Court Opinion

ID: 9658140
Source: CourtListenerOpinion
Date Created: 2023-08-23 20:48:00.312265+00
Date Added: 2024-06-11T18:13:51.934372
License: Public Domain

HENDERSON, Justice
(special concurrence).
Genius may be described as a deep capacity for taking pains with the subject at hand. Out of a great respect for lawyers, whose industry often knows no bounds, and often attains genius, I write this special concurrence, trusting that it will, somehow, someway, allay any efforts to circumvent in the future this decision concerning tax deeds. It is hoped by this writer that our decision, announced today, shall not spawn an eruption, either now, or in the future, of litigation and/or quiet title actions generally attacking title acquired by tax deeds or tax deed proceedings by my fellow South Dakotans.
Perhaps I should not fear so. Having been raised in the “Dirty 30’s,” and witnessed a mass exodus off the farms in Hand County, with many of our friends in the county having lost their land by taxes they could not pay, and later reacquired this land by and through tax sale proceedings and tax deeds, I confess a fear.* Franklin Delano Roosevelt in his First Inaugural Address on March 4, 1933, tried to quell the sadness and fear of this drought stricken and broke Nation with these words: “The only thing we have to fear is fear itself.” Valiantly he tried to save the family farms which were being lost to taxes — by the millions — and then placed in government ownership. He then aided us, as our leader, by the WPA, CCC, relief and many public work projects.
Mr. Chief Justice has obtained the necessary votes to give this decision prospective application. It is apparent that it is the considered judgment of this august body, by this decision declaring prospective application, that lawyers in South Dakota should not reach back, to find a boogeyman, i.e., a technical flaw, in tax sale proceedings and tax deeds to create “substantial inequitable results if applied retroactively,” as expressed by this Court. (Citing Chevron and Fisher). In Beitelspacher v. Winther, 447 N.W.2d 347, 353 (S.D.1989) written as a majority opinion by this special writer, this Court approved the Fisher case *272and cited a case therein, Vogt v. Billion, 405 N.W.2d 635 (S.D.1987) for this holding: “The Constitution neither prohibits nor requires retrospective effect of judicial decisions.”
Very salient facts concerning this appeal: The Bank’s tax deed was recorded on April 16, 1986; bank contends that neither the former owner, or anyone claiming through him, could interpose any defense to a quiet title action, after two years, namely April 16, 1988; the bank brought a quiet title action on May 9,1990, just four years after it obtained a tax deed. There were 240 acres of agricultural land in question. Bank paid $4,680.98 in delinquent real estate taxes and statutory costs. Bank paid to the State of South Dakota the sum of $2,318.76 for its vendor’s lien on the real estate. Total outlay by the Bank: $6,999.74 investment. Less than four months later, on August 1,1986, Bank sold this property on a Contract for Deed for $60,000.00. On August 4, 1986, the Contract for Deed was recorded. Bank stands to make approximately $53,000.26 in profit, if it prevails in this appeal, for holding the tax deed for 107 days, from the date of acquiring title. No notice was given to the appellee lienholders, who had judgments. These judgments constitute a lien under SDCL 15-16-7 “... for ten years from the time of docketing the same where it was rendered, and no judgment shall become a lien on real property as herein provided unless it be docketed in the county where the land is situated.” There is no question that appellee lienholders had liens perfected. South Dakota Farmer’s Oil had a judgment for $85.50 and Suther Oil Co., Inc. had a judgment docketed for $3,525.07.
In the History of South Dakota, Third Edition Revised, June, 1975, by Dr. Herbert S. Schell, a renowned historian and esteemed professor at the University of South Dakota, who was one of my professors at that school, expressed in his textbook:
A concomitant of the hard times was a high incidence of tax delinquency. In 1935 nearly 19 per cent of the land was tax delinquent. By the time the depression had run its course the tax delinquency rate was ranging from 25 to 50 per cent in a number of counties, and title to large acreages had changed hands through tax deeds. In 1938 four counties in the northwestern section of the state had possession of over a million acres, title to which was acquired through county tax deeds.
From the archives of the South Dakota Historical Society, now located at the Cultural Heritage Center, in Pierre, I located a study by the South Dakota State Planning Board, Published by the Central Office of said Board at Brookings (site of one of our state colleges). This is denominated Tax Delinquency Status of Farm Land in South Dakota as of January 1, 1935; however, the date of the publication is July 1, 1937. General tenor of this article is to reflect, factually, upon the tremendous number of acres of tax delinquency in this state, and on page 7 thereof, we find:
Tax delinquency increased rapidly from 1928 to 1932 in this state. An indication of this trend is apparent in the following. Properties delinquent in 40 counties in South Dakota increased from 13,688 in 1928 to 45,122 in 1932 an increase of 230 per cent. Acreage involved in this delinquency increased 247 per cent and the amount of money involved increased 158 per cent. The reason the amount of delinquency did not increase to the degree the number and acreage increased was that the tax rate per acre had decreased very rapidly from 45 cents in 1928 to 32 cents in 1932.
One of the charts herein reveals that, of all the taxable lands in South Dakota, as of January 1, 1935, 26% thereof was subject to tax deed. It is instructive that the tax delinquencies for one year or more on January 1, 1935, contains as an example, 411,-753 acres in Hughes County, county of our State Capital. Brown County had delinquencies of over 1 million acres, to wit: 1,047,033 acres. Three other counties had over 1 million acres in tax peril, through tax delinquencies. There were millions of acres in this state which were tax delinquent; and thére were millions of acres taken by tax deed.
*273Can we not conclude that, to this very day, there are millions of acres of land in this State which were acquired by tax deed? The answer is: A resounding yes.
So, now that the Supreme Court has declared unconstitutional the Notice of Intention to Take Tax Deed statute, i.e., SDCL 10-25-3, what effect does this have upon the millions of acres of land obtained by tax deed in the 1930’s, 1940’s, 1950’s, 1960’s, 1970’s, and 1980’s? First of all, the 1991 Legislative assembly has cured the notice defect. Thenceforth, all ascertainable creditors, via an amendment, must be notified (such as these appellees). By making the application of this decision prospective, a legal mind would believe that this ends it: The unconstitutional statute, hereafter, cannot be asserted as a weapon against a tax deed. However, the genius of lawyers, which I first alluded to, might well surface from the legal catacombs of cases decided in the early days of this Court. A case of antiquity is cited by the majority writer, namely, Cain, decided over 75 years ago, and McQuown, decided in 1951. Such decisions, tied in with our present decision, could trigger the genius to try to upset the applecart on tax deed titles throughout the state, taken over decades. “Out of this nettle, danger, we pluck this flower, safety.” William Shakespeare: 1 Henry IV, Il.iii. This is what I am trying to do; to pluck out of the laws of this state and its decisions, some safety from the nettle of danger. Safety, in land titles, is a must; for without it, the underpinning is so shaky, no peace of mind can exist, and calamity can befall those who have long believed that their title was perfectly sound.
With the above background, I first call to the attention of the Bar and Bench, SDCL 15-3-15, the subject of which is the “Vesting of title and payment of taxes for ten years under color of title.” It expresses:
Every person in the actual possession of lands or tenements under claim and color of title made in good faith, and who shall have continued for ten successive years in such possession, and shall also during said time have paid all taxes legally assessed on such lands or tenements, shall be held and adjudged to be the legal owner of said lands or tenements to the extent and according to the purport of his paper title. All persons holding under such possession by purchase, devise, or descent before said ten years shall have expired, and who shall have continued such possession and payment of taxes as aforesaid so as to complete said term of ten years of such possession and payment of taxes, shall be entitled to the benefit of this section, (emphasis supplied mine).
A careful reader will detect that this statute has two parts to it and I shall not unduly elaborate upon them. The key elements are color of title, possession for ten years, and payment of taxes for ten years. A tax deed held in good faith constitutes color of title. Murphy v. Pierce, 17 S.D. 207, 95 N.W. 925 (1903). Bad faith is never presumed; one who alleges that possession was under claim and color of title has the burden to prove bad faith. Andree v. Andree, 291 N.W.2d 788 (S.D.1980).
Conceded that the Supreme Court of this state has declared SDCL 10-25-3 unconstitutional in its prior form, certainly SDCL 15-3-15 has not been so declared. It is a viable statute, still on the books, and a haven for thousands of South Dakotans who own farms, ranches, or homes via SDCL 15-3-15. I likewise point out that SDCL 10-25-44 has not been struck down by this decision. Note that the language in the majority opinion, in its first two sentences under DECISION, indicates: “Ap-pellee’s claims would normally be time-barred from challenging the validity of these tax proceedings under SDCL 10-25-44.” Immediately it follows with the sentence: “However, they (the creditors) received no notice until they were joined in the quiet title action, long after the statute of limitations would have barred their claim.” Some notice is different than no notice. Certainly, the Bank in this case did not fulfill the ten year successive years in possession nor did it ever pay taxes on this land for ten years. See, salient facts, supra, this writing.
*274Concerning the constitutionality of SDCL 15-3-15 and SDCL 10-25-44, a few cases are worthy of note:
Sedlacek v. S.D. Teener Baseball Program, 437 N.W.2d 866 (S.D.1989).
Quote: Strong presumption that laws enacted by legislature are constitutional is rebutted only when it clearly, palpably, and plainly appears that statute violates constitutional provision. Quote: Party challenging constitutionality of statute bears burden of proving beyond a reasonable doubt that statute violates state or federal constitutional provision.
Homestake Min. Co. v. Johnson, 374 N.W.2d 357 (S.D.1985).
Quote: When considering a statute’s constitutionality, it is presumed valid, and should be upheld unless clearly and unmistakably unconstitutional.
Simpson v. Tobin, 367 N.W.2d 757 (S.D.1985).
Quote: There is strong presumption in favor of constitutionality of statute, and such presumption is only rebutted when it appears clearly, palpably and plainly that statute violates provision of State Constitution.
Meierhenry v. City of Huron, 354 N.W.2d 171 (S.D.1984).
Quote: Legislative enactment is accorded a presumption in favor of validity and propriety and should not be held unconstitutional by judiciary unless its infringement of constitutional restrictions is so plain and palpable as to admit of no reasonable doubt.
I now cite 38 A.L.R.2d 986, 992 for the general proposition that:
It is a general rule that where a tax deed follows the ordinary form for such deeds, is executed by an official having general authority to make such deeds, and purports by apt words to convey land either described accurately, or so referred to as to permit its accurate identification, it will be color of title to such land under a general statute of limitations, although such deed is absolutely void, for any reason whatever, and although the cause of such invalidity appears upon the face of the deed.
There are two exceptions, however:
The exceptions to this rule are, first, where the tax purchaser is attempting to avail himself of the deed and statute and the evidence is such as to charge him with actual notice, as distinguished from constructive notice, that the deed was bad, and, second, where the statute the operation of which is relied upon gives a special definition of “color of title” stricter than its ordinary meaning and requiring at least prima facie title.
At 993 thereof, it is expressed:
In Colorado, Illinois, South Dakota, and Washington there are statutes which permit rights to be founded upon “color of title” or “claim and color of title” made in “good faith.”
In California, Florida, South Dakota, and Wisconsin there are statutes of limitation based upon an entry upon land under “claim” of title, “exclusive” of other right, founding such claim upon a “written instrument,” as being a “conveyance” of the property in question, with continuous possession under such “claim” for various periods. Under these statutes the rule seems to be that any invalid tax deed will constitute color of title without reference to the nature of the invalidity, or whether it appears on the face of the deed or by proof aliunde, unless the purchaser received it or took possession in actual bad faith.
The majority opinion has cited Cain, a 1914 case in this Court, which is the subject, with many other South Dakota cases on this subject, at 1051 of 38 A.L.R.2d. Tying in SDCL 15-3-15 concerning the “Vesting of title and payment of taxes for ten years under color of title,” I submit said A.L.R. discussion of South Dakota law, in its entirety.
The South Dakota cases support the rule that, irrespective of whether a tax deed may be void on its face or through evidence dehors the record, it may be “color of title” if made in “good faith,” in support of prescriptive title, under a statute permitting acquirement thereof if the *275conditions quoted are present. Murphy v. Pierce (1903) 17 SD 207, 95 NW 925; Jackson v. Bailey (1905) 19 SD 594, 104 NW 268; Joy v. Midland State Bank (1910) 26 SD 244, 128 NW 147, mod on other grounds 28 SD 262, 133 NW 276; Cain v. Ehrler (1914) 33 SD 536, 146 NW 694.
The proposition that a void tax deed may constitute color of title in support of prescriptive title, under the statutory provision requiring “color of title” in “good faith,” was apparently applied in Murphy v. Pierce (1903) 17 SD 207, 95 NW 925, although the land attempted to be conveyed was not subject to taxation by reason of ownership by an Indian, where the court said that the instrument “purported to convey title, and that is sufficient to constitute color of title.”
In Cain v. Ehrler (1914) 33 SD 536, 146 NW 694, it was considered that a tax deed which upon its face appeared to be fair, but which actually was void in the sense that it did not divest the owner of the property of title because of failure of the holder of the tax sale certificate to give the statutory notice of the expiration of the period of redemption and to make and file a proper return thereof, may nevertheless constitute color of title in good faith as a basis for the founding of legal title under a ten-year statute of limitations defining title by adverse possession.
A tax deed which is void on its face because it shows that the grantor was a county which purchased it at public auction may nevertheless constitute color of title in support of title by adverse possession, and entitle the possessor of land thereunder to succeed in an action to quiet title if he shows that the requirements of adverse possession are fulfilled and that the former title has been extinguished. Joy v. Midland State Bank (1910) 26 SD 244, 128 NW 147, mod on other grounds, 28 SD 262, 133 NW 276.
In Jackson v. Bailey (1905) 19 SD 594, 104 NW 268, an action to quiet title based on a tax deed regular on its face and recorded for three years, although there was a jurisdictional defect consisting of an inadequate description of the property on the assessment roll (the recording act not curing jurisdictional defects), the court recognized that the acquirement of rights, if there had been possession for the statutory period under the statute conferring title upon one having “color of title” and paying the taxes in “good faith”for ten successive years, might not have been impossible had there been available sufficient information or admissible evidence to locate and identify the property, (emphasis supplied mine) (footnotes omitted).
My legal thesis is: A compliance under either of the two parts to SDCL 15-3-15, by meeting the three key elements which I have set forth above, permits every owner of real estate in South Dakota, holding title by tax deed, to indulge in the safe belief that, in the terms of the statute, he, she, or they “... shall be held and adjudged to be the legal owner of said lands....”
Peace, brother. Let there be peace in the valley and peace in the land.

 Many counties reinvested title to the landowners if the landowner would simply pay the taxes.