Source: https://supreme.justia.com/cases/federal/us/313/274/
Timestamp: 2019-04-21 20:38:17+00:00

Document:
1. The law of Alabama fixes October 1st of each year as the tax day as of which real property shall be assessed for the taxes of the succeeding tax year, and provides a statutory process whereby, in due course, valuations of properties and amounts of tax are determined. Taxes are made liens on the properties taxed, relating back to the tax day and continuing until the taxes have been paid. The lien is effective not only against the owner on the tax day, but also against subsequent purchasers.
(1) That the tax lien is not objectionable under the Federal Constitution as applied to a purchaser who bought on or after the tax day and before the amount of the tax had been fixed by levy and assessment. P. 313 U. S. 279.
(2) The fact that the purchaser, in such circumstances, was the United States did not invalidate the lien. P. 313 U. S. 281.
(3) Such a lien cannot be enforced against the United States without its consent. P. 313 U. S. 281.
2. A proceeding against property in which the United States has an interest is a suit against the United States. P. 313 U. S. 282.
This was a suit brought in this Court by the United States against the State of Alabama in which the plaintiff sought to have removed, as clouds on its title, tax liens imposed under the law of the State upon lands purchased by the plaintiff.
The Court decrees that tax sales and certificates of purchase, resulting from proceedings in an Alabama county court for enforcement of the liens, shall be set aside, but, in other respects, the bill is dismissed.
The United States brought this suit to quiet its title to land in Macon County, Alabama. The complaint alleges that the Alabama is asserting liens as attaching to the land on October 1, 1936, for state and county taxes for the tax year 1937, and further that the State claims an interest in the land by reason of tax sales and the issue to the certificates of purchase. The Government asks a decree declaring the liens, tax sales, and certificates of purchase to be invalid and enjoining the State from asserting its claims. The case was heard on bill and answer.
when property becomes assessable, the State shall have a lien upon each and every piece or parcel of property owned by any taxpayer for the payment of all taxes which may be assessed against him . . . which lien shall continue until such taxes are paid."
The county is to have a like lien for taxes assessed by it. These liens are made superior to all other liens. and may be enforced by sale as provided in the Act.
valuations were certified as provided by the statute to the county board of review, which, by virtue of its authority to fix valuations, made the definitive assessments. [Footnote 3] It appears that the board of review met on March 8, 1937, and adjourned on March 20, 1937. It also appears that the rate for state taxes had been fixed by the statute, [Footnote 4] and the rate for county taxes was set on February 8, 1937, under the authority given to the court of county commissioners. [Footnote 5] The school district tax was approved by the electors of the school district at an election held on June 14, 1937. The taxes for the year 1937 became payable on October 1, 1937, and became delinquent on January 1, 1938. [Footnote 6] Proceedings were then instituted in the county court for the sale of the lands, and, under its decrees, the sales took place on June 12, 1939. The lands were sold to the State, and certificates of purchase were issued accordingly.
First. The Government, invoking the principle that lands owned by the United States cannot be taxed by a State (Van Brocklin v. Tennessee, 117 U. S. 151) contends that the asserted liens are without validity because, at the time the tracts were acquired by the United States, the amount of the taxes had not been ascertained, as the values had not then been assessed and the rates of taxation had not been fixed. Therefore, it is said that the taxes had not then been imposed. The argument is that the Alabama tax statute does not "impose taxes," but "secures their payment," and that, unless taxes are imposed, the statute has no effect. The lien, it is urged, becomes "fixed and final" only when the taxes have been ascertained "by completion of levy and assessment."
"is effective for many purposes, though its amount is undetermined. It is notice to mortgagees or purchasers, who are held to loan or purchase at their own risk if they take their mortgages or deeds before the tax has been assessed or paid."
"Against mortgagees and purchasers, a lien perfected afterwards may take effect by relation as of the date of the inchoate lien through which mortgagees and purchasers become chargeable with notice."
Id., p. 288 U. S. 293. See also Osterberg v. Union Trust Co., 93 U. S. 424, 93 U. S. 425, 93 U. S. 428; People v. Commissioners, 104 U. S. 466, 104 U. S. 468. Compare Shotwell v. Moore, 129 U. S. 590, 129 U. S. 598. The lien in such a case, though inchoate on the day specified and maturing when the extent of liability is ascertained by the statutory process, is similar in that respect, as the court said in the Maclay case, to the lien of a transfer tax or duty upon the estate of a decedent which is effective although the amount is ascertained after death.
Our present inquiry is whether, assuming the validity of the state statute creating a lien as of October 1, 1936, as against other subsequent purchasers, it should be deemed invalid as against the United States. The question is not whether such a lien could be enforced against the United States. The fact that the United States had taken title and that proceedings could not be taken against the United States without its consent would protect it against such enforcement. But that immunity would not be predicated upon the invalidity of the lien. If, in this instance, title had been taken by the United States in the summer of 1937, after the amount of the taxes had been ascertained, and the respective liens were concededly valid, still proceedings against the United States could not be prosecuted without its consent.
either adverse to the United States or to its successors in title. We think that the United States is not entitled to that relief. The United States took the conveyances with knowledge of the state law fixing the lien as of October 1st. That law, in creating such liens for the taxes subsequently assessed in due course and making them effective as against subsequent purchasers, did not contravene the Constitution of the United States, and we perceive no reason why the United States, albeit protected with respect to proceedings against it without its consent, should stand, so far as the existence of the liens is concerned, in any different position from that of other purchasers of lands in Alabama who take conveyances on and after the specified tax date. It is familiar practice for grantees who take title in such circumstances to see that provision is made for the payment of taxes, and the Government could easily have protected itself in like manner. Finding no constitutional infirmity in the state legislation, we think that the liens should be held valid.
pleading to the contrary in its answer, the invalidity of the tax sales is now conceded by the State.
The United States is entitled to a decree setting aside the tax sales and the certificates of purchase, and, in other respects, the complaint is dismissed.
"From and after the first day of October of each year, when property becomes assessable, the State shall have a lien upon each and every piece or parcel of property owned by any taxpayer for the payment of all taxes which may be assessed against him and upon each piece and parcel of property real or personal assessed to owner unknown, which lien shall continue until such taxes are paid, and the county shall have a like lien thereon for the payment of the taxes which may be assessed by it, and if such property is within the limits of a municipal corporation, such municipal corporation shall have a like lien thereon for the payment of the taxes which may be assessed by it. These liens shall be superior to all other liens, and shall exist in the order named, and each of such liens may be enforced and foreclosed by sale for taxes as provided in this Act, or as other liens upon property are enforced."
"From and after the first day of October of each year, the state shall have a prior lien upon each and every piece or parcel of property, real or personal, for the payment of any and all taxes which may be assessed against the owner, or upon such property, during that year, for the use of the state, and the county shall have a like lien thereon for the payment of the taxes which may be assessed against such owner, or upon such property, during that year, for the use of the county, and these liens shall exist as to all lands bid in by the state at tax sales for the annual taxes thereafter assessed on the value of the property so purchased, in the event of the tax title failing."
Act No. 194, General Acts Alabama, 1935, § 29, p. 274.
Id., §§ 50, 72, pp. 284, 292.
Id., § 7, p. 263.
Id., § 64, p. 288.
Id., § 11, p. 267.

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