Continental & Commercial Trust & Savings Bank v. Werner
| Decision Date | 23 April 1923 |
| Citation | 215 P. 458,36 Idaho 602 |
| Parties | CONTINENTAL & COMMERCIAL TRUST & SAVINGS BANK, Appellant, v. WILHELMINA WERNER, GOODING COUNTY, IDAHO, et. al., Respondents |
| Court | Idaho Supreme Court |
Action to foreclose Carey Act contract. Judgment for defendant Gooding County. Affirmed.
Judgment affirmed. Costs awarded to respondent. Petition for rehearing denied.
Walters Parry & Bailey, Paul S. Haddock and E. D. Reynolds, for Appellant.
The Carey Act statutes provided that the lien of the Carey Act water contract is a first and prior lien. (C. S., sec. 3019.)
The revenue laws regarding the lien for taxes applicable to the case at bar do not provide that the tax lien is a first and prior lien. (1913 Sess. Laws, p. 173.)
The legislature has the power to declare that a tax lien shall take precedence over and become prior to other liens, but if the legislature fails to do so, then such tax lien takes no precedence over any other lien.
A Carey Act construction company cannot in foreclosure of its water contract protect itself for any sum paid out for taxes but can only bid in the property for the amount due on the deferred payments as shown by the water contract. (C. S., sec. 3023.)
The holder of a tax deed to Carey Act property "stands in the shoes" of the original entryman. (Bennett v. Twin Falls North Side Land & Water Co., 27 Idaho 643, 150 P. 336.)
M. F. Ryan and A. F. James, for Respondent, Gooding County.
All taxes shall be a lien upon the property assessed and shall only be discharged by the payment, cancelation or rebate of the taxes as provided in this act. (1913 Sess. Laws, pp. 173, 174.)
Such or similar language has been interpreted by other courts. (Mutual Ben. L. Ins. Co. v. Siefken, 1 Neb. Unof. 860, 96 N.W. 603; Eaton's Appeal, 83 Pa. 152.)
Priority of the lien for taxes will be implied where the legislative intent to give such priority can be gathered from the act. (Osterberg v. Union Trust Co., 93 U.S. 424, 23 L.Ed. 964; Parker v. Baxter, 2 Gray (Mass.), 185; Morey Engineering Co. v. St. Louis Art. Ice Rink Co., 242 Mo. 241, Ann. Cas. 1913C, 1200, 46 S.W. 1142, 40 L. R. A., N. S., 119; Campbell v. Gawlewicz, 3 Neb. Unof. 321, 91 N.W. 569; Doremus v. Cameron, 49 N.J. Eq. 1, 22 A. 802; Snyder v. Mogart, 5 Pa. Dist. Ct. 148; Minnesota v. Central Trust Co., 94 F. 244, 36 C. C. A. 214; Carsten & Earles, Inc., v. City of Seattle, 84 Wash. 88, 146 P. 381.)
All property is liable to taxation unless expressly exempted. (Secs. 2, 3, and 5, art. 7, Const. Ida.; sec. 1, Sess. Laws 1913, p. 173.)
The appeal from the judgment in this case was dismissed, because it appeared from the record that it had been taken after the expiration of the statutory time. (See foregoing opinion.) Thereafter a petition for rehearing was filed on behalf of appellant, from which it was made to appear that the court had been misled by a clerical error in the preparation of the record on appeal, and that in fact the appeal had been taken in ample time. The petition was accordingly granted, and the case is now for consideration on the merits.
This action is one to foreclose a Carey Act water contract on land in Gooding county. The defendant, Wilhelmina Werner, was duly served but defaulted and judgment was entered against her. Respondent entered its appearance and a stipulation of facts was entered into between the parties, upon which the cause was tried by the court. Respondent was awarded judgment, from which this appeal is prosecuted.
There is but one question involved, namely, whether the lien of a Carey Act contract is first and prior to a lien for taxes. It is stipulated that the land was patented and subject to taxation; that taxes were properly levied for the years 1915 and 1916 and that the same were unpaid. The contract between the Twin Falls North Side Land & Water Company and Wilhelmina Werner was entered into on the 25th day of May, 1908, and was thereafter assigned to appellant.
In order to determine the priority between the lien of a Carey Act contract and a lien for taxes it will be necessary to construe a portion of what is commonly known as the Federal Carey Act (6 F. Stats. Ann. 398, 8 F. Stats. Ann., 2d ed., 701; 29 Stat. L. 434, and C. S., secs. 3019 and 3097).
6 F. Stats. Ann. 398 (29 Stat. L. 434) provides, among other things, that:
" . . . . a lien or liens is hereby authorized to be created by the state to which such lands are granted and by no other authority whatever, and when created shall be valid on and against the separate legal subdivisions of land reclaimed, for the actual cost and necessary expenses of reclamation and reasonable interest thereon from the date of reclamation until disposed of to actual settlers."
It will be observed that no priority of liens is authorized by the federal statute but power is given to states, availing themselves of the provisions of the Carey Act, to create liens upon Carey Act lands and water furnished therefor, in favor of any person, company or association, contracting with the state for the reclamation of such lands. Idaho accepted the Federal Carey Act and in accordance therewith, in C. S., sec. 3019, made the following provision with reference to the lien of a Carey Act contract:
"Any person, company or association, furnishing water for any tract of land, shall have a first and prior lien on said water right and land upon which said water is used, for all deferred payments for said water right; said lien to be in all respects prior to any and all other liens created or attempted to be created by the owner and possessor of said land; said lien to remain in full force and effect until the last deferred payment for the water right is fully paid and satisfied according to the terms of the contract under which said water was acquired."
Appellant relies upon the provisions of the foregoing section to support his contention. C. S., sec. 3097, upon which respondent relies, provides:
"All real and personal property subject to assessment and taxation must be assessed at its full cash value for taxation for state, county, city, town, village, school district and other purposes . . . . and all taxes levied under the provisions of this chapter, shall be a lien upon the property assessed, and a lien upon any other property of the owner thereof . . . . and shall only be discharged by the payment, cancelation or rebate of the taxes as provided in this chapter."
Under C. S., sec. 3019, supra, the only liens to which the lien of a Carey Act contract is superior are those created or attempted to be created by the owner and possessor of the land and this is not a limitation upon the power of the sovereign to...
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... ... 899; ... Scandinavian-American Bank v. King County, 92 Wash ... 650, 159 P. 786.) ... (Osterberg v. Union Trust Co., 93 U.S. 424, 23 L.Ed ... 964; Parker v ... mina ... Werner, was duly served but defaulted and judgment was ... ...