Elbert, Limited v. Gross

• Decision Date: 14 August 1953
• Citation: 260 P.2d 35,41 Cal.2d 322
• Court: California Supreme Court
• Parties: ELBERT, Ltd. v. GROSS. L. A. 22222.

Page 35

260 P.2d 35

41 Cal.2d 322

ELBERT, Ltd. v. GROSS.

L. A. 22222.

Supreme Court of California, in Bank.

Aug. 14, 1953.

Rehearing Denied Sept. 10, 1953.

Myron J. Glauber, Los Angeles, Alfred L. Armstrong, Hollywood, and Maurice J. Hindin, Los Angeles, for appellant.

John F. Bender, Compton, and Gizella M. Allen, Los Angeles, for respondent.

EDMONDS, Justice.

Elbert, Ltd., a corporation, sued to obtain a partition of certain real property. The appeal of Joseph M. Gross from a judgment in favor of Elbert presents for decision questions as to the validity of a tax deed.

The real property in controversy is an unimproved lot situated in the City of Los Angeles. In 1925, a street improvement bond was issued under the provisions of the Improvement Act of 1911. Stats.1911, p. 730, Deering's Gen.Laws, 1937, Act 8199, now Sts. & Hy. Code, Div. 7, §§ 5000-6794. The bond was foreclosed in 1946 and the property sold to one Sipe, who assigned his certificate of sale to the corporation. This certificate stated that the owner of the lot was 'unknown'.

In 1945, the State of California conveyed the land to Gross by a deed based upon the nonpayment of taxes. Gross also holds a certificate of sale from the city treasurer issued to him pursuant to the foreclosure of a street improvement bond dated in 1928.

After the expiration of the time within which the lot could have been redeemed from the sale in connection with the foreclosure of the 1925 bond, the city treasurer conveyed the lot to Elbert. At that time, Gross was the record owner of the property, and it has been stipulated that he was not served with notice of the corporation's application for a deed.

The present action for partition is based upon the theory that under the parity principle, Monheit v. Cigna, 28 Cal.2d 19, 168 P.2d 965, 167 A.L.R. 995; Elbert, Ltd. v. Nolan, 32 Cal.2d 610, 197 P.2d 537; Stafford v. Realty Bond Service Corp., 39 Cal.2d 797, 249 P.2d 241, Elbert and Gross are co-owners of the lot. Gross answered the complaint, denying the validity of the deed to Elbert and seeking by cross-complaint to quiet his title against the claims of the corporation. In the alternative, he sought an equitable lien against the proceeds of a partition sale for the amount of certain real property taxes and expenses paid by him in connection with the property.

By its judgment, the trial court declared that Gross and the corporation, as tenants in common, each own an undivided one-half interest in the lot. It directed a sale of the property and a division of the proceeds, after expenses of sale, allowing each party an equitable lien for certain claimed expenditures. The court also ordered that the certificate of sale held by Gross be canceled.

As grounds for reversal of the judgment, Gross contends that the corporation's failure to give notice to the record owner of its application for a deed of sale from the city treasurer rendered such deed invalid, and he claims the right to redeem the land. He also argues that the judgment erroneously failed to allow him a lien against the proceeds of the partition sale for the amount of the indebtedness stated by the certificate of sale to be due and unpaid upon the foreclosure of the 1928 bond. Finally, he takes the position that Elbert's complaint is defective in that not all the parties having an interest in the property are joined in the action.

The corporation asserts that Gross' right to object to the validity of the treasurer's deed now is barred by the statute of limitations. The lien arising from the foreclosure of the 1928 bond, it declares, was extinguished by the failure of Gross either to redeem the land or to purchase the prior lien upon foreclosure of the 1925 bond.

At the time this action was commenced, section 6550 of the Streets and Highways Code read in part as follows: 'In order to obtain a deed the purchaser of the property or his assigness shall, 30 days prior to the expiration of the time of redemption, or 30 days before the date of his application for a deed, serve upon the owner of the property purchased, or his agent if he is named in the certificate of sale and upon the party occupying the property, if the property is occupied, a written notice * * *. If the property is unoccupied, a similar notice must be posted in a conspicuous place upon the property'.

The corporation contends that such notice need be given only if the owner is named in the certificate of sale. Its position is that the clause, 'if he is named in the certificate of sale,' modifies both 'owner' and 'agent'. However, the clause and the word 'agent' both appear in the same part of the sentence and are separated from the word 'owner' by a comma. The evident purpose of such punctuation is to limit the qualifying clause to 'agent'. Giving support to this conclusion is the established rule that 'a limiting clause is to be confined to the last antecedent, unless the context or the evident meaning of the statute requires a different construction.' County of Los Angeles v. Graves, 210 Cal. 21, 26, 290 P. 444, 446; Hopkins v. Anderson, 218 Cal. 62, 65, 21 P.2d 560.

So construed, in its original form, section 6550 required notice to be served upon the owner of the property, unless the name of his agent appeared in the certificate of sale, in which case, service might have been made upon the agent instead of the owner. It is significant that when the section was amended in 1950, Stats. 1950, First Ex. Session, p. 515, and the word 'agent' omitted, the Legislature also deleted the clause 'if he is named in the certificate of sale'.

The corporation relies upon Elbert, Ltd. v. de Gaffey, 108 Cal.App.2d 388, 238 P.2d 1044, in which a contrary rule was stated. That decision was based upon the wording of section 74 ^* of the Improvement Act of 1911, Stats.1911, p. 730; as amended by Stats.1921, p. 292, the statutory predecessor of section 6550 of the Streets and Highways Code. Section 74 required notice to be served upon 'the owner or agent of the property purchased, if named in such certificate * * *.' The court construed the Streets and Highways Code as making no requirement for notice unless the name of the owner or his agent appeared in the certificate of sale. Although recognizing the clear import of section 6550, the court felt constrained to interpret the statute according to its construction of the predecessor section because the Code Commission was not vested with authority to, nor did it intend to, amend the Improvement Act.

From the wording of section 74 it could not be said with certainty whether the clause, 'if named in such certificate,' qualified owner, agent, or both. Section 6550, in its original and in its present form, makes clear the inapplicability of the qualifying clause to the word 'owner'. Under such circumstances, a legislative intent to clarify the existing law may be inferred. Bermite Powder Co. v. Franchise Tax Board, 38 Cal.2d 700, 704, 705, 242 P.2d 9; Coca-Cola Co. v. State Board of Equalization, 25 Cal.2d 918, 923, 156 P.2d 1; Standard Oil Co. v. Johnson, 24 Cal.2d 40, 48, 147 P.2d 577; Union League Club v. Johnson, 18 Cal.2d 275, 279, 115 P.2d 425.

The Legislature may amend existing laws by enacting codifications which substantially change the phraseology or punctuation of prior statutes. In re Trombley, 31 Cal.2d 801, 806, 193 P.2d 734; Scott v. McPheeters, 33 Cal.App.2d 629, 633, 92 P.2d 678, 93 P.2d 562. Section 2 of the Streets and Highways Code provides: 'The provisions of this code, in so far as they are substantially the same as existing statutory provisions relating to the same subject matter, shall be construed as restatements and continuations thereof and not as new enactments.' The phrase, 'in so far as they are substantially the same as existing statutory provisions', indicates that some changes were contemplated. The reasonable conclusion is that the legislative change in wording of section 6550 of the Streets and Highways Code from its predecessor section was to make it clear that the clause, 'if he is named in the certificate of sale', has reference only to 'agent'. The holding of the de Gaffey case to the contrary is disapproved.

Elbert also urges that section 6550 should be interpreted as dispensing with personal service upon the owner if, as in the present case, the property is unoccupied. It construes the qualifying clause, 'if the property is occupied', as applying to both 'owner' and 'party occupying the property'. So read, if the property were occupied, the section would require service of notice upon both the owner and occupant, but, if unoccupied land were to be conveyed, it would be sufficient if notice were posted.

No sound reason is suggested for making the owner's right to notice dependent upon occupancy. Furthermore, such interpretation of the section is contrary to the rule of statutory construction that a limiting clause should be confined to the last antecedent. County of Los Angeles v. Graves, supra; Hopkins v. Anderson, supra. The more reasonable conclusion is that the clause refers only to the occupant. So construed, it performs the very obvious function of eliminating the requirement of serving notice upon 'the party occupying the property' when it is unoccupied. In that case, notice may be posted upon the property. Thus the section insures that notice will be given both to the owner and to the person in possession or who may thereafter come into possession.

Although, if presented in a timely proceeding Elbert's failure to give notice might have invalidated the deed, Gross now is barred from asserting such defect. The present action was commenced more than 18 months after the city treasurer executed and delivered his deed to Elbert. Section 6571 of the Streets and Highways Code provides: 'Any action, suit or proceeding attacking or contesting the validity of any deed issued under the provisions of this division, or the validity of the proceedings subsequent...