Lannan v. Waltenspiel

• Decision Date: 02 April 1915
• Docket Number: 2680
• Court: Utah Supreme Court
• Parties: LANNAN v. WALTENSPIEL et al

147 P. 908

45 Utah 564

LANNAN v. WALTENSPIEL et al

No. 2680

Supreme Court of Utah

April 2, 1915

Appeal from District Court, Third District; Hon. F. C. Loofbourow Judge.

Action by P. H. Lannan against T. C. Waltenspiel and others.

Judgment for defendants. Plaintiff appeals.

AFFIRMED.

Stephens & Smith for appellant.

Dey Hoppaugh & Fabian, H. J. Dininny, City Atty., A. Myers, and W. H. Folland, for respondents.

FRICK J. STRAUP, C. J. and McCARTY, J., concur.

OPINION

FRICK, J.

The plaintiff commenced this action in the District Court of Salt Lake County to foreclose a mortgage. The mortgage was given by the defendant Waltenspiel, and constituted a lien upon certain lots in Salt Lake City. Salt Lake City was made a defendant in the action for the alleged reason that it claimed "an interest in said premises in and by virtue of a certain special assessment for laying a sidewalk," etc. It was alleged in the complaint that the lien or claim of Salt Lake City was junior and inferior to plaintiff's mortgage lien. Salt Lake City appeared in the action, and in its answer set up the special assessment proceedings, that it had laid a sidewalk in front of plaintiff's property, and that by reason thereof it had acquired a lien on the lots described in the mortgage, which lien, it averred, was superior and paramount to the mortgage lien of the plaintiff. The district court found that plaintiff's mortgage was prior in time, but notwithstanding that fact adjudged that his lien was inferior to the lien of the city. The plaintiff appeals from the judgment, and insists that the court erred in adjudging that the lien of the city for the special assessment was paramount to his mortgage lien. The question, therefore, is: Which one of the liens aforesaid is the superior lien under the law?

We have a statute (Comp. Laws 1907, sections 253 to 282, inclusive) which provides for levying special assessments to defray the cost of local improvements, including the laying of sidewalks in front of or along any city lots or blocks. The regularity of the proceedings culminating in the special assessment in question here is not assailed, and hence we need not refer to the particular provisions of the statute authorizing the same. Section 281, which is the section giving the lien, reads as follows:

"Special assessments made and levied to defray the cost and expenses of any work contemplated by the provisions of this chapter and the cost of collection thereof shall constitute a lien upon and against the property upon which such assessment is made and levied, from and after the date thereof, and such assessments shall be collected in the manner prescribed by ordinance."

The only other section to which it is deemed necessary to refer is section 274, which, in substance, provides that:

"Special taxes to cover the cost of any public improvement * * * shall be levied and assessed on all blocks, lots, * * * lands, and real estate bounding, abutting, or adjacent to such improvement * * * to the extent of the benefits to such lots, * * * by reason of such improvement."

Counsel for plaintiff concede that the Legislature had the power to make the cost of a local improvement a prior lien upon the lots or lands benefited, but they insist that unless such is done in express terms the statutory lien is subject to a mortgage which was placed on the property before the special assessment was made, and to that effect, they contend, are the authorities. The authorities, among others, relied on by them are the following: 2 Page & Jones, Taxation by Assessment, section 1068; Hamilton, Law of Special Assessments, section 708; 2 Cooley on Taxation (Third Ed.), pp. 865 and 866; 2 Elliott, Roads & Streets (Third Ed.), section 745; 27 Cyc. 1176; Cook v. State, 101 Ind. 446; State v. Aetna, etc., Co., 117 Ind. 251; 20 N.E. 144. We do not refer to counsel's other citations because, in our judgment, they are readily distinguishable from the case at bar, and hence need not be considered.

Hamilton, in his work (section 708, supra), says:

"A lien for public taxes and assessments is upon the property, and is paramount to all liens acquired by personal contracts, when so provided by statute. There is no difference in this respect between taxes for street improvements and general taxes. Both are levied under the sovereign power of the state, and both are levied under the theory that they are for the general good, and the same powers for enforcing their collection are generally given. Such lien is superior to all other liens, prior or otherwise. Although the lien of a prior recorded mortgage is superior to that of a special assessment, it is within the power of the Legislature to change the rule, and make the mortgage lien secondary to that of the assessment."

Counsel omitted from their quotation the second, third, and fourth sentences of the section we have just quoted from, and quoted only the first and fifth sentences. The quotation as it is given by counsel is, however, sustained by the Indiana cases, while that portion which is contained in the second, third, and fourth sentences quoted by us is sustained by what we conceive to be the great weight of authority. But even the Indiana Supreme Court does not support counsel in their claim that the lien or special assessment must be declared to be prior in express terms or it will be subject to a mortgage. That such is the case is made manifest from what is said by Mr. Chief Justice Elliott in State v. Aetna, etc., Co., supra, where, at page 252 of 117 Ind., at page 144 of 20 N. E., he says:

"It is not necessary that it [the Legislature] should in express terms declare that the lien shall be a paramount one, for if the intention can be gathered from the general words and purpose of the statute the courts will give it effect."

Counsel also quote from 2 Elliott on Roads & Streets, section 749. The quotation, however, is again based on cases which, in our judgment, are contrary to the great weight of authority. We also take the liberty of quoting from the same author and from the same section as follows:

"While it is true that an assessment is not strictly a tax, it is also true that it is levied by the sovereign power, for the general public good. It is also true that a mortgagee is benefited to the extent that the land is improved, for to the extent that the land is improved to that extent is its value augmented. We cannot conceive why it is not in the power of the Legislature to create a lien and give it priority over all private rights or estates. This would seem to surely follow from what we have affirmed, and there is yet another reason, and that is this: Everyone who acquires an interest in land takes it subject to the right of the sovereign to lay general taxes upon it and to impose upon it the burden of paying the expense of public improvements which confer upon the land a special benefit. We feel that it is entirely safe to affirm that the Legislature may make the lien a paramount one, and to this effect are nearly all of the decisions. Statutes giving a lien are remedial, and therefore to be liberally construed, and so construed as to accomplish the legislative purpose. In creating liens for improvement assessments the Legislature makes secure compensation for what is in truth an industrial annexation to the land, for the road or street improved is in a sense an appurtenant of the land, which increases its value. Whoever holds an interest in the land profits by the appurtenance, and ought, in justice, to be subjected to the lien which secures the assessment. It is, for these reasons, often proper to deduce from the general language of the statute giving a lien the conclusion that it gives a paramount lien to which mortgage estates or judgment liens must yield."

The sentence immediately following the foregoing quotation, and on which counsel rely, namely, "But this conclusion cannot, perhaps, be inferred where no provision is made for giving those who hold such interests a hearing, and where there are no words declaring the superiority of the lien," is again based upon special statutory provisions. This is made apparent from the subsequent decision of the Supreme Court of Indiana, upon whose decisions, we have seen counsel specially rely, by reference to the case of Baldwin v. Moroney, 173 Ind. 574; 91 N.E. 3; 30 L. R. A. (N. S.) 761, where the doctrine contained in the sentence last quoted is...