Marysville Investment Co. v. Holle

51 P. 281, 58 Kan. 773, 1897 Kan. LEXIS 180
Supreme Court of Kansas·Decided December 11, 1897·No. No. 10857·Published·Cited by 5 cases

Opinion

Allen, J.

The town site of Palmetto was entered by the probate judge, in accordance with the act of Congress, for the benefit of the occupants thereof, as a town site. He conveyed the land to twelve persons, by name, as members of the Palmetto Town Company. Some of these persons, and the heirs of others, have conveyed to the plaintiff, which now claims the lots in controversy, which are included in the town site. The [778] defendants do not stand on the strength of their title, which is founded on a void tax deed and a possession insufficient to establish title by adverse possession, but they attack the plaintiff’s title, and contend that the deed from the probate judge to the plaintiff’s grantors was void, mainly because the statutes of Kansas required the conveyance to be made to the Palmetto Town Company. They also contend that the plaintiff is estopped by the conduct of its grantors, and by their laches to assert title to any of this property. On the first proposition, it is urged that whatever occupancy of the town site was held by individual members of the Palmetto Town Company was for the benefit of the corporation, and not of themselves as individuals; and that the corporation alone was authorized under the law to receive the deed, and that it alone was entitled to the land conveyed.

Second. Uneer“oTO-site ofno?Snses-"tltle’ quence. There is much evidence in the record tending to show that the town site was treated as the property of the Palmetto Town Company. Meetings were held by ‘the directors at which direcJ tions were given in reference to the drawing of lots by the members of the ,, . , , company, the sale and conveyance, by the president, of others for their benefit, the collection and disbursement of moneys belonging to the company, and other matters strongly tending to show that the grantees of the probate judge treated the town site as corporate property. Give to this testimony all the force the defendants claim for it, it yet can amount to only this. The title to the town site passed from the United States to the probate judge, in trust for the occupants thereof. The probate judge conveyed it directly to the beneficiaries, who treated it as common property belonging to their corporation [779] instead of individual property held by them as tenants in common. If the probate judge had deeded to the Palmetto Town Company instead of the individuals, the Town Company would then have held the legal title, but it would have held it in trust for the occupants, who, so far as this record discloses, were the very persons named in the probate judge’s deed. It would then have been the duty of the corporation to convey and dispose of the land for the benefit of the members of the company. The corporation would have been a mere trustee holding the legal title for its members, the cestuis que trust, who would have held the full equitable title. The state of the case, if the conveyance had been as the defendant’s counsel claims it should have been, would not have differed in substance from that presented by the case actually before us. The substantial interest, in either case, was vested in Marshall and others, to whom the probate judge made the conveyance. It may well be that, as against them, all conveyances made by the officers of the town company are valid, and that they would be estopped by their conduct from asserting any claim against persons holding under such conveyances; but, as against parties having no rights whatever in the property, they are to be treated as the full legal and equitable owners. This is in accordance with the conclusions reached in the case of Investment Co. v. Munson (44 Kan. 491), in which case these same matters were under consideration. The defendants in this case do not claim any privity with the Palmetto Town Company. They have derived no right or title from that company, or from any other person to whom title passed by the deed executed by the probate judge. Their title starts from a deed executed by William C. McCurdy, as administrator of Jerome [780] D. Brumbaugh, to John C. Nelson, on the nineteenth of September, 1878. This deed recites a consideration of six dollars, and purports to convey lots 3 and 7 in block 23. Lot 3 is not in controversy in this action. This deed conveyed no title, because the grantor had none to convey. The defendants offered in evidence a tax deed to Brumbaugh, but the court excluded it. It was clearly void on its face, and is conceded to have been so.

possession under void tax deed unlessn0 The fourth instruction given by the court would have been applicable and sound in a case where the defendants claimed title through the Palmetto Town Company, but it was utterly inapplicable to this case, and seriously misleading. The fifth instruction does not correctly state the law, an(l would be erroneous in any case. It is especially erroneous, however, as applied to the facts presented to the jury in this case. The court seems to have forgotten that it had excluded the tax deed under which the defendant claims, and that no tax title was in evidence before the jury.

ROUKTII, RlFTH. Tax-deed claimant must know . estopped, when. It is extremely doubtful whether, under our statutes, a case could possibly arise where the holder of the patent title would be estopped by mere silence or non-action to assert his title as against a purchaser under a tax ^ee(^ Our statutes provide a very brief limitation for the protection of parties claiming under tax deeds. In case a deed is issued which is void on its face, there are various ways through which the purchaser can protect himself. The Occupying-Claimant Law, and the provisions with reference to the recovery of taxes actually paid by the tax-title holder, are liberal, and in most cases very effectually protect the purchasdr against loss. A tax-title holder is always notified when he makes his purchase that his [781] title comes, not in privity with that of the holder of the government title, but adversely to it. He may not be informed with reference to the particular person who holds that title, but that some one holds it he always knows, else there could be no tax title. Until title passes from the government, the State has no right to impose taxes on the land. They are levied as a charge against private property. He who would build up an independent title with tax proceedings only for its foundation must look to the legality of the proceedings of the officers. If he obtains a deed valid on its face, five years’ possession under it cuts off all attacks based on defects in prior proceedings. Fifteen years’ undisputed possession, where the opposing party rests under no disability to sue, may give a perfect title even though the deed be void on its face. But it certainly is a novel application of the principle of estoppel to hold that it may arise in favor of a tax-title holder through controversies between those holding or claiming the patent title, or from their acts with each other based on misapprehensions of their legal rights. Conduct, to furnish a basis for estoppel, must be calculated to influence the action of the party relying on it.

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Marysville Investment Co. v. Holle, 51 P. 281, 58 Kan. 773, 1897 Kan. LEXIS 180 (kan 1897).

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