Court Opinion

ID: 9864746
Source: CourtListenerOpinion
Date Created: 2023-09-25 16:09:19.711966+00
Date Added: 2024-06-11T12:31:29.511463
License: Public Domain

Mr. Justice Stone
dissenting.
Plaintiff based its title on several treasurer’s deeds, each separately conveying a portion of the property, all issued to plaintiff on August 14, 1941, pursuant to sale of the property for general taxes, of several different years extending from 1929 to 1935, each of such certificates bearing endorsement thereon of subsequent general taxes to and including the year 1940. Defendant claims a lien by virtue of tax sale certificates issued to defendant’s assignor, the Town of Mountain View, on sale of the property in 1937 for default in 1928 or prior years in the payment of special sidewalk assessments which became a lien in 1924.
The court in the majority opinion holds that the sales for general taxes in 1935 or prior years, pursuant to which treasurer’s deeds were issued to the several properties involved in 1941, extinguished the prior lien of special assessments under which the properties were sold in 1937 to defendant’s grantor.
Under the revised statutes of Colorado, 1868, general taxes upon real property were made a perpetual lien without reference to other forms of taxation. In 1893, by amendment to the charter of the City of Denver, the legislature provided for a system of public works therein and the levying of special assessments upon the property benefited, and further provided that all assessments made in pursuance thereof should be a lien against each tract of land “and shall have priority over all other liens except general, taxes.” This was followed by chapter 151, S. L., 1899, which was a comprehensive act to pro*182vide for the construction of local improvements in cities other than Denver, to be paid by special assessments, and section 23 of that act provided, inter alia, that “all assessments made in pursuance of this Act shall be a lien in the several amounts assessed against each lot or tract of land, and shall have priority over all other liens excepting general taxes.”
In 1910 the case of City and County of Denver v. Keeler, 48 Colo. 54, 108 Pac. 998, was decided by this court. Therein Keeler, claiming title under a tax deed issued in 1904 on defaulted general taxes of 1899, sought to quiet title to property in Denver as against the city which claimed a lien by virtue of certificate issued in 1901 on sale for defaulted special assessment levied in 1894. The court held that under the provisions of the Denver charter, which made all assessments a prior lien excepting general taxes, the lien of special assessments was subordinated to those of general taxes.
Following the decision in City and County of Denver v. Keeler, supra, as to the lien of special assessments, our statute covering general taxes was amended, by chapter 197, section 3, S. L. 1911, to provide as to the perpetual lien of general taxes that, “Such liens shall have priority over all other liens except such liens as then exist which have been created by special assessments for public improvements.” Under statutes so worded, arose the case of Bennett v. Denver, 70 Colo. 77, 197 Pac. 768, wherein Bennett, who claimed title under a treasurer’s deed issued on a sale for general taxes in 1915 for defaulted 1914 taxes, brought action to quiet title against the City and County of Denver which claimed liens by virtue of unpaid special assessments on the property made in 1909 and 1913. The court there held that the sale under the later lien of the general taxes cut off the earlier lien of the special assessments.
The rule of the Bennett case was followed in Fishel v. Denver, 105 Colo. 120, 85 P. (2d) 1, which involved an identical situation of lien held under the provisions of *183the Denver charter asserted against title held under tax deed on default in subsequent general taxes, and it was again followed in Boulder v. Plains Co., 75 Colo. 86, 244 Pac. 233, where Boulder claimed prior lien of special assessment under the 1899 statute of identical wording with that of the Denver charter.
The Bennett case was decided by this court in 1921. At the next regular session of the legislature there was enacted a new local improvement statute, being chapter 180, S. L. 1923, wherein it is provided in section 19 that all assessments made in pursuance of that act shall “constitute a perpetual lien on a parity with the tax lien for general state, county, city, town or school taxes, and no sale of such property to enforce any general state, county, town or school tax or other lien shall extinguish the perpetual lien of such assessments,” - and this statute is now before us for the first time for construction.
The statutes under which the conflicting claims of priority between general tax and special tax have heretofore been decided, provided that the general tax should have priority except for the lien of special assessments and that the special assessments should have priority over all liens excepting general taxes. It was held in the Bennett case and subsequent cases that under such reciprocal statutory provisions, Colorado should follow the general rule as to taxes, and that a tax deed issued pursuant to sale for default in payment of a subsequent general tax cut off the prior lien of a special assessment.
The 1923 act constitutes a new declaration by the legislature as to the priority of lien of special assessments which was not involved in any of the cases heretofore mentioned. While the statute considered in the Bennett case declared that special assessments should have priority over all other liens excepting general taxes, the 1923 act here under consideration provides that the assessments shall constitute a perpetual lien on a parity with that of general taxes, and apparently having in view the rule declared in the Bennett case that deed *184under sale for delinquent general tax cut off the lien of a prior special assessment, the new statute goes further than merely to declare a parity. It specifically says that no sale of the property to enfore any general tax shall extinguish the perpetual lien of the assessment.
In order to make unmistakeable the scope of legislative intent, it has been further provided in subsequent statutes authorizing the issuance of tax deeds to counties, and the disposition by sale or lease of land so acquired, that the proceeds of such sale or lease shall be apportioned between the general taxes and special assessments and that noting in those statutes shall be construed to affect in any manner or degree whatsoever the lien of any special assessment to which such real estate and the conveyance thereof by the county treasurer is subject by statutes of this state (S.L. 1939, p. 486, §4; S.L. 1941, p. 649, §4). The construction of these statutes becomes of particular importance because of the fact that the same phraseology as to parity of lien has been adopted in the statute creating the Moffat Tunnel Improvement District and in the Water Conservation District Act. Under such plain legislative mandate, for this court still to assert the priority of the lien of the general tax over the lien of a special assessment creates uncertainty and confusion as to all these statutes, and constitutes usurpation by the court of the legislative function, and the abrogation to ourselves of a power we do not possess, unless we are compelled thereto by a constitutional prohibition against such legislation. Is there such prohibition?
There is no common-law rule which makes the levy of taxes of its own force a lien on the property of the taxpayer. In the absence of constitutional restrictions, the liens, both of general taxes and of special assessments are dependent upon the statute. Board of County Commissioners v. Bench Canal Drainage District, 56 Wyo. 260, 108 P. (2d) 590; State ex rel. v. Passmore, 189 Okla. 232, 115 P. (2d) 120; 51 Am. Jur., p. 881, §1010. In *185the absence of statutory provision concerning priority between general tax liens and liens for special assessment, the general tax lien is usually held superior. Robinson v. Hanson, 75 Utah 30, 282 Pac. 782.
In La Mesa, etc., Irr. Dist. v. Hornbeck, 216 Cal. 730, 17 P. (2d) 143, the court said that, “every presumption is against the legislative intent to prefer the lien of special assessments to those of general taxes,” and quotes from Re Dancy Drainage Dist., 199 Wis. 85, 225 N. W. 873, that, “In our view the lien for general taxes is of a distinctly higher order than the lien of any special assessment, and we should not construe any statute as giving precedence to the lien of any special assessment over the lien of general taxes in the absence of a plain legislative command.” Yet, notwithstanding this declaration of presumption, the California court in the La Mesa case, after citing pertinent statutes and a decision of its appellate court, said: “From the above authority and upon our construction of the section we may now safely conclude that under our system of taxation liens in favor of county and municipal corporations and special assessments, under the authority of state agencies for public purposes, are all on an equality. By this is meant that in case of delinquency a deed to any one of these agencies for such taxes will not obliterate the existing liens on the property in favor of any or all of the others * * * .”
A like conclusion was reached in Magee v. Whitacre, 60 Nev. 208, 106 P. (2d) 751. “The question here is whether or not the Legislature can constitutionally provide a lien for irrigation district assessments and make it equal to the general tax lien. We hold that it can * * *. It is evident that the Legislature has the undoubted power to say whether taxes shall constitute a lien, in the first instance, and what priority it shall have, in the second instance, and may provide that taxes shall not create a lien at all.” And in Walton v. City of Portales, 42 N. M. 433, 81 P. (2d) 59, in construing a statu*186tory provision very similar to the one here involved, the court said that the language used by the legislature “is so clear and unambiguous that we are not left in doubt that it was the intention of the legislature to elevate special assessment liens to a rank of equal dignity with liens for general taxes,” and the statute was held valid.
In Board of County Commissioners v. Adams, 154 Kan. 233, 117 P. (2d) 760, similar legislation was sustained as constitutional; that the general tax lien and the lien created by special tax bill were concurrent and that upon sale of the premises for default in both taxes if the proceeds were insufficent to discharge the liens in full, then after the costs were paid, the money received shall be divided pro rata between the two liens.
In Board of Commissioners v. Wewoka, 191 Okla. 233, 127 P. (2d) 826, the court sustained as constitutional a statute providing that special assessments for street improvements should be coequal with the lien of the other taxes, and that upon sale for defaulting liens, the property should be sold and the proceeds divided pro rata between the county and the bondholders. Particularly urged was the constitutional provision that the legislature should have no power to release or extinguish, in whole or in part, the indebtedness of obligations of any individual to the state or any county or other municipal corporation.
In Gould v. St. Paul, 120 Minn. 172, 139 N.W. 293, and Midway Realty Co. v. St. Paul, 124 Minn. 296, 145 N. W. 24, statutes were sustained and construed holding the lien of special assessments on a parity with that of general taxes and the purchasers under each were held to be tenants in common of the property.
The court in the majority opinion infers that the tax parity provided for by our legislature violates section 38, article V, of the Constitution providing that, “No obligation or liability of any person * * * shall ever be * * * released or postponed, or * * * extinguished except by payment thereof into the proper treasury.” It may be *187answered that a tax on real estate in Colorado is not an obligation or liability of any person, but merely a charge against the property. In Burton v. Denver, 99 Colo. 207, 61 P. (2d) 856, we specifically held that section 38 did not prevent the release and extinguishment of a tax lien, entirely without payment, upon issuance of an erroneous certificate of the county treasurer that the tax had been paid, and that under a like constitutional provision, the New Mexico court in Walton v. City of Portales, supra, held that a similar statute to that here involved did not offend against a like constitutional provision. “It is held, however, that a tax lien is not an obligation or liability within the meaning of a constitutional provision preventing the release of obligations of liabilities to the state.” 51 Am. Jur., p. 885, sec. 1014.
Section 3, article X, which provides that all taxes shall be uniform upon the same class of subjects and shall be levied and collected under general laws, does not prohibit special assessments (Denver v. Knowles, 17 Colo. 204, 30 Pac. 1041) and has no application to the question of liens. “Uniformity of taxation goes to the act of the assessing body when the tax is imposed. It has no application to delinquent certificates that have reverted to the State for nonpayment of taxes.” State ex rel. v. Culbreath, 140 Fla. 634, 192 So. 814. A statute is not discriminatory when the same means and methods are employed alike to the persons or property composing the class so that the law operates on all similarly situated. Kocsis v. Chicago Park District, 362 Ill. 24, 198 N. E. 847, 103 A. L. R. 141.
If I apprehend the reasoning of the court as expessed in the majority opinion, it holds the parity statute to be violative of section 8, article X, of the Constitution, which provides: “No county, city, town or other municipal corporation, the inhabitants thereof, nor the property therein, shall be released or discharged from their or its proportionate share of taxes to be levied for state purposes.” The Illinois constitution has a similar pro*188vision, in its article IX, section 6, with the additional clause, “nor shall commutation for such taxes be authorized in any form whatsoever.” In People v. Taylorville Sanitary District, 371 Ill. 280, 20 N. E. (2d) 576, the court held valid a statute making the lien of special assessments on a parity with those of general taxes, but the particular constitutional objection here raised was not specifically considered. In Schreiber v. County of Cook, 388 Ill. 297, 58 N.W. (2d) 40, the court sustained the validity of legislation providing for the sale of property for tax delinquency, the prorating of the proceeds between general taxes and special assessments, and the extinguishment of the lien for the balance of taxes unpaid as against the specific contention that it violated the constitutional provision against release, discharge, or commutation of taxes. The court there said: “The sale of land to satisfy a tax lien is an extinguishment of the lien, which becomes merged in the title purchased. Therefore, it is neither a release nor a commutation. A release is a discharge by voluntary act. An extinguishment of a lien is a discharge by operation of law.” And the court concluded that the constitutional provisions prohibiting a release or commutation of taxes, and of duties, liabilities and obligations due the state or a municipality, refer to voluntary releases and commutation as distinguished from reductions resulting from sales under judicial decrees and judgments. Again, in Village of Westchester v. Holmes, 390 Ill. 436, 62 N. E. (2d) 410, it is said: “We have held that the liens of general taxes against real estate and of special assessments levied by cities or other municipalities are on a parity and equal, with no preference or priority in any one over the other.
As we understand the argument implicit in the contended bar of article X, section 8, it seems to be that in the event the special assessments are given a parity with the general tax, then if the combined taxes should become so great that there would be no bid for the property at tax sale (which is not the situation here) and as *189a result the property should be struck off to the county and thereafter sold for less than the total amount of taxes and costs, the amount so ultimately recovered must be prorated between the special assessments and the general tax with the result that the state would not receive as large a share of the amount recovered as it would have received had proration not been required. Let us consider this contention in the light of the constitutional provision.
The evil sought to be remedied by these similar restrictions found in the Illinois, Idaho and Colorado Constitutions, as well as those of several other states, was the attempted release of state taxes of an entire taxing unit for the purpose of financial assistance to such unit, Raymond v. Hartford Life Ins. Co., 196 Ill. 329, 63 N.E. 745; as, for instance, granting a charter exempting the inhabitants of a town from state taxes for a term of years so that an amount equal to the state levy could be levied against the property within the city for the purpose of building a levee. People ex rel. v. Barger, 62 Ill. 452. We believe it is apparent that they are not violated by the statute here challenged for several reasons:
First. The constitutional restriction applies only to a release or discharge from taxes by specific legislative enactment and not to an extinguishment of the lien by operation of general law as here provided for. Marker v. Scotts Bluff County, 137 Neb. 360, 289 N. W. 534; Schreiber v. County of Cook, supra.
Second. The restriction applies to the release or discharge from a proportionate share of liability of all the property of a county or municipal corporation, while under the act we are here considering the tax lien is extinguished only on the particular parcels which, for want of a bid at a tax sale, are struck off to the county and are thereafter resold for less than the full amount of taxes.
Third. Notwithstanding the restriction, under our statutes long in operation and unchallenged, our county, *190school district and city taxes are held to have a parity of lien with state taxes. If for want of a bid at tax sale, any property is bid in by the county and resold for less than the total taxes due, the amount is prorated among the state, county, school district and city taxes so that the state only gets its pro rata share. If the property is situate within a city, the state must pro rate with the city so that the state obtains a smaller proration of the amount of tax paid than would be the case if the property were not within the limits of a city. Particularly in case the city in which a property is situate has constructed sidewalks, sewers or other improvements to be paid for by general obligation bonds whereby payment of principal and interest of these bonds is made through general taxation by the city, then in case of tax loss the state tax must pro rate with the city tax which includes the cost of the improvements, whatever part of the taxes may ultimately be recovered. If such parity statutes are not repugnant to the constitution, what is the offense of the statute providing that the lien of special assessments also shall be on a parity with that of general taxes.
Fourth. The rule of stare decisis applies. It has been repeatedly held by our courts that the liens both of general taxes and of special assessments in Colorado are creatures of statute. “Under some conditions taxes are a lien on realty, but they have this force because of the enactments. Legislation directly charging the realty is prerequisite to its existence; without it taxes are not thus collectible, either as against the owner or an encumbrancer.” Gifford v. Callaway, 8 Colo. App. 359, 46 Pac. 626. “Tax lien is statutory. A tax levied and assessed upon specific property is not a lien on that or any other property of the owner unless expressly made so by statute, and an intention to this effect must be clearly manifested in the statute, as the lien will neither be created by implication nor enlarged by construction.” Quoted with approval from 37 Cyc. 1138 in Thomas v. Patterson, 61 Colo. 547, 159 Pac. 34. “It is well settled *191that a tax does not become a lien upon real estate unless by express legislative action.” Commissioners v. Whitt, 74 Colo. 129, 219 Pac. 217. In People v. Denver, 85 Colo. 61, 273 Pac. 883, we upheld the act of the legislature making an excise tax imposed on the sale of gasoline a prior lien over that for general taxes, saying, “The question of tax liens is for legislative determination. The legislature may or may not make taxes a lien upon property; if it does not do so, no lien exists. It also may determine the priority of tax liens.” In Burton v. Denver, 99 Colo. 207, 61 P. (2d) 856, we considered the statutes providing in substance that the county treasurer shall, upon request and payment of his fee, certify in writing the taxes due on any parcel of real estate and that such certificate shall be conclusive evidence as to such taxes; and we there held that, notwithstanding article X, section 8 of the Constitution, the general assembly could and did provide for extinguishing the lien of a tax upon such treasurer’s certificate. Surely, if the legislature has the power so to extinguish the lien of the general tax, without its being paid, it has the power to provide for the lien parity of special taxes therewith. In the words of the New Mexico court in Walton v. Portales, supra, “If the legislature has the power to discharge the lien for general taxes, surely it would have the power to waive the superiority of the lien thereof over other liens.” Again, in People ex rel. v. Letford, 102 Colo. 284, 70 P. (2d) 274, in determining the validity of the Northern Colorado Water Conservancy District organized under the provisions of the Water Conservancy Act, we said, “Section 22 provides that all taxes and assessments are, until paid, a perpetual lien on a parity with the tax lien of general, state, county, city and town taxes, thereby importing a priority over other liens of all kinds. Section 19 creates a ‘perpetual tax lien’ for Class D assessments. Relator does not seriously question these provisions as they pertain to the general ad valorem tax and they appear not subject to challenge.”
*192Finally, it is a fundamental principle of construction that those who seek to overthrow a statute by reason of its repugnance to a constitutional provision must show the unconstitutionality of the act beyond all reasonable doubt. Denver v. Knowles, 17 Colo. 204, 30 Pac. 1041. Only clear and demonstrable usurpation of power will authorize judicial interference with legislative action. People ex rel. v. Letford, supra. No such plain and indubitable repugnance or usurpation is apparent in the statutes here involved. The determination of the wisdom of these enactments is of legislative, not judicial, cognizance and usurpation of authority when asserted by the court is more oppressive than when asserted by the legislature to the degree that relief by the people therefrom is more slow and difficult.
The majority opinion, in its concluding paragraph, as a further ground for reversal, determines that the defendant in error is not competent to appear in opposition to plaintiff in error, (1) in that the certificates under which he holds were assigned to him by the town clerk instead of by the town treasurer, and (2) in that he did not allege that he paid for the certificate in cash. These issues were not raised in the pleadings. The town and Sullivan, each by separate answer, alleged the assignment, and plaintiffs reply admitted Sullivan’s claim by virtue of the certificates and made issue thereon that the certificates “have been cut off by the general tax certificates of the plaintiff herein.” Neither were these issues raised at the trial. The assigned certificates were received in evidence without objection on either ground here held to avoid them and without testimony as to the nature or amount of the payment on their assignment. Nor were these issues raised in the specification of points to be considered by this court. The issue of the sufficiency of the assignment by the clerk was first raised in the brief of the plaintiff in error, and the question of the assumed insufficiency of payment was first raised in the majority opinion of this court.
*193There is an ancient, elementary and necessary rule that an appellate court may consider only issues presented to the trial court. - These issues were not so presented. The one issue determined, the one issue raised, and the one issue to which testimony was addressed in the trial court was that of the lien of the special assessment certificates. For this court now to inject other issues, not so determined and not so raised and to which testimony was not addressed below, is novel procedure.
There is a further rule that in a quiet title suit plaintiff must stand on the strength of his own title, not on the weakness of that of defendant. As we said regarding plaintiffs title in such a suit in Walters v. Webster, 52 Colo. 549, 123 Pac. 952, “As his title depended entirely upon the trustee’s deed, and it had been put in issue by the answer, it is clear that a judgment quieting title in him should not have been rendered, even though the defendant failed to establish title in himself.” See also Cooper v. Shannon, 36 Colo. 98, 85 Pac. 175.
It must further be noted that Sullivan made no claim to personal ownership of these certificates. The unchallenged testimony was that he held the bonds on behalf of the bondholders, and that the certificates had been assigned to him as their representative for the purpose of determining their rights. The bondholders were the true parties in interest and the issue whether they should have been represented in this suit by the town, which upon sale and issuance of the certificates became in law their trustee, or by Sullivan, who regardless of the validity of the assignments, was by agreement between themselves and the town to be their trustee, seems to be the only issue involved. I cannot concur in reversal on such ground.
Mr. Justice Jackson concurs in this dissent.