Hilton v. Smith

33 S.W. 464, 134 Mo. 499, 1896 Mo. LEXIS 210

• Court: Supreme Court of Missouri
• Decided: June 2, 1896
• Status: Published

Opinion

DIVISION ONE.

Maceablane, J.

The city of St. Louis, by proceedings in opening Park avenue, condemned portions of lots 5, 6, and 7, of city block, number 1282, and assessed as damages therefor the sum of $1,940.40. The /money was paid into- court by the city, and the two interpleaders, Hilton and Smith, each make claim to it. To which one of them the money belongs, depends upon which one was the owner of the land at the time the condemnation took place.

One Michael Brady was, as agreed, the common source of title. He died in 1868 and left surviving him his widow and four children. On the fourteenth of March, 1878, the widow, who had elected to take a child’s part in the land, and who had in the meantime married one Thomas Bellew, and the children by guardian acl litem, commenced a proceeding for the partition of the land. A decree of partition and order of sale was rendered March 27, 1878, and on the twentieth of April, 1878, the land was sold by a commissioner to John Taylor. The sale was confirmed by the court May 2, 1878, and on the same day a deed was made to the purchaser by the commissioner.

July 3, 1878, John Taylor sold and conveyed the land to Manitho Hilton. On July 8, 1879, Hilton conveyed by quitclaim deed to Florence M. Dickey. This deed was not recorded until March 11, 1880.

On the fourteenth of July, 1879, a suit was commenced in the circuit court by the state, at the relation of the collector, against Manitho Hilton and others to enforce the state’s lien for taxes on the lots for the year 1877. Judgment was rendered May 26, 1880; execution issued November 4, 1880; sale of lots was made to Mary E. Tanner, December 4, 1880; deed delivered to the purchaser December 11, 1880, and recorded January 7, 1881.

Judgment for damages on account of opening the street was entered February 22, 1881.

Florence M. Dickey assigned her interest to the fund in court to Silas D. Hilton, June 22, 1881, and he assigned to the present interpleader, Anna M. Hilton, on October 22, 1891.

Interpleader Smith claims the fund under title to the lots by virtue of several collector’s deeds for taxes secured under the revenue law of 1872. But a brief abstract of these sales and deeds need be given here. They were all under special executions upon judgments of the county court. The first was a sale of lot 5 made October 14, 1875, to N. Banks, who assigned his certificate to Smith. Deed to Huntington Smith, September 19, 18,79, recorded October 1, 1879. This sale was for the taxes of 1874. A sale of lots 6 and 7 was made to N. D. Allen, at the same time, 'under the same judgment,' for the taxes of 1874, the certificate was assigned to interpleader Smith and a deed was made to him, September 19, 1879, which was recorded also October 1, 1879. The lots were all sold again on the eleventh day of October, 1876, this time for the taxes of 1875. At this sale N. D. Allen was also the purchaser. The certificate was also assigned to said Smith to whom separate deeds for each lot were made by the collector September 19, 1879. These deeds were recorded October 1, 1879. To cure defects in these last deeds, on the twenty-ninth day of September, 1880, the collector made corrected deeds to Smith, reciting the purpose for which they were made. These new deeds were recorded October 2, 1880.

A number of objections were made to these deeds but we will assume that they were sufficient to pass the title to Smith.

This appeal involves the .construction of the revenue laws of- the state, hence the jurisdiction of this court.

From the foregoing statement, it appears that inter-pleader Smith, as assignee of the purchasers, held certificates of the purchase of these lots for the taxes of 1874 and 1875, and was entitled to deeds thereunder, at the time the back tax suit for the taxes of 1877 was commenced against Manitho Hilton and others, and, before judgment was rendered therein, had obtained deeds and put them on record. Neither Smith nor his assignor was made a party to this suit, and it is claimed by counsel for Smith that he stood to the land in the attitude of a second mortgagee in a suit to foreclose the first mortgage,' and his right to redeem was not divested by the sale.

On the other hand, counsel for interpleader Hilton claims that Smith, as the holder of matured certificates of purchase, was not an owner who is required to be made a party to the suit within the intent and meaning of the revenue act of 1877.

That act requires a suit for enforcing the lien of .the state against land for delinquent taxes to be brought against “the owner of the property.” Acts, 1877, p. 386, sec. 6 (R. S. 1889, sec. 7682).

In giving construction to that statute some important principles have been announced by this court which bear more or less directly upon the question here involved. It is only necessary to simply state these.

It is held that the proceeding contemplated by the law is not strictly in rem, and that the title acquired by the purchaser is derivative. Graves v. Ewart, 99 Mo. 13; Powell v. Greenstreet, 95 Mo. 13; Gitchell v. Kreidler, 84 Mo. 476.

While the owner of the land is required to be made a party to the suit, the law is satisfied if one who appears, from the records of land titles of the county, to be the owner, is made a party. Allen v. Ray, 96 Mo. 546, and cases cited.

The rights of mortgagees and beneficiaries in deeds of trust, whose deeds are duly recorded, are not affected by the judgment and sale unless made parties to the-suit. “The purchaser at the execution sale, and his vendee, stand in the position of one having purchased under a foreclosure of a senior mortgage, the junior mortgagee not having been made a party to the suit.” In such a case the mortgagee has the right to redeem. Williams v. Hudson, 93 Mo. 529; Allen v. McCabe, 93 Mo. 144.

The inquiry* here is whether the rights of inter-pleader Smith, which at the time of the commencement of the collector’s suit for taxes, he held under his certificates of purchase, and at the time of the judgment under his collector’s deeds, were foreclosed and extinguished by the judgment, sale and sheriff’s deed.

The statute requires the suit to be brought against the owner of the land charged with the lien of the state for taxes. For this reason the proceedings are not strictly in rem; but after jurisdiction of the subject-matter is acquired the proceedings are against the property. It is said in Allen v. McCabe, supra: “It must be remembered, that, although the statute makes it necessary that the owner of the property should be made a party, and this is necessary to call into activity the jurisdiction of the court over the subject-matter; yet, when this is done, the proceeding is in rem against the property to enforce the lien of the state on that property, subordinate to which the owner holds his title; the judgment is in rem. The execution goes against, and the sheriff sells, the property, and not the interest of any particular person in it. And his deed conveys, in the language of the statute, ‘a title in fee to the purchaser.’ ”

The owner, then, in contemplation of the statute, against whom the suit must be brought and thereafter prosecuted, is the actual owner, if known, or, if unknown, the apparent owner as shown by the records of land titles in the county. The law points the revenue officers of the state to these records for the evidence of ownership upon which to base their official action. The ownership includes all persons who have known or recorded interests in the land at the time the suit is commenced. The date of commencing the suit is the time fixed for determining the ownership. Persons who have neglected to make known their ownership, by record, or otherwise, will be presumed to have notice of the pendency of the suit and will be bound by the judgment therein. The suit proceeds against the property, and the collector is not required to add and bring in new parties as they make their interests known. One holding an unrecorded instrument affecting the title to the land should not be allowed to defeat the objects of the law and obstruct the collection of the revenue by filing it for record before judgment or sale. This principle has been applied to condemnation proceedings. Kane v. Railroad, 112 Mo. 38.

At the time the back.tax suit was commenced interpleader Smith held certificates of the purchase of the land at collector’s sales for taxes levied for the years 1874 and 1875. The time allowed by the law (Wag. Stat., p. 1202, sec. 208) in which the owner could redeem had expired and he was, and for some time had been, entitled to a deed.

What title to, interest in, or lien upon land a certificate of purchase secures to the holder is a question upon which there is a difference of opinion. It may be said generally that the right is no larger than the statute gives. The law of 1872 only gives the right to the redemption money in case the land is redeemed, and to a deed when the time of redemption has expired.

In the absence of provisions of law defining the rights of the holder of a certificate of purchase the generally accepted rule is that, until the delivery of a deed, he takes no title to the land, either legal or equitable. Black on Tax Titles, sec. 322; Burroughs on Taxation, p. 321.

The rule is announced by this court in Donohoe v. Veal, 19 Mo. 335, 336, as follows: “If the law did not propose to give the purchaser the title to the land until two years should elapse from the time of the purchase, then it did mean that the title should remain in the owner for that period, and the right of the purchaser was to receive his money, with a high penal interest, during the delay of redemption. It appears very clearly to be the design of these two acts, that the title of property sold for taxes shall remain undisturbed, until the' deed is actually executed by the register; and that, until that act is performed, the title is in the former owner.”

It was further held in that case that the doctrine of relation did not apply to such sales, .and the title acquired under the deed did not relate back to any prior act or proceeding.

The law of 1857 made the certificate prima facie evidence of title, yet the court held that it never intended to confer title; but was mere evidence of title authorizing the purchaser to take possession of the premises for a limited period. Clarkson v. Creely, 40 Mo. 114.

In Parsons v. Viets, 96 Mo. 413, this court, in considering the rights of one holding a certificate acquired under a sale made pursuant to the laws of 1872, held that he acquired thereunder no right to tho possession of the premises, and in taking possession he was a trespasser and disseizor.

After the period allowed for redemption -has expired, as was the case here, the holder of the certificate has a mere naked right to demand and receive a deed from the collector. The law thereafter gives him no lien upon the land for any sum, except that, in case his title fails, he may secure a lien under section 219, 2 Wagner’s Statute, page 1206. Pitkin v. Beibel, 104 Mo. 511.

Much reliance is placed by counsel in support of their theory, upon the decision of Blevins v. Smith, 104 Mo. 583. An examination of that case will show that an entirely different question was involved, namely, whether the inchoate right of dower could be prejudiced by any act’or default of the husband, and whether a judgment, sale and deed in a proceeding to enforce the state’s lien for taxes, in which the husband alone is made a party, would extinguish the inchoate right of the wife to dower. The wife has a substantial right in the real estate of the husband. Though this right may not appear upon the records of land titles, one purchasing takes his title subject to it. He is conclusively presumed to have notice; so a collector, in commencing a tax suit against the husband must take notice of the dower rights of the wife in the land to be charged with the tax. That decision has no bearing on the question under consideration here.

These parties must stand or fall on their strict legal rights; but interpleader Smith does not occupy a position which demands equitable considerations, if they could be accorded him. The law under which he purchased, by the strongest implication made it his duty to pay all subsequent taxes, and he has no right to complain of a sale which resulted' from his neglect of duty. Moreover, had he secured his deeds seasonably he would have been in a situation to have sought protection of his rights.

Our conclusion is that interpleader Smith was not an owner, within the meaning of the law, at the time the tax suit was commenced, and was not entitled to notice thereof; that his title only vested at the date of the delivery of the deeds to him and he took with notice of the pending suit and was bound by the judgment afterward rendered therein. O’Reilly v. Nicholson, 45 Mo. 166.

The judgment is therefore reversed and the cause remanded with directions to the circuit court to enter judgment in favor of interpleader Hilton.

All concur.

IN BA NO.

Pee Cubiam.

The foregoing opinion of Mac-eablane, J., handed down in division number one, is adopted as the opinion of the court in banc. Bbace, C. J., G-antt, Shebwood, Bubgess, and Robinson, JJ., concurring with Macbablane, J., therein; Bab-olay, J., dissenting. The judgment of the circuit court is therefore reversed and cause remanded to be proceeded with as in the opinion directed.