Coy v. Title Guarantee & Trust Co.

• Decision Date: 12 May 1919
• Docket Number: 3209.
• Citation: 257 F. 571
• Parties: COY v. TITLE GUARANTEE & TRUST CO. et al.
• Court: U.S. District Court — District of Oregon

257 F. 571

COY v. TITLE GUARANTEE & TRUST CO. et al.

No. 3209.

United States District Court, D. Oregon.

May 12, 1919

W. C Bristol, of Portland, Or., for receiver.

L. A Liljeqvist, of Marshfield, Or., for Coos County.

WOLVERTON District Judge.

On October 22, 1918, Coos county and W. W. Gage, sheriff thereof, were permitted, by order of this court, to implead R. S. Howard, Jr., as receiver of the Title Guarantee & Trust Company, in this cause, respecting certain litigation pending in the state court relative to state, county, and municipal taxes assessed for the years 1907 to 1912, inclusive, against certain real property situated in Coos county, in which R. S. Howard, Jr. as such receiver, claims an interest.

On and prior to April 30, 1904, F. B. Waite, L. D. Kinney, and J. N. Shahan were indebted to the Title Guarantee & Trust Company in the sum of $54,091.70, for which they had given their notes. On and prior to said April 30, 1904, John K. Kollock became vested, by deeds duly and regularly executed, with the title to certain lands theretofore included in what was known as the 'Rice trust,' with power to sell the same to satisfy out of certain of the proceeds the indebtedness due the Title Guarantee & Trust Company. As determined by the Supreme Court of this state, in the case of Kollock v. Bennett, 53 Or. 395, 401, 100 P. 940, 942 (133 Am.St.Rep. 840), the deeds to Kollock were intended to transfer a complete title, and, as the court says:

'It was fully understood at the time of the execution thereof that he (Kollock) should have full power to sell the property, execute deeds to purchasers, and apply the proceeds in cancellation of the Title Guarantee & Trust Company's claims, and account to his grantors for any sum remaining. By virtue of these transactions, respondent became, not a mortgagee, but a holder of the legal title, and liable only to account as trustee for the proceeds of sales from the property when made, and entitled to maintain a suit in his own name with reference thereto.'

As it respects the real property a brief description of which is set forth in Exhibit A to the petition and report of R. S. Howard, Jr., receiver, filed in the above-entitled matter December 6, 1917, it was assessed by the assessor of Coos county to John K. Kollock for the years 1907 to 1912, inclusive-- possibly in some instances to John K. Kollock and F. B. Waite, and in others to Kollock and L. D. Kinney. The taxes levied in pursuance of these assessments became delinquent on the 1st of April of the year following the respective assessments. After the expiration of more than three years after the taxes became delinquent for each year, the sheriff and tax collector for Coos county issued to Coos county certificates of delinquency in the manner provided by law. Subsequently, but within six years after the taxes became delinquent for each year, proceedings were instituted by Coos county to foreclose the liens for such taxes. There were five proceedings in all; the first involving the taxes for the years 1907 and 1908, and the other four involving the taxes, respectively, for the years 1909, 1910, 1911, and 1912.

Three questions are insisted upon by the receiver of the Title Guarantee & Trust Company, and are involved by the present controversy, namely:

First. Whether the proceedings in the state court to foreclose the alleged tax liens are inoperative and void, as it affects the receiver in this court, by reason of the fact that such receiver was not made a party to such foreclosure proceedings.

Second. Whether any of such proceedings are barred by reason of the property incumbered by the tax lien not having been sold within six years from the date of the original delinquency, in pursuance of section 65 of the act of the Legislative Assembly of 1907 (chapter 267, Session Laws 1907); and

Third. Whether such proceedings could be lawfully maintained without first obtaining leave of this court in the Title Guarantee & Trust Company receivership matter to institute the same.

We will treat of these in their order. The statute, in case of foreclosure of tax liens by the county, declares that all persons interested in any of the property involved in such proceeding may be made codefendants in the action. It then further provides that--

'The names of the person or persons appearing on the tax roll in the hands of the tax collector for collection at the date of the first publication of such notice as the owner or owners of said property shall, for the purpose of this section, be considered and treated as the owner or owners, of said property. ' Section 3698, Lord's Oregon Laws.

It is further provided that, in all judicial proceedings of the kind, no assessment of property or charge for any of said taxes shall be considered illegal on account, among other things, of the property having been charged or listed in the assessment or tax roll without any name, or with any other name than that of the owner. Section 3701, Lord's Oregon Laws.

The property in the main, at least so far as it pertains to this controversy, was assessed to John K. Kollock individually, but possibly in some instances to John K. Kollock and F. B. Waite, and perhaps in some instances to L. D. Kinney also. In no instance was the property assessed to John K. Kollock, trustee. And we may assume that such was the state of the tax rolls in the hands of the sheriff for collection at the date of the first publication of notice in each of the several tax proceedings.

Construing the first of the above-cited sections, it simply means that when the proceedings are carried on in behalf of the county to foreclose the tax liens, all persons interested in any of the property involved may be made parties codefendant; that is to say, the county (but not an individual), where it is proceeding to foreclose, may join as codefendants all persons interested in any of the property involved. But, in order to determine who those parties codefendant shall be, one must look to the succeeding clause, being the one above quoted. They are to be the persons whose names appear on the tax roll in the hands of the sheriff for collection at the date of the first publication of such notice. Thus the parties to be made codefendants may not necessarily be the parties to whom the property was primarily assessed. The property in the meanwhile-- that is, between the time of assessment and the time of the first publication of notice-- may have changed hands or ownership, and it is incumbent upon the county to look to the tax roll in the hands of the sheriff at the date of the first publication to determine where the present ownership lies. The information thus gained from such tax roll furnishes the date for determining who are the parties interested, and consequently who are to be made parties codefendant in the proceeding. The parties whose names appear on the tax roll then in the hands of the sheriff as owners are, for the purposes of the proceeding, to be considered and treated and are to be deemed the owners of the property involved. In other words, they are to be deemed the 'interested' parties, and all such...