Laz v. Southwestern Land Company

397 P.2d 52, 97 Ariz. 69, 1964 Ariz. LEXIS 195
CourtArizona Supreme Court
DecidedNovember 27, 1964
Docket7521
StatusPublished
Cited by25 cases

This text of 397 P.2d 52 (Laz v. Southwestern Land Company) is published on Counsel Stack Legal Research, covering Arizona Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Laz v. Southwestern Land Company, 397 P.2d 52, 97 Ariz. 69, 1964 Ariz. LEXIS 195 (Ark. 1964).

Opinion

UDALL, Chief Justice.

This is an appeal by Rose Laz, hereinafter referred to as Mortgagee, from an order of the Superior Court of Pima County granting Southwestern Land Company’s motion for summary judgment to quiet title to certain realty in Southwestern Land Company, hereinafter referred to as Land Company.

Procedurally, suit was commenced below by the Land Company to quiet its title to certain realty derived from a deed executed and delivered by the Superintendent of Streets of the City of Tucson, Arizona, in the foreclosure of a lien for assessments against Floyd McDonald and Evelyn McDonald, husband and wife (hereinafter referred to as McDonalds); the Mortgagee, and Katherine Kalck. Default judgment was entered against Kalck and the appeal has been dismissed as to her. No appeal was filed on behalf of the McDonalds. The Mortgagee answered the complaint claiming *71 a mortgagee’s interest in the said realty. The Land Company moved for summary judgment and judgment was entered quieting title in the Land Company.

Mortgagee appealed from the order below granting the Land Company’s motion for summary judgment. The Land Company moved in this Court that the appeal be dismissed on the grounds it is predicated upon a nonappealable order. Mortgagee opposed the dismissal in this Court and moved to amend her notice of appeal. Both of these motions by the respective parties were denied by this Court.

The facts are as follows: The McDonalds were owners of a certain parcel of realty situated in Pima County as evidenced by a deed of record in the office of the County Recorder. Mortgagee was assignee of the interest of a mortgagee of record in said realty, as evidenced by an assignment of record in the office of the County Recorder.

McDonalds allowed an assessment delinquency to occur and the realty was sold at a regular assessment sale to the Land Company. Title 9, Chapter 6, Article 2, A.R.S. (1956). After the redemption period, the Land Company gave the required notice to the McDonalds that it was going to make application to the city for a deed and subsequently the City executed its deed to the Land Company and the deed is of record in the office of the County Recorder. A.R.S. § 9-703 (1956). More than twenty days prior to the filing of the complaint in the quiet title suit, the Land Company tendered quit-claim deeds to the McDonalds, the Mortgagee, and Kalck, but none responded thereto. A.R.S. § 12-1103(B) (1956).

The Mortgagee challenges the regularity of the proceedings in two particulars. First she objects because the published notice of delinquent assessment pursuant to A.R.S. § 9-698 (1956) listed the ownership of the realty as “unknown” although McDonalds were of record as owners. Secondly she objects because although timely notice of intention to apply for a deed as required by A.R.S. § 9-703 (1956) was served by the Land Company on the McDonalds and no redemption of the property was made by anyone prior to the execution and delivery of the deed by the City to the Land Company, no notice of intention to apply for a deed was served on Mortgagee. Apparently Mortgagee first became aware of McDonald’s assessment delinquency when served with the quitclaim deed prior to the commencement of the suit.

The two issues thus raised by the Mortgagee are that (1) the published notice of pending sale was inadequate and (2) the Mortgagee was entitled to actual notice of the assessment proceedings. We will decide Mortgagee’s second contention first.

It is contended that a mortgagee of record is either an owner by statutory definí *72 tion, A.R.S. § 9-671, subsec. A (13) (1956); or the owner of such an interest as to require that she be served with notice of an assessment sale affecting the mortgaged property and that she be served with notice of an application for a deed, and if the statutes be construed as to not require such notices to her, they are unconstitutional as permitting the taking of property without due process of law.

The Land Company, on the other hand, argues that ■ the Mortgagee has no such interest that entitled her to notice and that the Legislature has not recognized any right in the mortgagee to any notice. The Land Company further justify their contention on the basis that the foreclosure of a tax lien is an action in rem. See Allied American Inv. Co. v. Pettit, 65 Ariz. 283, 179 P.2d 437 (1947).

Although there is some older case law which supports the Land Company’s contention that the Mortgagee has no such interest to entitle her to notice, see, e. g., Holmes v. Bowen, 60 Ohio App. 168, 19 N.E.2d 974 (1938) we feel that the Mortgagee has such an interest protected by the due process clauses of the State and Federal constitutions which entitled her, under the circumstances, to reasonable notice. This is evidenced by the redemption statute, A.R.S. § 9-702 (1956) which recognizes other valid interests in land when it provides that “(r)edemption may be made by any party having an interest in the lot at any time before the execution and delivery of a deed * * A mortgagee certainly would be a “party having an interest in the lot.” We also feel that the Land Company’s “in rem” argument has been invalidated by the United States Supreme Court in the case of Mullane v. Central Hanover Bank & Trust Co., 339 U.S. 306, 70 S.Ct. 652, 94 L.Ed. 865 (1950).

That case said the due process requirements regarding notice do not depend upon a distinction between actions in rem and those in personam, however useful such a distinction may be for other purposes.

Thus, recognizing that a mortgagee has a protected interest, the question narrows to whether the notice provisions of the assessment proceedings under Title 9, Chapter 6, Article 2, A.R.S. (1956) are reasonably calculated, under all the circumstances, to apprise interested parties, such as the Mortgagee in this case, of the pendency of the action and afford them an opportunity to present their objections. Mullane v. Central Hanover Bank and Trust Co., supra.

An examination of the General Public Improvement Act (Title 9, Chapter 6, Article 2, A.R.S. 1956) with respect to the various notices given reveals the following: The resolution by the governing body of their intention to order an improvement is required to be published in addi *73 tion to posting of notices along the proposed improvement area. A.R.S. § 9-675 (1956).

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Bluebook (online)
397 P.2d 52, 97 Ariz. 69, 1964 Ariz. LEXIS 195, Counsel Stack Legal Research, https://law.counselstack.com/opinion/laz-v-southwestern-land-company-ariz-1964.