Kelly v. City of Boston

• Decision Date: 28 January 1965
• Citation: 348 Mass. 385,204 N.E.2d 123
• Parties: Marguerits C. KELLY v. CITY OF BOSTON.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

Page 123

204 N.E.2d 123

348 Mass. 385

Marguerits C. KELLY v. CITY OF BOSTON.

Supreme Judicial Court of Massachusetts, Suffolk.

Argued Dec. 11, 1964.

Decided Jan. 28, 1965.

John H. Fitzgerald, Chelsea, for plaintiff.

William H. Kerr, Boston (Mario Misci, Asst. Corporation Counsel, with him), for defendant.

Before WILKINS, C. J., and SPALDING, WHITTEMORE, KIRK, and REARDON, JJ.

WILKINS, Chief Justice.

This proceeding for declaratory relief, which was heard on the bill of complaint, the answer, and a stipulation of counsel, has been reported without decision by a justice of the Superior Court. G.L. (Ter.Ed.) c. 214, § 31.

Certain land in the West Roxbury district of Boston was owned in fact and of record by the plaintiff from June 16, 1950, to the entry of a decree of foreclosure in the Land Court on November 8, 1960. On June 4, 1952, by instruments of taking duly recorded on June 18, 1952, the city collector under G.L. c. 60, §§ 53, ¹ 54, ² and 55, ³ took the land for the city for the nonpayment of 1950 real estate taxes, and a tax title account was set up on the city's books. On August 9, 1954, pursuant to G.L. c. 60, § 65 (as amended through St.1938, c. 305), ⁴ the city filed a petition in the Land Court upon which, under G.L. c. 60, § 69 (as amended through St.1945, c. 226, § 1), ⁵ a decree was entered on November 8, 1960, forever barring all rights to redeem from the tax taking. At that time the amount required to redeem was $9,825.80. On September 11, 1962, under St.1943, c. 434, ⁶ as amended, the city sold the land for $33,000, which was the fair market value also on November 8, 1960.

The issue, as stated by the plaintiff, is whether after the foreclosure sale the plaintiff should receive from the collector the surplus remaining over and above taxes, interest, costs, and other assessments committed to the collector. The issue, as stated by the defendant, is whether the plaintiff is entitled either to the amount by which the fair market value of a tract on the date of the foreclosure decree exceeds the tax liabilities then reflected in the tax title account or to the amount by which the proceeds of the sale after foreclosure exceed the aggregate of such liabilities and a sum in lieu of what the intervening taxes would have been.

The issue, however stated, has not been the subject of any decision of this court under our statutes in their present form. On the other hand, the reverse situation was presented in City of Boston v. Gordon, 342 Mass. 586, 175 N.E.2d 377, where it was held (p. 593, 175 N.E.2d p. 382) that 'foreclosure of the tax title to the locus operated to discharge the liabilities then reflected in the tax title account only to the extent of the fair market value of the locus on the date of the foreclosure decree.' In that case the city was permitted to recover a deficiency from the landowner.

The plaintiff places reliance on G.L. c. 60, § 43 (as amended through St.1935, c. 236), ⁷ which, while most explicit as to the order of the application of the proceeds of a sale to the payment of the several items of taxes, assessments, interest, and the like concededly is silent as to the disposal of any surplus. She argues that in equity and good conscience such surplus belongs to the taxpayer, and emphasis is laid upon earlier statutes which did so award any surplus.

The defendant denies the materiality of c. 60, § 43, and contends that it deals 'solely with the allocation of redemption and sale moneys among the various items of texes, assessments, rates and charges reflected in the tax title account.'

We must agree with the defendant's contention. In 1862 municipalities were authorized to sell land which they had purchased at a tax sale and which had not been redeemed within the specified period of time. St.1862, c. 183, § 7. After deduction for the expenses of the sale and the amount paid at the tax sale with ten per cent interest per annum and all intervening taxes and necessary charges, the moneys received at this sale inured to the prior owner of the property. These provisions were made applicable to land taken by a municipality. St.1878, c. 266, § 10. The Legislature continued to provide for the surplus from the sale of unredeemed land until 1915. See Pub.Sts. c. 12, § 58; St.1888, c. 390, § 66; R.L. c. 13, § 67; St.1909, c. 490, II, § 68. In 1915 the Legislature enacted the present system of foreclosing the right of redemption in the Land Court with notice of the proceeding being sent to all interested parties. St.1915, c. 237, § 3-15. Compare G.L. c. 60, §§ 64-77B, as amended. After foreclosure of the rights of redemption under a tax title, the land was to be held and disposed of like any land belonging to the municipality. St.1915, c. 237, § 18. Compare G.L. c. 60, § 77 (as amended through St.1953, c. 654, § 37). Foreclosure in the Land Court replaced the method whereby the right of redemption after a tax sale or taking was foreclosed by mere expiration of a certain period of time without notice to the parties. See Nichols, Taxation in Massachusetts (3d ed.) 386-387, 422; Report of the Special Commission Appointed to Consider and Recommend Changes in the Laws Relative to Liens, Mortgages and Tax Titles, 1915 House Doc. No. 1600, pp. 17-22. The surplus provision in St.1909, c. 490, II, § 68, was amended to apply only to land taken or purchased by a municipality prior to July 1, 1915, the effective date of St.1915, c. 237. See St.1915, c. 237, § 20.

We think it is clear from the above history of the tax statutes that the Legislature intended the surplus from a sale of land taken for nonpayment of taxes, on which the right of redemption has been foreclosed in the Land Court, to belong to the municipality. Our conclusion is supported by the Legislature's 1941 amendment of G.L. c. 60, § 79, which permits the sale without foreclosure of lands of low value which have been taken or purchased at tax sales by a municipality. By St.1941, c. 594, § 1, the Legislature provided that any surplus from such a sale should be deposited with the municipality's treasurer to be paid to the person thereto entitled if demanded within five years. No such provision was made for lands on which the right of redemption was foreclosed in the Land Court.

Section 43 of c. 60 provides no support for the plaintiff's contention. Statute 1935, c. 236, which inserted the sentence setting forth the order of the application of the proceeds of the sale after the right of redemption has been foreclosed, was...