Court Opinion

ID: 9448180
Source: CourtListenerOpinion
Date Created: 2023-08-03 23:24:58.829582+00
Date Added: 2024-06-11T17:31:19.068723
License: Public Domain

JONES, Chief Judge
(concurring in part).
I would recommend that the plaintiff be paid the amount of the taxes up to April 22, 1942, the date when the defendant requisitioned the property, limited to the amount which was distributed to the wrong parties. In other words, I feel that plaintiff on the basis of equity should be paid $44,707.74 rather than half that amount as recommended by the majority.
The tax liens were fixed and of record when the Government requisitioned the property. Neither the county nor its officials were made a party to the requisition proceedings. The taxes were a first lien and constituted a direct interest in the property. These taxes have not been paid on the parcels in question.
It is true some of the county officials knew that the proceedings were pending. It is also true that the defendant’s officials knew and also had official record notice of the first lien taxes.
There is considerable conflict in the testimony as to how much conversation occurred, as to what promises were made, and as to whether assurances were given that the county’s rights would be protected in final distribution.
All this points up the wisdom of having matters affecting land reduced to writing. Since the Statute of Frauds was enacted in England in 1677, practically every civilized country has enacted laws which provide that not a spoonful of dirt may be transferred in ownership from one party to another except in writing. Otherwise there could be no quieting of title in anyone so long as human beings possess an imagination, defective memories, and a degree of cupidity.
Since the issues are the same, in so far as the equities are concerned, I repeat a portion of what I said when the case was before us on the original trial.
“To deny [full] recovery in this case is unthinkable. Such action would directly violate the Fifth Amendment in two respects. It would deprive plaintiff of property without due process of law, and it would involve the taking of private property without just compensation.
“That can’t be done against an individual, much less against a State.
“The defendant admits that neither the State, county, nor any of their officers or agents were made parties to the proceeding. How can they be bound ?
“The defendant says that some of the State or county officers knew about the *782proceeding. Are we to have citation by rumor or by the uncertain word of the village gossip? There are some of the forms of procedure that are vital and cannot be supplied by the conflicts and uncertainties of oral testimony.
“These taxes were a first lien on the land. As was stated in Monroe v. Doe, 7 Ohio 262, 265:
“ * * The state has a lien upon all land not exempt from taxation, which is calculated to be perpetual and which cannot be affected by any sale or transfer * * *. It can be removed in no other way than by payment of all taxes, penalties and interest due on the land.’
“In volume 24 of the original edition of Ohio Jurisprudence, at p. 100, is found the following language:
“ ‘It is a fundamental proposition that persons having rights in land cannot be affected by a judgment or decree taking such land unless they are parties to the proceedings. [Citing Meyers [Myers] Fall & Collins, et al. v. Hewitt, 16 Ohio 449.]’
“As in practically all States, a tax lien is a first lien and is superior to all other liens.
“We quote from 2 Lewis Eminent Domain § 524 (3d Ed., 1909) :
“ ‘In Nebraska it has been held that a tax lien in favor of the State was not divested by a condemnation for railroad purposes * * * lien holders are owners within the statute and * * * must be made parties and * * * to divest their interest. [Citing State v. Mo. Pac. Ry. Co., 75 Neb. 4, 105 N.W. 983.] * * * jn any cage lien would undoubtedly follow the fund and could be enforced against the fund * * *.’ [Citing In re Sleeper, 62 N.J.Eq. 67, 49 A. 549.]
“We quote from section 538 of the same authority:
“ ‘If a necessary party is omitted, the proceedings will be nugatory as to such party. But as a general rule such an omission does not vitiate the proceedings as to those who are parties, nor can the latter complain of such omission.’ [Citing cases.]
“The author then states the general principles gleaned from a review of a great many eminent domain cases. These include, inter alia,, that the Fifth Amendment should be liberally construed for the protection of private rights; that the wox-d property includes every valuable interest which a person can have in or appurtenant to land; and that due process of law requires that the owner of any such right or interest should have a reasonable opportunity to be heard on the question of compensation before he can be deprived thereof for public use.
“It has been held that payment to one other thaxx the person entitled thereto is not a defense. Palo v. Rogers, 1933, 116 Conn. 601, 165 A. 803.
“The courts have uniformly held that whex'e property is subject to a tax lien, the payment of compensation money into the registry of the court does not extinguish the tax lien, but the lien is merely transferred from the land to the fund. Board of Capitol Managers v. Brasie, 1922, 72 Colo. 153, 210 P. 63; Ross v. Kendall, 1904, 183 Mo. 338, 81 S.W. 1107; Carpenter v. City of New York, 1899, 44 App.Div. 230, 60 N.Y.S. 633.
“We quote from the Brasie ease, supra [72 Colo. 153, 210 P. 64] the following:
“ ‘The money in the registry of the court stood in the place of the land, and the court below fell into error in not so holding. So much of the funds in the hands of the clerk as may be necessary should be applied to the payment of the special improvement tax, with accrued interest thereon, and the remainder, if any, should be paid to the respondent.’
“* * # a. F. O’Neil, Special Assistant United States Attorney, testified that he had paid millions of dollars to the county authorities, on other parcels of land and in other cases, and in no case was the county made a formal defendant. This procedure, therefore, was the cus*783tomary and established way of handling such matters between county and Federal authorities. The tax lien, being a first lien, always followed the proceeds and became a lien on any fund that might be paid into court by way of compensation.
“Witnesses on both sides in this case testified that in this particular county it often happens in Federal and State condemnation cases that the county is not made a party defendant, * * *. ******
“The first overt act by the Government which gave any indication that the Federal Government intended to refuse to recognize the validity of the tax liens was when the orders of distribution were entered on April 8,1948. Prior to that date the county had been repeatedly assured by letter of the Special Assistant United States Attorney in charge of the condemnation proceedings, Mr. O’Neil, that the taxes would be paid out of any funds arising out of a jury or court verdict entered on final trial and disposition of the case. The funds were distributed without regard to the valid existing tax liens, and without provision for their payment. Again the county officials were not notified and the rights of the plaintiff were completely ignored. ‘Upon what meat doth this our Caesar feed, that he is grown so great’ as to be able to ignore the established rights of a subdivision of a sovereign state? One is reminded of the story of the cannibal who is said to have claimed title to a piece of land on the ground that he ate the owner. ******
“The money was paid out to the former owners under an ambiguous agreement that apparently led such owners to believe that they were being paid these amounts for their equity. At the time these ambiguous agreements were made the Federal officials were fully aware of the fact that the sums that they were agreeing upon and paying were insufficient to cover the tax liens. In spite of all this, the money was paid out without a word being said to the plaintiff, who held a first lien on the fund. Whatever else may be justified, the defendant would be liable for such of the valid unpaid taxes that were in effect at the time the declaration of taking of the land was first made, to the extent at least that the funds unjustly distributed would have been sufficient to absorb such taxes.
“The facts shine through this whole record that the Federal officials apparently feared to let the rate of compensation as to this suburban property be fixed at a regular trial and deliberately settled with the equity owners for the purpose of leaving the plaintiff without any enforceable rights.” [153 F.Supp. 378.]
Stripped of its excess baggage and verbal persiflage, the bald facts remain— standing apart and shining like a cathedral — that the Government took the property upon which an official unit of a sovereign state had a valid lien; that the county was not made a party to the suit; that the funds were paid out by Federal officials on orders approved by the United States District Court, and that the first lien was bypassed and the county left holding the bag.
The majority opinion quotes extensively from the case of United States v. Dunnington, 146 U.S. 338, 13 S.Ct. 79, 80, 36 L.Ed. 996.
A careful reading of that case shows that it is utterly inapplicable to the facts here presented. If the time ever comes when it properly applies it should of course be given due consideration, but in its essence it has no more relevancy to the issues presented here than has Homer T. Wilson’s lecture on “America’s Uncrowned Queen.” The Dunnington case was “a proceeding by the heirs at law of a person formerly in rebellion against the United States to recover the value of a lot of land, which had first been confiscated as enemy’s property, and then condemned, in the hands of the purchaser, for the use of the government and for the enlargement of the Capitol grounds. * * * Under the confiscation act of July 17, 1862, 12 Stat. 589, c. 195, the lot had been seized as the property of a public enemy and sold to Shepherd.”
*784In 1872, the Congress passed a special act which authorized the Secretary of the Interior to make a purchase of additional property for the Capitol grounds and to ask the “Supreme Court of the District of Columbia” under such rules as it may adopt to make a just and equitable appraisement of the several interests of each and every owner of real estate, etc.
The act was a special one having to do largely with the right of heirs in property that was confiscated from owners some of whom had been classed as “enemy aliens.”
That entire case grew out of one of the most tragic experiences in our Nation’s history and was governed by special acts. The final decision from which the majority opinion quotes was not written until 1892, 30 years after the property was confiscated.
The Supreme Court held that “the presumption is, that due and legal notice was given of the proceedings, the appraisement was valid and binding upon Dunnington and his heirs.” 146 U.S. at page 350, 13 S.Ct. at page 83. Clearly the decision had no application to the case at bar.
By every tenet of fair play that I have known or read about from my youth to this good hour, Cuyahoga County should be reimbursed to the extent of $44,707.-74, and I so recommend.