No. 81-511 INTHE SUPREME COURT OF THE STATE OF MONTANA

YELLOWSTONE INVESTMENT AND DEVELOPMENT CO.

## , INC

# ., and EDWARD L. BOND, Plaintiffs and Respondents,

YELLOWSTONE COUNTY, MEFCO CO., RAYMOND WEBER and BERNICE M. FRIEZ, Defendants and Appellants.

Appeal from: DistrictCourtof the ThirteenthJudicial District, In and for the Countyof Yellowstone Honorable Robert

### Wilsan, Judge presiding. Counsel of Record: ForAppellants: Harold F. Hanser, CountyAttorney, Billings, Montana GaryE. Wilcox, Billings, Montana Jones, Jones and Work, Billings, Montana For Respondents: Stephens and Cole, Billings, Montana

Submitted

### on briefs: April 15, 1982 Decided: November 24, 1952 Filed: 

## NOV2i;

## 1!l82"!4r. Justice John C. Sheehy delivered the Opinion of the Court. Yellowstone County appeals from a summary judgment entered against it in the District Court, Thirteenth Judicial District,Yellowstone County. The summary judgment determined that certain tax deeds obtained by the county were invalid. We affirm the determination of the DistrictCourt. Edward L. Bond was the record owner of Lots 1, 6, 7 and 8 of Block 4 of SpringValley Subdivision, Yellowstone County,Montana, in the month of October 1979. Back taxes of $4,338.G4 were due for Lot 1,and $4,461.04 for Lot 8. OnAugust 22, 1979, the county clerk of Yellowstone County made written notice of application for tax deed for the lots, which written notice indicated that Bond's right of redemptionwould expire on October 22, 1979, and that Yellowstone County as purchaserwould apply for tax deeds on October 23, 1979. On August 23, 1979, the county clerk mailed copies of the notice of application for tax deed 

### by certifiedmail, in separate envelopes, one to Eond, addressed to him at 490 Indian Trail Road, Billings,Montana, and another notice to L. A. Builders, Inc., at 206 

### N. 29th Street, Billings, Montana. The envelope addressed to 

### L. A. Builderswas delivered onAugust 24, 1979, and the county received a receipt acknowledging the receipt by L. 

### A. Builders, Inc. of the notice. However, the certified mail envelope addressed to Bond at 490 Indian Trail Road was returned "unclaimed"by the post office. At the same time as the mailings, the county clerk caused publication in the Laurel Outlook, a newspaper published in Laurel,Montana, of a notice of application for tax deedagainst L. A. ~uilders, Inc. and Edward L. Bond, which written noticeswere printed and published onAugust 22 and August 29, 1979. On October 11, 1979, Edward L. Bond deeded his interest in the real estate here in question to Yellowstone Investnent and DevelopmentCo., Inc., by filing deeds of record in the office of the county clerk of Yellowstone County. On October 23, 1979, the county clerk executed a b~ritten affidavitand proof of service in connection with the county's application for tax deeds. In the affidavit, the county clerk recited that notice of application for tax deeds was mailed to Edward L. Bond at 

### 490 Indian Trail Road, in Billings, Montana, and that the letter addressed to him had been returned unclaimed. The printed portion of the affidavit recited "thatthe addresses used inmailing all the above letters are the best and latest addresses obtainable for the said persons, as disclosed by the County records of Yellowstcne County,Montana." The printed portion of the affidavit also recited that the post office address of (theaddressee's

name is left blank)was unknown and that therefore the notice of application for tax deed had been served by publication. On the sane day, October 23, 1979, the county treasurer issued tax deeds to the county for the lots. On December 20, 1979, Yellowstone County sold its interest in Lot 1 and Lot 8 of Block 4, SpringValley subdivision, to Mefco Company, in Billings,Montana. Yellowstone County on December 19, 1979, also sold Lot 7,Block 4, to Raymond Weber, and Lot 6, Block 4, to Bernice 

### M. Friez. On January 

### 10, 1980, Bond and Yellowstone Investment and Development Company, as plaintiffs, filed 

### a complaint inthe ~istrict Court of Yellowstone County, attacking the issuance of the tax deeds to the county as invalid, essentially

on the ground that the notices of application for tax deeds

were insufficient. Both defendantsWeber and Friez did not appear in the action, and eventualiy default judgmentwas taken against them. All of the remaining parties moved the District Court for surrmary judgment. Each of the parties submitted affidavits in support of their respective motions for surrrnary judgment. Yellowstone and Mefco relied on the affidavits of the county treasurer and the county clerk,who supplied from the records in their offices the written instruments to which we have above referred. Bond and Yellowstone Investmentand DevelopmentCo., Inc. in support of their motion for summary judgment, supplied the DistrictCourt with copies of their tax statements for 1979, each of which showed that the address of Edward L. Bond was 347 Moccasin Trail in Billings,Montana. Bond and Yellcwstone Investment also relied on an affidavit of James L. Carbor,e, to the effect that he inspected the records in the Yellowstone County clerk and recorder's office ofmany deeds and mortgages and could not find Bond's address listed; that he had insp~cted the Yellowstone County treasurer's office for the tax statements for the years 1978 and 1979 and found the address of Edward L. Bond to be 347Moccasin rail, Billings, Montana; that he inspected the records of the Yellowstone County assessor's office for 1978 and 1979, where Bond's addresswas alsc listed as 347Moccasin rail, Billings,Montana. An affidavit of Robert L. Stevens, Jr., the attorney for the plaintiffs, was also relied on,which essentially

### recited that Bond's Moccasin Trail address was available to the county clerk within a few feet of his office. Edward L. 

### Bond also supplied to the District Court his affidavit to the effect that he had accidentally discovered thepending application for tax deed in late September or early October, 1979; that he had consulted an attorney and had learned fromhim that the county could not secure a tax deed until proper notice had been given; that he had gone to the clerk and recorder's office to determinewhat he must do to remove the property from jeopardy and that the clerk and recorder would not accept tender of the taxes, interest and penalties, hut also required the payment in full of all unpaid special improvement district assessments. On July 22, 

### 1981, the District Court entered an order granting a summary judgment in favor of Bond and Yellowstone Investment and Development Co., Inc. and denying the motion of Mefco Co. for summary judgment. On August 3, 

### 1981, the District Court entered judgment in favor of the plaintiffs requiring the plaintiffs to tender to the county all real estate taxes, interest and penalties on the property, and that upon the tender and receipt of those moneys, the tax deedswere to be canceled and declared null and void. The default judgment againstWeber and Friezwas entered at the same time. Following the judgment, Mefco Co. and Yellowstone Countymoved the District Court for a new trial. In support of 

### their motion for a 

### new trial, they provided the District Court with copies of three deeds dated October 11, 1979, between Edward L. 

### Bond, as grantor and Yellowstone Investment and Development Co., Inc. as grantee, relating to properties other than those involved in the tax deeds, in which deeds

### the address of Edward L. 

### Bond is shown to be 490 1ndian Trail, Billings,Montana. The attorney for Bond presented the District Court with a counteraffidavit to the effect that the Indian

### rail address was Bond's address when the deeds were prepared in the early summer of 1979,and not when the deedswere filed in October of 1979. The District Court denied themotion for new trial. YelLowstone County only appeals from the judgment and the denial of the motion for new trial. On appellate review of the validity of tax deeds, certain rules guide us. Notice of application of tax deed to the owner,whether by mail or publication, is jurisdictional to the validity of the tax deed. Sanbornv. Lewis and Clark County (1941),113Mont. 1, 120 P.2d 567. Serviceby publication of a notice of application for tax deed isvalid onlywhen the address of the owner is unknown. Section 15-18-202(3), MCA. Every.statutorystep in the application for a tax deed must be fully compliedwith. Perry v. !'laves (1951), 125Mont. 215, 233 P.2d 820;King 

### v. Rosebud County (19811, Mont. 

## , 631P.2d 711. The requirement that notice - 

### for applicationbe given applies to counties applying for tax deeds. InLoweryv. Garfield County (1949),122Mont. 571, 580, 208 P.2d 478,we said: "Thestatute requiringwhat notice shall be given and the filing of the affidavit are a 

### limitation upon thepower of the county treasurer to issue the tax deed and render void any deed issued by him unless and until the statutory requirements have been fully compliedwith. His authority to execute the deedmust be shown in and appear upon the face of the affidavit. The giving of the notice is jurisdictionaland unless the requirement of the law in respect to suchnotice is complied with and that fact establishedby the affidavit filedwith the county treasurer, the tax deed may not legally issue. The validity of the tax deed depends upGn compliance with the statute authorizing its issuance and a tax deed issued by the county treasurer isvoid where the notice required by 

### the statute isnot given.

(Citingcases.)

### "Section 15-18-202(2), MCA, provides that a written notice of application for tax deed shallbe given to the

owner by registered or certified letter addressed to him at the post office address of said owner "asdisclosed by the mortgage records in the office of the county clerk and recorder." Here the affidavit of Carbone establishes that therewas no post office address for Bond listed on any mortgage on file in the county clerk's office. The records in the county treasurer's office and the county assesscr's office shcwBond as residing at 347 Moccasin Road. His assessment notices and tax notices for the years in question

were mailed to him at that address. The county contends, however, that the county clerk, when he made his affidavit

on October 23, 1979, for the issuance of the tax deeds, could rely on the deeds which were filed on October 11, 1979, and upon the Polk's Billings City Directory, each of which showed Bond's address to be 490 Indian Trail. Aside from the fact that the October 11, 1979 deeds and the material from Polk's Billings City Directorywere not presented to the District Court until motion wasmade for new trial, there is nothing in the record,either at the time of summary judgment, or at the denial of the motion for new trial to refute that the post office address of Bond on August 22 and 23, 1979, was on Moccasin Road. If that were not the true address of Bond onAugust 22 or 23, 1979, it was the duty of the county, when the motions for summary judgmentwere pending, to raise or demonstrate the existence of a genuine issue of material fact. The District Court is not required to anticipate proof to establish a material substantive issue of fact. Larry 

### C. Iversonv. Bouma (1981), Mont. 

### , 639 P.2d -47, 38 

### St.Rep. 1911; State ex rel. BurlingtonNorthern v. DistrictCourt (1972),159 Mont. 295, 496 

### P.2d 1152. The county also contends that since the letter to Bond

was returned unclaimed, his address then became "unknown" and therefore serviceby publicationwas allowed. Here the record before the District Court at the time of the sumnary judgment showed that the IndianTrail address was not Bond's post office address at that time. The return of the letter unclaimed is not a sufficient ground upon which the county could rely to contend that Bond's addresswas "unknown"even though the affidavit and proof of service submittedby the county clerk to the county treasurer for the issuance of the tax deeds recites that the addresses used inmailing the letterswere the "bestand latest addresses obtainable for said persons, as disclosed by the county records of Yellowstone County,Montana." This obviouslywas not the case, for the records of the county treasurer and the county assessor each showed Bond's true post office address on the date of the mailing of the notice. The publication, therefore, of the notice of application for tax deed by the county can have no legal effecthere. The conclusion recited by the county clerk in his affidavit that Bond's post office addresswas unknown is obviously not in accord with easily ascertainable facts. However, the county also contends that under Bond's affidavit, he had actual notice of the pending tax title proceedings, and therefore any invalidity of the serviceof notice upon him does not disturb the legal effect of the tax deeds issued by the county. That contention overlooks the specific jurisdictional provisions of section 15-18-202(2), MCA, that notice be delivered to the owner by registered or 

### certified mail where his post office address isknown,andthat until such servicehas been made toa known post office address, under section 15-18-202(1), MCA, the owner of the property has the right of redemption indefinitely "until such notice has been given." The abortive attemptby the county toserveBond by mail at490 Indian Trail didnot, and has not yet, foreclosed Bond's right toredeem the real property. When the District Court granted summary judgment in thiscase, therecord before it, based on the affidavits and othermaterials submitted, was clear that thepost office address of Bond was 347 Moccasin Road and not at490 Indian Trail atthe timeof notice and application fortax deed. It

was not until the parties moved for a new trialafter the summary judgment that the deeds of October 11, 1979, and the material inPolk's Billings City Directorywerepresented to the court. Inmaking theirmotion for a new trial, the county did not contend that thenew material was "newly discovered evidence" as thebasis for itsmotion. If it had, because the "new evidence"was atalltimesavailable tothe county, and perhaps initspossession, themotion for theneT7 evidence would have to be denied on thatground. Kartes v. Kartes (1977)' 175Mont. 210, 573 P.2d 191. lloreover, the county does not contend, even now, that therewas a fact issueastothe truepost office address of Bond. The county relies on its contention that the Indian Trail address

was theproper address for service of the notice based on the record aswe have shown it here. On that ground, the county cannot prevail. Accordingly, the surrmary judgment granted by the ~istrict Court isaffirmed.We Concur: