Wall v. McNee, 8120.

• Court: United States Courts of Appeals. United States Court of Appeals (5th Circuit)
• Writing for the Court: FOSTER, SIBLEY, and HUTCHESON, Circuit
• Citation: 87 F.2d 768
• Parties: WALL et al. v. McNEE.
• Docket Number: No. 8120.,8120.
• Decision Date: 29 January 1937

87 F.2d 768 (1937)

WALL et al.
v.
McNEE.

No. 8120.

Circuit Court of Appeals, Fifth Circuit.

January 29, 1937.

Cary D. Landis, H. E. Carter, and James B. Watson, all of Tallahassee, Fla., for appellants.

D. C. Hull, Erskine W. Landis, and Francis P. Whitehair, all of De Land, Fla., for appellee.

Before FOSTER, SIBLEY, and HUTCHESON, Circuit Judges.

SIBLEY, Circuit Judge.

The decree appealed from adjudged unconstitutional as applied to the complainant-appellee Janet McNee, because impairing the obligation of her contract as a bond creditor of St. Lucie Inlet District and Port Authority, a statute of Florida enacted in 1933 (Acts Fla.1933, c. 16252), which made "bonds or matured interest coupons of all counties or other taxing districts receivable at par and in lieu of money in redemption of tax-sales certificates or other evidences of tax liens held in the name of the State * * * for all purposes other than the levy made for State taxes." Section 6. The act expressly requires the state's part of the taxes to be paid in cash, the payment in bonds and coupons being restricted to taxes due to a county or other taxing district, and that the bonds and coupons received be held uncanceled for adjustment of accounts between the county and taxing districts interested.

The taxing district here involved issued bonds in 1926 of which the complainant-appellee owns $43,000. The special statute authorizing them required the levy each year of a tax upon all the real and personal property of the district sufficient to pay interest on the bonds and to provide a sinking fund to pay the principal, the tax to be collected as other taxes are. Taxes were levied accordingly in

87 F.2d 769

each year, but were largely uncollected, so that the sinking fund is insufficient to pay matured bonds and the interest is in default since 1931. At the filing of the bill tax-sale certificates amounting to $212,639 were outstanding against the property of the district for its uncollected taxes. The record shows that, since the collapse in 1926 of the Florida boom and the consequent reduction in property values, the taxes necessary to service large local bond issues have been such as to cause nearly half of the land of the state to pass under tax-sale certificates and thus off the tax-paying rolls. In the effort to absorb the defaulted obligations of the counties and lesser taxing districts and to redeem the certificated property and return it to the active tax rolls, the statute under attack and others have been passed. In 1929 an act (Acts Fla.1929, Ex.Sess., c. 14572) was made authorizing the sale of tax certificates, after the two-year period for redemption, for less than the taxes due. It was upheld as against a property owner in Ridgeway v. Peacock, 100 Fla. 1297, 131 So. 140. A 1931 act (Sp.Acts Fla. 1931, c. 15810) made a...