Court Opinion

ID: 3808008
Source: CourtListenerOpinion
Date Created: 2016-07-06 07:47:49.99421+00
Date Added: 2024-06-11T13:33:50.594524
License: Public Domain

I agree with paragraphs 1, 2 and 3 of the syllabus of the majority opinion, but not with the 4th paragraph thereof or that part of the opinion dealing therewith. The importance of the questions involved justify this expression of my views.
The bonds in question were issued in 1924 pursuant to chapter 173, S. L. 1923 (11 O. S. 1941 §§ 21 et seq.). The annual installments thereon remained unpaid for the years 1931, 1932, and 1933, and on May 13, 1937, plaintiffs instituted this action to foreclose the assessment lien as provided by said section 107. While the action was still pending the property was sold to county at resale in 1939 for the delinquent ad valorem taxes for 1930 to 1938, inclusive. Thereupon the county was made a party. It asserted title in fee simple under the resale tax deed, and that the same was superior to the lien of the plaintiffs.
The trial court rendered judgment foreclosing plaintiffs' lien and ordering distribution of the proceeds of the sale.
All parties look upon the judgment as holding the county's deed subject to and inferior to the plaintiffs' lien.
The special assessment lien in this case attached to the property in 1924. Said section 103 deals with the levying of the assessment, and provides further as follows:
"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, co-equal 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, but unmatured installments shall not be deemed to be within the terms of any general covenant or warranty."
The remedy pursued by plaintiffs and the procedure employed are not attacked. Said section 107, after authorizing this character of action for the foreclosure of the assessment lien as to delinquent annual installments thereon, provides:
"Such judgment shall provide for the sale of said real estate subject to existing general or ad valorem taxes and special assessments."
The county contends that the court erred in holding the special assessment lien superior to the resale tax deed; that such holding in effect made the special assessment lien superior to the lien of the ad valorem taxes upon which the resale deed was based; that such holding would be contrary to the coequality provision in the statute, and would place upon the statutes an interpretation wholly at variance with section 5, art. 10, of the Constitution, which provides that "the power of taxation shall never be surrendered, suspended, or contracted away." It is further contended that the resale deed passed to the county a fee-simple title free from every lien, including that of the plaintiffs, and that said section 103, so far as it would make the liens coequal, is actually violative of the above constitutional provision.
The statutes, though they purport to make the special assessment lien coequal with the lien of the ad valorem taxes, do not provide equal remedies for the bondholder and the county. The bondholder may by proper action foreclose his lien to the extent of the delinquent installments, but his action, as the Legislature plainly provided, cannot touch the ad valorem taxes assessed against the property, for, as provided by the Constitution, supra, the power of taxation shall never be surrendered, *Page 147 
suspended, or contracted away. The power of taxation necessarily includes the power of collection; and the power to sell property in satisfaction of taxes is necessary to full power to collect. Since special street improvements are not governmental functions, the constitutional provision contemplates any legislative attempt to give to special assessments priority or advantage in any way over ad valorem taxes, regardless of the time of assessment.
On the other hand, the county has a full and complete remedy by tax sale to foreclose not only its own lien but the lien of the bondholder as well, 11 O. S. 1941 § 106. That section, after defining certain duties of the city clerk with reference to the collection of special assessments, provides:
". . . and it shall be the duty of the city or town clerk, promptly after the date of maturity of any such installment and interest and on or before the fifteenth day of September in each year, to certify said installment and interest then due to the county treasurer of the county in which the city or town is located, which installment and interest shall be by said county treasurer placed upon the November delinquent tax list of the same year prepared by the treasurer of said county, and collected as other delinquent taxes are collected."
Thus it is seen that the right of the bondholder to enforce his lien on his own initiative is not as full and complete as that of the county to collect its own taxes. The county can foreclose the bondholder's claims, but the bondholder cannot foreclose the county's. And this I gather from an interpretation of the provisions of the above sections, which were a part of a single legislative act (H. B. 189, ch. 173, S. L. 1923).
The Legislature has not attempted 'to give to the bondholder an advantage over the county. The statute does not permit the bondholder in the foreclosure of his lien, or in any other way, to interfere with the county's taxing power. There is specific constitutional provision for the creation of special assessment liens (sec. 7, art. 10); and the statute making the lien of such assessments coequal with the lien of ad valorem taxes does not have the effect of surrendering, suspending, or authorizing the contracting away of the power of taxation. And said statute does not authorize the release or extinguishment of ad valorem tax liabilities contrary to section 53, art. 5, of the Constitution. Special assessment liens have been coequal with the ad valorem tax liens on the same property since the First Legislature (S. L. 1907-08, sec. 634, R. L. 1910; sec. 4609, C. O. S. 1921). The first statute was repealed in 1923 when section 103, supra, was enacted. We have heretofore recognized the provision as constitutional, and we should not at this late date hold otherwise. See Runnells v. Citizens' Nat. Bank,157 Okla. 94, 11 P.2d 173; Blythe v. Pratt, 171 Okla. 2,41 P.2d 895; Service Feed Co. v. City of Ardmore, 171 Okla. 155,42 P.2d 853.
The liens in favor of the county and the special assessment bondholder which by the statute are made coequal are for all delinquent ad valorem taxes for the collection of which the county may sell the property at resale and for all delinquent installments of special assessments subject to collection by resale or by foreclosure action.
In this I disagree with my associate Mr. Justice DAVISON, in his opinion, "that each annual paving installment as it becomes 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."
In circumstances such as we have here, I believe his view would destroy the coequality of liens provided by the statute.
The liens being coequal, the respective titles to the realty arising from the separate foreclosures of said liens must also remain on an equal basis. If this were not so, the coequality would be destroyed and the provision of the statute hold little meaning. We have held that the county may sell the property at resale for the ad valorem taxes *Page 148 
alone without including special assessments then delinquent, but that such sale was subject to said assessments and did not foreclose them. Service Feed Co. v. City of Ardmore, supra. This being the case, the resale must also be subject to the title acquired under the deed executed pursuant to the judgment foreclosing the assessment lien. The inevitable result, brought about by the statutes and our former decisions, is that the purchaser on execution and the purchaser at resale each acquires an undivided interest in the property in fee simple, the extent thereof in either case depending upon the proportion that the amount of the lien bears to the sum of both. The relation of the purchasers becomes that of tenants in common, and their remedies are governed accordingly.
In the instant case the trial court was without power to adjudicate the title of the county and to foreclose its claim in the land. The statute is a special one, authorizing a particular remedy for an obligation wholly statutory, and must therefore be strictly construed to confine action thereunder to the remedy therein provided. The issues before the trial court concerned only the foreclosure of the lien in the amount found to be secured thereby, and sale of the land in satisfaction thereof, subject always to the title of the county, whatever that may be, and distribution of the proceeds as on sale on execution. The statute does not authorize the court to try title or to partition real property. Each lien creditor must make his debt out of the security in hand. There can be no marshaling of securities.
If proceeds of a sale for the satisfaction of either the ad valorem taxes or the special assessments alone were involved, I could agree with Mr. Justice DAVISON that such proceeds should be applied to the payment of the taxes or assessments and extinguishment of the liens in the inverse order in which such taxes and assessments accrued and liens attached, but where there is a sale for both the ad valorem and special assessments liens for periods of years which do not coincide, as is the case here, the application of such doctrine would destroy the coequality of the two liens.
The majority opinion holds that because the bondholder has elected to follow the statutory remedy of foreclosure, the cost of the foreclosure must come out of his pro rata share of the sale price of the property even though the county's title is disposed of by the foreclosure and subsequent sale. Such holding is contrary to the statute which authorizes the foreclosure, if the statute is correctly construed by the majority opinion. It amounts to the imposition of a penalty by fiat of this court. If we have such power, we should not exercise it.
I am of the opinion that the judgment of the trial court should be affirmed insofar as it forecloses plaintiffs' lien, but in all other respects it should be reversed and the cause remanded, with directions to enter judgment for the plaintiffs foreclosing their lien, subject specifically to the title of the county.