Federal Land Bank of Spokane v. Bissonnette

• Decision Date: 22 October 1931
• Docket Number: 5716
• Citation: Federal Land Bank of Spokane v. Bissonnette, 51 Idaho 219, 4 P.2d 364 (Idaho 1931)
• Parties: THE FEDERAL LAND BANK OF SPOKANE, a Corporation, Appellant, v. E. F. BISSONNETTE et al., Respondents
• Court: Idaho Supreme Court

4 P.2d 364

51 Idaho 219

THE FEDERAL LAND BANK OF SPOKANE, a Corporation, Appellant, v. E. F. BISSONNETTE et al., Respondents

No. 5716

Supreme Court of Idaho

October 22, 1931

WATER AND WATERCOURSES-WATER ASSESSMENTS-LIENS, ENFORCEMENT OF-LACHES-EQUITY.

1. Generally, mere delay in asserting right does not bar its enforcement in equity, unless enforcement is barred by statute of limitations.

2. Circumstances of each case must govern courts of equity in permitting defense of laches to be made.

3. Defense of laches does not apply where unnecessary to protect adverse party from being placed in worse condition than he would have been in had action been prosecuted with greater diligence.

4. Prior lienholder need not enforce lien for benefit of subsequent lienholder.

5. Mortgagee, claiming injury from delay in enforcing water assessment liens, was charged with knowledge of unpaid taxes and of interest rate on unpaid water assessments, which mortgagee could have paid.

6. In mortgage foreclosure proceeding, water company held not precluded by laches from asserting priority of water assessment liens to mortgage lien, no injury being shown.

APPEAL from the District Court of the Eleventh Judicial District for Twin Falls County. Hon. William A. Babcock, Judge.

Suit to foreclose mortgage. From that portion of decree refusing to subordinate statutory water assessment liens to the mortgage lien, on account of laches, plaintiff appeals. Affirmed.

Decree affirmed. Costs to respondent.

Bissell & Bird and Arthur W. Ostrom, for Appellant.

The unprecedented delays on the part of respondent in foreclosing its maintenance liens, resulting in substantial injury and damage to appellant, constitute lack of diligence and laches. (Just v. Idaho Canal Co., 16 Idaho 639-653, 133 Am St. 140, 102 P. 381, 385; 10 R. C. L. 396; 21 C. J. 231 232.)

It was laches and lack of diligence for respondent to remain passive while taxes, maintenance liens and unusually high interest accumulated against the land. (21 C. J. 232, citing authorities.)

James R. Bothwel and W. Orr Chapman, for Respondents.

In the case of a Carey Act operating company which is actually controlled by the water users themselves, the lien of maintenance and operation assessments is first and prior to all other liens save taxes upon the land to which the water and water right is appurtenant or upon which it was used. (C. S., sec. 3040; 1925 Sess. Laws, chap. 107; Carlson-Lusk etc. Co. v. Kammann, 39 Idaho 654, 229 P. 85.)

In considering the question of laches each case must be determined according to its own particular circumstances and no one decision constitutes a precedent in the strict sense for another. In legal significance laches may be said to be, not mere delay or lapse of time alone, but unreasonable, unwarranted and unexcused delay, which together with other circumstances in the case satisfactorily shows an abandonment of the cause, or an unreasonable delay and an injury to another not responsible for the delay, such that it would be inequitable to permit the party responsible for the delay to be preferred on his legal rights. (Smith v. Faris-Kesl Const. Co., 27 Idaho 407, 150 P. 25; 21 C. J., p. 217, sec. 217; Northern P. R. Co. v. Boyd, 177 F. 804, 101 C. C. A. 18; Id., 228 U.S. 482, 33 S.Ct. 554, 57 L.Ed. 931; Lesser v. Reeves, 142 Ark. 320, 219 S.W. 15.)

VARIAN, J. Lee, C. J., and Budge, Givens and McNaughton, JJ., concur.

OPINION

VARIAN, J.

Appellant brought this suit to foreclose a mortgage on real estate situate in Twin Falls county, on April 18, 1930. The court decreed foreclosure but decreed certain unpaid water assessments due respondent, Twin Falls Canal Company, levied for the years 1921, 1922, 1923, 1924, and 1926, aggregating the sum of $ 500.30, including interest, to be superior to the lien of appellant's mortgage as claimed by cross-complaint. From that portion of the decree in favor of said respondent plaintiff appeals. The only question presented by this appeal is, did the court err in decreeing the water assessment liens to be prior to that of appellant's mortgage? Appellant does not contest the priority awarded for the assessments levied for the years 1928 and 1929, aggregating $ 31.90.

On April 8, 1918, Bissonnette and wife executed their note to appellant for the principal sum of $ 1400, payable in semiannual amortized payments of $ 45.50 over a period of years, the last payment falling due October 8, 1952. This note was secured by mortgage of even date therewith upon forty acres of land in Twin Falls county, Idaho. Bissonnette defaulted in his payments, after making the twenty-second in October, 1929, and failed to pay state and county taxes assessed against the property for the years 1926, 1927, and part of 1929, afterwards paid by appellant. He likewise defaulted in the payment of the water maintenance assessments due respondent, Twin Falls Canal Company, for the years 1921, 1922, 1923, 1924, 1926, 1928 and 1929.

Said respondent is a Carey Act operating company and the mortgaged lands are within the project for which it functions. There is no question raised as to the amounts for which respondent claims prior liens but appellant contends that, due to the laches of respondent in prosecuting its suits for foreclosure thereof, it has lost its priority and should have its liens for the above-mentioned years, except 1928 and 1929, declared subsequent to the lien of appellant's said mortgage.

It is not controverted that respondent filed its notices of claim of lien against the mortgaged premises, within the statutory time, in the office of the county recorder of Twin Falls county, for the delinquent assessments for each of the years above mentioned, and thereafter, within the time limited by statute, commenced its suit to foreclose the same in the proper court. Lis pendens was also recorded for each suit. Summons issued and was served upon some of the numerous defendants, and while appellant was made a party defendant in the foreclosure cases summons was not served upon it. Appellant is a nonresident, or foreign, corporation.

When suits were commenced the delinquent maintenance assessments for the year 1921, aggregated $ 149,458.65 for the year 1922, $ 104,676.55 for the year 1923, $ 24,348.36; for the year 1924, $ 8,744.16; and for the year 1926, $ 25,623.23. Of these amounts sued for, at the date of the trial of the instant case, there was uncollected of said amounts the following: For the year 1921, $ 1507.52; for the year 1922, $ 1501.33; for the year 1923, $ 425.10; for the year 1924, $ 921.80; and for the year 1926, $ 1323.51.

There is testimony that the years mentioned constituted a period of deflation on the Twin Falls tract and that the farmers were unable to pay their water assessments, or the banks to loan them money to pay them, particularly for the year 1921, when all loan companies operating in that section, except appellant, and business men on the tract, and farmers generally, requested the respondent canal company not to proceed with foreclosure proceedings, owing to prevailing unfavorable financial conditions. Loan companies generally, with the exception of appellant, requested that service of summons in the lien foreclosure cases be not made, in cases involving lands mortgaged to them, as they preferred to pay the assessments and so save the costs of foreclosure.

It was stipulated that no service of summons has been made in any of the cases involving the water liens for the years 1920, 1921 and 1922, since early September, 1924. And no service was made upon appellant in any of the cases.

The court found, among other facts, that since prior to the year 1921 the respondent, Twin Falls Canal Company, has been actually controlled by the settlers and owners of lands comprising the Carey Act project under which it functions. It further found that respondent Canal Company had proceeded with due diligence in the prosecution of its lien foreclosure suits and that they were not subject to dismissal for lack of prosecution as prayed in appellant's cross-complaint.

Appellant does not raise the constitutionality of C. S., sec. 3040, and the amendment thereof, Sess. Laws 1925, chap. 107, p. 153 and concedes in his brief that these provisions grant respondent "a first and prior lien, except as to the lien of taxes, upon the land to which such water and water rights are...