Bennett v. Greenwalt
| Decision Date | 20 June 1939 |
| Docket Number | 44539. |
| Citation | 286 N.W. 722,226 Iowa 1113 |
| Parties | BENNETT et al. v. GREENWALT, Treasurer of Polk County (MISSILDINE et al., Intervenors). |
| Court | Iowa Supreme Court |
Appeal from District Court, Polk County; Russell Jordan, Judge.
Suit in equity to enjoin Treasurer of Polk County from advertising offering, or selling at tax sale any parcel of land on which Polk County holds either a certificate of tax sale, or a tax deed. Decree for plaintiffs, from which Ruffcorn, intervener has appealed.
Reversed and remanded.
A tax deed based on a tax sale for general taxes when valid and effective displaces and extinguishes the liens of all special assessments existing at time of sale regardless of whether assessments were due or were to become due.
Harding, Ruffcorn & Jones and Jos. F. Smith, all of Des Moines, for intervenor-appellant Ruffcorn.
Francis J. Kuble and Howard M. Hall, both of Des Moines, for plaintiff-appellees.
C. S. Missildine and H. Pierce Witmer, both of Des Moines, for intervenor-appellee Missildine.
F. T. Van Liew and Sam Orebaugh, both of Des Moines, for intervenor-appellee City of Des Moines.
This is another Polk County tax case. Like a number of its predecessors, it is a by-product of the scavenger tax sales of May and December, 1935, and of January, 1937. At these sales Polk County was the purchaser of a great many parcels of real estate. After deducting resales, assignments, and redemptions, it was still the holder of tax certificates and tax deeds on approximately 12,000 pieces of property, at the time of this litigation. In the summer of 1937, Greenwalt, the County Treasurer, who had succeeded Munn, who, as such treasurer, had made the sales, informed the Board of Supervisors, and the County Attorney, that he thought it was his duty, under the law, to advertise and offer for sale, at the annual December, 1937, tax sale, all real estate, against which there were delinquent taxes, including all such property on which Polk County held tax certificates or tax deeds. Thereafter the members of the board of supervisors filed their petition in equity against the treasurer praying that he be enjoined from advertising, offering or selling any parcel of real estate on which Polk County, Iowa, held certificates of purchase or tax deeds, by virtue of being a purchaser of real estate at the aforesaid tax sales. Against a great many of these parcels there were unpaid and unmatured special assessment certificates which had been levied thereon, for grading, paving, sewer, and other improvements, benefiting the property.
Plaintiff's petition, among other matters, alleged: that the tax sale records of the treasurer's office contained specific descriptions of each tract sold to the County, to which tax certificates and tax deeds were issued, and which had been assigned, or redeemed, and by reference, each description was made a part of the petition; that under Section 7244 of the 1935 Code of Iowa, the treasurer was barred from selling any parcels on which the county held tax sale certificates, at the annual tax sale, in December, 1937; that the liens of all special assessment certificates, against any of said parcels which had gone to tax deed, whether due or to become due, had ceased to be liens, upon the execution of said tax deeds; that the treasurer intended to sell said parcels to pay said assessments, unless restrained; that the expense of advertising and selling said parcels would fall upon the plaintiffs; that any such sales would be wrongful, under Code sections 7293 and 7294, and it would be the duty of the treasurer to refund any such purchase money; that under the law the said property of the county was not taxable; and that the holders of special assessment certificates had lost any rights which they had, by failing to purchase property on which they had liens, at the tax sales, and by failing to procure assignments under section 6041 of the 1935 Code. The prayer was as hereinabove stated.
Missildine filed a petition of intervention alleging that he was a tax payer of Des Moines, interested in the success of the plaintiffs, and, by reference, incorporated in his petition the prayer and all allegations of plaintiff's petition.
Ruffcorn, for himself and certain clients, filed a combination petition of intervention and answer, in which he alleged: that he was the owner of eleven special assessment certificates, and the trustee for a number of owners and holders of other such certificates on property within the limits of Des Moines, which were all issued prior to January 1, 1930; that he admitted Polk County was the apparent owner of a large number of scavenger tax sale deeds, but denied their validity and insisted that they be established only by strict proof; that he admitted that a large number of properties had been purchased by the county at such tax sales, on which no notices had been served to redeem therefrom; that all of said special assessment certificates were issued in payment of street improvements, as provided by contract, and at a time when Section 7244 of the 1931 Code, unamended by Chapter 82 of the Acts of the 46th General Assembly, was in force, and a part of said contract, and required the treasurer to annually offer at public sale all real estate against which there were delinquent taxes; that said amendment by the legislature was unconstitutional in that it impaired his contract right to have his special assessments collected by the county treasurer through tax sale under the provisions of Section 7244, as it existed in the 1931 Code of Iowa; that Section 7244, as amended, prohibits the sale of property on which the county holds tax sale certificates as distinguished from property on which others hold tax certificates or tax deeds, and for that reason is discriminatory and in contravention of the fifth and fourteenth amendments to the Constitution of the United States, U.S.C.A., and of Section 6, Article 1, of the Constitution of Iowa; that the treasurer is required under Sections 7244, 6037, 7252 and 7246 of the 1935 Code to advertise said property for tax sale; that the extra expense of the tax sale is no basis for the injunction, and that it is not illegal. He prayed that the injunction be denied and that the treasurer be ordered to advertise and sell as required by the above mentioned Code sections.
The City of Des Moines intervened and adopted, as its own, the allegations and prayer of Ruffcorn's pleading.
The County Treasurer, Greenwalt, appeared pro se, and filed answer, denying the allegations of plaintiff's petition, asked that the suit be tried at once, and that all petitions filed be dismissed.
Motions to dismiss and strike were filed by the plaintiffs against the pleadings of the intervenors, and the latter reciprocated with like motions. All were submitted with the case.
The treasurer, as a witness for plaintiffs, testified that he would have offered the property involved at tax sale had the petition not been filed; that the publication cost was 30 cents a description, and for the 12,000 properties involved would have amounted to $3,600, and that the expense for extra clerical help and other items of labor and expense would approximate $1 a description, or about $12,000, making the total expense for advertising and selling and conveying the involved property about $15,600; and that his only desire in the matter was to be properly advised by the court as to his duty. The only exhibits offered by the plaintiffs were twelve books, designated as Tax Sale Registers, showing the record of the scavenger tax sales in May, 1935, December, 1935, and January, 1937. No tax deed nor tax certificate held by the County was introduced in evidence. No notice to redeem, and no affidavit of service, nor proof or return of service, was introduced. The Tax Sale Registers show the owner's name the person in whose name the property is taxed, the legal description of the property, the years advertised for sale, the amount of the tax levied for each year, with interest and costs, the purchaser, the amount paid by him, to whom assigned, by whom redeemed, with the date and amount paid in redemption. It also shows the date of filing the notice to redeem and affidavit of service, and the date when the tax deed is issued, and the name of the grantee. Any delinquent special assessments are shown after each description. By agreement these Registers were introduced without further identification, with the right of all parties to make such legal objections to them or corrections as might be deemed necessary. None of the properties sold to the county, at the May, 1935 sale were advertised or sold at the December 1935, or January 1937 scavenger tax sales. But this was not true of property sold to others than the county, at the May sale. At the time of these tax sales and at all times previous, the only checking or examination of the records, in the treasurer's office, prior to the issuance of a tax deed, was to ascertain whether redemption had been made, and the date of the filing of the notice to redeem and the affidavit of service, so as to determine whether the ninety days for redemption had expired. The notices to redeem and the affidavits of service were merely filed, and were never checked or examined in any way for any purpose, or to see whether they were correct, or in proper form, or the service good, or were legally sufficient to permit the issuance of the tax deed. The tax certificate was checked with the records to ascertain if the description was correct. The only information which the Treasurer's office has as to property owned by the county is as shown by the Tax...
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