Richardson v. City of Denver

Chief Justice Hayt delivered the opinion of the court. Is a municipal corporation liable to the purchaser at its tax sale for the money paid where 'the proceedings leading up to the sale, as well as the sale itself, are absolutely void ? [401] In answering this question we will consider : First, — Appellant’s rights in the absence oí a statute fixing the city’s liability. Second, — The statutory law upon the subject. The question is one of first impression in this court, although the subject has received the careful consideration of many able courts in other jurisdictions. In Lincoln v. Worcester, 8 Cush. 65, Chief Justice Shaw declares there are three requisites to the right of recovery for money paid by reason of illegal taxation. First, — The assessment must be absolutely void. Second, — The money sued for must have been received by the corporation for its own use. Third,— The payment must have been upon compulsion and not voluntary. Justice Dillon in his work on municipal corporations fully indorses the conclusions reached in the above cause, and cites many authorities in confirmation of the views expressed by the Massachusetts court. The learned author says that unless all these conditions are present a payment under protest will not ordinarily give a right of recovery in the absence of a statute authorizing the same. 2 Dillon, Mun. Corp., 3d ed., § 940. The soundness of these legal propositions must be admitted. Testing appellant’s claim by them, and we find that at least one of the essential requisites of recovery is wholly wanting in this case. The payment made was entirely voluntary. Richardson bought for purelj speculative purposes. He took the chances and must abide by the consequences, unless he can find some statute authorizing the recovery of the money paid. If his venture had proven fortunate he might have secured a veiy valuable property for a small sum of money. In any event he had ample means of ascertaining the validity of the proceedings ’under which he purchased and it must be assumed, under the circumstances, that he bought with full notice of the illegality of the same. A purchaser at a tax sale from one who is not the owner of the property comes strictly within the rule of “ caveat emptor.” [402] • Neither the county treasurer, who conducted the sale in this instance, nor the city, at whose instance the sale was made, guaranteed the title. In addition to this it is not shown in this case that the city received any benefit from the payment. Although it is well settled that an entire failure of consideration will entitle a party to recover back the mone3 paid under certain circumstances, it is equally as well established that he cannot do so where the money is voluntarily paid with a full knowledge of all the facts. 1 Parsons on Contracts, 6th ed., 466; Forbes v. Appleton, 5 Cush. 117. It has been repeatedly held in cases where the payment was voluntary that the money cannot be recovered in the absence of fraud or mistake of fact. A mistake as to the law gives no right of action for the money paid. We are, therefore, of the opinion that the judgment of the district court is in accordance with the general law upon the subject, and must, for this reason, be sustained unless such law is modified in this state by statute. Dillon’s Mun. Corp., 3d ed., § 946; Flint v. The County, 27 Fed. Rep. 850; Comm. v. Goddard, 22 Kan. 389 ; Hamilton v. Valiant, 30 Md. 139; Lamborn v. County Comm., 97 U. S. 181; Railroad v. Comm’rs, 98 U. S. 541. We are aware that in Chapman v. The City of Brooklyn, 40 N. Y. 372, and Wells v. The City of Chicago, 66 Ill. 280, a different conclusion has been reached; but these cases cannot be said to shake the current of authority to the contrary. In the New York case the court failed to notice the principle governing where the money has been voluntarily paid with knowledge of the facts. In the case in Illinois the assessment was for the cost of the extension of Milwaukee avenue in the city of Chicago. The city having been enjoined from making the extension, the money could not be used for the projected improvement, and it was held that plaintiff and not the city was entitled to it. The facts are entirely different from the facts in the present controversy. Here the improvement was made prior to the assessment and [403] the money paid over to the contractor in pursuance of his. contract with the city. Failing to establish the liability of the city independently Of the statute, appellant contends that this action should have been sustained under the statute. In support of this contention reliance is placed upon sections 2824, 3352 of the Gen. Stats, of Colo., 1883, and § 81 of the special charter of the city of Denver enacted in 1881. The first two of these sections are as follows : “ § 2824. When by mistake or wrongful act of the treasurer, clerk or assessor, or from double assessment, land has been sold on which no tax was due at the time, the county shall hold the purchaser harmless by paying him the amount of principal, and interest at the rate of twenty-five per cent per annum ; and the treasurer, clerk or assessor, as the ease may be, and his sureties on his official bond, shall be'liable to the county for all losses sustained by the county from sales made through the [their] mistake or misconduct.” “ § 3352. It shall be the duty of the treasurer of said county, and he is hereby authorized and empowered to collect the said city or town taxes, in the same manner and at the same time as other taxes upon the same tax list are collected. And all the laws of the state for the assessment and collection of general taxes, including the laws for the sale of property for taxes, and the redemption of the same shall apply and have as full effect for the collection of such city or town taxes as for such general taxes, except as modified lty this act. * * * ” So far as the present controversy involves the section of •* city charter relied upon, it is practically the same as general section 3352 last quoted, and a further reference to the charter is therefore deemed unnecessary. In reference to § 2824 it is to be observed, it is only when considered in connection with § 3352 that it is claimed to apply to sales made by cities and towns. That it was the intention to make it applicable to municipal corporations in any case is not clear from the •language employed. It is sufficient for the purpose of this [404] case to say that in our judgment no language to be found in the latter statute will warrant the court in holding it was the intention of the legislation to make the former applicable to sales made in pursuance of a special assessment like the one in this case. Here the money when collected did not pass into the general revenues of the city, but, on the contrary, it became part of a special fund out of which the sidewalk contractor alone was paid; -while in case of recovery by plaintiff the judgment must be a general one against the city. Moreover the measure of his damages is not only the amount paid but 25 per cent per annum additional. We would not feel warranted in extending the provisions of such a statute beyond its express terms, except upon words clearly indicating that such was the legislative intent. As such language is not to be found in the act we must hold that appellant’s contention in this regard is not well founded. The judgment of the district court will therefore be affirmed. Affirmed.