Burns v. Lauderdale Loan & Discount Co.

• Decision Date: 15 April 1941
• Citation: 148 Fla. 92,4 So.2d 467
• Parties: BURNS et al. v. LAUDERDALE LOAN & DISCOUNT CO. et al.
• Court: Florida Supreme Court

4 So.2d 467

148 Fla. 92

BURNS et al. v. LAUDERDALE LOAN & DISCOUNT CO. et al.

Florida Supreme Court

April 15, 1941

On Rehearing Sept. 24, 1941.

Rehearing Denied Nov. 24, 1941.

En Banc.

Appeal from Circuit Court, Broward County; George W Tedder, judge.

Clyde W Atkinson and J. Lewis Hall, both of Tallahassee, and Edgar G Hamilton and Paty, Warwick & Mooney, all of West Palm Beach for appellants.

Curtis Byrd, of Fort Lauderdale, for appellee City of Fort Lauderdale.

C. L. Chancey and J. T. Chancey, both of Fort Lauderdale, and M. Lewis Hall and Tyrus A. Norwood, both of Miami, for other appellees.

PER CURIAM.

In view of the finding of the chancellor that 'practically the sole issue presented by the pleadings is whether or not the City sold the certificates and improvement liens, including taxes for 1938, for an inadequate consideration'; his recitals that 'It is conceded by plaintiffs that the City has the authority to sell and assign its past due certificates * * *'; and that 'No charge of fraud or bad faith is made * * *'; and his admonition that 'This opinion should not be construed as a finding that the Commission acted fraudulently or that they can be charged with bad faith. On the contrary, it is my belief that their actions were in the best of good faith, and for what they believed was for the best interests of the City * * *'; and considering the authority vested in the city by Chapter 15208 of the Laws of Florida, Sp.Acts of 1931, the decree in the case should have been entered in favor of the defendants. Therefore, it is the order of the court that the cause be reversed, with directions to dismiss the bill of complaint.

BROWN, C. J., and TERRELL, BUFORD, and THOMAS, JJ., concur.

CHAPMAN, J., dissents.

WHITFIELD and ADAMS, JJ., not participating.

On Petition for Rehearing.

THOMAS, Justice.

The sale of tax certificates and street assessments was made by the city to the appellants en masse for an amount representing but a small percentage of the total face value of the certificates and the assessments. The lower court held that the commissioners, who at the time served the city, acted in good faith, for what they thought was the best interest of the city and that no fraud was chargeable to them. By per curiam order this court ruled that in the circumstances reflected in the record and considering the findings of the chancellor his decree should be reversed.

Upon petition for rehearing the court was of the view that further argument should be heard on the question whether the contract was valid so far as it affected street improvement liens and taxes less than two years old. The case was then reheard.

There seems to have been no authority for the city to include in the sale those taxes which had not become due more than two years before the transaction and it appears also that by former fuling of this court in the case of Marshall v. C. S. Young Construction Company et al., 94 Fla. 11, 113 So. 565, 55 A.L.R. 662, liens for street assessments were not assignable in circumstances such as are reflected in this record.

It cannot be determined what amount was paid for the liens and what amount was received by the city for the taxes, nor is it ascertainable what proportion of the sum paid was intended to cover those taxes more, and those taxes less, than two years old. It seems impracticable to separate these three items and appears that if such discrimination were undertaken on the part of the court it would amount to an attempt to rewrite the contract. Therefore, the decree so far as it cancels the contract is affirmed with directions to provide for refund to the appellant amounts paid under it after deducting amounts received by him from individual taxpayers or lienors subsequent to the execution of the contract, or the reimbursement by him of the amounts received in excess of the sum paid to the city if that proves to be the case.

BROWN, C. J., WHITFIELD, CHAPMAN, and ADAMS, JJ., concur.

TERRELL and BUFORD, JJ., dissent in part.

WHITFIELD Justice (concurring with opinion of Mr. Justice THOMAS).

This appeal is from a decree for the plaintiffs. An opinion signed by the Circuit Judge and filed in this cause in the trial court contains the following:

'This is a suit brought by the plaintiffs as citizens and taxpayers of the City of Fort Lauderdale to set aside and cancel the sales of tax certificates and improvement liens of said City made to P. V. Burns as agent on October 18, 1938, and November 4, 1938. The sale of October 18, 1938, involved certificates on 7033 lots or parcels of land, and an undetermined number of improvement liens. The sale of November 4, 1938, involved certificates on 6024 lots or parcels and an undetermined number of improvement liens. The sales also included the City taxes on said lands for 1938 amounting to $18,109.93. The total actual face value of the certificates was $477,976.33 and the amount of the improvement liens was $258,589.41 plus accrued interest for a number of the years. Under the discount plan adopted by the City the alleged principal of the improvement liens collectible at the time of the sale was $64,612.94. The purchase price of $11,000.00 on the October 18th bid and $1,600.00 on the November 4th bid was paid prior to the beginning of this suit.'

Chapter 15208, Sp.Acts of 1931, contains the following:

'That the City of Fort Lauderdale is hereby granted the authority and right to sell and dispose of all tax certificates which may have heretofore been issued by said City or which may hereafter be issued by said City for the non-payment of its taxes and which may be held and owned by said City and which have been issued for a period of Two (2) years or more upon such terms and conditions as may be fixed and determined by the City Commission of said City. Nothing herein contained shall be construed to affect the power of said City to sell its tax certificates at par, with accruals of interest and penalties prior to the expiration of said two year period.' Sec. 1.

The quoted statute clearly does not purport to authorize the sale of 'improvement liens' that are distinct from 'tax certificates'. Nor are unpaid taxes subsequent to those included in tax sale certificates covered by Chapter 15208. Tax sale certificates more than two years old may be sold under statutory authority at a discount only when all due efforts have been made and demonstrate that full face value or at least a larger price than that offered cannot reasonably be anticipated by a consideration of the value of the lands and the paramount liens on the land with other pertinent facts and circumstances in the interest of all the taxpayers and the required equality of burdens. No such restriction is contained in Chapter 15208.

The statute in this case merely authorizes the sale of tax certificates 'upon such terms and conditions as may be fixed and determined by the City Commission of said City;' there being no standard stated even of reasonableness to guide the city commission in this matter vitally affecting rights of all taxpayers and the requirement for uniformity in imposing tax burdens; and particularly the express statutory right to redeem the land, before tax deeds are issued which is seriously impaired if not defeated by the sale of tax certificates en masse for a relatively small lump sum that has no proportionate relation to the amounts stated in any tax sale certificate. Authority to sell en masse for a lump sum is not contemplated by the constitution or conferred by the statute. See Secs. 985 (770), 992 (775) C.G.L.; Chap. 17457, Acts of 1935.

In Hoadley v. City of Tarpon Springs, 99 Fla. 130, 125 So. 912, it was held that a statute was invalid under which municipal tax sale certificates, including liens less than two years old, were sold en masse at a discount.

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