintiffs,
-vs-
BOARD OF COUNTY COPMISSIONERS OF
BIG HORN COUNTY, MONTFJ~A,
Appellant and Defendant.
MARY BROKEN ROPE,
Appellant and Plaintiff,
-vs-
BOARD OF COUNTY COBLMISSIONERS OF
BIG HORN COUNTY, MONTANA,
Respondent and Plaintiff,
-vs-
MARY ELIZABETH TOBACCO,
Appellant and Plaintiff
-vs-
BOARD OF COUNTY COMMISSIONERS OF
BIG HORN COUNTY, MONTANA,
Respondent and Defendant.
Appeal from: District Court of the Thirteenth Judicial District,
Honorable Leonard H. Lanqen, Judge presiding.
Counsel of Record:
For Appellants:
Hon. Mike Greely, Attorney General, Helena, Montana
Mike McCarter, Assistant Attorney General, argued,
Helena, Montana
James E. Seykora, County Attorney, argued, Hardin, Montana
For Respondents:
Edwin Dyer argued, Hardin, Montana
William D. Hutchinson argued, Helena, Montana
Submitted: December 5, 1977
Mr. Justice Frank I. Haswell delivered the Opinion of the Court.
These three cases were consolidated on appeal because they
involve the same issues. The plaintiffs brought suit to have certain
tax deed sales declared null and void and to exercise their alleged
statutory preferential right of repurchase. The defendant Board of
County Commissioners appeal from the District Court's decision in
Stewart, and the plaintiffs in Broken Rope and Tobacco appeal from
the decisions for the defendant Board in those cases.
Benito and Angela Stewart, husband and wife, owned certain
real property in Wyola, Montana. The Stewarts fell delinquent in
their real property taxes, and on March 3, 1975, Big Horn County
acquired the property by tax deed. On April 9, 1975, this property
was sold at public auction to Mr. and Mrs. Gilbert Harris.
Mary Broken Rope owned certain real property located in
Crow Agency, Montana, and Mary Elizabeth Tobacco owned certain real
property located in Wyola, Montana. They also fell delinquent in
their real property taxes. On June 30, 1975, Big Horn County ac-
quired these properties by tax deed and on November 17, 1975, it
offered them for sale at public auction. Daniel and Carlene Old Elk
purchased the Broken Rope property under a contract of sale dated
November 18, 1975, and Clarence and Violet Englert purchased the
Tobacco property at the November 17, 1975 public sale.
The plaintiffs in all these cases filed similar complaints
against the Board of County Commissioners alleging that the Board
did not comply with section 84-4190, R.C.M. 1947, the statute govern-
ing the procedure for sale of county tax deed lands, and that there-
fore the sales of these particular properties were null and void.
Section 84-4190 requires the Board to determine the fair market
value of the property for sale, to state that value in the ~ o t i c e
of Sale, and to make no sale of the property for less than that
value. The plaintiffs allege that this statute requires the Board
to make an objective determination of the fair market value of the
properties according to certain accepted methods of determining fair
market value but that the Board failed in this respect because the
Notices of Sale placed an "unreasonably low value" upon their
properties. They further allege that once the sales are set aside,
they should be allowed to exercise their statutory right of repur-
chase under section 84-4190 and that they stand "ready, willing and
able" to exercise this right.
In all three cases, the defendant Board filed motions to
dismiss for failure to state a claim for relief. These motions
were subsequently denied. The Board then answered the complaints
and alleged the following affirmative defenses: (1) Section 84-4190
states that the Board of County Commissioners shall determine and
fix the fair market value of the properties to be sold, thus leaving
the entire appraisal value in the discretion of the Board; (2) the
complaints failed to state a claim for relief; and (3) the applicable
statute of limitations barred the action.
In the Stewart and Broken Rope cases, interrogatories and
answers were filed indicating the procedure the Board followed in
establishing the fair market value of the properties. In all three
cases, the parties stipulated as to the appraised values contained
in the Notices for Sale and the amount of the taxes, penalties and
interest due at the time of the taking of the tax deed by Big Horn
County on all properties offered for sale at the April 9, 1975 and
November 17, 1975 public sales. The plaintiffs contend that the
answers to interrogatories and the stipulations demonstrate that
the Board established the fair market value of these properties
merely by rounding off to the nearest whole number the amounts owed
on the properties for taxes, penalties and interest and that such
method of establishing the fair market value was arbitrary.
Both parties in the three cases moved for summary judgment.
After briefs were submitted and oral argument heard, the District
Court entered judgment in favor of the Stewarts in Stewart, and in
favor of the Board in Broken Rope and in Tobacco. The losing
parties appealed.
Both sides have raised numerous issues on appeal regarding
the action taken in the District Court. In addition the Board
asserts for the first time on appeal several procedural issues
including whether the plaintiffs lack standing to challenge the
method by which the Board determined the fair market value of the
properties in question. Because we feel the standing issue must
be decided adversely to the plaintiffs, we will not discuss the
other issues which the parties have raised.
The concept of standing arises from two different doctrines:
(1) Discretionary doctrines aimed at prudently managing judicial
review of the legality of public acts, 13 Wright, Miller & Cooper,
Federal Practice & Procedure: Jurisdiction 83531 at 176; and (2)
doctrines of constitutional limitation in the federal courts drawn
from the "cases and controversies" definition of federal judicial
power in Article 111, United States Constitution and in the Montana
courts drawn from the "cases at law and in equity" definition of
state judicial power in Article VII, 1972 Montana Constitution.
Prior Montana cases which have dealt with the issue of
standing have considered it in the context of challenges to the
constitutionality of legislative enactments, Chovanak v. Matthews
(1948), 120 Mont. 520, 188 P.2d 582, and in the context of taxpayer
and elector suits, State ex rel. Mitchell v. District Court (19541,
128 Mont. 325, 275 P.2d 642; Holtz v. Babcock (1963), 143 Mont. 341,
389 P.2d 869, reh-den. (1964), 143 Mont. 371, 390 P.2d 801; and
State ex rel. Conrad v. Managhan (1971), 157 Mont. 335, 485 P.2d 948.
From these cases we synthesize that the issue presented for
review must represent a "case" or "controversy" within the judicial
cognizance of the state sovereignty. Additionally, the following
minimum criteria are necessary to establish standing to sue a
governmental entity: (1) The complaining party must clearly allege
past, present or threatened injury to a property or civil right; and
( 2 ) the alleged injury must be distinguishable from the injury to
the public generally, but the injury need not be exclusive to the
complaining party.
What injury to a property or civil right have the plaintiffs
alleged? In their brief, the plaintiffs argue that section 84-4190
requires the Board to appraise and sell tax deed properties at their
fair market value, not an arbitrarily selected lower value, "in
order to protect the interest of the taxpayers of the County as a
whole." Apparently, their theory is that properties sold for less
than their fair market value will decrease county revenues thereby
eventually increasing county taxes. The plaintiffs, however, do
not allege in their complaints that they are taxpayers of Big Horn
County and therefore, have elected not to base their standing on a
taxpayer status.
Instead, they allege that the injury they will suffer if the
tax deed sales are declared valid is to deprive them of their pre-
ferential right to repurchase their properties under section 84-4190.
This right allows them to repurchase their properties by paying only
the taxes, penalties and interest due instead of paying the property's
fair market value as determined by the Board of County Commissioners.
The preferential right of repurchase in section 84-4190 is
not an absolute right, but a defeasible right. This right vested
in the former owners of tax deed property is defeated if he does
not pay the taxes, penalties and interest due " * * * before the
time fixed for the first offering of said property for sale * * *."
Section 84-4190, R.C.M. 1947. Although one of the tax deed properties
involved in these cases was offered for sale and sold on April 9,
1975, and the property in the other two cases was offered for sale
and sold on or about November 17, 1975, the plaintiffs apparently
at no time have attempted to make the required payments. In their
complaints, they allege only that they stand "ready, willing and
able" to exercise their preferential rights of repurchase. Plain-
tiffs have not alleged in their complaints that they have complied
with the provisions of section 84-4190 by making tender of the taxes,
penalties and interest due on their properties before the respective
first offerings of their property for sale. Due to their own inac-
tion, the preferential right granted them by section 84-4190 no longer
exists. Having lost their preferential right to repurchase, the
plaintiffs have alleged no injury to a property or civil right. We
therefore hold that they lack standing to sue the Board of County
Commissioners for alleged improper procedure in the tax deed sales
of their former properties.
Plaintiffs argue that if this Court were to declare the tax
deed sales null and void for failure of the Board of County Comrnis-
sioners to follow proper statutory procedure in the sale of the
property, they would still he able to exercise their preferential
right of repurchase "before the time fixed for the first offering"
of the property for sale. This contention cannot withstand an
examination of the legislative history of section 84-4190.
The original predecessor of the preferential right of repur-
chase provision in section 84-4190 was first enacted in 1933. The
history of amendments to this section demonstrates that the legis-
lature has constantly narrowed the time frame within which the
preferential right may be exercised. As initially enacted in 1933,
and then re-enacted in 1939, the statute provided that the taxpayer
could exercise the right "at any time before such sale". 1933 Mont.
Laws (~xtra.),Ch. 33, S1; 1939 Mont. Laws, Ch. 181, S1. This
Court held that under this language if the property was offered for
sale but not sold, the taxpayer could still exercise his preferential
right of repurchase. State ex rel. Johnson v. Garfield Co. (1944),
116 Mont. 300, 151 P.2d 481. In 1941, the legislature amended the
statute to read that the taxpayer could exercise the right "at any
time before the date fixed for such sale". 1941 Mont. Laws, Ch. 171,
S1. Under this language even though the property had been offered
for sale but not sold, the taxpayer was precluded from later exer-
cising his preferential right of repurchase. Beckman Bros. v. Weir
(19471, 120 Mont. 305, 184 P.2d 347.
The 1941 amendment left unresolved the situations where the
Board set one date for the sale but because no sale was made, it
later set a second date for the sale, or as in the instant case where
the sale is made but is later declared null and void. The 1945 amend-
ment resolves these situations. The legislature amended the statute
to its present form; the taxpayer could exercise his preferential
right of repurchase "at any time before the time fixed for the first
offering of said property for sale." 1945 Mont. Laws, Ch. 144, S1.
The clear emphasis of this language is on the time fixed for
the first offering of the property for sale, not on whether the sale
was actually consummated or whether it was later set aside. The
legislative amendments to this statute evince an intent to fix a pre-
cise time at which the taxpayer's right to repurchase is defeated.
That time is at the "first offering" of the property for sale, not
at the first completed sale or at the first unchallenged sale.
A first offering of the properties for sale was made on
April 9, 1975 for one of the properties and on November 17, 1975 for
the other properties. The plaintiffs did not allege in their com-
plaints that they tendered payment before those respective dates.
Under no set of facts that they have alleged have they shown injury
to themselves for which this Court may grant relief.
Plaintiffs argue that the defendant Board is raising the
issue of standing for the first time on appeal and that under the
rule in LaBonte v. Mutual Fire & Lightening Ins. Co. (1925), 75
Mont. 1, 241 P. 631, the Board is now precluded from raising this
defense. The question raised in LaBonte, however, was whether the
plaintiff was the real party in interest, not whether the plaintiff
had standing to sue. The concepts of "standing to sue" and "real
party in interest" are very different. 6 right & Miller, Federal
Practice & Procedure: Civil 81542. Objections to standing cannot
be waived and may be raised by the court sua sponte. United States
v. Storer Broadcasting Co. (19561, 351 U.S. 192, 197, 76 S.Ct. 763,
100 L.Ed. 1081; 6 Wright & Eliller, Federal Practice & Procedure: Civil
81542 at 642-43.
The judgment in Stewart is reversed and the judgments in
Broken Rope and -
Tobacco are affirmed.
T-&?.p4
Justice
We Concur:
>
Justices