Davis v. County of McLean

*861 Christianson, Ch. J. This is an action to foreclose a real estate mortgage. IVIeLean county is made a party defendant on the theory that it claims and holds certain liens on the mortgaged real estate subordinate to the lien of plaintiff’s mortgage. The defendant county admits that it claims certain liens on the property by virtue of certain taxes, among which are certain Hail Indemnity Taxes; but it asserts that these liens are all prior and superior to the lien of plaintiff’s mortgage. The material and undisputed facts are as follows: Plaintiff’s mortgage is dated September 28, 1915, and was duly recorded October 6th, 1915. .Default having occurred in the conditions thereof, the mortgage was duly foreclosed by advertisement on June 28, 1921. The plaintiff became the purchaser at such sale. No redemption was made, and on July 10, 1922, the sheriff of said McLean county executed and delivered to the plaintiff a sheriff’s deed to said premises in form and substance as provided by the laws of this state, and the plaintiff thereupon entered into possession of the premises. Certain portions of the premises were cropped during the years 1920, 1921 and 1922; and during those years the crops thereon were insured, against loss by hail, in the State Hail Insurance Department, and what is commonly known as an indemnity hail tax was assessed against said lands on account of such insurance. The various taxes, including the indemnity hail tax, were not paid, and the land was sold at tax sale for the amounts due for such taxes for the years 1920 and 1921. At such tax sales the lands were bid in by the said county of McLean, in accordance with the provisions of § 2991, Comp. Laws, 1913, The taxes for 1922 became and are delinquent. McLean county is.the holder of the liens existing by virtue of such taxes and tax sale certificates. The plaintiff admits that all general taxes, and the so-called “Mat (Hail) Tax” are valid tax liens, prior and superiorato the lien *862 of plaintiff’s mortgage; and be bas duly tendered and deposited tbe full amount due on sucb tax liens, including all penalties and interest; but be denies tbat tbe “Indemnity Hail Tax” is a lien prior to sucb mortgage, and asserts tbat tbe liens created by tbe “Indemnity Hail Tax” are inferior and subsequent to the lien of plaintiff’s mortgage. Tbe county, on the other band, contends tbat tbe indemnity bail tax stands on tbe same basis as other taxes against tbe premises, and tbat tbe lien or liens created by virtue thereof are liens superior to tbe lien of plaintiff’s mortgage. This contention presents tbe sole question involved in the ease. Tbe trial court sustained the contention of tbe defendant county, and tbe plaintiff bas appealed. A determination of tbe question presented on this appeal involves a consideration of tbe various constitutional and statutory provisions of this state relating to State Hail Insurance. At tbe general election in 1918 there was submitted to tbe people of this state, for approval or rejection, tbe following two proposed constitutional amendments, to-wit: “Tbe Legislative Assembly may by law provide for tbe levy of a tax upon sucb lands as may be provided by law of tbe State for tbe purpose of creating a fund to insure tbe owners of growing crops against losses by bail; provided, tbat sucb tax shall not affect tbe tax. of four mills levied by the Constitution. Tbe Legislative Assembly may classify sucb lands of tbe state as may be provided by law, and divide tbe State into districts on sucb basis as shall seem just and necessary and may vary tbe tax rate in sucb districts in accordance with tbe risk, in order to secure an equitable distribution of tbe burden of sucb tax among the owners of sucb land as may be provided by law.” Amendments to N. D. Const. Art. 24; Laws 1911, chap. 93. “Tbe Legislature may by law provide for tbe levy and collection of an acreage tax on lands within tbe State in addition to tbe limitation specified in Section 174, in Article 11, of the Constitution. Tbe proceeds of sucb tax shall be used to indemnify tbe owners of growing-crops against damages by bail, provided tbat lands used exclusively for public roads, rights of way of common carriers, mining, manufacturing or pasturage, may be exempt from sucb tax.” Amendments to N. D. Const. Art. 30; Laws 1919, chap. 85. Tbe first amendment originated in tbe legislature, and was submitted *863 to tbe people in accordance with § -202 of the Constitution. The second amendment was proposed by initiative petition filed in the office of the Secretary of State on May 3rd, 1918. Both 'amendments were submitted to the people for approval or rejection at the general election held November 5th, 1918. The first amendment received 52, 475 affirmative,-and 30,257 negative, votes. The second amendment received 40,329 affirmative, and 33,572 negative, votes. No question is raised in this case as to the adoption of either amendment. In other words, the case has been brought and submitted on the theory that both, constitutional amendments were duly submitted to, and approved by, the people at the general election in 1918; and, hence, became, and now are, part of the Constitution of this State. The State Hail Insurance Department was established by the Legislative Assembly in 1919. Laws 1919, chap. 160. The law establishing the State Hail Insurance Department was amended and re-enacted in 1921. Laws 1921, chap. 77. So far as the questions involved in this action are concerned, there is no material difference between the two laws, and, hence, only the provisions of the 1921 Act will be quoted. The State Hail Insurance Department was placed under the control, management and supervision of the Commissioner of Insurance. Laws 1921, chap. 77, § 2. The Act provides: Section 5. “The crops insured under this Act shall consist of all crops grown on cultivated land listed as actually cropped, subject to and paying the taxes herein specified, provided that no loss shall be allowed or paid for damage to crops after they have been harvested, or that occur after the fifteenth day of September of any year, nor shall damages be paid on any crops prior to June tenth of each year, nor upon crops listed for insurance upon which an application for extension of time for withdrawal has been made as provided in § 12 of this Act during the time of such extension; provided that insurance on fall and winter grain shall take effect June 1st of each year. Section 6. “There is hereby levied for the years 1921, 1922, 1923, 1924. 1925 upon each and every acre of tillable land in the State, a fiat tax of three cents per annum for the purpose of carrying out the provisions of this Act, and creating a permanent surplus in the Hail *864 Insurance Fund to be applied.in paying losses more promptly. Provided that lands used exclusively for public roads, rights of way of common carriers, mining or manufacturing purposes, and lands included witbin the platted portion of any incorporated city, town or village shall be exempt from such tax. All moneys collected under {lie provisions of this Section shall be paid into the State Hail Insurance Fund but a separate record of such moneys shall be kept by the County and State Treasurers. Section 7. “The commissioner of insurance shall on or before the twenty-fifth day of October of each year ascertain the amount which .is required for the total payment of all loss caused by hail to crops insured by the department and a sum sufficient to pay interest at the rate of six per cent on all warrants issued from the first day of December until called for payment by the State Treasurer plus a sufficient sum to maintain and operate the department for the succeeding year, and shall thereupon for the purpose of securing and paying the same levy an indemnity acreage tax sufficient to cover said amount on all cropped land insured (except hay and meadow land) not withdrawn from the operation of this Act as hereinafter specified, provided that the total amount of said indemnity tax shall not exceed in any one year the sum of fifty cents per acre for seven dollars indemnity or seventy-one cents per acre for Ten Dollars indemnity. Provided further that if the sum collected by the maximum levy should be insufficient to pay all losses in any one year, the payment of losses shall be prorated. All moneys collected under the provisions of this Section shall be p'aid into the State Hail Insurance Fund. Section 8. “After the commissioner of insurance shall have determined and levied said indemnity acreage tax he shall forthwith notify the county auditor of each county of such levy, and the County Auditor shall spread such indemnity and flat tax on the tax rolls in separate columns for that purpose. Such indemnity taxes and flat acreage taxes shall be collected by the Treasurer of said county and shall be kept in a separate fund to be known as the State Hail Insurance Fund. Section 9. “It shall be the duty of every county and township assessor in his respective district at the time of listing property for assessment to return the number of tillable acres in every tract, parcel or subdivision of land, subject to taxation together with the name of the *865 person in whose name the land is taxed and "also the number of acres of such land, if any, in crop or to be sowed or planted to crop during such year. He shall note upon a diagram on the crop listing blank the location of such land in crop or to be planted or sowed to crop during such year, ’and shall return and file same with the county auditor of such county on or before the first day of June of each year. Such assessor in addition to the compensation allowed by law shall receive the sum of fifteen dollars for each full township of thirty-six sections or at the rate of seven cents per hundred aci*es or fraction thereof listed, whether tillable or not. Such compensation shall be paid out of the hail insurance fund on vouchers issued by the Commissioner of Insurance and approved by the state auditing board, provided that warrants in payment of such listing of land shall not be issued before the county auditor shall have filed with the Hail Insurance Department a certified statement that such assessor has listed every tract of land in his township or district. Section 10. “All taxes provided for in this act shall become due and payable on the first day of December of each and every year for which the tax is levied, and shall become delinquent on the-first day of Starch. following, and if unpaid there shall attach thereto a penalty of 5 per cent 'as soon as the same become delinquent; also on the first day of June following an additional penalty of 2 per cent, on the first day of November following a further penalty of three per cent on original taxes, and the same shall be charged and collected accordingly without being specially entered or noted on the tax list, and shall be collected by the county treasurer of each county, provided, that all sums arising from the penalty and interest for nonpayment of such taxes as hereinbefore provided, shall accrue to and become a part of the State hail insurance fund. Provided, all laws relating to the collecting of penalty and interest, and sale of realty for nonpayment of taxes, shall apply to taxes accruing under this Act. And it is further provided that delinquent taxes that have been levied under the provisions of this Act shall bo advertised and sold together with general real estate taxes in one sum and one certificate shall be issued therefor. It is further provided that It shall be the duty of the County Treasurer of each county in the State to remit to-the State Treasurer all taxes collected under the provisions of this Act during each month on or *866 before the 15th day of the following month, and the State Treasurer shall upon the first clay of each month, report to the commissioner of insurance the condition of the state hail insurance fund. Provided, further that the commissioner of insurance before paying any losses arising under this Act shall deduct from such payment the ’amount due the State from the person liable for payment of same under the provisions of this Act. Section 11. “Every owner or his agent or tenant or his agent of any land subject to the provisions of this Act shall make an affidavit that the land so insured is actually cultivated and in crop or intended- to be cultivated and put into crop. Such affidavit shall contain ’a legal description of the land together with the number of acres claimed as crop land and in case of ’any loss by hail such owner and tenant shall be bound by said affidavit as to the number of acres cropped. Such affidavit shall be made in triplicate and shall be sworn to before the assessor. The assessor shall file the original and one duplicate of such affidavit with the county auditor on or before the first day of Juno of each year, and a copy of such affidavit shall be left with the maker and shall constitute his policy of insurance. If the owner or tenant or their agents be absent or refuses or neglects to furnish such affidavit, the assessor shall certify the number of acres cropped, the description of said land and the name of the owner, and tenant, if any, and file same with the county auditor, and such owner and tenant shall be bound by such certificate as to the facts so certified. Provided, that if any assessor shall neglect to list such land or shall list it improperly, any such owner or tenant or their agents may list such land with the County Auditor prior to June 10th of any year by making affidavits as above provided. The originals of such affidavits to be filed by the county auditor with the hail insurance department immediately. Any assessor who shall neglect or fail’ to list any land in the township or district in which he is assessor, as provided in this section, shall be guilty of a misdemeanor. Provided, that the hail insurance department shall be liable for loss only on lands listed as provided in this Act. ■ Section 12. “Any owner of land liable for the indemnity tax herein provided for, may at any time pxfior to the 15 th day of June in each year, withdraw any portion of all land owned by such person from *867 tlie levy of said indemnity tax upon making an affidavit in duplicate, giving the legal description of the land, the number of acres withdrawn and stating that he desires to withdraw therefrom, and filing-such affidavit in duplicate with the county auditor, and the county auditor shall, within three days file a copy of same with the -'commissioner of insurance, and the party making withdrawal shall note upon his crop listing affidavit the number of acres and the legal description of land so withdrawn 'and sha?l note upon a diagram upon such withdrawal affidavit the location of land so withdrawn. Such affidavit shall be sworn to before any notary public or county auditor or a qualified justice of the peace. Provided, that no assessor shall acknowledge any affidavit of withdrawal. Provided, further that it shall be the duty of the Hail Insurance Department to furnish each county auditor for distribution by the assessors all withdrawal blanks, crop listing blanks, extension application blanks and loss report blanks together with self-addressed envelopes necessary in their respective townships. Should such owner wish to withdraw all his land subject to indemnity tax then he shall surrender also the crop listing affidavit and file same together with the application for withdrawal with the county auditor. Provided, that in case said land or any portion thereof is rented such owner shall first procure the written consent of such tenant for any withdrawal authorized by this Act, such consent to be filed with the county auditor, together with the owner’s application for withdrawal. Provided, that the owner shall have a self-executing first lien upon all crops and grain belonging to the tenant grown upon the land as security for the payment of said tax or the part of such tax properly chargeable against the tenant’s share of such crop or grain. The owner shall also have a first lien chargeable against tenant’s share of hail indemnity if filed with the Commissioner of Insurance prior to October 1st. Provided, further, that any owner may secure an extension of the time for such withdrawal up to the first day of July of any year by filing with the county auditor prior to June 15th of any year an application in duplicate, asking that such extension be granted. Such application to contain a clause relieving the hail insurance department from all liability for payment of indemnity during time of such extension but such application may be cancelled ’at any *868 time prior to July 1st. Such application to be sworn to-and signed by the applicant before an officer authorized to administer oaths. Section 13. “Each county auditor shall file and keep one copy of the crop affidavits presented to him by the assessors and shall forward the originals thereof on or before the 10th day of June of each year to the commissioner of insurance at Bismarck. Prior to July 15th of each year the county auditor shall file a tabulated statement showing the total number of acres classified ’as tillable land and cropped in his county. Each county shall receive the sum of 50 cents per each 1000 acres of tillable area to be paid out of the hail insurance fund prior to December 31st, of each year on vouchers issued by the commissioner of insurance and approved by the state auditing board. Provided, that any county where the Auditor shall fail or neglect to make returns, statements and reports to the commissioner of insurance at the time specified in this Act, shall forfeit the sum of $10.00 per day during the time such county auditor neglects to make such returns, statements or reports, and the Commissioner of Insurance is hereby authorized to deduct the amount of such fine to the extent of such compensation above provided for to any county. Provided, further it shall be the duty of the attorney general to proceed to collect the amount of such penalty for the time of such delinquency in excess of the amount above provided for.” Section 15. “The •maximum amount of indemnity for total loss shall bo $7.00 per acre except where the owner, occupant or tenant shall, prior to the 1st day of July of any year, make application to the county auditor, for an additional $3.00 per acre indemnity. Such application shall be made out in duplicate upon blanks furnished by the hail insurance department and one of these copies shall be forwarded to the hail insurance department within three days after it is filed. Such application shall contain the legal description of the land and the location of the crops upon such land noted upon the diagram on the application on which additional insurance is desired, and that such crop has not been destroyed or damaged by hail. Such ’application shall be sworn to before some one authorized to administer oaths and be signed by the applicant. If the applicant is a tenant the signed consent of the person liable for the taxes authorized by this Act must appear upon such appliea *869 tion, and if owner makes such, application the signed consent of the tenant, if any, must appear upon such application. Provided, that 'no indemnity shall be allowed to any claimant for the loss of less than ten per cent ’and a loss of eighty-five per cent or more, shall be deemed a total loss. There shall be no claim allowed for any loss or damage by hail to crops described in this Act, except for such portion as is traceable to hail.” The taxes involved in this case were levied under §. Y of the Act. The plaintiff contends that such taxes are liens subordinate and inferior to the lien of plaintiff’s mortgage; that the two amendments to the Constitution relating to state hail insurance, and the legislative enactment establishing the state hail insurance department insofar as they authorize or provide for the levying of the so-called indemnity hail tax are, as against the plaintiff — (who is the holder of a prior mortgage upon the premises sought to be made subject to such tax) — ,viola five of § 10 of article 1 of the Constitution of the United States, which provides: “No state shall . . , pass any „• . . law impairing the obligation of contracts;” and of the due and equal protection of the law clauses of the 14th amendment of the Constitution of the United States. In our opinion the case does not present any question of conflict between the two amendments of the State Constitution and the Constitution of the United States; for the Hail Indemnity Tax, authorized by § 7, supra, is not a tax within the contemplation of éither of the amendments to the State Constitution. The first amendment authorizes the legislative assembly to provide by law “for the levy of a tax upon such lands as may be provided by law of the State for the purpose of creating 'a fund to insure the owners of growing crops against losses by hail.” The second amendment provides that “the legislature may by law provide for the levy and collection of an acreage tax on lands within the state,” the proceeds of which “tax shall be.used to indemnify the owners of growing crops against damages by hail.” We need not consider in what respects the two amendments differ from each other. So far as the question here is concerned there is no essential difference. Both amendments «provide for the levy of a tax. Both contemplate that the legislature, by law, shall designate the lands *870 to be taxed. Both involve the taxing power, and in the clearest terms indicate that the power must be exercised by the legislature itself. Neither amendment purports to authorize the legislature to create any lien or charge upon lands in this-state, except such 'as may result from the levy of a tax. The power of taxation is an inherent incident- of sovereignty. 26 R. C. L. p. 26; 11 Enc. U. S. Sup. Ct. Rep. p. 214. Taxes do not rest upon contract, express or implied. “They are forced contributions, and in no way dependent upon the will or contract, express or implied, of the persons taxed.” 26 R. C. L. 26; Rochester v. Bloss, 185 N. Y. 42, 47, 48, 6 L.R.A.(N.S.) 694, 77 N. E. 794, 7 Ann. Cas. 15; Cray, Limitations of Taxing Power, § 41. In his work on taxation Judge Cooley said: “Taxes are not contracts between party and party, cither express or implied, but they are the positive acts of the government, through its various agents, binding upon the inhabitants, and to the making and enforcing of which their personal consent individually is not required.” 1 Cooley, Taxn. 3d ed. p. 19. The power to fax belongs exclusively to the legislative branch of the government (11 Enc. U. S. Sup. Ct. Rep. p. 375; 26 R. C. L. p. 27; 1 Cooley, Taxn. 3d ed. pp. 43, et seq; Gray, Limitations of Taxing Power, §§ 533, 534; Vallelly v. Park Comrs. 16 N. D. 25, 15 L.R.A. (N.S.) 61, 111 N. W. 615, and cannot be delegated except to municipal corporations for municipal purposes. 26 R. C. L. p. 30; 1 Cooley, Taxn. 3d ed. pp. 99, 100; Gray, Limitations of Taxing Power, § 534; Vallelly v. Park Comrs. supra. “It is a general rule of constitutional law that a sovereign power conferred by the people upon any one branch or department of the government is not to be delegated by that branch or department to any other. This is 'a principle which pervades our whole political system, and, when properly understood, admits of no exception. And it is applicable with peculiar force to the case of taxation. The power to tax is a legislative power; and within that power lies the authority to prescribe the rules of taxation, and to regulate the manner in which those rules shall be given effect. The people have not authorized this department to relieve itself of the responsibility by a substitution of other agencies. . . . There is nevertheless one clearly defined exception to the rule that the legislature shall not delegate any portion of *871 its authority. The exception, however, is strictly in harmony with the general features of our political system, and it rests upon an implication of popular assent which is conclusive. This exception relates to the case of municipal corporations.” 1 Cooley, Taxn. 3d ed. pp. 99—101. But the power to levy taxes — even for municipal purposes — may in no event be delegated to private individuals. Murton v. Holes, 17 N. D. 154, 115 N. W. 256. The indemnity hail tax is not an enforced or compulsory contribution levied by the state by virtue of its sovereignty. It does not owe its existence to any “positive act of the government.” According to the statute, land may be rendered subject to the indemnity tax in three ways':' (1) Where it is listed by the assessor, and not withdrawn by the owner (§§ 9-12) ; (2) Where, (the assessor having failed to list it) it is listed by the “owner or tenant, or their agents” (§ 11); and, (3) Where the “owner, occupant or tenant” makes application for an additional indemnity of $3.00 per acre. § 15. Whether any tract of land is or is not subject to such tax depends upon the facts in each individual case. Unless the land is listed there is no indemnity against loss by hail and no liability for indemnity tax. Bossen v. Olsness, 48 N. D. 68, 182 N. W. 1013. Every tract of land in the state may be withdrawn from the operation of the act and relieved from the indemnity tax. And no tract becomes subject to the tax unless the owner thereof (or if the tract is leased the owner and the tenant) impliedly consents that it may become subject thereto. The Hail Insurance Act does not apply automatically either so as to insure all growing crops, or to render all tracts of land on which crops are grown subject to the indemnity tax. Ibid. But “it is the primary duty of the owner of land or the tenant, or the agent of either, in order to effect state hail insurance upon the crops grown upon such land,, to make the affidavit or affidavits provided for in § 11.” Brown v. Nelson, 50 N. D. 589, 197 N. W. 223. In other words, neither the right to indemnity for loss by hail nor liability for indemnity tax arises solely by operation of the legislative will as expressed in the law. On the one hand there is no right to indemnity for a hail loss unless and until such action is taken in each individual case as will impose liability upon the state hail insurance department under the terms of the statute. On the other hand, there is *872 no liability for indemnity tax — 'and no tract of land becomes subject thereto — unless there is an implied consent by the owner (or by the owner and the tenant) that such tax may be levied against the particular tract of land. In every case it is within the power of some private individual or individuals to determine whether the indemnify tax shall or shall not be levied against a particular tract of land.- The indemnity tax rests, in each instance, not upon the legislative will, but upon the will of private individuals. This is true as regards every tract of land within the state. If in any one year the owners of all the lands in this state and their tenants should elect to withdraw the lands from the operation of the hail insurance act, by filing proper affidavits of withdrawal, not one cent of indemnity tax would be levied. It seems too clear for controversy that the indemnity tax, is not a tax within the well settled and fundamental meaning of that term. It does not rest upon some positive act of the government, but upon the consent of certain private individuals. In short, the indemnity tax-is'devoid of the fundamental attributes of a tax. And in our opinion it falls squarely within the rule announced by this court in Yeatman v. King, 2 N. D. 121, 33 Am. St. Rep. 797, 51 N. W. 721. That case involved a so-called tax levied under a statute authorizing the cotinty to furnish seed grain to certain individuals upon application therefor. There, as here, the contest arose between the holder of a real estate mortgage upon the premises, — a mortgage in existence at the time the said grain was furnished and the tax or lien in favor of the county came into existence. There, as here, the county asserted that its lien, although subsequent in point of time, was by virtue of the statute prior to the lien of plaintiff’s mortgage. The statute involved in that case provided that if the indebtedness due to the county for the seed grain furnished should not be -paid on the 1st of November following, the amount of such indebtedness should be entered upon the tax list of the county for the ensuing year, “as a tax upon the land upon which such seed wheat was sown, to be collected 'as other taxes are; and the sum so entered and levied shall be a first lien . . . upon the real estate owned by such person, until the tax is fully paid.” In considering whether a lien for seed grain so furnished was in fact and in law a tax, and constituted a lien prior to an existing mort-’ gage against the premises, this court said: *873 “Tbe statute wbicb makes tbe íieu a first lien upon tbe land describes it as a tax lien, and tbe amount due for tbe seed grain is declared to be a tax, and tbe 'amount thereof, in case of default in its payment, is directed to be entered upon tbe tax list of tbe county. But the voice of tbe legislature cannot alter tbe essential nature of things. No legislative fiat can make that a tax wbicb is not and cannot be a tax. If tbe law-making power were vested with unlimited authority to fix tbe meaning of words, to take cases without tbe prohibition of tbe constitution by arbitrary definitions, tbe fundamental rights of the citizen would be safe only so long as tbe legislature should abstain from defining away constitutional protections. Due process of law might be defined to embrace arbitrary confiscations; such a thing as an ex post facto statute might be defined practically out of éxistence; and many, if not all, of tbe barriers erected to shield the fundamental rights of the citizen from legislative assault — barriers seemingly of adamant, and apparently standing upon abiding foundations — would crumble before tbe breath of legislative definition. We are confident tbe agent has no power to define away tbe limitations upon bis delegated authority. . . . “Is, then, tbe obligation under tbe law resting upon tbe person who has received temporary county aid in tbe shape of seed grain, to repay to tbe county tbe value thereof, a tax in any sense of tbe word' whatever? ■‘■’We are very clear that it is not. If tbe oracle be consulted we find it gives back no answer that will justify tbe theory that this obligation is a tax. Says Judge Cooley at tbe very threshold of bis work on Taxation: ‘Taxes are defined as being tbe enforced proportional contribution of persons and property, levied by authority of tbe state for tbe support of tbe government and for all public needs. Tbe amount to be paid by him who has been supplied by tbe public with seed grain is not in any sense a “contribution,” but it is a debt owing by him to tbe county for value received by him in tbe form of property. If it could be regarded as a contribution, it is not a proportionate contribution, for be who owes tbe duty to make this payment owes it iii addition to bis duty to pay bis proportion of faxes, and be may be the only person in tbe county upon whom this extra obligation rests. Neither can it be said to be an “enforced” contribution. Whatever be is bound to pay is owing because of bis voluntary purchase of - seed *874 grain from tbe county. There is no' coercion. lie pays what he agrees to pay and no more.’ ■ “If this obligation is a tax in a proper sense, then the state may give it a priority of lien. If not a tax, then the legislature cannot, by designating it as a tax, give it any greater preference as a lien than could be given it should no such name be affixed to it. To postpone a legal existing lien upon real property to a subsequent lien by a statute enacte'd subsequently to the attaching of such prior lien is to impair the obligation of a contract. This object cannot be accomplished by indirection' — by calling something a tax which is not a tax. The legislature could not by an act passed after the plaintiff’s mortgage had been executed and become a lien upon the property, confer upon any person who should loan or advance money or money’s worth to the mortgagor a lien upon such property prior to that of the existing mortgage. Nor can the legislature lawfully give to a county or other public corporation or subdivision of the state any such priority in such a case unless the claim be for a tax, as a tax is known to the law. Neither can the state itself secure any such priority under such circumstances. When entering ■ into contract relations with individuals, the state, or a municipal corporation thereof, is to be treated the same as an individual. It cannot call or charge up the amount of a loan as a tax, and by that device confer upon the loan all the qualities of a tax. If it could, and in this manner insert a lien for this pseudo tax ahead of existing liens, the holder of security upon real estate would be at the mercy of the state, despite the supreme law of the land preventing the impairing of the obligations of a contract by any state. If the state can make this claim a tax, then there is no limit to its power by definition to confiscate the securities of others. The amount advanced to the individual by the state would not affect the right of the state to call it a tax. Neither would the purpose for which the advance was made, nor the exigency to meet which the sum was loaned, limit in any manner the power of the legislature to invest such loan with all the attributes of a tax. The loan by the public supplanting the first lien upon real property might be so great as to work a destruction of the lien supplanted: But it is sufficient to condemn a law that it works any impairment, however slight, of the obligations of a contract. To affect a dollar of a prior lien by subsequent legislation is as vicious before *875 tbe law as to destroy tbe lien altogether. Walker v. Whitehead, 16 Wall. 314, 21 L. ed. 357.” This language and reasoning is equally applicable to the indemnity hail tax. It follows from what has been said that the trial court was in error in holding that the indemnity tax created a lien prior to plaintiff’s mortgage. The order appealed from is reversed and the case is remanded for further proceedings not inconsistent with this opinion. Nuessle, Burke, JoiiNsok, and Biedzell, JJ., concur.