Court Opinion

ID: 3986059
Source: CourtListenerOpinion
Date Created: 2016-07-06 10:42:13.40805+00
Date Added: 2024-06-11T07:44:00.767849
License: Public Domain

I concur except as indicated herein:
It is established as the rule in Utah that where the fee title holder seeks to quiet his title as against a tax title purchaser there need be no offer of reimbursement in order that such reimbursement may be granted by the Court. Burton v. Hoover,93 Utah 498, 501, 74 P.2d 652, 653:
"* * * the pleading need not allege and offer to repay defendant's investment in the property. The court of equity will make that a part of the total equity it administers to adjust the situation. It is a part of the remedy and not of the cause of action."
See also Reeve v. Blatchley, 106 Utah 259, 147 P.2d 861;Utah Lead Co. v. Piute County, 92 Utah 1, 65 P.2d 1190;Bolognese v. Anderson, 87 Utah 455, 49 P.2d 1034, modifying87 Utah 450, 44 P.2d 706. The reason stated in the Burton case, supra, is as follows:
"* * * as the plaintiff has invoked the aid of a court of equity to vacate the tax deeds, he must do equity, * * * atleast to the extent to which the attempted purchase by defendantshas relieved his property of liens, he must, as a condition to obtaining such relief, reimburse the defendants, together with interest on such amount at the legal rate from the date of payment until repaid." (Italics added.)
The benefit which is attained by the original title holder in having the lien removed from his property, which lien arose from the owners duty to pay taxes, is the basis for reimbursement. SeeOregon Short Line R. Co. v. Hallock, 41 Utah 378, 126 P. 394;Holland v. Hotchkiss, 162 Cal. 366, 123 P. 258, containing an extended discussion on this point; and L.R.A. 1915C, 492, note. 4 Cooley on Taxation, 4th Ed. 2967 in speaking of the reason that many states have adopted statutes requiring the owner to reimburse the tax sale purchaser has the following to say:
"* * * If the tax purchaser has, by his purchase, paid a charge which the state might fairly and justly make a legal one upon the land, and which the owner of the land ought himself to have paid *Page 328 
to the state, there is no reason why the state should not give to the purchaser, when he loses the expected benefit of the purchase, a remedy to recover the amount of the tax from the party who ought to have paid it."
Speaking of such statutes, the court in State Finance Co. v.Beck, 15 N.D. 374, 109 N.W. 357, 360, says:
"As indicated * * *, the court has inherent power, independent of such a statute, to do what the statute requires."
We should differentiate between the various types of situations to which the cases refer. In some instances such a distinction has not been made so that the rules frequently appear to be in conflict when in fact they are not.
One class of cases is those wherein the taxing body imposing the tax has the power and authority to levy the tax as it is levied, and the tax becomes a valid lien on the property, but through some failure or neglect in the tax sale procedure, the sale is rendered ineffective. Within this group are such cases asBolognese v. Anderson, 87 Utah 450, 44 P.2d 706, Id.,87 Utah 455, 49 P.2d 1034, rehearing, Id., 97 Utah 136,90 P.2d 275; Burton v. Hoover, 93 Utah 498, 74 P.2d 652; Fisher v.Wright, 101 Utah 469, 123 P.2d 703; Equitable Life  CasualtyIns. Co. v. Schoewe, 105 Utah 569, 144 P.2d 526, and many others. From cases with this type of fact situation there has arisen the doctrine that if the original title holder sues the tax sale purchaser to quiet title, he should be required to reimburse the tax sale purchaser under the equity maxim. "He who seeks equity must do equity." L.R.A. 1915C, 492, note at 494:
"It is well established * * *, that in granting affirmative relief against the holder of an invalid tax title by way of cancellation of tax certificates or deed, or quieting title to land, a court of equity should require, as a condition precedent to the granting of the relief, that the one seeking it should reimburse the tax title holder the equitable amount to which he is entitled for taxes paid on the land with interest. This rule is based on the maxim that he who seeks equity must do equity. So that, while the holder of the invalid tax title *Page 329 
might not be able to recover the taxes paid from the owner, he has a right in equity to reimbursement as a condition of granting equitable relief to the owner. The rule of course presupposesthat the taxes were valid." (Italics added.)
Knox v. Gaddis, 1 App. D.C. 336:
"It is a fundamental and familiar principle of equity jurisprudence that he who seeks equity must do equity; and there can be no better application of the maxim than the case in which a person seeks to vacate a tax sale as irregular and a tax deed as a cloud on title, without offering to reimburse to the purchaser at the tax sale or holder of the tax deed the taxes paid by him with all proper interest and costs * * * The removal of a tax deed as a cloud on title is the equivalent of redemption from a lien through the process of a court of equity; and the redemption cannot be allowed without an offer of readiness on the part of the person seeking to redeem to do what ordinary fairness requires him to do."
See also Holland v. Hotchkiss, supra, and cases cited therein. The thing to be borne in mind is that in all these cases the tax is a valid tax, imposed by the proper taxing authority. The thing which renders the tax sale invalid is failure to conform strictly to the requirements of the statute authorizing the sale.
On the other hand, a group of cases to be distinguished from the group set out above, are those wherein the tax is void, such as an assessment by a governmental body not empowered to make the assessment; or the property sought to be assessed is property exempt from any taxation; or the tax levied is defective by reason of having a substantive defect which renders it null and void. The tax is utterly void and no duty arises to pay it. If the taxing body sought to foreclose a lien for such taxes on the theory it was given by statute they would fail by reason of a void as distinguished from an erroneous assessment.
The cases establishing the basis for giving reimbursement to the tax sale purchaser, by reason of the discharge of a valid subsisting lien and a consequent benefit to the title holder, do not hold good in the type of case where the *Page 330 
tax itself is the thing which is void. Under the latter circumstances there is no duty upon the title holder to reimburse where he seeks to remove a cloud or quiet title as against a tax sale purchaser. The payment of a void tax has not benefited him. He is under no duty to pay such taxes. The cases generally recognize this distinction. Chicago, M.  St. P.R. Co. v.Kootenai County, 33 Idaho 234, 192 P. 562, holds that if the assessment is void, a tender of the taxes is not a condition to the right to cancel a tax sale certificate. See also Holland v.Hotchkiss, supra; Wilmerton v. Phillips, 103 Ill. 78;State Finance Co. v. Myers, 16 N.D. 193, 112 N.W. 76; TitleTrust Co. v. Aylsworth, 40 Or. 20, 28, 66 P. 276; Eaton v.Bennett, 10 N.D. 346, 87 N.W. 188; 4 Cooley on Taxation, 2957, sec. 1505, 4th ed.; New Netherlands American Mortgage Bank v.Greene  Laurence County Drainage Dist., 199 Ark. 217,133 S.W.2d 446 and 51 Am. Jur. 893, Taxation, Sec. 1022 which expresses the rule as follows:
"There is no authority to order the sale of land for taxes which are neither due on nor collectible from the land."
The defendants have sought to limit this rule to cases wherein the property was exempt from any taxation. The authorities, however, do not support such a limitation. Santa Clara County
v. Southern Pac. R. Co., 118 U.S. 394, 6 S. Ct. 1132,30 L. Ed. 118; State of California v. Central Pac. R. Co., 127 U.S. 1,8 S. Ct. 1073, 32 L. Ed. 150; Chicago, M.  St. P.R. Co. v.Kootenai County, supra; Sioux City Bridge Co. v. DakotaCounty, 61 Neb. 75, 85 N.W. 607; Chicago  A.R. Co. v.People, 129 Ill. 571, 22 N.E. 864, 25 N.E. 5; People ex rel.Hudson  M.R. Co. v. State Board of Tax Commissioners,69 Misc. 1, 125 N.Y.S. 895; L.R.A. 1915C, note 492. These cases are all ones in which the assessing body had no jurisdiction to assess the tax, but authority was in another body, and the assessment as made was declared to be void. See also 61 C.J. 596, Taxation sec. 734 et seq.; 51 Am. Jur. 795, Taxation, sec. 895. *Page 331 
Now to the present situation — the one presented by the 145 acres in controversy: The property is subject to tax by reason of U.C.A. 1943, 80-5-3, quoted above, by the State Tax Commission, if, in fact, it is mining property. The tax, however, was assessed or levied by the county. It is a tax assessed or levied by the wrong taxing authority, but upon property which is subject to taxation by another governmental body, and which property has the duty to bear its proportionate share of the tax burden if properly levied.
The tax as levied comes within the defects noted above in relation to void taxes. If this is mining property (I am not sure that all the evidence available has been presented on this question of mining property) then there is no authority in the county to levy a tax on it the same as other real property, nor can the county levy any kind of a tax thereon and create a valid lien. Under the authorities the tax is void. To pay it is of no benefit to the original title holder. For all we know at present, under the solution proposed by the prevailing opinion, the original title holder may have to reimburse the purchaser for a sum that will never be properly levied against his property.