Opinion ID: 2072744
Heading Depth: 1
Heading Rank: 5

Heading: Mortgage Tax

Text: At trial the Koobs objected to the introduction of the memorandum of July 19, 1973, on the grounds that the document was inadmissible as evidence because the plaintiffs had not paid the mortgage registration tax pursuant to Minn.St. 287.10, which provides: No such mortgage, no papers relating to its foreclosure nor any assignment or satisfaction thereof, shall be recorded or registered unless the tax shall have been paid; nor shall any such document, or any record thereof, be received in evidence in any court, or have any validity as notice or otherwise; but, if the tax be paid, no error in computation or ascertainment of the amount thereof shall affect the validity of such mortgage or the record or foreclosure thereof. (Italics supplied.) For the purposes of the payment of the tax, contracts for deed which give or entitle the vendee to take possession are deemed to be a mortgage to the extent of the unpaid purchase price. [7] The plaintiffs offered to pay the tax at trial when the objection was raised, but the trial court held that payment was unnecessary. We believe the trial court was correct on the theory that the July 19 contract is not a contract for deed, but only a contract to enter into a contract for deed. The purpose of the statute is to collect revenue prior to the use of the document for recording purposes or foreclosure. If the Koobs had not breached the agreement of July 19, a formal contract for deed would have been executed and the tax could have been paid. The only reason it was not was because of the actions of the defendants. The trial court only determined a contract existed. Until that determination was made (or admitted by the defendants) no tax would be due.