Camden v. The Fink Coal

• Decision Date: 13 November 1928
• Docket Number: (No. 6137)
• Court: West Virginia Supreme Court
• Parties: Wilson Lee Camden v. The Fink Coal & Coke Company

106 W.Va. 312

Wilson Lee Camden

v.The Fink Coal & Coke Company

(No. 6137)

Supreme Court of Appeals of West Virginia.

Submitted October 30, 1928.

Decided November 13, 1928.

1. Taxation Surface Owner, Paying Taxes Assessed in Fee

Against Coal Land, Held Entitled to be Subrogated to Rights of Taxing Power as for Payment of "Debt."

A tract of coal land is assessed in fee against the surface owner who pays all the taxes thereon. Held: the surface owner is entitled to be subrogated to the rights of the taxing power against the coal. (p.. 313.)

2. Equity Cidpable Negligence May Bar Equitable Relief

Against One Free From Fault; Negligence Does Not Defeat Equitable Relief When Both Parties Are Equally at Fault, and Defendant Has Not Been Prejudiced.

Culpable negligence may bar equitable relief against one free from fault. Negligence will not preclude relief, however, when both parties are equally at fault and the defendant has not been prejudiced thereby. (p. 315.)

3. Same Delay Alone Does Not Constitute "Laches," But Must

Place Another at Disadvantage.

Delay alone does not constitute laches; it is delay which places another at a disadvantage. (p. 316.)

Appeal from Circuit Court, Gilmer County.

Suit by Wilson Lee Camden against the Fink Coal & Coke Company. Decree for plaintiff, and defendant appeals.

Affirmed.

R. F. Kidd, for appellant.

B. W. Craddock, for appellee.

Hatcher, Judge:

The plaintiff, who is a resident of the state of Maryland, owns several tracts of land in West Virginia. In June, 1903, he granted to John M. Core the coal underlying a tract of 64 acres on Finks creek in Gilmer county. A few weeks later Core conveyed the same coal to the defendant. No transfer of this coal to defendant was made on the land books until 1919. From 1903 to 1918 inclusive, the plaintiff was charged with and paid the taxes on the fee of the 64 acres. He obtained in this suit a lien against the coal for the proportionate part of the taxes paid by him which properly should have been charged to the defendant.

The defendant contends that a tax is not a debt and therefore this is not a ease for subrogation, citing Hogg's Eq. Principles, sec. 417. That author relies on Hinchman v. Morris, 29 W. Va. 673, which fully supports the text. Subrogation of a sheriff to the rights of the state, because of taxes he had advanced for others, was there refused on the theory that taxes were not debts under the Virginia Code of 1860. That decision, however, is limited by specific declaration to the status of taxes under that Code. See pages 683, 685-6-7. Shortly after the separation of this state from Virginia a statute was passed giving the sheriff the same remedies for taxes paid by him, as if the taxes had not been so advanced; and sometime later the Legislature authorized a tax collector to proceed by appropriate action or suit against the person liable for taxes "in the name of the state, in any court of law or equity, or before any justice of the peace having jurisdiction." See sections 33 and 34, Ch. 30, Code, 1923. The decision in Hinchman v. Morris, points out certain differences between the essential qualities of a tax and a debt. Taxes have been invested by legislative action with several of the characteristics of a debt there listed. A few distinctions yet remain, but the grudging admission of an older decision that a tax was in "the nature of a debt" (McIrney v. Beed, 23 Iowa 410, 414) has ripened into the present popular conception that a tax is an obligation the taxpayer owes (see note 42 Am. St. Rep., 656), and that where a statute imposes personal liability for a tax, the tax becomes, in a broader sense, a debt. While adhering to the legal technical exclusion of taxes from the meaning of the word debt, the Supreme Court, of California stated in Perry v. Washburn, 20 Cal. 318, 350: "The term debt, it is true, is popularly used in a far more comprehensive sense, as embracing not merely money due by contract, but whatever one is bound to render to another whether from contract or the requirements of law." And in the later case of Gas Company v. Brickwedel, 62 Cal. 641, 645, it was held that where the law made the payment of taxes a personal obligation, then a tax became a debt in "the larger sense" within the meaning of the statute. "The effect of our statutes and decisions is to make the tax on land a debt of the owner of the land, secured by a statutory lien, the debt and lien being treated as other debts and liens." Nashville v. Cowen, 78 Tenn. 209, 213. A tax is "a debt in the higher sense of the word." State v. Georgia Company, 112 N. C. 34, 37. "A tax is nothing more than a debt due by the citizen to the taxing power." Shermerhorns Ex. v. Commonwealth, 107 Va. 707. In line with the modern trend this Court in Woodyard v. Sayre, 90 W. Va. 295, 299, after comparing Hinchman v. Morris and allied cases with our statutes, concluded: "It is quite manifest that these provisions of the statute materially altered the rights of the sheriff as collector of taxes, and make taxes debts for which the officer may now sue and obtain judgment or decree, and that he may enforce the lien thereof given by statute at least on the personal estate of the tax payer, and that if the law had been then as it is now, the decisions in the cases cited, as well as that of Myers v. Miller, 45 W. Va. 595, would have been different."

Hinchman v. Morris was written in 1887. Since then the law of subrogation has been greatly expanded. 25 R, C. L. 1322-3. It is now conceded that there is nothing in the nature of a lien for taxes to prevent the application of the equitable doctrine of subrogation where that doctrine would otherwise apply. Title Co. v. Haven, 196 N. Y. 487, 494-5. And it is generally held that one possessed of a real or apparent interest in property who pays taxes thereon to protect it taxes for the payment of which another is justly bound is entitled to subrogation to the right of the taxing power. 25 R. C. L. 1366; In re Hominy Co., 294 Fed. 921, 925. This holding is thoroughly in accord with the fundamental doctrine of subrogation which has been stated to be "broad enough to include every instance in which one party pays a debt for which another is primarily answerable, and which in equity and good conscience should have been discharged by the latter." McNeil v. Miller, 29 W. Va. 480, 483; Bassett v. Straight, 78 W. Va. 262, 266; Fidelity & Guar. Co. v. Trust Co., 95 W. Va. 458, 462.

We are aware that some courts have refused subrogation where payment of taxes is made under a mistake, as in this case. See Iowa Homestead Co. v. By. Co., 17 Wall 153, and Carr v. Stewart, 58 Ind. 581, 583. The decisions in that line of cases are due to the doctrine that such a payment is voluntary and for that reason cannot be recovered. That doctrine does not prevail in this state. Neely v. Jones, 16 W. Va 625; Crumlish Admr. v. Imp. Co., 38 W. Va. 390; Ins. Agency v. Ins. Co., 69 W. Va. 129; Marinack v. Blackburn, 93 W. Va. 585, 590-1. Besides the plaintiff cannot be considered a mere volunteer. He was the owner of the surface of the 64 acres. He was entitled to pay the taxes on the fee charged in order to protect his lesser interest. Cooley Taxation, 4th ed., sec. 1260.

Defendant says relief should be denied the plaintiff, because of his negligence in not having the coal properly charged. Culpable negligence may bar equitable relief against one free from fault. But the negligence of the plaintiff in this respect must be shared by the defendant, as it was the latters duty to have the coal charged to it. Here is a mutual mistake arising from mutual negligence. Relief...