OCR Text |
Show PAGE MONDAY, FEBRUARY 11. 1974 THE DAILY RECORD TWENTY-FOU- R In the Supreme Court of the State of Utah Quiet Title Continued occurred after the date of the transfer there could be no tax lien upon it. of the property to Huntington City, cities., ations. Quite simply, the main opinion reasons that there is no tax lien upon realty prior to levy and assessment despite clear statutory language saying that there is a tax lien on realty as of the first day of January of the year in question which is before assessment and levy. Moreover, Buch conclusion is reached without showing the interrelation and dependency of the tax lien, beyond its mere dollar' valuation, upon assessment and levy. tax exempt status of Huntington City emanates from the same constitutional provision. Thus, the nature and extent of the tax exemption privilege, as determined in State v. Salt Lake County with respect to the State of Utah, is authoritative with respect to the nature and extent of the exemption privilege claimed by Huntington City. Clearly, the exemption privilege is dependent upon the status and owner ship of the property on the day when the tax lien of any year would attach if subject to taxation; that is, a city which purchases -private property after the attachment date takes like any other purchaser subject to the tax lien. The The majority opinion relies heavily upon the case of Utah Parks Company v. Iron County and Cedar City Corporation, 14 Utah 2d 178, 380 P. 2d 924 (1963). There, a private corporation brought an action for reimbursement of property taxes paid to Iron County after the property had been conveyed to Cedar City. On January 1, 1958, plaintiff was the record owner of the property and conveyed the property to the City, a tax exempt municipal corporation, on January 31, 1958. ' The warranty deed executed by plaintiff contained a covenant that all taxes subsequently assessed on the property were to be paid by the grantee (Cedar City). The 1958 ad valorem tax upon the property was processed in plaintiff's name and, without protest, was paid. Authority from other Jurisdictions sustains this consluslon. In 164 Cal. App. 2d. 41, 330 P. 2d 282 (1958), the certain property against wnicn tne counc ox los Angeles held valid tax liens. In upholding the enforceability of the liens, the California District Court of Appeal stated: City of City of Long Beach v. Alstup. Long Beach condemned The statutory scheme would seem to leave no doubt was the intention of the Legislature to prevent a lien Monday in March of any year from which attached on the being extinguished by reason of the fact that after the lien to the property passes or is deemed to pass has attached T. Bowen v. Olsen, 2 Utah 2d if, 268 P. 2d 983 (1954), which payraenT is notice to an asserted owner of an adverse claim, which is not dispositive here but some evidence of occupancy. See also 78- - , U. C. A. 1953, re presumption of of taxes. possession by payment 1 & 2.TJ. C. A. 1951, as amended. 3. Title i. Peterson v. Callister, b Utah id 359, 313 P. 2d 814 (1957); rehearing denied 8 Utah 2d.' 348, 334 P. 2d 759 (1959); Hansen v. Monis, 3 Utah 2.1 310, 283 P. 2d 884 (1955). 5. In the alternative plaintiff sought reimbursement from Cedar Git v. 78-12-- -5. 1 status: In reaching this conclusion, it should be noted that the controlling feature. is not thf mere change ot ownership, but rather a change in "ownership which has the ifctof converting property from a taxable status to that ot nontaxable. 380 P. 2d at 926. plaintiff was held entitled to a tax refund from Iron County; its alternative action against Cedar City for reimbursement was denied. Accordingly, Ujah Par kb injiivh serins dispositivea ol the case such conclusion is in the majority opinion. here as evidenced the reasons. First, untenable for at least two siguim-anmajority opinion the without of county being a party Lm; ry (.Muniy determines taxing rights be a holder to in the Utah Park Company to this lawsuit, county, claiming of a tax lien against the property in question, was i named party in the suit. Surely, it is but a fundamental proposition that this court cannot with binding authority determine the tax rights of a county where it is not a party litigant. For this reason, Utah Parks Company posed a taxation issue (although admittedly in the guise of a title qu stion), while the only question before the court in the present action is one ol titk. Likewise, the main opinion addresses the question, "Who ys the lax?" The answrr seems clearly but illusionarily satisfactory, but with respect to this particular case it has asked and addressed the wrong question. The only inquiry that need be posed and dealt with by this court is, "What happened to the county's tax lien following transfer of the property to the city?1' At Ho-vcve- p-- The court addressed itseli to this issue in State v. Salt Lake County, 96 Utah 464, 85 P. 2d 851 (19331. There, the mortgagor had borrowed money from the state and mortgaged the land as security for payment in 1924, Subsequently, the mortgagor defaulted in his payments and being threatened With foreclosure., executed a warranty deed conveying the mortgaged properly to the State of Utah on December 16, 1956. Meanwhile. the property was assessed and sold lor taxes of 1932 by bid to Salt Lake County. Taxes for 1933 through 1936 accrued and, upon failure to redeem, the county auditor deeded the property to the county in satisfaction of the taxes. The State then brought suit to quiet title to the property in itself. In dismissing the State's complaint, this court wrote: If the taxes for 1932 to 1936 inclusive were levied against this and we have so held, property as that of . . .mortgagor be can then by what process of reasoning adjudged unlawful they after and solely because the Statu obtained a deed for the property from . . . mortgagor . . . in satisfaction of the mortgage? The State by that deed co-ilacquire only such title, as the grantor had at the time of the dee.i; that is, a title, encumbered by taxes theretofore lawfully asse&bf d and 1' vied, and by prior tax sales if any . . .... .. To escape payrnenMlu Slate cannot loan its exemption status tf its aranlor. and hve it rc:u h bat k retroactively . . . and ward off or cancel taxehj nraj lawfully levied on the property, That would be abatement uf taxes, i.ot exemption from taxation. 85 P. 2d at 854. . ! regret that stranger here. b, title ' public corporation in a proceeding in eminent The obligation to pay the taxes accrues the date the lien attaches. The lien has the effect of a Judgment and of an execution duly levied. The judgment is not satisfied or the lien removed until the tax is paid or legally cone e led. The lien attaches to the award in the proceeding in eminent domain. tax-exem- 330 P. pt 2d at 290. foregoing case is meticuously written and seems persuasive a support of the position of this dessent. See, also Santa Monica v. Los Angeles County. 115 P. 945 (1911); United States v. Alabama. 313 U. S. 274 (1941). The The concise issue of the Gillmor case, cited in the main opinon, was the authority of a municipality to levy a tax upon property detached from corporate limits by Judicial declaration. Contrary to the implication of Mr. Justice Ellett's opinion, Gillmor does not stand for the proposition that a tax levy made upon a tax exempt purchaser of the property, where such after the attachment of the tax lien, lien. metaphysically destroys the Fives v. Petersen. 5 Utah 2d 280, 300 P. 2d 635 (1956), cited by the majority for the proposition that "before the holder of a tax deed can deprive the record owner of land, the burden is on him to establish his title by showing that the tax and all proceedings in connection therewith were according to statute." purchase of the property occurred is thereby invalid and somehow pre-existi- ng first glance t - first to a domain. 5. As a party to the action, Iron County apparently argued that the ad valorem tax lien had attai iwrt to Mir properly as of the iirst day of January and remained enforceable regardlsb ot any subsequent transfer oi title to a his court, however, rejected such arguparty enjoying tax exempt btdtus. a'd valorem tax was ''erroneously" and "illegally" ment and concluded that ihe and collected upon property hold by Cedar City who enjoyed tax exempt levied it that 12-7- 78-12- The property of the United States, of the State, counties, towns, school districts . . . shall be exempt from taxClause 1, Section 2, Article 13, Utah Constitution. I I did not diM r i t'l.-.- t a so, although. I think it to be a In the foregoing case the taxes had been assessed and levied upon the property prior to its conveyance by the mortgagor to the State, whereas in the present case the land was conveyed to Huntington City, levy. But, as required by the clear language prior to assessment and a tax lien attached as of the first day of January, of section anyirrespective of subsequent assessement and levy. There is hardly or assessment upon about or levy so significant legally legerdemain thing case different the a in conclusion would present the property that produce from that in State v. Salt Lake County; quite simply, if the property was in private ownership as of the date of attachment of the lien, the mere fact that it was transferred to a public body should in no way Interrupt the taxing process. State v. Salt Lake County is also significant in that that case was decided in light of Article 13, Sec. 2 of the Utah Constitution: 59-10- -3, It is generally true that the burden of proof is upon the holder of a tax deed to show that he procured his tax deed in strict compliance with statutory requirements. But, no Utah statute requires that levy and assessment of the tax for the year in question be made prior to the time of acquisition by the tax exempt body. Clearly, the record shows no failure on the part of the tax holder In meeting the requisite formalities in perfecting his deed. In fact, due to the clear and express language of Section a tax lien attaches on the first day of January of each taxing year, the burden of proof seems to be upon the party claiming that no lien attached or that after its attachment, it was extinguished by reason of exemption. Clearly, the statutory presumption is that the tax lien attached. See, State v. Salt Lake County, supra, where the burden of proof was upon the State to show that it qualified for a tax exemption; Santa Monica v. Los Angeles County, supra. 59-19- -3 that Finally, presumptions aside, the normal allocation of the burden of proof is upon the plaintiff to prove his allegations by a preponderance of the evidence. In this case the plaintiff was Huntington City. unanswered question in this case is "Where did the lien go ?" The obvious answer is that this court destroyed it by judicial legislation which now eliminates a statutory lien that is unellminatable by the judiciary. Who are we to say eta t once it attaches it can be destroyed by Judicial fiat? Who are we to day that a barnacle on the Ship of Title emotionally can be destroyed by our decision? Who are we who can defy and deform and defame and destroy a lien that we admit once existed but can be extinguished by a delinquent taxpayer's deed in complete defiance of a govermental unit invested with the power of its prepetuation through the tax process, The when such agency never hat been given the opportunity of determining fiscal taxable rights, - as is the case here. its This case, in my opinon, reflects an abomination of basic governmental rights and controls. Under this case there appears to be a lien that is not a lien,' that is a lien according to the main opinion, but a ghostly and ectaplasomic one, and ethereal - background for a title examiner's property rights' seance, a proprietary ennui for a scholar, and an unreasonable, unwarranted and emotional treatment of simple, ordinary, statutory, unbarnac led, decisional, and common law rights. With perhaps repetitionalinexcuse, but with emphatic emphasis, the question remains in this case: 'Vhat happened to the lien?" The obvious answer is : "We eliminated it." After this case it will be advisable for municipalities to get recalcitrant taxpayers to give them deeds for "One dollar and other good and valuable consideration" . . ."to have and to hold until death do us part," to devest a legltmate purchaser, who has bid in, bought, and thought he had good title, - only to be devested of his hoped for and legitmately expected title, after payment of all taxes for all the statutory time, when the record title owner successfully has renounced and eliminated his tax obligation by the simple and legally unwarranted device of ducking that tax burden in favor of an eleemosynary outfit and thus defeat a crystal clear, CALLISTER, Henriod. statute knowing that this court: will condone his tax liability if he but his taxridden charitable, untaxable organisation, be it the City of the various churches, the Red Cross, Salvation other, -- ad Infinitum. unambiguous and forgive him of real property to a of Huntington, any Army or a thousand quit-clai- ms Chief Justice, concurs in the dissenting opinon of Mr. Justice |