State v. Sheridan County
| Decision Date | 27 October 1942 |
| Docket Number | 6863. |
| Parties | STATE v. SHERIDAN COUNTY. |
| Court | North Dakota Supreme Court |
Rehearing Denied Nov. 9, 1942.
Syllabus by the Court.
1. A statute must be construed as a whole. The intention of the lawmakers must be deduced from a view of the whole statute and of every part thereof taken and compared together.
2. Chapter 254, Laws 1935, which authorizes the Board of University and School Lands "in all cases where a mortgage held by the State of North Dakota as security for investment of the permanent school funds in this state is in default and foreclosure thereof is deemed advisable" to "accept from the record title owner of the land covered by that mortgage a deed of conveyance to the State of North Dakota of said mortgaged land," is construed; and for reasons stated in the opinion, it is held, that a deed of conveyance to the state under said Chapter 254, Laws 1935 does not operate to cut off and terminate the rights and interests under a prior tax deed.
Alvin C. Strutz, Atty. Gen., and C. E. Brace, Asst. Atty. Gen., for appellant.
Geo. Thom, Jr., State's Atty., of McClusky, for respondent.
The plaintiff brought this action to quiet title to certain lands in Sheridan County in this state. In its complaint, the plaintiff alleges that it is the owner of the land and that the defendant claims an estate in or lien upon the premises by virtue of a tax deed, and that such tax deed has been rendered inoperative and vests no right or interest in the defendant.
The material and undisputed facts are: On March 11, 1925, the plaintiff through its Board of University and School Lands, and other duly constituted officers, loaned to one Augustadt $800 of the permanent school fund of the state; that to secure payment of such loan the said Augustadt, as mortgagor, mortgaged the land in question to the plaintiff, and as a result the plaintiff acquired a valid first mortgage lien upon the said premises. Thereafter default occurred in the terms of said mortgage in that the mortgagor failed to pay interest on and principal of the loan, and taxes upon the premises, and that thereupon the plaintiff, by virtue of said default declared the loan due, and intended to foreclose its mortgage; that instead of making foreclosure the plaintiff, on February 24, 1941, took from the mortgagor a quitclaim deed for said premises, pursuant to the provisions of Chapter 254, Laws of 1935.
The taxes against said lands for the year 1931 having become delinquent, said lands were offered for sale, and bid in by the defendant county, at the tax sale held December 13, 1932. No redemption was made, and pursuant to proceedings duly had a tax deed was issued to the defendant county on March 2, 1940.
It was, and is, the contention of the plaintiff that, under the provisions of Chapter 254, Laws of 1935, the deed that was executed and delivered to the plaintiff by the mortgagor, Augustadt, operated to abrogate and terminate any and all rights and interest of the defendant by virtue of the tax deed.
The trial court rendered judgment that the tax deed still remains in force and effect, and that by virtue thereof, the defendant county is the owner of the land, that the plaintiff's mortgage is a valid first lien on the land, and that the title of the county under the tax deed is subject to the lien of such mortgage. The plaintiff has appealed from such judgment and demands a new trial in this court.
The plaintiff predicates its right of action solely upon the following provision of Chapter 254, Laws of 1935:
The legislative assembly which enacted this statute was confronted with grave conditions resulting from drought and the economic depression. The value of farm lands had been greatly depreciated, and in a large number of instances farm mortgages were in default. These conditions confronted all individuals, concerns, and agencies, public and private, having investments in farm mortgages.
The situation was recognized by all three departments of both the state and national governments. Congress created new financing facilities and agencies for the sole purpose of aiding farmers who were unable to pay mortgages against their farms. These financing agencies took cognizance of the fact that it would be necessary for holders of mortgages on farm property to reduce or scale down the accrued and unpaid interest in order to enable the farmers to refinance their indebtedness through the Federal Land Bank and the Land Bank Commissioner.
The Industrial Commission of North Dakota and the manager of the Bank of North Dakota took cognizance of the existing conditions and authorized a scaling down of interest on, and in some instances of even a part of the principal of, the real estate mortgages executed to the Bank of North Dakota under the provisions of Chapters 147 and 154, Laws 1919, and the acts supplementary to and amendatory thereof. The Board of University and School Lands also took cognizance of the existing conditions. A large number of the real estate mortgages, in which the trust funds under its control had been invested, were in default, and it was apparent that in many cases the debtors could not pay the principal and interest of their indebtedness, and the Board of University and School Lands sought to authorize the scaling down of interest on its defaulted mortgages where that appeared to be to the best interest of the state, in order to enable a mortgagor to avail himself of the refinancing provided by the Federal Land Bank and the Land Bank Commissioner (State v. Board of University and School Lands, 65 N.D. 687, 702, 262 N.W. 60); but this court held that the Board of University and School Lands was without power to authorize a reduction of any part of the past due interest. State ex rel. Board of University and School Lands v. Hanson, 65 N.D. 1, 256 N.W. 201.
This was the condition that confronted the Legislative Assembly when it convened in January, 1935, and the proceedings of that Assembly bear...
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