American Agricultural Chemical Co. v. Brock

Adams, J. Tbe deed of trust was executed on 1 July, 1923, and was duly registered tbe next day. Tbe plaintiff’s judgment was recovered and docketed on 3 October, 1927. Tbe property described in tbe deed *344 o£ trust was first exposed to sale in February, 1928, but was finally sold on 19 May, 1928. On 2 June, 1928, tbe clerk issued an order requiring tbe trustee to make title to tbe purchaser; tbe trustee executed bis deed on 9 June, 1928, acknowledged it on 2 July, 1928, and delivered it to tbe defendant on 3 July, 1928. After paying tbe amount due on tbe deed of trust tbe trustee beld a surplus, tbe application of wbicb was disputed, and being in doubt as to tbe parties entitled to it, be brought this proceeding under C. S., 2592 et seq., for tbe purpose of having tbe proper party finally determined. Tbe clerk made an order that tbe surplus be paid on tbe plaintiff’s claim and on appeal to tbe Superior Court bis judgment was affirmed. It is provided in C. S., 7987, that tbe lien of State, county and municipal taxes shall annually attach to all real estate of tbe taxpayer on tbe first day of June, but it is likewise provided in C. S., 2815, and in Public Laws 1927, cb. 80, sec. 440, that tbe lien shall attach annually on tbe first day of May; and it was beld in Shaffner v. Lipinsky, 194 N. C., 1, that tbe lien of assessed taxes attaches to real estate as of this date. In C. S., 7980, provision is made for adjusting tbe rights of contesting parties: “In all civil actions and special proceedings wherein tbe sale of any real estate shall be ordered, tbe judgment shall provide for tbe payment of all taxes then assessed upon tbe property and remaining unpaid. . . . And whenever any real estate shall be sold by any person under any power of sale conferred upon him by any deed, will, power of attorney, mortgage, deed of trust, or assignment for tbe benefit of creditors, tbe person making such sale must pay out of tbe proceeds of such sale all taxes then assessed upon such real estate,” etc. Tbe defendant contends that tbe lien of tbe State, county, and municipal taxes levied for tbe calendar year 1928-29 attached to all real estate described in tbe deed of trust on tbe first day of May, 1928; that this is tbe first lien on tbe land; and that it should be satisfied out of tbe fund arising from tbe sale of tbe property in preference to tbe lien created by tbe docketed judgment. Tbe plaintiff contends that tbe board of county commissioners did not levy any tax until 28 July, 1928 (C. S., 7971(40), that no tax bad been assessed against tbe real property at that time, and that C. S., 7980, provides for tbe payment of such taxes only as are assessed upon tbe property and remain unpaid at tbe date of tbe sale. These diverse contentions present tbe question in controversy. Tbe County Fiscal Control Act went into effect on 7 March, 1927. P. L., 1927, cb. 146. It requires tbe board of county commissioners to appoint an accountant who shall prepare an estimate of tbe amounts *345 necessary to be appropriated to different objects of tbe county and its subdivisions for the next ensuing fiscal year. After the accountant submits his budget estimate the board, not later than the fourth Monday in July in each year, must adopt and record on its minutes an appropriation resolution by which appropriations shall be made for the several purposes of the county, and not later than Wednesday after the third Monday in August in each year and after the ascertainment of the assessed valuation of property for taxation the board must levy such rate of tax as shall be necessary upon all the taxable property of the county, in the ease of county appropriations, and upon all the taxable property in each subdivision, in the case of appropriations for subdivisions. Secs. 10, 11, 12. Under these provisions the board of aldermen determined the tax rate and levied upon the taxable property in the city on 23 July, 1928, and on 28 July, 1928, the board of county commissioners made a like assessment upon property within the county. If the uncomputed and unassessed tax was a lien upon the land at the time of the trustee’s sale the tax lien was superior to the lien created by the deed of trust or the plaintiff’s judgment. And as the purchaser’s title relates back to the date of the deed of trust the land may yet be subject to a sale under the tax lien unless the defendant’s contention that it should be paid out of the fund is correct in contemplation of law, especially in view of the holding that the object of C. S., 1980, is to pass a clear title to the purchaser. Wooten v. Sugg, 114 N. C., 295; Exum v. Baker, 115 N. C., 242; Smith v. Miller, 158 N. C., 99, 103. Was the uncomputed and unassessed tax a lien on the surplus fund when the clerk ordered the trustee to execute a deed to the purchaser? We think not. The statute contemplates the payment, out of the proceeds of the sale, of such taxes as are assessed when the sale is made. C. S., 7980. To assess a tax is to fix the proportion which each person among those who are liable to it has to pay; to fix or settle a sum to be paid by way of a tax; to charge with a tax. Black’s Law Dictionary; Bouvier’s Law Dictionary. An assessment or levy of a tax is essential to its certainty. The judgment sets out the fact that no tax had been levied or assessed when the trustee executed his deed. It was impossible for the trustee to pay a tax which had never been levied, and the parties claimed a right to an immediate distribution of the fund. The defendant’s contention involves, not only uncertainty as to the amount of tax to be levied, but indefinite delay in settlement by the trustee. For the purpose of attaching to and following the land the lien of the tax when assessed and levied relates back to the first day of May; but the proceeds of a sale made under section 7980 may be applied to such taxes only as are assessed when the sale is made. We are not inadvertent to *346 tbe difficulties arising from statutes wbicb are not easily to be reconciled, but we are of opinion that our disposition of tbe question conforms to tbe spirit of tbe law. Tbe judgment debtors claim no interest in tbe fund and are not proper parties. Tbe interests are those only of tbe plaintiff and tbe defendant. Tbe judgment is Affirmed.