Smith v. Ludington

By the Court, Cole, J. The question presented in this case is not distinguished from that involved in Smith vs. Rogers, and upon which that case turned. It was there held that after the amount of the street commissioner’s certificate had been assessed as k tax upon the lot against which it was chargable, and the lot sold at a tax sale, the certificate could not be foreclosed in equity as was provided by chapter 338, Priv. Laws of 1856, and the amendatory act of 1862 (ch. 347, Priv. Laws of 1862); and the reason given was, that the lot could not be twice legally sold to enforce the payment of the same charge upon it. Eor if the tax sale was .valid, the title óf the original owner would be divested thereby and become vested in the purchaser at the tax sale; while, in contemplation of law, the sale would discharge and extinguish the lien created by the street commissioner’s certificate. In the argument filed on the motion for a rehearing in the Rogers case, the counsel for the respondent admits that these results must follow when an individual buys the property at the tax sale. But he insists the effect is otherwise when the property is bid in by the city at the tax sale in default of other bidders. In that case, he claims because the city pays upon its bid no money out of which the holder of the street commissioner’s certificate can obtain the amount due him, that the lien of that certificate still continues. We have attentively considered the argument upon this point, and confess that it is not satisfactory to our minds. It is obv-i ous the whole argumeiffc hinges upon the point, as to what [338] effect must be given to tbe tax sale. Does or does not tbat sale, when regular, divest tbe title of tbe original owner in tbe property ? Where tbe property at tbe tax sale is purchased by an individual, it is admitted tbe title is divested, subject to tbe right of the original owner to redeem by complying with tbe statute upon tbat subject. If be does not redeem within tbe time limited, and the proceedings have been regular, then tbe purchaser is entitled to bis tax deed, which vests in him an absolute estate in fee simple. Now what is tbe consequence when tbe city bids off tbe property at tbe tax sale under its charter ? Tbe charter provides tbat tbe city shall receive in its corporate name tbe tax certificate, “ and shall be vested with tbe same rights as other purchasers.”' Sec. 16, chap. 8, charter, 1852. But it is said this language is not to be understood in its broad signification, because manifestly tbe city could not take and bold tbe title under a tax deed. Whether it could or not we consider quite immaterial to the point in issue. ■ For it . cannot be denied tbat “ in case tbe city should become tbe purchaser of any real estate at any tax sale, tbe treasurer is authorized to sell tbe certificates issued therefor for the amount sold, and interest, and to indorse and transfer such certificate to tbe purchaser,” and tbe assignee is “ entitled to receive a deed of such premises in bis own name, and with tbe same effect as though be bad been tbe original purchaser.” 'Sections 15 and 16, chap. 8, charter. This shows most conclusively tbat tbe title of tbe original owner is divested at tbe tax sale as well where tbe city bids in tbe property as where it is purchased by some third party. If the title is divested, if the property is once sold to satisfy tbe tbe tax assessed against it, tbe inevitable legal result must be tc? extinguish tbe lien given by tbe street commissioner’s certificate. For to say, not withstanding tbe sale, tbat tbe lien still continues and can be enforced by a subsequent sale, is manifestly giving the first no effect whatever. But it is claimed tbat tbe lien is not extinguished when tbe city bids in tbe property, because no mon [339] ey is paid, out of which the holder of the street commissioner’s certificate can obtain the amount due to him. True, the charter does not require the city to pay over the money on its bid. It takes the tax certificate in its corporate name, which the treasurer is authorized to sell and transfer for the amount thereof, and interest, and the hqlder of the street commissioner’s certificate can either take up the tax certificate and obtain the property through the tax deed, or wait until the city can find a purchaser for such tax certificate. He is not remediless. The law has rendered him all -the aid in its power by selling the property for the amount of the lien or tax upon it. He is placed in a position where he can obtain the property upon which his lien existed, and what more can he possibly ask ? Suppose property is sold to satisfy a mortgage or judgment, and no one bids at the sale. The creditor takes the property in satisfaction of his debt. So here. Upon the tax sale a plain, ready way is afforded for the holder of the street commissioner’s certificate to obtain the property in satisfaction of the amount due him. This, it appears to us, is all that in law or equity can be required, and we see no reason or necessity for any further sale of the property. But it is further claimed and insisted that the law of 1856, and the amendatory act of 1862, intend to give and do in fact give the holder of the street commissioner’s certificate the right to foreclose the same by a suit in equity, even where the special tax has been assessed against the property, and the property sold at the tax sale. I frankly admit that such appears to be the object and design of those acts. They give such holder the right to maintain the action as well where the tax. certificate has been assigned under the provisions .of the city charter as where the city holds it. No distinction whatever is made. It may be said that the city can transfer the tax certificate to a purchaser only upon beingpaid the amount due thereon and interest, and that such payment into the city treasury ipso facto operates as a payment or redemption of the lien giv [340] en by the street commissioner’s certificate. These laws do not 'declare that any such effect shall be given to a sale and transfer of the tax certificate. And there would seem to be far less reason for holding that they should have that effect, than for saying that the lien was discharged by a sale of the property upon which it existed, to satisfy this very charge. But to my mind the proposition seems self evident, that property cannot be twice legally sold to enforce the payment of tbe same lien upon it. For if more than one valid sale can be made, why notan indefinite number? Why may not the legislature as well provide that a party may sell the property a dozen times, as twice ? In reason and principle I can perceive no difference in kind, but merely in degree, in the exercise of legislative power in the one case and in the other. Therefore so far as the above cited statutes attempt to give a party the right to bring an action in equity to foreclose the lien created by the street commissioner’s certificate, after the special tax has been assessed upon the property, and the property sold to raise this tax, I am constrained to hold them inoperative and void. The judgment of the circuit court, holding that the complaint stated no cause of action, and dismissing the action, is affirmed.