No. 84-511 

IN THE SUPREME COURT OF THE STATE OF MONTANA 

Plaintiff and Appellant, 

-vsHAROLD V. KRUSE and NAOMI 

J. KRUSE, Husband and Wife, 

and 

ROBERT M. WILLETT, BRUCE MICHEL 

ROBERTS, 

and 

All other Persons claiming interest 

in described real property, 

Defendants and Respondents. 

........................... 

KRIS ROBERT HIRT, 

Intervenor and Respondent, 

JAMES B. WALTERS, LEE McDONALD 

and RICK HILDEBRAND AND SANDY 

HILDEBRAND, Husband and Wife, 

Defendants and Appellants. 

APPEAL FROM: District Court of the Nineteenth Judicial District, 

In and for the County of Lircoln, 

The Honorable Robert M. Bolter, Judge presiding. 

COUNSEL OF RECORD: 

For Appellants: 

Sverdrup & Spencer, Libby, Montana 

Fennessy, Crocker & Allen, Libby, Montana 

For Respondents: 

Allen L. McAlear, Bozeman, Montana 

Submitted on Briefs: May 9, 1955 

~ecided: January 8, 1986 

Filed: JAN 8 - I986 

- - 

Clerk 
Nr. Justice William E. Hunt, Sr. delivered the Opinion of the 

Court. 

The appellant, James Walters, brought a quiet title 

action in April. 1981 in I;incoln County District Court. The 

named defen6ants made no appearance and the Cistrict Court 

ordere6 title quieted in appellmt VJalters on June 8, 1981. 

In February 1983, the respondent, Kris I-Tirt, fil-ed a motion 

and action to set aside that decree. The District Court 

crdered the decree set aside and the parties then proceeded 

on the origi~al quiet title action as if an appearance had 

heen made. The District Court quieted title in the 

respondent, Kris Roberts Hirt. This appeal followed. 

We affirm. 

The issues presented for rev: 'ew are: 

1. Whether the District Court erred in setting aside 

the quiet title decree. 

2. Whether there wwas evidence of fraud sufficient tc 

allow the qujet title decree to be set aside. 

3. Whether a diligent search was performed in 

accorCance with Rule 40(5), b4.R.Civ.P. 

The first issue is whether the District Court erred. in 

setting aside the quiet title decree. Our discussioc of this 

issue controls an6 renders a discussion of the remaining 

issues unnecessary. 

This matter concerns a two parcel tract cf real property 

located in Lincoln County, Montana. In 1958, Harold and 

h'aomi Kruse purchased the property from Forrest and Vera 

Sund. The deed was recorded in Linccln County. 

In 1972, the Kruses sold the property by contract for 

deed to Robert Wil-lett. The contract was held in escrow in 
Bonners Ferry, Idaho. The contract made no provision fcr 

payment of taxes. In 1373, Willett assigned the contract to 

Bruce and Kris Foberts. The Roberts' marriage was dissolved 

and as part of the divorce settlement Eruce assigned his 

interest. to Rris in December 1974, and then executed a quit 

claim deed to her in August 1975. Pris is now Kris IIirt, 

respondent. There was no notice of any of these transactions 

recorded in Lincoln County where the land is located. 

Lincoln County continued to assess taxes on the property 

to the Fruses as record owners. The 1976 taxes were not paid 

and in July 1977, the property was offered for public tax 

sale. No bid was received on the property and Lincoln County 

became the purchaser. 

In Ja~uary 1980, Lee McDonald purchase2 the property 

from Lincoln County via a tax deed. procedure. The tax deed 

contained an incorrect and incomplete description. In 

Februs-ry 1981, the appellant, James Walters, purchased the 

property from McDo~ald. b7alters recorded his deed. 

IE April 1981, Walters filed a complaint to quiet title 

to the property. He named as defendants in that action the 

Kruses, Willett, Bruce Poberts, and "all other persons, 

~lnknown. " 

On June 8, 1981, the District Court, having determined 

that the defendants had been duly served, yet failed to 

appear and were in default, and having determined that proof 

to the satisfaction of the court having been made, ordered 

title quieted in the appellant. Appellant, Walters, then 

conveyed two parcels to Rick and Sandy Hildebrand. That deed 

was recorded in Cctober 1981. In the meantime the 

respondent, Rris Hirt, had been paying on her contract held 

in escrow in the Idaho bank. The respondent believed. that 
the escrow arrangement included payment of taxes. In 

September 1982, respondent's friend who lived next to the 

property advised her that somecr,e was living end building on 

the property. 

In February 1983, Kris ITirt filed consolidated motions 

to set aside her default and to intervene ir, the original 

quiet title acrtion, a third party complaint on quiet title, 

and an action to set aside the tax deed. She alleged tha.t. 

the tax sale and subsequent transfers were void. for 

irregularities incl-uding lack of definite description, 

failure to give proper notice, fraud on the court, and 

failure to use proper tax deed procedure. She named the 

appellant, his predecessor, McDcna.ld, and the Hi1debra.r.d~ as 

defendants. 

In November 1983, the Cistrict Court set aside its June 

1981, decree that had quieted title in the appellant. 

Appellant, Walters, then moved to set aside this judgment in 

favor cf the respondent., Hirt. This motion was denied. The 

appellant then filed an amended complaint and the natter went 

to trial. In July 1984, the District Court issued fj-ndings 

of fact and conclusions of law. The court found. that Lincoln 

County did not have jurisdiction to issue a tax deed because 

the notice was meterial.ly defective in stating the amount due 

and in setting forth the clescription. As a result of the 

defects, the court found that Kris Roberts did not. lose her 

right to redeem the property by payment of delinquent taxes 

and that upon payment of those taxes she sh.ould have the 

title quieted in her favor on the land not. previously 

conveyed to the Hildebrarids. 

As to the land conveyed to t-he IIildebrands, the court 

fou~d that title should remain in th.e HiLZebrands as bona 
fide purchasers for val-ue, but that the appellant Walters 

should! pay Hirt For the property he had conveyed to them. 

Judgnent was entered quieting title in the respondent subject 

to the Hildebrand's Gr appellant's right to redeem by paying 

the respondent for the parcel upGn which the Hil.debrands had 

constructed buildings. Both the appellants and Hildebrands 

appeal~d. Subsequently the Hildebrands settled their dispute 

and dismissed their appeal. 

The first issue we must decide is whether the District 

Court erred in setting a-side the quiet title decree. 

The respondent, in her consolidated motion and action to 

set aside the quiet title decree, also challenge6 the 

underlying tax deed procedure under which lGcDonald, 

appellant's prezecessor in title, claimed his interest. 

However, as the District Court found, the description of 

property claimed under the tax deed procedure was so 

6eficient that there could be no valid transfer of any 

interest under any kind of action. The notice published in 

the tax deed procedure referred to Section 25 and not to 

Section 26, the section in which the land lies. In addition 

the description referred to a "Tract 1" in H.E.S. 735--there 

is no Tract 1 in H.E.S. 735. To compounl the difficulty in 

locating the land, the description 2id not indicate north or 

south for the township, or east or west for the range. 

Fe agree with the Cistrict Court that the nctice of 

application fcr tax deed was so vague, incomplete and 

erroneous that it does not adequately identify the lanz and 

is therefore fatally defective. Yetter v. Gallatin County 

(Kont. 1982), 645 P.26 941, 942, 39 St.Rep. 905, 907. 

Defective notice of application for a tax deed deprives 

the county treasurer of jurisdiction to issue the tax deed. 
Edwards v. Walters (Kont. 1983), 664 P.2d 332, 937, 40 

St.Rep. 914, 921. Because no valid tax deed has been issued 

respondent's right to redeer, the property has not. terminated. 

Section 15-18-101, MCA. 

Because of our holding a-s to the first issue it is not 

necessary to discuss the second and third issues. 

The judgment of the District 

We Concur: