Spratt v. Price

Mr. Justice Westcott

delivered the following opinion on the petition for rehearing at-the June Term, A. D. 1881: .

In the opinion in this case wre reviewed all the cases we *315could find' having a bearing upon the questions involved. The principles announced in the case of the Connecticut Mutual Life Insurance Company vs. Butte, decided by the Supreme Court of Michigan at January Term, A. D. 1881, of that court, which case was not then before us, it is insisted discloses the error of our conclusions in this case. We examine that case.. It was an action of ejectment by a first mortgagee against a second mortgagee claiming under a tax title acquired by second mortgagee’s agent after foreclosure and sale under the second mortgage, the first mortgagee having subsequently foreclosed and purchased the property. The court assimilate the case to that of one tenant in common purchasing at a tax sale the interest of his co-tenant, and remark that “it is no doubt true that a second mortgagee is under no obligation to protect the first mortgagee, and that the real point in controversy is whether, if the second mortgagee pay the taxes or bid off the land, the payment or purchase will not ipso facto constitute a protection,” and the decision is that when the second mortgagee (the party purchasing in that case,) is in a position to add the amount of the purchase to the amount of his mortgage lien, and the first mortgagee assents thereto, then the purchase should be treated as a payment only, that the first mortgagee could not recover in ejectment without a tender of repayment of the tax, and that such tender involved the admission that the second mortgage was a living unextinguished lien. The court say, however, that if this second mortgage is destroyed by the subsequent foreclosure proceeding of the first mortgagee there was no equity entitling the first mortgagee to insist that the purchase was a payment, and the tax deed would be sustained, and that if the first mortgagee denied the existence of the second mortgage, there was nothing to preclude the second mortgagee from insisting that he held, the tax title *316as any mere stranger to the title. "We have stated the case very fully in order that the great difference between it and the case at bar may be seen. "When Price here purchased at the tax sale, he was, so far as Spratt was concerned, a stranger to the title. He was not a mortgagee as to Spratt, for Spratt’s claim is that he held then the title discharged of Price’s mortgage lien. If Spratt got any title it was' free from this lien, as he was a stranger to the title to Price, the mortgagee, and to Comfort the mortgagor. Spratt does not here propose to tender Price the money he has paid, nor does he admit that Price’s mortgage is now a subsisting lien. Spratt himself was no mortagee, either first or second. He purchased at a tax sale, which he contends destroyed any mortgage lien, and it certainly would be very strange indeed if he can claim that Price was a mortagee whenever it operated for his, Spratt’s, benefit, but not a mortgagee when it is to result in his, Spratt’s, injury. It is true that in this case in Michigan, Judge Cooley, speaking of the relations of first and second mortgagees and mortgagor to the State, remarks that “ each one of the three may be said to owe the duty to pay the taxes, and the State will sell the interest of all if none of the three shall pay.” As applicable to that case, such a general remark may or may not be the subject of adverse criticism. It may be within the line of thought which its peculiar circumstances inspired, but it is not, and cannot be, applicable to this case, so different in its facts that the peculiar equities announced in the Michigan case cannot be operaative. Again, this language, if. given the signification which appellant contends for, is certainly in conflict with the ideas of “ duty to the State,” as announced by the same court in the case of Blackwood vs. Van Vleit, 30 Mich., 123, where the particular matter was the subject of its consideration.

*317We had occasion in the case of Gorton vs. Paine, decided at last term, to consider the relation of a second mortgagee purchasing a tax title after foreclosure of his mortgage to the first mortgagee, and we refer to that case for our views upon the subject. As to the relation of a mortgagee out of possession, under no contract to pay the taxes to the State and to the mortgagor in possession, from which it is sought here to make Price, by his .purchase at a tax sale, pay a tax due upon the then property of Spratt, we will repeat that he owed no obligation to the State or to his mortgagor to pay the taxes upon the land. He was, or should have been, taxed upon the security which he held. Lamar vs. Palmer, Collector of Revenue, 18 Fla. To pay this is the extent of his legal duty. The mortgaged land may be valued at ten thousand dollars, and the mortgage be for five hundred. The tax against the mortgage is for the latter sum. This is the extent of his interest. True it may be that a sale for the tax levied against the land of the mortgagor would destroy this security of the mortgagee, and it is on account of this resulting loss that some of the courts hold that he may pay the tax before sale, and the statute gives him a right to redeem after sale, and not because of any “ duty ” that he owes either to the State or to the mortgagor which requires him to pay a tax due by a person other than himself. As to the matter of relation of the deed to the day the party was entitled to it, we can only repeat what we have said in the opinion. Erom the day he was entitled to the deed he had the equitable title. His purchase was at public sale and the facts which constituted the basis of the action of the court were matters readily ascertainable by the appellant.

The rehearing is denied.