Flansburg v. Shumway
| Decision Date | 01 June 1928 |
| Docket Number | 26333 |
| Citation | 219 N.W. 956,117 Neb. 125 |
| Parties | CLAUDE COPLEY FLANSBURG, APPELLANT, v. NETTIE SHUMWAY, EXECUTRIX, APPELLANT: FARMERS IRRIGATION DISTRICT ET AL., APPELLEES |
| Court | Nebraska Supreme Court |
APPEAL from the district court for Scotts Bluff county: EDWARD F CARTER, JUDGE. Affirmed.
AFFIRMED.
C. C Flansburg and B. M. Shumway, for appellants.
Raymond & Fitzgerald, contra.
Heard before GOSS, C. J., ROSE, GOOD, THOMPSON and HOWELL, JJ., and LANDIS and REDICK, District Judges.
Appellant here, plaintiff below, obtained a decree of foreclosure. There is no controversy over plaintiff's mortgage, the amount, or that it was due. Certain taxes were given priority over the mortgage lien. Plaintiff's appeal raises the questions of the existence of the taxes, priority of taxes, if existing, over contract lien, and effect of a tax sale certificate.
Defendant mortgagor, Nettie Shumway, files a separate appeal naming herself as coappellant, wherein she consents to the foreclosure of plaintiff's mortgage, but insists that the apparent lien of the taxes is of no force and effect because of the failure to enforce a tax sale certificate. The cause was heard upon an agreed statement of facts.
In 1910 a mortgage was executed on a parcel of land in an irrigation district, which was duly assigned to plaintiff. On the 6th day of January, 1917, the plaintiff executed and delivered a formal release of this mortgage which was recorded. The instant foreclosure decree is based upon a mortgage executed November 18, 1916, recorded December 18, 1916, securing a note dated January 1, 1917. One of the covenants of this mortgage was: "To pay all taxes, assessments and charges, of every character, levied or charged in Nebraska, which are now, or may hereafter become liens upon said real estate." This mortgage secured the same debt as the mortgage formally released by plaintiff January 6, 1917. In 1917, and each of the subsequent years 1918 to 1922, inclusive, there were levied upon the premises covered by the mortgage, state, county, school and irrigation district taxes, all of which were regularly assessed and levied as provided by law. The date upon which the particular irrigation assessment for the year becomes a lien is fixed in section 2877, Comp. St. 1922, as the 1st day of October in the year in which it is assessed. The state, county and school taxes were a lien from the 1st day of October of the year in which levied, under the 1903 revenue act, December 1st under the 1921 act, section 5822, Comp. St. 1922.
The taxes levied from 1917 to 1922, inclusive, have not been paid. In 1903 a new general revenue act was passed, the first since 1879. Section 17, ch. 73, Laws 1903, of that act provides: "All general taxes due the state, county, school district, irrigation districts, town, road districts, city or village, shall be a first lien on the real estate on which levied and take priority over all other incumbrances and liens thereon." This section was in force until the 1921 law, where it appears as: "All general taxes due the state and its governmental subdivisions shall be a first lien on the real estate on which levied and take priority over all incumbrances and liens thereon." Comp. St. 1922, sec. 5825.
Statutory provisions in force at the time of the execution of a mortgage enter into and become a part of the contract. The 1910 mortgage which was assigned to plaintiff and formally released and the new mortgage of 1916 upon which the decree of foreclosure is based were contract liens upon land in an irrigation district, both subject to such liens of the kind specified as may afterward be acquired under the statute. Plaintiff contends that the assessments due the irrigation district are not in a strict sense taxes, but are special assessments, the lien of which is positively fixed by section 2877, supra, relating to irrigation districts. There is no attempt to fix priorities in this section as between liens. Reference for that must be made to section 17 of the 1903 act, and section 5825, supra. On the question of priority of special assessments over existing liens created by contract plaintiff cites Lincoln Street R. Co. v. City of Lincoln, 61 Neb. 109, 84 N.W. 802, and City of Lincoln v. Lincoln Street R. Co., on second appeal, 67 Neb. 469. The first opinion, 61 Neb. 109, was filed January 4, 1901, and the second opinion, 67 Neb. 469, February 4, 1903, while section 17, ch. 73, supra, became effective September 1, 1903. In these cases a contract lien was held superior to certain special paving assessments, but such holding was because of a statute, section 79, art I, ch. 13a, Comp. St. 1899.
Board of Commissioners v. Northwestern Mutual Life Ins. Co., 114 Neb. 596, 209 N.W. 256, cited by plaintiff, does not apply. There a drainage special assessment was held inferior to the contract lien because notice was not given to the mortgagee of record of the proposed organization of the district. There was no regularly assessed and levied special assessment to create a lien so far as the mortgagee was concerned.
There is a distinction between the meaning of "taxes" and "assessments" based on different classes of public burdens. Taxes are imposed for general revenue, assessments for public improvements, mainly locally beneficial. Irrigation districts are quasi-public corporations in the sense that they are organized for general public good, with power to assess property within their boundaries for the purpose of raising sufficient revenue to secure water to irrigate arid lands. Irrigation districts have the power to levy taxes in the nature of assessments. This power is defined by statute. By including "irrigation districts" in section 17, supra, in reference to priority of taxes over contract liens, necessarily what taxing powers the district had would be intended. The priority between general taxes and special assessments is provided for in section 5826, Comp. St. 1922.
Assuming the existence of the taxes, we are forced to the conclusion that the trial court properly found plaintiff's contract lien inferior thereto.
Plaintiff and coappellant both claim that the irrigation district had no right or power to levy any special assessments on the land involved in the instant foreclosure because...
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