Court Opinion

ID: 3808009
Source: CourtListenerOpinion
Date Created: 2016-07-06 07:47:50.001371+00
Date Added: 2024-06-11T13:50:33.730211
License: Public Domain

I agree with the conclusion of a majority of my associates that the statutory provision making liens for special assessments for street improvements coequal with liens for ad valorem taxes is valid and constitutional.
It is my opinion, however, that priority exists between successive annual liens determined upon application of the rule that the last is first and the first is last. I also entertain the view that the manner in which coequality is undertaken to be preserved in this case, that is, by sale and pro rata distribution of the proceeds between the holder of the special assessment liens and the holder of the ad valorem tax title, is unauthorized by law.
It is my belief that the proper solution of the problem in this case requires a recognition that titles created in separate proceedings and based upon coequal *Page 149 
liens are coequal, and that the relationship of tenancy in common exists between the holders of the respective titles.
The rights of the parties, if a controversy subsequently arises, can then be adjusted by proceedings to partition. If liens of unequal rank have been included within those of coequal rank in creating either of the titles, the question of priority can be adjusted through partition by sale as distinguished by partition in kind.
The importance of this case warrants setting forth my views in sufficient detail to reflect the basis of my conclusions. Such a treatment necessitates a limited restatement of facts appearing in the majority opinion.
This cause involves a controversy between bondholders of a paving district of the city of Wewoka, who are seeking to enforce by foreclosure proceedings a special assessment lien for street improvements on a city lot, and the county of Seminole (in which the city of Wewoka is located), which is claiming title to the property under a resale tax deed.
The settlement of the controversy involves a determination of what constitutes and what is the effect of coequality between ad valorem tax liens and liens for special improvements when separate procedures have been or are being pursued for the enforcement thereof.
The problem is one of public interest and innovation of theory on appeal is not prohibited. Magnolia Petroleum Co. v. State, 175 Okla. 11, 52 P.2d 81.
The street improvement bonds herein involved were issued on April 26, 1924, by the town (now city) of Wewoka. They were not general obligations of the municipality (Severns Paving Co. v. Oklahoma City, 158 Okla. 182, 13 P.2d 94), but, on the contrary, were payable from assessments made against property in a street improvement district numerically designated as number one of the town of Wewoka.
The street improvement district was created, the bonds were issued, and assessments were made against the property deemed to be benefited, under and by virtue of the provisions of chapter 173, S. L. 1923, 11 O. S. 1941 §§ 81 et seq. and §§ 151 et seq. The provisions of existing law at the time the bonds were issued became and constitute a part of the contract with the bondholders. Davis v. McCasland, 182 Okla. 49,75 P.2d 1118; Straughn v. Berry, 179 Okla. 364, 65 P.2d 1203; Prince v. Ypsilanti, 140 Okla. 131, 282 P. 282; Nelson v. Pitts,126 Okla. 191, 259 P. 533, 53 A. L. R. 1137; Perryman v. City Home Builders, 121 Okla. 150, 248 P. 605.
Among the properties specially assessed to bear the cost of the improvement was: lot one in block two of the incorporated town of Wewoka. The special assessment against this property was $464.40, payable in ten equal annual installments of $46.44 each, together with such interest and penalty as might accrue before payment. This action is to foreclose the special assessment lien on said property for delinquent installments.
With reference to the status of special assessments it was provided by a portion of section 23 of the act (chap. 173, S. L. 1923, supra) that:
". . . . Such special assessments, and each installment thereof and the interest thereon are hereby declared to be a lien against the lots and tracts of land so assessed from the date of the publication of the ordinance levying the same, coequal with the lien of other taxes and prior and superior to all other liens against such lots or tracts of land, and such lien shall continue as to unpaid installments and interest until such assessments and interest thereon shall be fully paid, . . ."
The legislative intent to create a coequal lien has been recognized by this court. Service Feed Co. v. City of Ardmore,171 Okla. 155, 42 P.2d 853; Blythe v. Pratt, 171 Okla. 2,41 P.2d 895; Runnells v. Citizens' Nat. Bank of Wooster, Ohio,157 Okla. 94, 11 P.2d 173. What constitutes coequality will be subsequently considered. *Page 150 
The specific date when the coequal lien attached under the literal provision of the statute as determined by the publication of the assessing ordinance does not appear in the record; however, the approximate time of its passage and publication is sufficiently indicated to satisfy the requirements of this litigation. It was passed and published in the latter part of 1923 or the first part of 1924.
In 1931 default was made in the payment of the annual installments, and thereafter no further payment was made on the same. This action to foreclose the lien on the property for the unpaid installments was instituted in the district court of Seminole county on May 13, 1937, by S.N. North and other bondholders as relators in the name of the city of Wewoka, Okla., as plaintiffs, against A. Thelma Johnson, the then owner of the property, as defendant.
At the time of the institution of the action three unpaid installments (the last three of the ten annual installments) for 1931-1932 and 1933 were delinquent and unpaid. These installments with the accumulated interest and penalties thereon aggregated $249.22.
The authority for the institution and maintenance of this foreclosure action rests on section 29 of chap. 173, S. L. 1923, 11 O. S. 1941 § 107, which, after prescribing the details of the procedure, provides in part:
". . . Such judgment shall provide for the sale of said real estate subject to existing general or ad valorem taxes and special assessments. All owners or encumbrancers shall be made parties defendant in such suit. . . ."
It seems obvious from the general content of the section, as well as the particular language above quoted, that the Legislature intended the remedy created to be available only for the enforcement of delinquent special assessments, and that the particular words used contemplate the limitation of the remedy rather than a qualification of the right to be enforced thereby. That is, the foreclosure remedy was created for the sole and only purpose of providing a method of enforcing delinquent special assessments. It was not intended to authorize the foreclosure or enforcement of other tax liens in a manner not elsewhere provided for, but the Legislature contemplated the continued existence of other laws authorizing sales for taxes to the extent of their force and effect. In other words, the remedy is cumulative. It does not purport or pretend to authorize a sale comprehending and extinguishing an outstanding tax title.
Similarly, by making provision for the exclusion of ad valorem taxes and sale subject thereto, the Legislature clearly indicated that no part of the proceeds of the sale should be applied to the payment of such taxes.
Thus by legislative action a remedy has been provided for a specific purpose. That remedy has been previously approved by this court as a valid legislative action. Service Feed Co. v. City of Ardmore, 171 Okla. 155, 42 P.2d 853; Bailey v. Oklahoma City, 157 Okla. 96, 11 P.2d 113; City of Shawnee v. Taylor, 171 Okla. 185, 42 P.2d 860. The remedy has been classified as a special proceeding dependent upon and requiring substantial compliance with the statute. Morgan v. City of Ardmore, 182 Okla. 542, 78 P.2d 785. We therein said:
"It is to be borne in mind that an action to foreclose an assessment lien for street improvements by a bondholder is a special proceeding for the collection of such assessments and the provisions of the statute providing the procedure therefor are mandatory and must be substantially complied with. . . ."
The relators through the plaintiff city are therefore seeking a judicial sale which will confer title based exclusively on delinquent paving assessments. They are now opposed by the county as the holder of a tax title derived through a sale for ad valorem taxes. This opposition has developed outside this litigation in the following manner and due to the following circumstances: *Page 151 
When in 1931 the owner of the property here involved began to neglect the payment of the special assessments against her property she likewise became negligent in connection with the payment of ad valorem taxes. As a result, ad valorem taxes for the years 1930 to 1938 were not paid.
After other prerequisite steps were taken, the status of the property, with reference to ad valorem taxes, became such that in 1939 it was advertised for and sold to the county at resale for the accumulated ad valorem taxes for the years 1930 to 1938. The amount of such taxes was $295.56.
This disposition at resale had no relation to the delinquent special assessments, which were not included in the amount for which the property was sold.
This court has held that although statutory authority exists for including in the amount for which porperty is sold at tax sale or resale the amount of any delinquent special assessments for street improvements (Oklahoma City v. Vahlberg,185 Okla. 28, 89 P.2d 962), the failure to include such items does not destroy the validity of the sale but merely renders the sale ineffective for the extinguishment of the liens and existing rights in connection therewith. Blythe v. Pratt, supra; Settle v. Frakes, 156 Okla. 53, 9 P.2d 768. In so deciding, however, the court did not exclude the possibility that questions of priority of liens and titles derived from liens might arise by virtue of time; that is, prior and subsequent delinquencies were not judicially placed in the same category with reference to priority.
When the county of Seminole had acquired its title at resale for ad valorem taxes, it was made a party defendant to this litigation and thereupon asserted a title in itself allegedly superior to any that could be created by a sale in this proceeding.
On the trial of the case the trial court entered its judgment foreclosing the special assessment lien and directed a sale of the property. The county has appealed and appears herein as plaintiff in error. Our continued reference to the parties will be by their trial court designation.
It is thus apparent from the foregoing statement of facts, considered in connection with the statutory provisions and established principles of law interpolated therewith, that in this appeal we are confronted with a situation in which by legislative enactment provision has been made for coequality between liens for special assessments and liens for ad valorem taxes.
It is further apparent that each of those coequal liens may, through appropriate proceedings and independent of the other, develop into title, which title in each case purports to be in fee simple as far as the other or any other title is concerned.
In this case one title has already been secured in another proceeding and recognition thereof is sought herein and in this another title is being sought through foreclosure under the statute.
It is at once apparent that (other factors creating priority being eliminated from consideration for the present) if either title is allowed to prevail over the other, coequality of the respective liens upon which they are based is automatically destroyed and emasculated.
There is one rational and legally sound solution for such a situation. Two outstanding independently created coequal titles to the same property and each extending to the entire estate can result in but one relationship, namely, that of tenants in common, the proportionate share of each of the respective tenants in common depends upon the extent of the obligation secured by the lien from which the title arose, with due consideration to any portion of either obligation which may have constituted a prior lien. Tenancy in common requires only unity of possession or the right of possession, and other unities essential to other types of cotenancy are not essential. 14 Am. Jur. 87; Earp v. Mid-Continent Petroleum Corporation, 167 Okla. 86, 27 P.2d 855. Specific judicial *Page 152 
authority for this view will be found in the cases from Minnesota which I shall subsequently discuss in this opinion and which are of controlling importance because of the close analogy of the problem here presented.
At this point it is appropriate that I briefly allude to what is meant by coequality of liens. By the statute, coequality between ad valorem tax liens and special assessment liens is provided, but it is of paramount importance that we remember that coequality does not exist between ad valorem tax liens for successive years, and it follows that such equality does not exist between titles secured pursuant to liens for successive years. In such cases the last is first and the first is last. As is said in Cooley on Taxation (4th Ed.) vol. 3, p. 2473:
" 'Tax-liens,' it is said, 'take priority in the reverse order of other liens. As to all other liens the first in order of time is prima facie superior to those of a later date. In the case of tax-liens, however, the 'last shall be first and the first last.' The general and universal rule is that in proceedings in rem to enforce the payment of taxes the last tax levied and sought to be enforced is superior and paramount to the lien of all other taxes, claims, or titles.' This rule is well settled."
This rule of priority in the reverse order between ad valorem taxes for successive years has been recognized and applied in this jurisdiction. State v. National Bank of Commerce of Pawhuska, 139 Okla. 134, 281 P. 579 (modified in other respects by subsequent decision of this court). Notice, also, discussion in Mahany, Oklahoma Sales of Land For Taxes, chap. IV., p. 69, par. 11.
This general rule is, of course, subject to special statutory provisions applicable to particular situations which by their application create exceptions not herein applicable and not a proper subject of discussion in this opinion. (Notice 68 O. S. 1941 § 451; Honeyman v. Andrew, 124 Okla. 18, 253 P. 489; Neff v. Gray, 157 Okla. 207, 11 P.2d 755.)
The reason for the general rule is obvious. A person who acquires the title to land takes it subject to the subsequent accrual of obligations imposed by the sovereign power. Those obligations being a burden against the land only, the land must remain subject to their imposition.
So, in general, and subject only to statutory provisions creating exceptions to the contrary, the rule of the "last shall be first and the first shall be last" applies to ad valorem tax liens accruing from year to year.
The legislative provision making street improvement assessments coequal does not, nor was it intended to, destroy this priority from year to year, but, on the contrary, was intended, in my judgment, to give each delinquent paving assessment coequality with the delinquent ad valorem taxes subject to sale that year. That is, place it on the same footing.
There is another possible interpretation based on the peculiar wording of our statute which from a purely literal and logical standpoint claims a degree of consideration but which must be discarded by reason of its failure to harmonize with the legislative intent as determined by the result and its failure to dovetail in a rational manner with other statutory provisions.
Looking exclusively to the statute creating coequality and applying the rule of reverse priority, it will be noticed that the street assessment lien is made to attach as of the date of the publication of the assessing ordinance, which of course is at or near the beginning of the ten-year period during which the assessments become due; in this case, in the latter part of 1923 or 1924. It could be very reasonably said that each ad valorem tax for each subsequent year created a superior lien. Such a view, though defensible in theory, would, in practical effect, destroy all semblance of coequality from a practical standpoint. I am of the opinion that it would not carry out the legislative intent especially in view of legislative provisions contemplating the certification each year of delinquent *Page 153 
paving assessments to the county treasurer and authorizing their combination with delinquent ad valorem taxes for tax sale purposes, all of which proceed on a year to year basis. Notice procedure as reviewed and considered in Oklahoma City v. Vahlberg, supra.
In Board of Com'rs of Creek County v. Alexander,58 Okla. 128, 159 P. 311, this court said in paragraph 1 of the syllabus:
"It is a cardinal rule in the construction of statutes that the intention of the Legislature, when ascertained, must govern, and that to ascertain the intent all the various provisions of legislative enactments upon the particular subject should be construed together and given effect as a whole."
And in paragraph 4:
"When it is apparent that a strict interpretation of a particular statute, construed alone, would defeat the intention of the Legislature as shown by other legislative enactments, which relate to the same subject, and which have been enacted in pursuance of, and according to a general purpose in accomplishing a particular result, such construction should not be adopted."
Upon consideration of the foregoing principles and in order to accomplish the purpose of the legislative act, I am of the opinion that each annual paving installment as it becomes a delinquent carries with it a lien of equal priority with ad valorem taxes which become or would be delinquent and salable in the same year.
To illustrate specifically, past-due delinquent ad valorem taxes become subject to sale during November. A delinquent special assessment becomes delinquent and should be certified to the county treasurer in September. It may be combined with the ad valorem taxes for such sale. It was and is these two obligations and the liens which protect the same which are coequal. In other words, coequality should be determined as of the time the annual delinquencies of ad valorem and special assessments become or would become salable.
Each annual delinquency salable during any year, whether street improvement or ad valorem assessment, is superior to prior annual delinquencies salable of either class, and inferior to annual delinquencies salable during subsequent years.
The elimination of the possible but untenable theory that the attachment of the street improvement lien prior to the maturity of installments (that is, at the time the assessing ordinance is passed) makes the problem identical in all essential respects with that which confronted the Supreme Court of Minnesota in connection with a statute passed by the Legislature of that state in 1905. By section one of chapter 200 of the Laws of Minnesota of 1905, it was provided:
"That all assessments upon real property for local improvements made or levied by the proper authorities of any city in the State of Minnesota now or hereafter containing a population of over 50,000, according to the last national or state census, shall be a paramount lien upon the land upon which they are imposed from the date of the warrant issued for the collection thereof, and of equal rank with the lien of the state for taxes which have been or may be levied upon said property under the general laws of the state; and that the general rules of law as to priority of tax liens shall apply equally to the liens of such assessments and to such liens for general taxes, with the same force and effect as though all of the liens aforesaid and all of the taxes and assessments aforesaid, were of the same general character and imposed for the same purpose and by the same authority, without regard to the priority in point of time of the attaching of either of said liens, and a sale or perfecting title under either shall not bar or extinguish the other."
The legislative provisions of the Minnesota act were more specific and detailed than are our own. Perhaps they were unnecessarily so. The additional provisions do not depart from coequality of the liens, but merely expressly recognize conditions which in many respects must be necessarily implied in order to preserve the coequality *Page 154 
of liens. The difference in the two acts does not, therefore, create the basis for a distinction.
The foregoing act was the subject of controversy before the Minnesota court a number of times. Gould v. Grout, 110 Minn. 324, 125 N.W. 273; Smith v. Iten, 116 Minn. 44, 133 N.W. 74; Gould v. City of St. Paul, 120 Minn. 172, 139 N.W. 293; Midway Realty Co. v. City of St. Paul, 124 Minn. 300, 145 N.W. 21.
In Minnesota, as in this state, separate proceedings were available by which title could be obtained from the respective liens.
The case of Gould v. City of St. Paul, supra, is particularly instructive, but due to the length of that opinion we shall not encumber this opinion with quotations therefrom. The holdings in the Gould Case and other preceding cases were summarized in the case of Midway Realty Co. v. City of St. Paul, supra. The conclusions are summarized by the following excerpts:
"General tax liens and city assessment liens are of equal rank. The general rule as to tax liens of equal rank apply. Each lien is superior to all that go before it. The lien last in time is first in right, whether it be a tax or assessment lien. A later tax lien will take priority over all earlier liens, whether for taxes or assessments. Likewise a later assessment lien will take priority over all earlier liens, whether for taxes or assessments. . . .
"All city assessment liens accruing during any year are equal in right of priority with the lien of taxes for that year. . . . Tax and assessment liens accruing during any one year are accordingly equal in right of priority. Tax and assessment liens accruing during a subsequent year all take priority over all tax and assessment liens of former years.
"Where land is sold at a forfeited tax sale for taxes for a number of years, as from 1901 to 1906, for an entire amount, the lien of the holder of a certificate issued on such a sale is equal in right of priority with an assessment lien accruing in any one of those years.
"Where the holders of liens equal in right of priority are foreclosed — that is, where title is obtained thereunder by sale and expiration of the period of redemption — the holders thereof become, by operation of law, tenants in common of the property. Foreclosure of any such lien does not cut out another lien of equal right of priority."
Notice, also, Waltom v. City of Portales, 42 N.M. 433,81 P.2d 58. There is one point upon which I am unable to follow and concur in the view adopted by the Minnesota court. That is, the failure to preserve coequality from year to year and priority between prior and subsequent years when annual delinquencies salable of unequal rank have been merged in the same deed.
It is my opinion that priority between successive annual liens can and should be preserved even though those liens have been merged in titles by continuing to recognize that those liens are the basis of the title. When there are two outstanding titles, priority exists to the extent only that they embrace liens of coequal rank.
To illustrate and apply to this case, delinquencies of ad valorem taxes which become or rather would have become salable during years subsequent to the delinquency of the last of the three installments for street improvements being foreclosed, are included in the ad valorem tax title of the county. These subsequent delinquencies were, on considering the last shall be first and first shall be last doctrine, prior to the paving lien, and if the value of the property is less than the aggregate sum due as merged in the two titles, they operate to increase the interest of the county and in any partition sale should be paid first from the proceeds of sale.
Thus, in this case ad valorem taxes for the year 1930 in the sum of $73.12 became delinquent and salable in November of 1931. At the same time an installment of a special assessment for street improvement for the year 1931, in the sum of $46.44, also became salable. These two liens were and are coequal. The same coequality exists between the 1931 taxes in the sum of $38.86 and the 1932 special assessment installment in *Page 155 
the sum of $46.44. Likewise, coequality exists between the 1932 ad valorem taxes for $31.23 and the special assessment for 1933 for $46.44. In the aggregate, parity exists in this case between liens for ad valorem taxes in the sum of $139.21 and liens for paving taxes in the sum of $139.32, plus accumulated interest and penalties. On the other hand, there are accumulated ad valorem taxes for the years 1933-1938, inclusive, becoming salable in the years 1934 to 1939, inclusive, aggregating $156.35, being later in point of time than the paving assessments and the prior ad valorem tax liens. The latter sum should be recognized as based upon a superior lien and should be paid first out of the proceeds of the sale of any property if any contest arises between the co-owners requiring partition by sale.
It is also appropriate to notice at this point that the Minnesota court in the Gould Case, 139 N.W. 293 (supra), recognized the right of the holders of the respective titles to avail themselves of the remedy of partition for the settlement of any controversy that might arise between them.
In accord with the foregoing authorities I am of the opinion:
1. That such coequality exists on a year to year basis, making the lien for each annual special assessment when it becomes delinquent coequal with the lien for ad valorem taxes that become delinquent and salable during that year.
2. That priority may exist between liens for street improvements and liens for ad valorem taxes from year to year on application of the rule that the last shall be first and the first shall be last, subject to express exceptions created by legislative act or necessarily implied from the same.
3. That where land is sold at resale to the county for taxes for the years 1930 to 1938, inclusive, without reference to special assessments falling due during those years, and in another and independent procedure title is sought which grows out of the special assessment lien for assessments becoming due for any one or several of the same years, the two titles are of coequal rank and the holders thereof are tenants in common, their respective fractional interests being determined on a pro rata basis, taking into consideration priorities between annual delinquencies salable.
4. That the judgment of the trial court insofar as it failed to recognize the coequality of the outstanding title of the county should be modified and insofar as it authorized foreclosure of the special assessment lien should be affirmed.
5. That the rights of the tenants in common should be adjusted in a partition suit, not in this special statutory proceeding.
For the reasons stated, I concur in part and dissent in part.