Nelson v. Pitts

• Decision Date: 20 April 1926
• Docket Number: 16537.
• Citation: 259 P. 533,126 Okla. 191,1926 OK 391
• Parties: NELSON v. PITTS, County Treasurer, ex rel. LATTIMORE, Co. Atty.
• Court: Oklahoma Supreme Court

259 P. 533

126 Okla. 191, 1926 OK 391

NELSON v. PITTS, County Treasurer, ex rel.

LATTIMORE, Co. Atty.

No. 16537.

Supreme Court of Oklahoma

April 20, 1926

Rehearing Denied Sept. 27, 1927.

Syllabus by the Court.

The provisions of chapter 212, S. L. 1923, in providing for the sale of real estate for the satisfaction of delinquent ad valorem taxes, and delinquent assessments for street improvement in cities and towns by foreclosure suit in the district court, and the extinguishment of all tax and assessment liens of every kind and character against such land upon confirmation of sale, is void for the reason that it has the effect of impairing the obligation of contracts and is violative of section 15 of the Bill of Rights, which expressly prohibits the passage of any law impairing the obligation of contracts.

"The laws existing at the time of the issuance of municipal bonds and under the authority of which they are issued, enter into and become a part of the contract in such a way that the obligation of the contract cannot thereafter be in any way impaired, or its fulfillment hampered or obstructed by a change in the law." Moore v. Otis et al. (C. C A.) 275 F. 747.

Said chapter 212, Acts of 1923, is also void because it has the effect of abridging the power of the state to levy and collect taxes, and therefore violative of section 5, art. 10 of the Constitution, and has the effect of extinguishing obligations due the state in violation of section 53, art. 5, of the Constitution.

Appeal from District Court, Muskogee County; Enloe V. Vernor, Judge.

Action by Bert Pitts, County Treasurer of Muskogee County, on the relation of S. H. Lattimore, County Attorney of Muskogee County, against H. B. Nelson and another, for a decree of sale of certain land. From a judgment for plaintiff, defendant named appeals. Reversed, with directions.

Thos. J. Wiley, of Muskogee, for plaintiff in error.

S. H. Lattimore, Co. Atty., of Muskogee, for defendant in error.

HARRISON J.

This was an action in the district court of Muskogee county by the county treasurer of said county, upon the relation of the county attorney thereof, against C. H. Nelson and H. B. Nelson, for a decree of sale of a certain tract of real estate situated in the city of Muskogee, and owned by said C. H. Nelson, and fully described in the judgment roll herein.

The object of the suit being to satisfy certain delinquent ad valorem taxes against said tract and also certain delinquent sewer assessments against same as being a certain sewer district No. 57, for the payment of which warrants had been issued, also certain delinquent street improvement assessments against said tract as being within a certain paving district No. 151, for the payment of which bonds had been issued.

The action was brought under chapter 212, S. L. 1923, against C. H. Nelson as the owner and occupant of said tract and against H. B. Nelson as the owner and holder of all the street improvement bonds issued for the street improvement in said district No. 151. Each of said defendants filed a separate demurrer to the petition on the ground that said petition did not state a cause of action. Both demurrers were overruled, and both defendants refused to plead further, and each stood on his demurrer, whereupon judgment was rendered decreeing the sale of said tract for the payment of said delinquent taxes and said sewer and delinquent street improvement assessments. From such judgment said H. B. Nelson, the owner of said street improvement bonds, has appealed here, contending that said chapter 212 is unconstitutional and void.

We shall not enumerate the various and sundry grounds and reasons urged against the constitutionality of said chapter 212, as we think it will suffice to say that it is contended that said statute violates practically every limitation contained in both state and federal Constitutions. However, we shall pass upon only such contentions as are finally and necessarily decisive of the invalidity of said act. The provisions of said act pertinent to the questions here involved are as follows:

"Section 1. When the tax charges (including ad valorem taxes and special assessments) against any parcel or tract of real estate shall exceed in amount the fair value of said tract or parcel of land, and either the ad valorem taxes or special assessments are delinquent for as long as three years, the said property may be sold by proceedings had in the district court of the county wherein said property is located, in the manner hereinafter provided.

Sec. 2. For the purpose of recovering the tax charges mentioned in section 1, and foreclosing the lien created thereby, an action may be filed in the district court in the name of the county treasurer, acting through the county attorney, against the record owner of the tract of land, the person in possession and against all holders of liens whether created by special assessments or otherwise. If the holders of bonds, certificates or other evidence of indebtedness created pursuant to special assessments, or other lien claimants be unknown, they may be served by publication as in cases against unknown heirs in cases affecting title to real property. * * *

Sec. 4. The court is hereby granted jurisdiction and authority by its judgment in any such case to direct the manner of sale, character of notice thereof and terms under which said property shall be sold, and the proceeds derived from such sale shall be disbursed as follows:

(a) If the sale price for said property shall be insufficient to pay the amount of special assessments thereon, then the whole of the amount realized from said sale, less costs of suit and expenses of the sale, shall be paid pro rata to the holders of bonds or other evidence of indebtedness issued pursuant to special assessments against said property in the order in which the liens therefor were created, and if the liens on said property for said special assessments were created at the same time, then the holders of all the bonds issued pursuant thereto shall be paid pro rata to the extent of the amount realized from said sale: Provided, however, such bonds or other evidence of indebtedness shall be surrendered to the

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