Opinion
14567
November 10, 1937.
In the original jurisdiction, April, 1937, Judgment for plaintiff.
Action by the Home Building Loan Association in the original jurisdiction of the Supreme Court against the City of Spartanburg and others to set aside a tax sale.
Report of W.C. Cothran, Special Referee, follows:
On June 1, 1936, the City of Spartanburg sold the six pieces of property described in the complaint to satisfy its lien for taxes at which time the plaintiff held fee simple deeds to each of said lots. Prior to the sale, the plaintiff attempted to stop the sale by injunction, the application therefor having been made before his Honor, Judge G.B. Greene. The application was refused by Judge Greene without prejudice, whereupon this action was commenced in the original jurisdiction of the Supreme Court, the object being to set aside the tax sale upon grounds specifically referred to hereafter.
Prior to this action another action was brought in the Court of Common Pleas for Spartanburg County by the same plaintiff against the same defendants, demanding similar relief. The action culminated in a decree by his Honor, Judge Oxner, in January, 1937, which will also be further mentioned. The present case presents several issues which were neither submitted to nor passed upon by Judge Oxner. In the case decided by him there is no difference in the status of the plaintiff in that case and here, as in both cases, the plaintiff was the owner of the lots involved in fee simple.
The defendants filed objection to the jurisdiction of the Court and also filed a demurrer by certain of the defendants, asking that as to them the complaint be dismissed upon the ground that no cause of action was stated against them. For the reasons stated in my report in the case of Cleveland v. City of Spartanburg et al., 194 S.E., 128, filed today, the objection to the jurisdiction of the Court cannot be recommended although it is recommended that the demurrer be sustained.
In view of the former action in which the decree of Judge Oxner was filed, I have grave doubts as to the proper maintenance of the additional grounds presented in the present case other than the ground relative to the penalty charged upon the 1936 taxes. The objections urged before Judge Oxner and passed upon by him were:
(1) The tax sale was void because of failure to levy and seize the property prior to the sale.
(2) That the tax sale was void because the lien of the city for taxes had expired.
(3) That the tax sale was void because it included penalties which were charged without legal authority.
The additional grounds presented in this action and not presented to Judge Oxner are:
(1) No attempt to first collect the taxes from the personal property.
(2) Failure to furnish amount of taxes due prior to sale.
(3) No penalty for 1936 taxes.
In the case of Holcombe v. Garland Denwiddie, 162 S.C. 379, 160 S.E., 881, 884, the Court quotes from the case of Johnston-Crews Co. v. Folk, 118 S.C. 470, 111 S.E., 15, as follows: "If the identity of the parties and the identity of the causes of action have been established, the former adjudication is conclusive, not only of the precise issues raised and determined, but of such as might have been raised affecting the main issue."
It would thus appear that the first and second questions above set forth as not being presented to Judge Oxner could and should have been presented in the other action and should thereby be concluded. However, as this objection is not specifically raised and is not referred to in the brief of counsel, the new grounds will be considered.
The grounds passed upon by Judge Oxner are now the subject of appeal to the Supreme Court, 194 S.E., 143, the record for appeal having been filed in that Court. It would, therefore, be rather a useless undertaking on my part to offer any recommendation to that Court as to what disposition it should make of Judge Oxner's decree. A correct disposition of that appeal will be made at an early date regardless of what recommendation I might care to offer.
The first of the so-called additional grounds will now be considered: It is that there was no attempt to collect this tax against the personal property of the plaintiff before recourse was had against the real estate.
For many years it was considered the general rule that the personal property of the delinquent taxpayer should first be exhausted before recourse be had against the real property ( Ebaugh v. Mullinax, 34 S.C. 364, 13 S.E., 613, cited in Taylor v. Strauss, 95 S.C. 295, 78 S.E., 883), and, in the Ebaugh case it was also held that the lien on the real property remained valid in case the personal property was insufficient to pay the amount of delinquent taxes. However, in 1902, Section 2570 of the present Code was passed by the General Assembly, by providing as follows: "The distress and sale of personal property shall not be a condition precedent to seizure and sale of any real property hereunder."
An exactly similar provision is to be found in Section 2833 of the present Code under the heading of "Property Liable for Distress and Sale for Delinquent Taxes."
In the case of Town of Cheraw v. Turnage, 184 S.C. 76, 191 S.E., 831, 836, the decree of the Circuit Judge, affirmed on appeal, contains the following statement: "The exhaustion of the personalty appears to be a prerequisite to collection out of the real estate," and cites Section 2853 of the Code and annotations thereunder as his authority. This section of the Code prescribes the form of tax executions to be issued by the county treasurer to the sheriff, directs the sheriff to levy by distress and sale of personal property, and, if sufficient personal property cannot be found, then by distress and sale of the land. The annotations first cite the case of Ebaugh v. Mullinax, supra, and also the case of Curtis v. Renneker, 34 S.C. 468, 13 S.E., 664, as showing that under certain statutes the personal property must first be exhausted before the land can be sold. Then the annotation proceeds as follows: "But under late tax Acts, the failure to exhaust the personalty does not necessarily defeat the title of the purchaser to land," citing cases.
Although they are not mentioned in this note, the "late tax acts" are evidently the sections of the Code above referred to. As the statement in the Turnage case was not at all necessary for the property decision of that case, it being used merely to demonstrate a distinction between a tax and a paving assessment lien, it may well be considered as obiter dicta on the part of the Circuit Judge.
I, therefore, recommend that this objection on the part of the plaintiff be not sustained.
The next additional ground is that the tax collector failed to furnish the amount of taxes due by the plaintiff.
It is true that Section 2831 of the Code provides for the payment of all taxes due by mortgagor to the mortgagee, and, under this section, the plaintiff herein had the right to pay the taxes due by the owner of the property for its own protection. By said section, it is implied that the holder of the mortgage has the right to obtain from the proper authorities the exact amount to be paid else his statutory right to make payment would be incomplete. However, there is nothing in the law which makes compulsory on the city authorities the duty or obligation to furnish such information, and certainly nothing to render invalid a tax sale when the information was not furnished. It is said in 61 C.J., 1998, that fraud or mistake of the officer which prevents the owner from paying his taxes is sufficient ground to set aside a sale. That is the only authority cited by the plaintiff to sustain the objection now being considered, and its inapplicability is apparent at a glance, there being no evidence whatsoever of either fraud or mistake on the part of the city. In fact, the testimony shows that one of the attorneys for the plaintiff went to the city hall in order to get information about these taxes. He was told that the office force was very busy, and that the young ladies in the office were busy working on the tax books. He was asked to come back after office hours and the books would be opened for his inspection, and that the exact amounts due would be given to him. Just why the attorney and the tax collector never met for the purpose of getting the desired information I am unable to say, as each rather heatedly blames the other. Suffice it to say that they did not meet, and the exact figures were not obtained. As there is no law requiring the furnishing of the information, and no penalty for failing to furnish it, I recommend that this ground of objection be not sustained. I am forced to say, however, that a little more patience, consideration, and co-operation on the part of both parties would have produced better results. As stated by some very wise man many, many years ago: "More flies can be caught with molasses than with vinegar."
This ground is hardly applicable to the case now being considered for the reason that the plaintiff is the holder of the legal title to the lots and is not the mortgagee as in case No. 1, 194 S.E., 137. However, in justice to both parties, this point has been considered although by agreement of the attorneys it was eliminated from case No. 1. The interest manifested by the attorneys and the amount of testimony taken thereupon warrant its consideration although such consideration may not be necessary.
The next ground to be considered is that there should be no penalty for the 1936 taxes. This question could not have been raised in the suit before Judge Oxner, and, in my opinion, is the only proper question to be considered in this case. Judge Oxner held, in the case now on appeal in the Supreme Court, that there was no provision made by ordinance whereby a penalty could be claimed by the city for delinquent taxes prior to 1936. The situation as to 1936 taxes is somewhat different, as will herein appear. Judge Oxner held that there was no valid ordinance passed imposing penalties for the years under consideration in his decree, the ordinance of July 6, 1936, not being involved in that case, whereas it is practically the sole issue here.
In the case on appeal, the plaintiff contended that the applicable statute was Section 7470 of the Code, while the defendant thought that Section 7437 was the proper one. In the present case, it makes little difference which section may be appropriate as both contain practically similar provisions which may be considered applicable. Both give to municipalities the size of Spartanburg the power to impose taxes. We may, therefore, take the provisions of Section 7470. It is therein provided that the city "shall have power to impose by ordinance published at least ten days * * * an annual tax," etc. Then follow these words: "The said council shall also have power to provide for the payment of a penalty," etc.
The ordinance imposing the tax was duly passed, and there is no contention as to its validity. The council passed another ordinance on July 6, 1936, without the ten-day publication, providing for a penalty on delinquent taxpayers, and this second ordinance is the subject of attack upon the following grounds:
(1) It was passed secretly.
(2) It was never published.
(3) It is an ex post facto ordinance contrary to the provisions of the Constitutions of the State and of the United States.
The allegation in the complaint is that the penalty ordinance was passed in executive session of the council. It is a rather common practice on the part of city councils to go into what they deem executive sessions, thereby dismissing all who are in attendance witnessing the working of the "city fathers." Ordinances are not passed at such sessions but confidential matters are freely discussed. The penalty ordinance was offered in evidence, and it appears to be regular in all respects, and there is not a word in the testimony to show that it was passed in secret or during an executive session. It was spoken of by the plaintiff's attorney as an amendment to the tax ordinance, but there is nothing in the ordinance or in the testimony to show that it was other than a separate ordinance, regularly passed. It cannot be recommended that this objection be sustained.
The second objection is that the penalty ordinance was never published. It is contended that as the city council was given power to pass a tax ordinance after ten days' publication, and, in the same section of the Code, authority was given the city to provide a penalty on delinquents, that the penalty ordinance should likewise be published for ten days. The proof shows that it was not so published.
This objection involves a construction of Section 7470 of the Code. The books are so full of cases holding that the intention of the legislative body is the first rule of construction of statutes that a citation of them is wholly unnecessary. Full effect must be given to each section, and the words must be given their plain meaning. Where there is no ambiguity, words must not be added to or taken from the statute. In this case there is no hint of an ambiguity, nor is there a use of jumbled or misunderstood words. Every word is so plain, every sentence so complete, that the legislative intent can hardly be misunderstood. As far back as Guery v. Kinsler, 3 S.C. 423, the Court has held that, where the terms of a statute are clear and not ambiguous, there is no room for construction, and Courts must apply them according to their literal meaning.
First, authority is given to the council to pass an ordinance after ten days' publication. Second, authority is given the council to impose a penalty. Both of these grants of power are within the discretion of the council. If the first be exercised it must be done as is provided; that is, by ordinance published for ten days. If the second be exercised, it shall be done by council. No mention is made of ordinance or publication, and the natural inference to be drawn from the words used is that the legislative intent is that the council could exercise its discretion in this regard in any way that it legally cared to do. The inclusion of the ordinance and the publication in the tax matter excludes the ordinance and publication in the penalty provision. The use of the term expressio unius est exclusio alterius, as used above, is never used to defeat the legislative intent, but is used to accomplish it. Matthews Co. v. Atlantic C.L.R. Co., 102 S.C. 494, 86 S.E., 1069.
The next and final ground of objection on the part of the plaintiff, as set out in the complaint, is that the penalty ordinance was ex post facto, and, therefore, in conflict with the provisions of the Constitutions, both of the State and of the United States.
The attorney for the plaintiff evidently wishes to raise the question here that the penalty ordinance is retroactive in its provisions, he having evidently, for the moment, lost sight of the fact that ex post facto laws apply only in penal and criminal matters. Byrne's Adm'rs v. Stewart's Adm'rs, 3 Desaus. 466. The objection will therefore be considered upon the basis of retroactive legislation. The city tax ordinance of October 25, 1935, levying a tax from October 20, 1935, to October 20, 1936, provides in Section 4 as follows: "City taxes for the fiscal year 1935-1936 shall be due and payable from the first day of June to the 10th day of July, inclusive, without penalty."
Section 5 provides: "That any person, firm or corporation failing to make payment of taxes as herein provided in Section 4 shall be subject to the penalty as prescribed by law."
It thus appears that the penalty ordinance which was passed on July 6, 1936, did not attempt to impose a penalty upon delinquent taxpayers until July 10, 1936. It was, therefore, not retroactive in its nature as it did not attempt to impose a penalty on any delinquent prior to its passage, but only upon those who were delinquent prior to the 10th day of July.
In the case of Citizens' Bank v. Heyward, 135 S.C. 190, 133 S.E., 709, it is held that statutes are to be construed as having only prospective operation, unless the purpose to give them retrospective effect is expressly declared or necessarily implied from the language used.
In the present case, there is nothing in the ordinance to indicate a retrospective effect, as the ordinance provides a penalty only upon those who are delinquent at a future date.
I, therefore, recommend that no one of the additional grounds of objection presented by the plaintiff in this case be sustained. As before stated, it is not my purpose to pass upon those questions presented to Judge Oxner and now the subject of appeal in the Supreme Court, and, hence, my recommendation is limited to a dismissal of the additional grounds presented by the plaintiff and discussed herein.
Messrs. DePass DePass, for plaintiff, cite: Notice to property owner, 79 S.C. 517. Execution: 99 S.C. 342; 83 S.E., 454; 27 N.W., 871; 55 N.W., 615; 95 S.C. 295; 83 S.C. 1; 65 S.E., 222; 31 S.C. 546.
Messrs. Odom Bostick and Esten C. Taylor, for defendants.
November 10, 1937. The opinion of the Court was delivered by
This case, instituted in the original jurisdiction of this Court, is here upon exceptions of the plaintiff to the report of Hon. W.C. Cothran, Special Referee, to whom it was referred. In our opinion, his well-considered report correctly disposes of the questions involved in the case, and we adopt it as the opinion of this Court. The report will be reported. While the exceptions are overruled, the plaintiff is entitled to the relief prayed for in its complaint upon the issues not passed upon by the Special Referee, but which have been determined in its favor by this Court, in the case heard by Judge Oxner. 194 S.E., 143.
A permanent injunction will, therefore, be issued, enjoining and restraining the City of Spartanburg, its agents and servants, from making conveyance of the property described in the complaint to the City of Spartanburg, or to any other person.
MR. CHIEF JUSTICE STABLER and MESSRS. JUSTICES BONHAM and BAKER concur.
MR. JUSTICE CARTER did not participate on account of illness.