McCague v. City of Omaha

• Decision Date: 23 February 1899
• Docket Number: 8672
• Citation: McCague v. City of Omaha, 58 Neb. 37, 78 N. W. 463 (Neb. 1899)
• Parties: THOMAS H. MCCAGUE, RECEIVER, v. CITY OF OMAHA
• Court: Nebraska Supreme Court

78 N.W. 463

58 Neb. 37

THOMAS H. MCCAGUE, RECEIVER, v. CITY OF OMAHA

No. 8672

Supreme Court of Nebraska

February 23, 1899

ERROR from the district court of Douglas county. Tried below before DICKINSON, J. Affirmed.

AFFIRMED.

R. W Breckenridge, for plaintiff in error.

The statutes contain numerous provisions which require void taxes to be refunded to the payer thereof. (Touzalin v. City of Omaha, 25 Neb. 817; Morris v. Merrell, 44 Neb 423; Caldwell v. City of Lincoln, 19 Neb. 569; Chicago, B. & Q. R. Co. v. County of Nemaha, 50 Neb 393; Supervisors v. United States, 4 Wall. [U. S.] 435; Galena v. Amy, 5 Wall. [U. S.] 705; City of Indianapolis v. McAvoy, 86 Ind. 587; People v. Commissioners of Buffalo County, 4 Neb. 150; State v. Farney, 36 Neb. 537; People v. Supervisors, 36 How. Pr. [N. Y.] 1; King v. Inhabitants of Derby, Skin. [Eng.] 370; King v. Barlow, 2 Salk. [Eng.] 609; Backwell's Case, 1 Ver. [Eng.] 153; People v. Supervisors, 51 N.Y. 401; Phelps v. Hawley, 52 N.Y. 23; People v. Supervisors, 68 N.Y. 114; People v. Common Council, 140 N.Y. 300; Inhabitants of Veazie v. Inhabitants of China, 50 Me. 518; Milford v. Orono, 50 Me. 529; Kellogg v. Page, 44 Vt. 356; Hayes v. Los Angeles County, 99 Cal. 74; Ralston v. Crittenden, 13 F. 508.)

There is a clear and sharp distinction between a sale which is void because the tax is void, and a sale void for irregularities in procedure which defeat the title of the purchaser. (Lynde v. Inhabitants of Melrose, 10 Allen [Mass.] 49; Churchman v. City of Indianapolis, 110 Ind. 259; State v. Casteel, 110 Ind. 174; Casselbury v. Piscatawa Township, 43 N. J. Law 353; Mayor of Jersey City v. Riker, 38 N. J. Law 225; Budge v. City of Grand Forks, 1 N. Dak. 309.)

Money paid for void taxes can be recovered back at common law. (Town of Virden v. Needles, 98 Ill. 367; City of Covington v. Voskotter, 80 Ky. 220; Lincoln v. Worcester, 8 Cush. [Mass.] 55; Wright v. Boston, 9 Cush. [Mass.] 233; Wells v. Chicago, 66 Ill. 280; Rogers v. Greenbush, 58 Me. 390; Newman v. Livingston County, 45 N.Y. 676; Bank of Commonwealth v. Mayor, 43 N.Y. 184; Mayor of Jersey City v. Riker, 38 N. J. Law 225; Tuttle v. Everett, 51 Miss. 27; City of Galveston v. Sydnor, 39 Tex. 236.)

Money paid under mistake may be recovered. (Alston v. Richardson, 51 Tex. 1; Koontz v. Central Nat. Bank, 51 Mo. 275; Devine v. Edwards, 87 Ill. 177; City of Indianapolis v. McAvoy, 86 Ind. 587; City of Louisville v. Henning, 1 Bush [Ky. ] 381; City of Covington v. Powell, 2 Met. [Ky.] 226; City of Louisville v. Zanone, 1 Met. [Ky.] 151; Ray v. Bank of Kentucky, 3 B. Mon. [Ky.] 513; Underwood v. Brockman, 4 Dana [Ky.] 309; City of Louisville v. Anderson, 79 Ky. 334; Northrop v. Graves, 19 Conn. 548; Walker v. Conant, 65 Mich. 194; Fraker v. Little, 24 Kan. 598.)

The doctrine caveat emptor is not applicable to the facts of this case. (Hayes v. Los Angeles County, 99 Cal. 74; Phelps v. Mayor, 112 N.Y. 216; Loomis v. Los Angeles County, 59 Cal. 456; Clapp v. Pine Grove Township, 138 Pa. St. 42; Mayor of Jersey City v. Riker, 38 N. J. Law 225; Corbin v. Davenport, 9 Ia. 239.)

Saunders & Macfarland, also for plaintiff in error.

W. J. Cornell, Lee S. Estelle, and E. H. Scott, contra.

OPINION

NORVAL, J.

The facts upon which this action was predicated may be summarized thus: The city of Omaha opened and extended South Nineteenth street through Hartman's Addition, and to pay the costs and expenses thereof the municipal authorities levied special assessments upon the adjacent lots, including lots 60, 61, 66, 67, 72, 73, and 78 in said Hartman's Addition to the city of Omaha. These special taxes or assessments not having been paid by the lot owners at the time the same became delinquent, the lots heretofore mentioned were sold by the county treasurer to Edward B. Baer, at private sale, for said special assessments. Subsequently said special taxes were adjudged null and void, and the purchase-money having been paid by the county treasurer to the city of Omaha, Edward B. Baer instituted this action against the city to require it to return said purchase-money. Plaintiff has prosecuted error from the judgment rendered against him. In this court Thomas H. McCague, as receiver of the German Savings Bank of Omaha, was substituted as plaintiff.

It is insisted by the city attorney that the precise question herein involved was decided adversely to the contention of this plaintiff in Pennock v. Douglas County, 39 Neb. 293, 58 N.W. 117, and it is agreed that the court below determined this case on the authority of that decision. The correctness of the rule announced in Pennock v. Douglas County, supra, is denied by plaintiff. It was there decided that in the absence of statutory authority a city of the metropolitan class cannot be required to refund money which it has received from a purchaser of real estate at a sale made thereof by the county treasurer for a special assessment or tax levied by the city, and for which special assessment or tax said real estate was not liable. It was also held in that case that the rule of caveat emptor applies to a purchaser at a tax sale. It is now strenuously argued in the brief of counsel for plaintiff that the court in the Pennock Case incorrectly assumed that there was no statute under which one paying an illegal or void city tax may recover the same from the municipality. In this the learned counsel is in error. The court assumed no such proposition; but what it did hold was that there was no statute which authorized a metropolitan city to refund to a tax purchaser money paid on the sale of real estate for void special assessments, and upon an investigation of the subject anew, aided by able argument of counsel, we discover no valid reason for changing our views upon the question. An examination of the arguments advanced by plaintiff's counsel will disclose that they are fallacious.

Attention is challenged to the following provisions of section 69, chapter 12a, of Compiled Statutes 1889, popularly known as the "Charter of Metropolitan Cities": "Any party feeling aggrieved by any such special tax or assessment or proceeding may pay the said special taxes assessed or levied upon his, her, or its property, or such installments thereof as may be due, at any time before the same shall become delinquent, under protest and with notice in writing to the city treasurer that he intends to sue to recover the same back, which notice shall particularly state the alleged grievance and grounds thereof, whereupon such party shall have the right to bring a civil action within sixty days thereafter, and not later, to recover back so much of the special taxes paid as he shall show to be illegal, inequitable, and unjust, the cost to follow the judgment or to be apportioned by the court as may seem proper, which remedy shall be exclusive. The city treasurer shall promptly report all such notices to the city council for such action as may be proper." The first observation which we make of the foregoing provisions is that they had been repealed prior to the time, and were not in force, when plaintiff purchased the lots for the special taxes assessed against them. Moreover, these provisions have no application to the case at bar, and cannot be invoked by a purchaser at a tax sale. They conferred authority upon one paying illegal special taxes under protest and notice in writing to the city treasurer to bring an action against the city within sixty days thereafter to recover from the city such illegal taxes so paid by him. Plaintiff is not within the provision of this statute, since he did not pay these special assessments at all, much less under protest, but purchased the lots at treasurer's sale. Again, he did not institute this action within sixty days after his said purchase, so in no event is he in a position to invoke the statute under consideration.

The following portion of section 94, chapter 12a, Compiled Statutes, is relied upon by plaintiff: "The city council may at any time correct any error or defect, or supply any omission in the assessment or listing of any property subject to municipal tax made for the purpose of taxation for the then current fiscal year, and may require any and all persons to appear and answer under oath as to their possession or control of personal property subject to municipal taxation and the mayor and council by ordinance may make such compromise, settlement, or adjustment of any action or litigation concerning the validity, legality, or regularity of any tax or taxes levied for city purposes, as they may deem just and expedient, and the city treasurer shall conform thereto in his action respecting the collection of taxes under any tax list in his hand. These provisions shall apply to general municipal taxes and to special assessments, as far as the same are applicable, unless otherwise provided in the ordinance levying the same." We discover nothing in the above provision which justifies the maintaining of the present suit. It would require either a great stretch of the imagination or radical judicial legislation to make said section applicable to a purchaser at tax sale. A mere reading of the section is sufficient to disclose that it has no bearing upon the question now before the court. Certainly the power given the city council to correct an error in the assessment or listing of property for the purposes of taxation does not carry with it the power to refund money received by...