Johnson v. Berg, 20683.

• Citation: 147 Wash. 57,265 P. 473
• Decision Date: 13 March 1928
• Docket Number: 20683.
• Parties: JOHNSON v. BERG et al.
• Court: Washington Supreme Court

265 P. 473

147 Wash. 57

JOHNSON v. BERG et al.

No. 20683.

Supreme Court of Washington, En Banc.

March 13, 1928

Appeal from Superior Court, Kitsap County; French, Judge.

Action by John P. Johnson against M. J. Berg and others. Judgment for defendants, and plaintiff appeals. Reversed and remanded.

Askren Main and Tolman, JJ., dissenting.

Ray R Greenwood, of Bremerton, for appellant.

Beardslee & Bassett, of Seattle and Marion Garland, of Bremerton, for respondents.

HOLCOMB J.

Appellant the holder of twelve certain improvement district warrants issued by Kitsap county to defray the cost of the construction of what is known as road No. 27, incorporated in local improvement district No. 1, in that county, instituted this action to enforce the collection of assessments levied by the county against the properties of respondents. The complaint alleged that the county treasurer had failed, neglected, and refused to pay the warrants, and that he neglected, refused, and failed to promptly collect any of the assessments levied against the property of respondents.

The answer denied the material allegations of the complaint and affirmatively alleged, among other things, that the superior court for Kitsap county had, by decree made and entered on September 23, 1919, several years prior to the commencement of the action herein, and a cause which was entitled M. J Berg to al. (these respondents) v. Kitsap County et al., being cause No. 4202 of the files of that court and county, adjudged and decreed that the assessments against the property of these respondents were null and void, enjoined the collection of such assessments, and made such injunction permanent and perpetual as to the county and its officers; that the decree in that case is a bar to this action.

At the trial a blank copy of a warrant of the same kind as the twelve warrants issued to appellant, and also the record in the case of Berg et al. v. Kitsap County et al., cause No. 4202, were introduced in evidence, which evidence was supplemented by statements of counsel on both sides amounting practically to an agreed statement of facts. From the agreed statement of facts so made, it appears that the warrants in question were purchased when issued for value, were to run not to exceed ten years from the date of their issuance, and became due, Nos. 33 to 35, inclusive, in August, 1925, and Nos. 36 to 45, inclusive, in October, 1925; that the treasurer refused to pay the warrants when due according to their face, and also refused to collect the assessments against the property of these respondents. These respondents are the identical parties who were the plaintiffs in cause No. 4202, which was begun in January, 1916, and went to decree, as before stated, in September, 1919. That decree was never appealed from, and became final. The warrants in this action are the last of the warrants, and there is no other property from which they may be collected.

Appellant was not a party in any way in cause No. 4202, and had no knowledge of that litigation.

The trial court found that the assessments levied against the properties of respondents had been adjudged and decreed null and void, that the court had perpetually enjoined and restrained Kitsap county and its treasurer from collecting such assessments, and concluded as a matter of law that the assessments had never become due, and that therefore appellant had no legal right to maintain this action.

The one question to be determined is whether or not cause No. 4202 of the superior court for Kitsap county is res judicata in this action.

Appellant based his action upon chapter 224, Laws of 1909, being sections 6672 to 6698, inclusive, Rem. Comp. Stats., which provide for the creation of county local improvement districts for road construction, prescribe the methods to be followed under the act, and the method of financing.

Sections 6688 and 6689 authorize the issuance of special warrants to defray the cost of the improvement. Section 6690 provides that such warrants may be redeemed by the payment of assessments levied upon the property benefited in the district. Section 6691 provides that the proceeds of such warrants shall be applied to the payment of the costs and expenses of the improvement. Section 6692 provides that such assessments shall be collected by the county treaurer and the warrants redeemed from the moneys so received.

Section 6693, Rem. Comp. Stats., is as follows:

'If the county treasurer shall fail, neglect or refuse to pay said warrants issued under the provisions of this act, or to collect promptly any such assessments when due, the owner of any such warrants may proceed in his own name to collect such assessments and to foreclose the lien thereof in any court of competent jurisdiction, and shall recover in addition to the amount of such warrants and interest thereon, five per centum, together with the costs of such suit. Any number of holders of such warrants for any single improvement may join as plaintiffs and any number of owners of the property on which the same are a lien may be joined as defendants in such suit. Neither the holder nor any owner of any such warrant issued under the authority of this act shall have any claim therefor against the county through the instrumentality of which the same is issued, except from the special assessment made for the improvement for which such warrant was issued, but his remedy in case of nonpayment shall be confined to the enforcement of such assessment. A copy of this section shall be plainly written, printed or engraved on each warrant so issued.'

Appellant purchased his warrants when issued and long prior to the commencement of the action designated as No. 4202 in Kitsap county. Under the provisions of the above section 6693, he was accorded the right of collection in his own name, and that was part of his contract. It was also a part of his contract, under that section, that he should have no other redress, except against the property specially benefited.

Appellant therefore contends that he is availing himself of the remedy accorded him by the statute, and the only remedy, and that the decree in cause No. 4202 is void as to him because he never was a party to or bound by it.

Appellant insists that in order for a judgment to be res judicata it must appear that the person against whom it is asserted was either a party or in privity with a party to the action, and that it cannot be maintained that there is any privity between him and the defendants, who were parties to the action in cause No. 4202. State ex rel. Reed v. Gormley, 40 Wash. 601, 82 P. 929, 3 L. R. A. (N. S.) 256, 5 Ann. Cas. 856, is quoted to the effect that:

'It is a rule of law, as old as the law itself, that a court cannot adjudicate the rights of parties who are not actually or constructively before it, with an opportunity to defend or maintain their rights in the action.'

The above cause is also relied upon by appellant generally. In that case we held that a suit to enjoin the payment of county warrants could not lie except where the warrant holders were made parties, and that the difficulty of service of process upon the holders of warrants who were unknown and whose presence could not be secured was no excuse for failure to join necessary parties defendant.

In Stallcup v. Tacoma, 13 Wash. 141, 42 P. 541, 52 Am. St. Rep. 25, we held that a judgment in an action where a bondholder was not made a party would have no binding effect upon such bondholder in an action to restrain the payment of city bonds.

In Savage v. Sternberg, 19 Wash. 679, 54 P. 611, 67 Am. St. Rep. 751, we held that the fact that a city that has been enjoined from paying certain warrants cannot be set up as a defense to mandamus proceedings to compel payment by one who was not a party to the injunction suit, and that a party or officer is not bound by a void injunction or order of the court and will not be punished for its violation.

As to these cases and other cases cited by appellant from other jurisdictions, respondents insists that in each of them the judgment or decree pleaded in bar foreclosed the right of a party, not before the court, from recovering the value of the bond or warrant and that this is not true in the instant case.

Respondents rely upon another provision of the statute relating to such improvement districts; i. e., section 6696, Rem. Comp. Stats., reading in part as follows:

'* * * But the court in which any action may be brought to enjoin, reverse, or declare void the proceedings by which any such road has been laid out, constructed or improved, or ordered to be laid out, constructed or improved, or to enjoin the collection of any tax or assessment levied or ordered to be levied for the purpose aforesaid, may, if there be manifest error in such proceedings affecting the rights of the plaintiff in such action, set the same aside, as to him, without affecting the rights or liabilities of other parties in interest; and the court shall, in the final hearing, make such order in the premises as may be equitable and just, and may order the assessment levied against the plaintiff's property to remain on the assessment roll for collection, or to be again levied in whole or in part, or may perpetually enjoin the same, or any part thereof. The cost of such action, and the proceedings had therein, shall be apportioned among the parties, or paid out of the county treasury, in whole or in part, as justice may require and the court direct: Provided, that all the land liable to assessment, under the provisions of this act, for the construction of such road, shall be held responsible to the county, to protect the county against all loss or liability arising from any judicial proceedings affecting

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