State v. Towner County

CourtUnited States State Supreme Court of North Dakota
Citation283 N.W. 63,68 N.D. 629
Docket Number6551
Decision Date13 December 1938

Syllabus by the Court.

1. Section 176 of the Constitution of this State exempts all property of the State from taxation and this exemption applies to the lands and properties of the State obtained from the United States under a grant of land and property to the State for educational purposes, which grant was accepted by the State of North Dakota by constitutional provisions wherein the lands and proceeds are declared to be a perpetual fund, " and no part of the fund shall ever be diverted even temporarily, from this purpose or used for any other purpose whatever * * * *", and if said land is sold that, " No grant or patent for any such lands shall issue until payment is made for the same; provided, that the lands contracted to be sold by the state shall be subject to taxation from the date of such contract." Sections 153 to 176 of the Constitution as amended.

2. Section 325 of the Compiled Laws, making provision for the sale of said land, provides: " The lands so contracted to be sold by the state shall be subject to taxation from the date of such contract and the taxes assessed thereon shall be collected and enforced in like manner as against other land * * *" Such section, however, provides further that the contract of sale may be declared null and void for the nonpayment of taxes, and, further, that if not so nullified the land may be sold at tax sale, " and the purchaser at such tax sale of any such lands so sold shall only acquire by virtue of such purchase, such rights and interests as belong to the holder and owner of the contract of sale * * * and the right to be substituted in the place of such holder * * *. But no tax deed shall be issued upon any tax certificate procured, under the provisions of this section while the legal title of said lands remain in the state of North Dakota * * *" ; and, further, that " Whenever the contract for the sale * * * has been cancelled, * * * thereafter such lands shall not be listed for taxation * * *."

3. In view of the foregoing provisions it is held that the constitutional provision making such land " subject to taxation from the date of such contract" means that the only interest in the land subject to the lien of taxes is the interest of the purchaser of the land.

4. When such contract for the sale of land is canceled, the land reverts to the State, and no interest therein is subject to taxation until a resale or redemption is made, and upon reversion of the land to the State all unpaid taxes levied thereon are canceled.

Appeal from District Court, Towner County; G. Grimson, Judge.

Action by the State against Towner County to quiet title in plaintiff to certain land and to adjudge that defendant's claims for taxes be adjudged null and void and to require defendant to cancel such taxes. From a judgment in favor of the defendant, the plaintiff appeals.

Judgment modified and as modified affirmed.

Alvin C. Strutz, Attorney General, and C. E. Brace, Assistant Attorney General, for appellant.

No provision of the state Constitution can be held to conflict with or annul Article 29, amending § 176 of the said Constitution unless such construction is imperative. State ex rel. Morris v. Sherman, 63 N.D. 9, 245 N.W. 877; State ex rel. v. Hall, 125 Neb. 236, 249 N.W. 756.

The presumption of law is that a legislative enactment is constitutional unless it is clearly shown that it contravenes some provision of the state or Federal Constitution. State ex rel. Haggerty v. Nichols, 66 N.D. 355, 265 N.W. 859.

No property is beyond the reach of the taxing power unless put beyond it designedly and by an unequivocal act of the sovereign power. Robertson v. State Land Office, 44 Mich. 274, 6 N.W. 659; School Dist. v. Hefta, 35 N.D. 637, 160 N.W. 1005.

Homestead lands belonging to the United States were not taxable so long as the entryman had not made final proof, but when final proof was made and final certificate delivered the land became taxable. Cooley, Taxn. 4th ed. § 605.

If a homestead entry is cancelled for fraud, a levy of taxes on the land, and a sale thereunder, are void and of no effect. Durham v. Hussman, 88 Iowa 29, 55 N.W. 11.

A mortgage lien prior in point of time takes precedence over a tax lien unless otherwise provided by statute. Cooley, Taxn. 4th ed. 2472, § 1240.

In the absence of a constitutional prohibition, the legislature can declare that taxes on realty, although levied subsequent to the execution of a mortgage, shall have priority. Eagle Point Irrig. Dist. v. Cowden (Or.) 1 P.2d 605; State v. Burleigh County, 55 N.D. 1, 212 N.W. 217.

The legislature has power to give tax liens priority over all other liens of whatever nature. Cooley, Taxn. 4th ed. § 1240; Pugh v. Commissioner of Sinking Funds, 53 N.J.L. 629, 23 A. 270.

The state will not attempt to enforce a lien for taxes against municipally owned property. People v. Doe, 36 Cal. 220; People ex rel. Doyle v. Austin, 47 Cal. 360.

After the state acquires property, all power to enforce a tax lien thereon, even for taxes assessed prior to such acquisition, is arrested and abated. State v. Locke, 29 N.M. 148, 219 P. 790, 30 A.L.R. 407; Gasaway v. Seattle, 52 Wash. 444, 100 P. 991, 21 L.R.A.(N.S.) 68; State v. Snohomish County, 72 Wash. 320, 128 P. 667.

Assessments should be made against such lands only as are subject to taxation. Erickson v. Cass County, 11 N.D. 494, 506, 92 N.W. 841; Chicago v. People, 80 Ill. 384; People v. Trustees of Schools (Ill.) 7 N.E. 262.

"No person or municipality can acquire as against the state a vested right to taxes, or the right to collect them when levied. . . ." Gasaway v. Seattle, 52 Wash. 444, 100 P. 991.

The legislature did not intend to make the investment of school funds and sinking funds precarious by subjecting them to the liability of being swept away by the summary process of tax sales. Public Schools v. Trenton, 30 N.J.Eq. 667; Chicago v. People, 80 Ill. 384.

When state's rights are to be transferred or affected by statute, the intention must be clearly expressed or necessarily implied. State Land Bd. v. Campbell (Or.) 13 P.2d 346; Cornelius v. State, 40 Okla. 733, 140 P. 1187.

J. J. Kehoe, State's Attorney, for respondent.

As in regard to statutes, so in regard to constitutions, contemporaneous and legislative expositions are frequently resorted to, to remove and explain ambiguities. Sedgwick, Statutory & Const. Law, 412; People ex rel. Gallup v. Green, 2 Wend. 266; People v. Wright, 6 Colo. 92.

The power of taxation is one of the highest attributes of sovereignty. It is inherent in the state. State v. Nichols, 66 N.D. 355, 265 N.W. 859.

Where the Constitution exempts certain property without further providing in express terms that no other property shall be exempted, or where the Constitution grants the legislature the power to exempt certain classes of property from taxation, a prohibition against any other or further exemption is implied. 60 C.J. 389, § 390.

Where there is a general provision and a specific one, the specific one must be given full effect. 11 Am. Jur. 663.

Where two statutes treat of the same subject matter, the one general and the other specific, the special provisions control the general. State ex rel. March v. White, 41 Utah 480, 126 P. 330; Nelden v. Clark, 20 Utah 382, 59 P. 524; University of Utah v. Richards, 20 Utah 457, 59 P. 96, 77 Am. St. Rep. 928; Crane v. Reeder, 22 Mich. 322.

It does not follow that because the legislature failed to expressly declare that a lien for taxes is superior to all other liens that such a lien should be subordinate. Minnesota v. Central Trust Co. 94 F. 244, 36 C.C.A. 214; Osterberg v. Union Trust Co. 93 U.S. 424, 23 L. ed. 964.

There is a distinction between the right accruing to the state in handling revenues belonging to it and the rights of the state arising from control of the common school fund held in trust by the state. Woods County v. State (Okla.) 257 P. 778, 53 A.L.R. 128.

In the absence of constitutional restraint, the power of the legislature over taxation is as unlimited as the subject with which it deals. State ex rel. State Tax Commission v. Redd, 166 Wash. 132, 6 P.2d 619; 26 R.C.L. 27.

The taxing power of the state is never presumed to have been relinquished unless the language in which the surrender is made is clear and unmistakable. Erie R. Co. v. Pennsylvania, 21 Wall. 492, 22 L. ed. 595; 1 Cooley, Taxn. 4th ed. 159, § 60.

Burr, J. Christianson, Ch. J., and Morris, Sathre and Nuessle, JJ., concur.


There is no dispute as to the facts in this case. The land involved herein is part of the permanent school fund of the state of North Dakota created by the United States grants and otherwise; and the state of North Dakota is, and at the time of the commencement of this action was, the owner in fee of said land. In November, 1919, the board of university and school lands sold this land to J. F. Thomas, the purchase price being $ 6,400.00. The purchaser paid $ 1,280.00 on the purchase price at the time of sale and agreed to pay the remainder in four equal payments, with interest at 6%, but defaulted in the payments, and on or about January 12, 1925, the contract was duly canceled.

During the years 1920 to 1924, inclusive, the defendant levied annual taxes against the land, and "no part of said taxes have been paid and the same still stands of record in the offices of the treasurer and the county auditor of the defendant."

The complaint sets forth these facts narrated and alleges that the defendant claims a lien on the premises for the taxes assessed against the...

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