Hoffman v. Groll

The opinion of the court was delivered by Johnston, J.: The makers of the note and mortgage upon which this action was brought, have made no defense. J. J. Hoffman, who was made a defendant in the action, claimed under a tax deed, which, if valid, would extinguish the mortgage lien, and vest the absolute title to the land in himself. The mortgaged land was subject to taxation in 1873, and the taxes not being paid, it was offered for sale in 1874, and there being no bidders, it was struck off to the county. The subsequent taxes, for the years 1882 to 1884 inclusive, were not paid, but were charged up against the land. On May 1, 1884, the county clerk, by order of the board of county commissioners, and in accordance with the provisions of chapter 43 of the Laws of 1879, assigned the tax-sale certificate to Hoffman. The tax deed in question was based on that, assignment, and was issued on the 4th of November following, and its validity [657] was the principal question before the court. It was held by the district court to be invalid for several reasons; the first of which is that the county treasurer in his notice of the tax sale omitted to state that the land would be offered for sale at public auction. The statute, in terms, requires that the land shall be sold at public auction, and also that the notice shall contain the statement that the sale will be so made. It has been held that the omission of this statement in the notice, if taken advantage of before the statute of limitation runs, will defeat the deed. (Hafey v. Bronson, 33 Kas. 598; Belz v. Bird, 31 id. 139; Corbin v. Young, 24 id. 198.) Counsel for Hoffman contends that the tax deed is not based on a sale made pursuant to the defective notice, but is based wholly on the authority of chapter 43, Laws of 1879. The first section of that act reads as follows: “Whenever any lands or town lots .that may have been or shall hereafter be sold for any taxes due thereon, that may have been or shall hereafter be bought in by any county for such taxes, are or hereafter shall be unredeemed for three years from date of such sale, and no person shall offer to purchase the same for the taxes, penalties and costs due thereon, the county commissioners of the county where such lands or town lots are located, may permit the owner, his agent or attorney, to redeem the same, or may authorize the county treasurer to execute, and the county clerk to assign, tax-sale certificates for such lands or town lots, for any sum less than the legal tax and interest thereon, as shall be in their judgment for the best interest of the county; which assignment shall have the same force and effect as if the full amount of all taxes, interest and penalties had been paid therefor: Provided, however, That no deed shall be issued upon any certificate so assigned until six months after such assignment has been made.” There is no authority given to the couuty commissioners in this section to make a sale of the lands which have been struck off to the county. They are only authorized to order the execution and assignment of tax-sale certificates for lands that have been previously sold for taxes.. The assignment in such a case differs from an assignment of lands held by .the county in other cases, only in this, that instead of the purchaser being [658] required to pay the full amount charged against the land, he may be allowed by the commissioners to purchase the interest of the county in the land for a reduced amount. The tax-sale certificate executed by the county treasurer and assigned by the county clerk under this statute, is based upon the anterior tax proceedings, and upon the sale which was made when the land was bid in by the county; and therefore a legal notice of the sale is a prerequisite to the validity of the tax deed issued under the statute, and the omission to state in the notice that the land would be sold at public auction must be held to be a fatal defect in the deed in question. The mortgagee was at liberty to question the validity of Hoffman’s tax title, as he held under the original owner, and may protect the interest conveyed by the mortgage to the same extent as the original owner might do. It being an action to foreclose the mortgage, .Hoffman, who claimed an interest in the land, was properly made a defendant. He set up his tax title, which, if upheld, divested the mortgage lien, and it was the duty of the court to determine the existence and priority of the liens claimed by the respective parties, and in such a case no tender of the taxes was necessary. The whole matter was before the court for equitable adjustment, and as the foreclosure has been decreed, the proceeds of the sale will be brought into court for distribution, and the interest of the holder of the invalid tax deed is fully protected. The only other question which we need to notice is as to the amount allowed by the court to Hoffman. He was allowed $265.50, which was the amount actually paid to the county on the tax-sale certificate, together with interest thereon, and the value of the improvements, but he claims that he was entitled to receive $455.99—the full amount of taxes, interest and penalties legally charged against the 'land. Section 142 of the act relating to taxation provides that the successful claimant in an action where the tax deed is found to be invalid, shall be adjudged to pay the holder of the tax deed, or the party holding under him, the full amount of all taxes paid on such' land. By § 2 of the chapter under which the' cer [659] tificate was assigned and the deed issued, it is provided that the party desiring to redeem as therein prescribed — “Shall pay to the purchaser or holder of the tax certificate, his heirs or assigns, in money, the amount paid for the property, and all subsequent taxes paid thereon, with interest from the date of each payment, at the rate of twenty-four per cent, per annum.” The court allowed the full amount to which he would have been entitled if the land had been redeemed, and he is entitled to no greater sum where the deed is held to be invalid. The further claim of Hoffman for a greater rate of interest than was awarded by the court, has been determined against him. By the terms of the decree he was to receive interest at seven per cent, per annum on the amount of recovery from that date, the same as an ordinary judgment draws; and it has been decided that the amount due for taxes in any action in which the tax deed is set aside, draws interest thereafter at the rate of seven per cent. (Corbin v. Young, 24 Kas. 198.) The judgment of the district court will be affirmed. All the Justices concurring.