Charleston Heights Co. v. City Council of Charleston

• Decision Date: 15 December 1926
• Docket Number: 12124.
• Citation: 136 S.E. 393,138 S.C. 187
• Parties: CHARLESTON HEIGHTS CO. v. CITY COUNCIL OF CHARLESTON.
• Court: South Carolina Supreme Court

136 S.E. 393

138 S.C. 187

CHARLESTON HEIGHTS CO. v. CITY COUNCIL OF CHARLESTON.

No. 12124.

Supreme Court of South Carolina

December 15, 1926

Appeal from Common Pleas Circuit Court of Charleston County; S.W. G Shipp, Judge.

Suit by the Charleston Heights Company against the City Council of Charleston to set aside a sale for taxes of certain property. Decree for defendant, and plaintiff appeals. Decree reversed, and cause remanded for judgment in favor of plaintiff.

Ficken & Erckmann, of Charleston, for appellant.

John I Cosgrove, of Charleston, for respondent.

COTHRAN J.

This is an action to set aside a sale for taxes, of certain property belonging to the plaintiff, by the city council of Charleston, in December, 1924. The ground of the relief sought is that, at the time of the sale, the city council had no lien upon the property for city taxes; that it never had any lien, but, if any ever existed, its duration had then expired.

The case was tried by his honor, Judge Shipp, upon an agreed statement of facts. He filed a decree, dated June 19, 1925, dismissing the complaint. From that decree the plaintiff has appealed.

It appears that the property in question, Nos. 10 and 12 Hayne street, in the city of Charleston, was owned by the Evelyn Real Estate Company during the years 1920, 1921, and 1922. The property was duly assessed for city taxes and the same were levied for the years mentioned, by the city authorities. Not having been paid as required, tax executions were issued therefor and were placed in the hands of the city sheriff for collection, as follows: For the year 1920, on December 5, 1920; for the year 1921, on December 4, 1921; and for the year 1922, on December 27, 1922. No attempt was made to enforce these executions until the fall of 1924, as will be seen. On June 20, 1924, the Evelyn Real Estate Company conveyed the premises to the plaintiff, Charleston Heights Company. In September, 1924, the city proceeded to advertise the property for sale, under the executions for the three several years stated. The plaintiff protested against the sale upon the ground that the city's lien for the taxes had then expired. The sale was withdrawn for the time, but in November the property was readvertised for sale under the same executions, and on December 8, 1924, over the formal written protest of the plaintiff, it was sold and bid off the city, which has threatened to take possession of the property under its tax sale title. On January 9, 1925, the plaintiff instituted this action for the purpose stated above, claiming that the proceedings taken by the city constituted a cloud upon its title.

The plaintiff claims, as stated, that, at the time of the levy and sale under the tax executions, the lien of the city council, provided for in the act of 1878, had expired under the express provisions of that act and the ordinance of 1881, adopted in pursuance thereof, which limited the duration of the lien to two years from the date of the imposition of the several taxes.

The Act of 1878 (16 St. at Large, p. 725) vests the city council of Charleston with the power to make any tax thereafter imposed by them, a lien paramount to all other liens except taxes imposed by the state, and that "the said lien shall remain as a paramount lien for the term of two years." The act also provides the manner in which the taxes shall be entered upon the books of the city council in order that the lien may exist. (No question arises in reference to this portion of the act; it is referred to only to show that the lien is authorized by the act, its creation is regulated by the act, and its duration is fixed.) Manifestly, the inception of the lien is the date of the imposition of the tax, and its limitation is two years from that date.

Pursuant to this act, the city council passed an ordinance in the year 1881, providing for the lien authorized by the act, and in practically the identical terms fixing specifically the inception and duration of the lien as "for the term of two years from the date of the levy of the tax."

And in the ordinances for the years 1920, 1921, and 1922, levying the city taxes, the duration of the lien was similarly limited to two years.

As will hereinafter be shown, the existence of a lien upon the property taxed is obliged to be referable to some constitutional or statutory provision; it cannot exist without it. If so, it appears to be too clear for argument that, when so provided, the nature of the lien, the property upon which it is fastened, and the duration of the lien are necessarily controlled by the authority providing for the lien. The act of the General Assembly, the ordinance of the city passed in pursuance of it, and the annual ordinances of the city levying taxes, specifically limiting the duration of the lien to two years from the imposition of the taxes, it follows that the lien dies with the expiration of the temporal limitation; and in the case at bar, unless there be some law which relieves the lien from "this body of death," it has passed beyond life and beyond resurrection.

The defendant, conceding the fact of the two-year limitation in the act and in the ordinances, contends that the lien existed at the time of the levy independently thereof, for the following reasons:

(1) That, under the Constitution (article 8, § 6), municipalities are vested with "power to assess and collect taxes for corporate purposes," which authority carried with it by implication, a lien upon property subject to the tax.

(2) That, under the Act of December 17, 1894, amending the charter of the city of Charleston (21 St. at Large, p. 1103), the defendant was authorized to adopt and did adopt "such of the state legislation heretofore enacted or hereafter to be enacted, as they may deem expedient and, as may be applicable, with reference to the enforcement and collection of state and county taxes," giving it a lien for 10 years.

(3) That, under section 2950, Civil Code 1912, and amendments, of force when the taxes in question were laid, the city council had a lien for unpaid taxes, as a paramount lien over all other liens except for state taxes until paid.

(4) That executions were duly issued for said taxes and lodged with the city sheriff for collection, by sale if necessary, and that the city council thereby had a general lien upon the property subject to the taxes.

(5) That, under the statutes of this state, the defendant, for and on behalf of the state, held a lien for unpaid and delinquent school taxes for the years in question, coupled with which lien was that of the defendant for taxes for general corporate purposes.

(6) That when the Evelyn Real Estate Company conveyed the property in question to the plaintiff, the former was insolvent and that, under section 103 of the Revised Ordinances of the city of Charleston, the lien of the defendant for unpaid taxes was a paramount lien upon the property.

(7) That the plaintiff is merely a holding company for the mortgagee whose mortgage was satisfied by the conveyance mentioned, that the mortgage gave the mortgagee the privilege of paying the taxes upon the property which it did not avail itself of, and that said mortgagee and the plaintiff, its holding company, are estopped now from asserting any invalidity in said taxes or executions or lien.

In his decree, his honor, Judge Shipp, based his conclusion solely upon the ground that the lien of the city council for the taxes existed as a general lien, by virtue of the issuance and lodgement of the tax executions with the city sheriff for collection by levy and sale, if necessary. He declared:

"It is my opinion, therefore, that the executions for the unpaid taxes in question carried their own general lien, commencing at the time of the filing of the executions in the office of the city sheriff, and of force and effect as a lien on the property affected by the taxes superior and prior to all subsequent incumbrances, transfers, and liens, but secondary to all existing and superior incumbrances. It follows, therefore, that the city of Charleston, upon lodgment of these executions in the city sheriff's office, had a general lien on the property affected by the executions, which carried with it the right to sell its equity in the property levied on in the hands of the owner or purchaser thereof. It naturally follows that, under the general lien of the executions themselves, even in the absence of a paramount statutory lien, the city had a right to sell the property of plaintiff to satisfy such general liens,"

-declining to pass upon the other grounds taken by the defendant to sustain the sale.

The respondent, however, by proper notice of motion to sustain the decree, has presented the additional grounds:

(1) That the city council had a paramount lien for the taxes in question on plaintiff's property for a period of 10 years, in addition to the general lien created by the lodgement of the executions with the sheriff, as held by his honor, Judge Shipp.

(2) That, under the act of 1894, the city council was authorized to adopt and did adopt the state legislation upon the subject, and thereby acquired a lien for city taxes for the same duration as that of the state for its taxes.

(3) That, as the state had a lien for school taxes, the city council, for and on behalf of the state, had such a lien and had the right to tie such lien, a lien of its own for city taxes.

So that the questions to be determined by this appeal arise out of the several contentions based upon the conclusion of his honor, Judge Shipp, and the sustaining grounds of the respondent.

The first contention of the defendant is that, under the Constitution (article 8, § 6), municipalities are vested with "power to assess and...