Knox County v. Perry

• Decision Date: 06 January 1943
• Docket Number: 31497.
• Citation: 7 N.W.2d 475,142 Neb. 678
• Parties: KNOX COUNTY v. PERRY et al.
• Court: Nebraska Supreme Court

7 N.W.2d 475

142 Neb. 678

KNOX COUNTY v. PERRY et al.

No. 31497.

Supreme Court of Nebraska

January 6, 1943

Syllabus by the Court.

1. When a county has purchased a tax sale certificate, held the same for two years, its foreclosure proceedings thereafter are governed by section 77-2040, Comp.St.1929.

2. In bringing a foreclosure of a tax sale certificate under section 77-2040, Comp.St.1929, the proper procedure is to follow that provided for the foreclosure of real estate mortgages.

3. Under section 20-1530, Comp.St.1929, providing for the redemption by the owner of real estate which has been foreclosed, he is required to pay the amount of the decree with interest and costs; but in case it has gone to sheriff's sale and been sold to a bidder who was not a party to the suit, the owner so redeeming must then pay, in addition, to such bidder 12 per cent. interest on the amount of his bid.

EBERLY, J dissenting.

R. J Shurtleff, of Norfolk, for appellants.

W. Keith Peterson, of Center, for appellee.

Andrew D Mapes and H. G. Greenamyre, both of Norfolk, amici curiae.

Heard before SIMMONS, C. J., and ROSE, EBERLY, PAINE, CARTER, and YEAGER JJ.

PAINE Justice.

This action involves a tax foreclosure brought by the county of Knox, the county having waited two years before bringing foreclosure of numerous tax certificates in this one action. Sheriff's sale was had, and a person not a party to the suit bid in one tract for $400, which was less than the amount of the decree on that item. The sole question involved is the amount which the owner of the land should be required to pay to redeem from this sale before confirmation.

No answer was filed by any of the defendants. The decree of foreclosure was in the usual form. No evidence was taken by the district court, but the original tax sale certificate upon which the 9th cause of action was based was filed with the clerk of the court and canceled by him.

This decision is entirely in reference to the real estate set out in the 9th cause of action. After the sheriff's sale the owner filed objections to the confirmation on the ground that it did not sell for its fair market value, and that a subsequent sale would bring a higher price, and further requested that before confirmation he be given an opportunity to redeem the real estate by the payment into court of the amount required by the laws of Nebraska, and that he be accorded a judicial determination of the amount necessary to redeem, and be given a reasonable time to comply with the order.

Thereafter the district court entered an order, giving such defendant five days in which to redeem said real estate by paying the full amount of said decree with interest and costs, including attorney's fees. Thereafter, the owner having failed to redeem the premises on the terms set out, the sale was confirmed, and the sheriff directed to execute and deliver a deed to the purchaser, from which decree the owner of the property appeals.

The owner of the land sets out, as the error relied upon for reversal, that the court erroneously required him to make payment of the full amount of the decree, when he stood ready to redeem by the payment of the amount of the bid plus interest and costs.

Section 77-2047, Comp.St.1929, is cited as his authority, and reads as follows: "Any person entitled to redeem any lot or parcel of land may do so at any time after decree of foreclosure and before sale by paying to the clerk of the court the amount found due against the same with interest and costs to date of redemption. If redemption is made after sale and before confirmation such person must pay the sum for which the land was sold, with interest and costs to that (date) of confirmation." (Italics ours.)

Appellant insists that he had the right to redeem, within the terms of this statute, up to the time of confirmation by the payment of the amount of the bid with interest and costs.

There being a question as to which method of foreclosure was employed by the county in this case, it is necessary to set out the steps taken, as shown by the pleadings, before discussing the section of the statute applicable thereto, as well as some of the decisions of our court in relation to the foreclosure of delinquent taxes by counties.

The petition, which was filed November 19, 1940, alleged that the county of Knox purchased the tax sale certificate on November 7, 1938, for delinquent taxes for the years 1931 to 1937 inclusive, together with delinquent special improvement taxes, also the taxes which have become delinquent for the years 1938 and 1939, with lawful interest and charges, which all amounts to the sum of $456.56. Service by publication was made for four weeks.

On April 15, 1941, a decree was entered in the case, which, omitting portions thereof, finds generally in favor of plaintiff upon its cause of action; that the taxes for the years 1931 to 1937, inclusive, were duly levied and assessed against said real estate and were delinquent, and said real estate was on November 7, 1938, duly sold to the said county, and tax sale certificate No. 343 was issued by the county treasurer to said county, and plaintiff is now the owner and holder thereof; that thereafter taxes were levied for the years 1938 and 1939, which have become delinquent, and that there is due the said county the sum of $527.65 with interest at the rate of 7 per cent. per annum on account of said tax sale certificate and the subsequent taxes, which sum is a first and paramount lien upon the real estate; that the county of Knox is entitled to a foreclosure of its lien for taxes as found due.

On May 16, 1941 order of sale was issued, directing the sheriff to cause the real estate to be advertised and sold as upon execution to satisfy the tax liens, and on June 26, 1941, the sheriff's return states that he sold the real estate described to Vendelin Hanzlik for $400.

On June 30, 1941, defendant D. P. Wetzel, claiming ownership of the real estate, filed objections to confirmation of sale, alleging that the real estate did not sell for its fair market value and that at a subsequent sale said real estate would sell for more than the decree, interest and costs. Said Wetzel requested the court that before confirmation he be given opportunity to redeem the real estate by payment into court of the amount required by law, and that he be accorded a judicial determination of the amount necessary to redeem, and a reasonable length of time in which to comply with any order the court might make as to said redemption.

On March 5, 1942, the court ordered that defendant be given until March 10, 1942, to redeem said premises by paying the full amount of the decree with interest and costs.

On March 26, 1942, order was issued, finding that the owners of the equity of redemption had failed to redeem said premises on or before March 10, 1942, and that said sale should be confirmed, and the sheriff was ordered to execute and deliver a deed to the premises to the purchaser.

We will now take up the several methods by which a county can foreclose its tax liens. The public revenue act of 1903 was a new and comprehensive act, set out in chapters 73, 74 and 75 of the laws of that year. In it the legislature provided several separate methods by which a county could enforce its lien for taxes against real estate.

The first method is set out in section 231, ch. 73, Laws 1903, and gave the county a lien for all taxes due all of the taxing bodies, with the right in the county to foreclose such general lien upon each tract of land for all taxes, without buying a tax sale certificate thereon, it having been held in Logan County v. Carnahan, 66 Neb. 685, 693, 92 N.W. 984, 95 N.W. 812, that the county must have a tax certificate to foreclose. This plan is set out in detail and with amendments in section 77-2039, Comp.St.1929, and provides that the owner might redeem his property at any time within two years from the date of the sale by paying the amount of the taxes found due thereon with subsequent taxes, interest and costs. This section was discussed in Commercial Savings & Loan Ass'n v. Pyramid Realty Co., 121 Neb. 493, 237 N.W. 575.

A second method for the foreclosure of delinquent taxes by counties is set out in section 232, ch. 73, Laws 1903, and provides that any person, county, city or village can buy a tax sale certificate for delinquent taxes and hold the same for two years, which would be until after the time for redemption had expired, and then foreclose such tax sale certificate, or tax deed in case one was secured, in the same manner as provided for the foreclosure of a...