Telonis v. Staley

• Decision Date: 29 December 1943
• Docket Number: 6168
• Citation: 104 Utah 537,144 P.2d 513
• Court: Utah Supreme Court
• Parties: TELONIS v. STALEY ET AL

144 P.2d 513

104 Utah 537

TELONIS v. STALEY ET AL

No. 6168

Supreme Court of Utah

December 29, 1943

Appeal from District Court, Seventh District, Carbon County; George Christensen, Judge.

For former opinion, see 106 P. 2d 163.

Former decision of Supreme Court and judgment of the lower court reversed, and cause remanded, with instructions to grant a new trial.

H. G Metos and Allen T. Sanford, both of Salt Lake City, for appellant.

Henry Ruggeri and F. W. Keller, both of Price, and O. K. Clay, of Salt Lake City, for respondents.

Thomas & Thomas, of Salt Lake City, amicus curiae.

McDONOUGH Justice. WOLFE, C. J., and MOFFAT, J., concur. LARSON Justice, dissenting. PRATT, J., on leave of absence.

OPINION On rehearing.

McDONOUGH, Justice.

Plaintiff appealed from a judgment of the district court of Carbon county quieting defendants' title to the surface rights of certain coal mining property. We affirmed the judgment of the district court in an opinion and decision reported in 106 P.2d 163, 104 Utah 505. For reasons deemed adequate by the court, appellant's petition for rehearing was granted, and the case was reargued and reconsidered by the court.

In 1932 the Union Pacific Coal Company was the owner of record of property in Carbon County involved in this action. The State Tax Commission in that year assessed the values of the real estate, separately evaluating the surface rights and the mineral rights, and certified the same to Carbon County. These values were spread upon the county tax records. The company failed to pay the taxes, and after advertisement for delinquency the property on January 10, 1933, was sold for taxes to Carbon County. Record of the sales was noted in the Treasurer's office and a tax sale certificate for each tract was filed with the County Recorder. No redemption was made, and on January 12, 1937, the County Auditor issued auditor's tax deeds to the county. The property was advertised and offered for sale at the May sale, but there were no bidders. On June 18, 1937, at private sale for a consideration of $ 2,000, the county sold and conveyed to defendants Staley and Sillitoe, the surface rights to the property. In December, 1937, Staley and Sillitoe mortgaged the surface rights to defendant Carbon-Emery Bank for $ 4,000. On January 11, 1938, Union Pacific Coal Company, for a consideration of $ 200, quitclaimed the real estate to plaintiff, who on February 2, 1938, commenced this action by filing a complaint in the simplest form to quiet his title. By both answer and counter-claim defendants asserted title in Staley and Sillitoe by virtue of the tax sale proceedings above noted.

The questions presented for reconsideration are as follows:

1. Are mineral rights and surface rights required to be separately taxed and sold when ownership of both reside in the same person?

2. May a tax sale certificate which does not show the year for which the property was sold for taxes nevertheless be admitted in evidence as a prima facie showing that necessary steps leading to the sale had been taken?

3. Did the failure of the County Auditor to authenticate the assessment roll with his affidavit as required by statute invalidate the assessment and sale for taxes?

We consider these questions in the order set forth.

1. In this case, Union Pacific Coal Company, grantor of plaintiff, owned both the surface and mineral rights in the land used for mining purposes. It made no request that the surface be taxed on its valuation separately from the mines and mineral rights. Owing to the common ownership and failure of the owner to request separate taxation, it was proper for the county officials to aggregate the valuations of both surface and mineral rights in applying the tax levy and in all proceedings subsequent thereto. Section 5864, C. L. Utah, 1917, as amended by Chap. 53, Laws of Utah 1931, and as embodied in Sec. 80-5-56, R. S. U. 1933, which relates to assessment of mines and mining properties, provides in part:

"* * * In all cases where the surface of lands is owned by one person and the mineral underlying such land is owned by another, such property rights shall be separately assessed to the respective owners."

Where the surface and underlying mineral of a claim or land are owned by the same person as shown by the records, they may be advertised and sold as one even though assessed separately. The reason for this is that where the surface property has adaptability for uses other than mining purposes and is actually used for such other purpose, is has an additional assessable value which should be shown in the same manner as improvements are required to be shown in the assessment. Barnard Realty Co. v. Butte, 50 Mont. 159, 145 P. 946. But there is no requirement of the statute that the rights separately assessed should be separately advertised and sold. Nor is such the reasonable implication of Sec. 80-5-56, R. S. U. 1933, which merely requires assessment to the respective owners when the surface is owned by one person and the underlying mineral to another. Where there is separate ownership of the respective rights, separate levy and separate sale would necessarily follow; but where the rights are all owned by the same person the statute does not contemplate that, nor has any reason been shown why, the rights should be separately sold.

Utah Copper Co. v. Chandler, 45 Utah 85, 142 P. 1119, and Utah Copper Co. v. Eckman, 47 Utah 165, 152 P. 178, cited by the appellant, do not require a contrary conclusion. In each of these cases, the surface rights were occupied and used by the defendant and were assessed to him. The question raised was whether the defendant had by adverse possession (including the payment of taxes) acquired title thereto. While the apparent implication of these cases is that a separate estate in the surface rights was created by occupancy and use, thus justifying assessment to the claimant, we are not called upon to examine into the validity of such holding, since, though it be valid, it does not follow that where such rights are unquestionably owned by the same person they are to be regarded as separate estates for purposes of tax levy and sale.

2. The form of the certificate of sale is governed by Sec. 6021, Chap. 139, Laws of Utah 1921 (as modified it became 80-10-35, R. S. U. 1933), which specifies:

"The certificate of sale shall be substantially in the form hereinafter provided,"

and the form recites a sale of the property by the treasurer for the

"delinquent state, state school, state high school, county, city, city school, . . . . and district school taxes, for which said property is liable, assessed in the name of . . . . as owner for the year . . . ., together with the penalty provided by law and the costs of sale; that a description of the property sold is as follows, to wit: . . . ."

If the certificate were "substantially in the form hereinafter provided" the words "city, city school" would have to be deleted if the property were outside the limits of any city or town. The Legislature specified a form which would have to be modified as far as including the words "city, city school," if the property were not within any city or town. To be substantially in the form specified in the statute, the certificate would have to show the year in which the taxes were levied and for which year the sale was made.

Immediately following the form of the certificate in Sec. 6021, Chap. 139, Laws of Utah 1921 (Chap. 95, Laws of Utah 1915), appears the following:

"The certificate of sale herein provided for, when signed by the county treasurer and delivered to the purchaser, shall be prima facie evidence of the regularity of all proceedings connected with the assessment notice, equalization, levies, advertisement, and sale of the property therein described, and the burden of showing any irregularity in any of the proceedings, resulting in the sale of property for the non-payment of delinquent taxes, shall be on him who asserts it. * * *" (Italics added.)

When the foregoing provisions were incorporated into Revised Statutes of Utah, 1933, as part of Section 80-10-35, the italicized words "herein provided for" were deleted and the word "when" and the phrase "and delivered to the purchaser" were also deleted; and between the words "assessment" and "notice" a comma was inserted to read, "assessment, notice." Chapter 101, Laws of Utah 1939, Section 80-10-35, R. S. U. 1933, was amended so that no certificates of sale are issuable in tax sale proceedings conducted after September 1, 1939. The amended section now reads as follows:

"A copy of the record of any tax sale duly certified by the official custodian of such record at the time of the certificate under the seal of his office as a true copy of the entry in the official record showing such sale is prima facie evidence of the facts therein shown, and the regularity of all proceedings connected with the assessment, valuation, notice, equalization, levies, tax notices, advertisement and sale of the property therein described, and the burden of showing any irregularity in any of the proceedings resulting in the sale of property for the nonpayment of delinquent taxes shall be on him who asserts it." (Italics added.)

The words italicized were inserted in the 1939 amendment. Although the 1921 statute does not by literal construction make the tax sale certificate prima facie evidence of the regularity of all proceedings connected with the assessment or the issuance of the tax notices, and while the statute as modified in Section 80-10-35, R. S. U. 1933, does not mention "tax notices," it is reasonably clear that the purpose of these statutory provisions is to make a tax sale certificate which is executed in...