Kershner v. Sganzini

• Court: New Mexico Supreme Court
• Writing for the Court: MABRY, Justice.
• Citation: Kershner v. Sganzini, 45 N.M. 195, 113 P.2d 576, 134 A.L.R. 1290, 1941 NMSC 18 (N.M. 1941)
• Decision Date: 05 May 1941
• Docket Number: No. 4594.,4594.
• Parties: KERSHNER et al.v.SGANZINI et al.

45 N.M. 195

113 P.2d 576

KERSHNER et al.

v.SGANZINI et al.

No. 4594.

Supreme Court of New Mexico.

May 5, 1941.

Appeal from District Court, Taos County; George W. Hay, Judge.

Suit to quiet title by G. D. Kershner and another against Georgia Sganzini and others, wherein the defendants filed a cross-complaint. From a judgment for defendants, plaintiffs appeal.

Reversed and remanded with directions.

Where sale was held in December, 1936, for 1935 delinquent taxes but certificate of sale was not issued until after expiration of two-year redemption period and within time to redeem, taxpayer appeared before county treasurer to ascertain what taxes were due, the treasurer in certifying amount of taxes, interest and penalties made no calculation of the statutory two per cent. cost and taxpayer paid taxes after the expiration of the redemption period when he was for the first time advised by the county treasurer that there was an outstanding certificate of sale, which had been issued after the redemption period, in taxpayers' quiet title action against holders of tax deed issued on the tax sale certificate, the taxpayer was entitled to relief. Comp.St.Supp.1938, §§ 141-739, 141-741, 141-754, 141-761; Laws 1934, c. 27, §§ 8, 11, 14, 20, 23, 24, 25.

Antonio M. Fernandez, Fred J. Federici, and George E. Remley, all of Santa Fe, for appellants.

W. A. Keleher and A. H. McLeod, both of Albuquerque, for appellees.

MABRY, Justice.

There is involved here the legality of a tax title to certain lands in Taos county. Upon suit by appellants to quiet title to several certain lode mining claims, appellees answered denying title in appellants and setting up ownership in and title to the claims by purchase through tax title on December 12, 1936, for 1935 delinquent taxes in the sum of $47, and seek to quiet title in themselves. Appellants by reply and answer to appellees cross complaint raise the issue of the validity of the tax title upon which appellees rely. The judgment was for appellees, on their cross-complaint, quieting their title. Appellants rely upon three principal grounds for reversal, viz., (1) that there was no sale for 1935 taxes in 1936; (2) the conduct of the treasurer mislead appellants to their prejudice and constituted constructive fraud; and, (3) the assignment of the certificate by the treasurer was void and therefore the deed was void.

The following may be said to substantially set out the pertinent facts: That although sale was advertised and held (though probably in an irregular manner) in 1936 for the 1935 delinquent taxes, no certificate of sales were written up and filed as to the property in question or any other property for which said sale was held, until after December 15, 1938, and until more than two years (the period of redemption) had elapsed; that the certificate in question relied upon as the basis for the tax deed here involved, though dated December 12, 1936, was actually not written up or issued until December 15, 1938, at which time it was signed by the then county treasurer in the name of a former county treasurer no longer in office; that the tax deed upon which appellees' title rests and which was based upon the said certificate of sale was itself executed and delivered on February 17, 1939; that shortly before December 12, 1938, and within time to redeem from a sale of their property in 1936, appellants appeared before the county treasurer to ascertain “what taxes were due” on the property in question. They, together with the treasurer, examined the tax rolls and records, and appellants were then and there furnished by the treasurer with a statement of the amount of all taxes, including interest and penalty, due for the year 1935 and other years; and, that from an examination made of the books and records of the treasurer's office, it was ascertained that no notation or record of any sale of appellants' property for the year 1935 had been made upon the tax roll or otherwise. Furthermore, appellants were not advised by the treasurer of any outstanding certificate against the property (there being yet none in fact) nor were any questions asked nor was anything said by either the treasurer or appellants about a tax sale covering delinquencies for 1935; that in figuring and estimating and certifying to appellants the full amount of taxes, interest and penalties owing for the year 1935 and other years, no calculation was made by the treasurer of the statutory 2% costs, which invariably follow from sale and are required to be paid incident to redemption of the property by the owner after the tax sale (Section 20, Chap. 27, Laws 1934, Sp.Sess.); that when the owner prepared to pay his 1935 and other taxes on the 16th day of January, 1939, he was then, for the first time, advised by the treasurer that there was an outstanding certificate of sale against his property for delinquency for the year 1935. Appellees, through their agent, secured the ante-dated certificate of sale and the deed based thereupon with full knowledge of the state of the record as to the tardy issuance of the certificate and deed, and the ante-dating of said certificate was in fact at the request and upon direction of the said agent. All facts were sufficiently pleaded, sufficient proposed findings and conclusions were tendered by appellants, sufficient objections were taken to all adverse findings and conclusions, and ample assignments of error made, to properly raise the questions here for review.

In substance, appellants' contention is that, first, there was no sale of the property at all, which, it is conceded, is an absolute requirement to pass title by tax deed. Indeed, we held directly in the recently decided case of Hughes v. Raney, 45 N.M. 89, 110 P.2d 544, 545, hereinafter referred to, “If there was no sale, a jurisdictional defect is presented against which neither the curative nor limitation provisions of the delinquent tax law will avail defendant.” In the second place, say appellants, if there were a sale, the conduct of the treasurer hereinbefore fully set out, mislead appellants to their prejudice and constituted constructive fraud which makes such sale, and the tax deed flowing therefrom, invalid; and, third, even if the sale were held in 1936 as alleged, it was void and the certificate was therefore in January, 1939, still in the hands of the treasurer and subject to redemption; further, that equity and good conscience require that the court look at the substance and not the form in relation to the acts of the parties and the date when they occurred rather than at any false recitals of the certificate and the tax deed, and rather than be bound by any prima-facie presumption of regularity ordinarily clothing such deeds, to determine whether constructive fraud is shown.

Appellants urge that the conduct of the treasurer in failing to make a record of any kind for more than two years after the purported sale, and in failing to advise appellants of such purported sale when they came to ascertain “what taxes were due” preparatory to payment, so misled appellants to their prejudice that the acts and omissions constituted constructive fraud, from the effects of which a court of equity will relieve. Whether this be true becomes a most important inquiry.

We have held that failure to make the notation “sold to the state”, upon the tax rolls opposite the entry of the property (Sec. 11, Chap. 27, Laws of 1934) is not fatal, but is an irregularity taken care of by the curative statute. Chisholm v. Bujac, 27 N.M. 375, 202 P. 126. We have pointed out many irregularities in tax proceedings which are not jurisdictional. Bull v. Martinez, 43 N.M. 113, 86 P.2d 599; Maxwell v. Page, 23 N.M. 356, 168 P. 492, 5 A.L.R. 155; Williams v. Van Pelt, 35 N.M. 286, 295 P. 418; Baker v. Johnson, 35 N.M. 293, 295 P. 421; Eaves v. Lowe, 35 N.M. 610, 5 P.2d 525; N.H. Ranch Co. v. Gann, 42 N.M. 530, 82 P.2d 632; Foster v. Bennett et al., 44 N.M. 618, 107 P.2d 321.

We have also held that it is not important that a proper deed be executed at the time when he is first entitled thereto, since the purchaser from a tax sale is entitled, at some time, to have a good and timely conveyance, and the party complaining, in any event, would have no right to defeat the ultimate delivery of a good and sufficient deed. Witt v. Evans, 36 N.M. 365, 16 P.2d 60, 61. In this case we said: “If the deed in question were void, it would not alter the fact that, as assignee of tax sale certificates, appellant holds ‘complete legal title’ to the land. That status, if not sufficient to enable him to quiet his own title, would at least prevent his adversary from quieting his. *** He would still be in a position to demand a valid deed.”

It was further pointed out in Hood v. Bond, 42 N.M. 295, 77 P.2d 180, 185, that “the power vested in the treasurer to execute a tax deed is not exhausted until a deed is made in compliance with law.” See the recent case of Scudder et al. v. Hart, 45 N.M. 76, 110 P.2d 536, recently decided, where we discussed rather fully the question of constructive fraud through acts and omissions properly to be charged to the county treasurer.

We also held in the case of Hughes v. Raney, 45 N.M. 89, 110 P.2d 544, 545, (recently decided but not yet reported) that no formality in announcing the sale to the state was required to evidence such a sale of all property unsold at the end of the five day period provided (See Sec. 8, Chap. 27, Laws 1934), and that the word “deemed” would be read into the statute. To quote from this opinion: “We are forced to the conclusion that the true meaning of the language employed in section 8 is reflected when we supply the word ‘deemed’ before the word ‘sold’ so that the first sentence of said section will read: ‘Sec. 8. On the fifth day of the sale, all property on which no acceptable bid has been received, shall be (deemed) sold to the State of New Mexico for the amount of the taxes,...