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District Court of Appeal, Second District, Division 1, California.

ANGER v. BORDEN et al.

Civ. 17879.

Decided: June 29, 1951

Jacob Forst, Los Angeles, for appellant. H. Burton Noble, City Atty., of Pasadena, Frank L. Kostlan, Asst. City Atty., Robert E. Michalski, Deputy City Atty., Pasadena, for respondent.

This action comes before us upon a settled statement, from which it appears that plaintiff and appellant, C. F. Anger, brought an action for partition and to quiet title against several defendants, including defendant and respondent City of Pasadena. The dispute here presented involves only said appellant and respondent city, concerning two parcels of land.

Parcel 1 was deeded to the City of Pasadena by its city treasurer on May 29, 1925, for nonpayment of city property taxes and special assessments totaling $24.52. The amount claimed by the city to be necessary to redeem this property from such sale on the date of the trial was the sum of $247.91. The property was also sold at a tax sale by the State of California on February 16, 1945, it having been deeded to the state in 1937 for delinquent Los Angeles County taxes. The purchaser at the latter sale paid $55 for the tax deed, and thereafter conveyed his interest to appellant. Appellant also holds Street Improvement Bond 1, Series A, Improvement of Willard Place, issued April 12, 1927, under the Improvement Act of 1911 (Stats. 1911, p. 730, now Div. 7, Streets & Highways Code). This bond matured on January 2, 1937, and had not been foreclosed by court action or sale through the City Treasurer's Office. The court, on motion of respondent struck the improvement bond from the record on the ground that the lien evidenced by such bond had been extinguished under the provisions of section 2911 of the Civil Code.

As to Parcel 2, it appears that the property was deeded to respondent city by its treasurer on May 21, 1934, for nonpayment of city property taxes and special assessments totaling $52.29. The amount claimed by respondent city to be necessary to redeem the property was $1,415.96. Appellant purchased the property at a tax sale held by the State of California on August 5, 1948, the property having been previously deeded to the state in 1934 for delinquent county taxes. Appellant paid $20 for this deed.

The points raised by appellant in the statement of appeal are as follows:

‘1. That the claim of the City of Pasadena for its general taxes accruing after the said City of Pasadena received the deed from (the city tax collector of) the City of Pasadena should not be allowed.

‘2. That plaintiff is entitled to a lien for the balance due on Bond 1, Series A, Improvement of Willard Place, 1927, as shown by the coupons attached thereto * * *.’ (This contention refers only to Parcel 1.)

‘3. That plaintiff is entitled to a reasonable sum for attorney's fees for quieting the titles involved, which sum should be fixed by the trial court at the time of trial.’

Appellant's first point on appeal is stated in his brief as follows: ‘In a partition suit, what are the rights of a street bond on which the last payment is more than four years old?’ Appellant then points out that this question was presented in Sipe v. Correa, Cal.App., 227 P.2d 59, (hearing granted by Supreme Court, April 2, 1951), and appellant adopts the brief therein by reference. The case was decided by this court subsequent to the filing of appellant's brief herein, and adversely to the contentions of the appellant in that case. Following the rule laid down in the cited case, as well as in the cases of Rombotis v. Fink, 89 Cal.App.2d 378, 201 P.2d 588, (hearing denied by Supreme Court), Gordon v. Rombotis, Cal.App., 227 P.2d 548, and Scheas v. Robertson, Cal.App., 224 P.2d 760, it must be held that the trial court, upon the record presented, did not err in holding that the lien of appellant's street bond had been extinguished under the provisions of section 2911 of the Civil Code.

Appellant's second point is presented as follows:

‘Is a city, which owns its own tax deed, entitled to a lien, in a partition suit, arrived at upon a different and greater basis than the lien of the county tax deed which has passed into private hands?’

By its decree as to Parcel 1, the court adjudged ‘that the title of said C. F. Anger and the City of Pasadena thereto, as tenants in common, is hereby adjudged to be quieted against all claims and demands of the said defendants, who are hereby forever debarred from asserting any claims * * *. That the plaintiff (appellant) is entitled to a lien on said property in the sum of $55, and that the City of Pasadena is entitled to a lien in the sum of $24.52, the sum of its tax deed and assessments, plus general taxes accruing subsequent to the time it obtained its tax deed, in the further sum of $223.39, making a total lien of the City of Pasadena, in the sum of $247.91.’ (Emphasis added.) A similar decree was entered as to Parcel 2, the lien of appellant amounting to $20.60, and that of respondent city amounting to $1,424.80. The effect of the decree is that the respondent city is given a lien against the property for the full amount of the Pasadena delinquent taxes and penalties for all the years following the first delinquency although Parcel 1 had been sold to the city in 1925 and Parcel 2 in 1934, whereas appellant's lien is limited to the amount paid for his tax deed from the State of California. (The court found that plaintiff paid all taxes against the property due to the County of Los Angeles at the time of filing the complaint, and had made no claim for said sums and was given no judgment therefor.) The finding as to the amount of the city's lien was based on testimony of the City Assessor, Tax and License Collector of Pasadena as to ‘the amount necessary to redeem said property on the date of the trial.’

A portion of appellant's argument is as follows:

‘In Elbert [Ltd.] v. Nolan, 32 Cal.2d 610, 197 P.2d 537, it is held that when a lien has become a deed, the deed holder receives only the amount paid for the deed, plus one-half of the surplus, if any, on partition sale. If the lien has not gone to deed, the amount of the lien is to be paid, but without half of the surplus.

‘In this case appellant, a private party, got the amount paid for the county tax deed, but the respondent City got the amount paid for its deed, plus the full amount of what the taxes would have been had it not elected to get a deed, plus one-half of the surplus, if any, on partition sale.

‘Section 3950, Revenue and Taxation Code, compels a tax deed buyer to pay all taxes, after the tax deed, to the time of filing suit if he wished to sue. (Each tax deed pays taxes due to the date of the deed.) This can only be for the purpose of urging the prompt clearing of titles and providing a penalty for delays. Appellant paid such taxes, and got nothing for the payment. The City was given the privilege of being a property owner, and collecting taxes also. It is forgiven its laches as only citizens must act promptly and pay taxes. The doctrine of parity should place the City in the same position as a private party.

‘Because unpaid taxes, with interest and penalties, pile higher than the value of the property, general statutes, applicable to private parties, were once applied to cities to check this evil. ([City of] San Diego v. Higgins, 115 Cal. 170 [46 P. 923]; Clark v. [City of] San Diego, 144 Cal. 361 [77 P. 973]; Dranga v. Rowe, 127 Cal. 506 [59 P. 944].)

‘The cities had this changed by statute in their favor, and the evil of properties off the tax rolls because of huge taxes got so bad that section 3900, Revenue and Taxation Code, was passed and upheld.

‘One of respondent's tax deeds was issued in 1925. If the City would act to get a new tax deed, this new tax deed would wipe out the old one and its back taxes. (Helvey v. Bank of America, [Nat. Trust & Savings Ass'n], 43 Cal.App.2d 532, 111 P.2d 390.) However, the city prefers not to act and to receive more for its lack of diligence.’

Appellant further argues: ‘While respondent never raised this point in pleadings, findings, judgment, trial brief or settled statement, it may be relying on Section 3695, Revenue and Taxation Code. This section provides that if a taxing agency does not object to the sale of a county tax deed, all its taxes and assessments are eliminated. If it does object, ‘the lien of its taxes or assessments or any rights' are not affected.’

It is further argued that giving respondent the full benefit of the section just cited, nevertheless respondent's own charter, section 15, ‘commanding it to pattern its laws as nearly as practical to the laws of the State of California, would seem to compel a respect for section 3900, Revenue and Taxation Code, and the decisions affecting other taxing agencies and private parties.’ Under the city ordinance, appellant urges, assessments are provided for only until the land is deeded to the city, but that a redemptioner must pay assessed back taxes and an amount ‘based upon the respective rates effective the year not so assessed.’ Under the decisions in Sutter-Yuba Inv. Co. v. Waste, 21 Cal.2d 781, 136 P.2d 11, and Imperial Irr. Dist. v. Varney, 87 Cal.App.2d 264, 196 P.2d 820, ‘ordinarily there are no taxes subsequent to the deed to a taxing agency for its taxes.’ Therefore, concludes appellant, ‘even under section 3695, Revenue and Taxation Code, and its own charter and ordinances, respondent city is not entitled to taxes not assessed after it got its tax deed. It is limited to the words ‘or any rights' meaning its rights as a tax deed holder under section 3900, Revenue and Taxation Code, which places it on a parity with other deeds of a governmental origin.’

Respondent, conceding that the respective tax lien claims of the city and appellant are on a parity, Monheit v. Cigna, 28 Cal.2d 19, 168 P.2d 965, 167 A.L.R. 995; Rev. & Tax. Code, sec. 3900, urges ‘that the quantum of its (respondent city's) lien is the amount necessary to redeem on the date of partition.’ The tax ordinance of respondent city (Ord. No. 3108) does not provide that the right of redemption shall terminate upon execution of a deed to the city, but provides for termination of such right of redemption after the city has become the owner either by sale, by entry and use for a public purpose, or by notice. To apply the rule in the Monheit case strictly, it is urged, the city would be forced to elect one of three methods of termination rather than to hold the property subject to the right of redemption until the owner decides to redeem, as has been the city's policy in the past. ‘Such a decision would compel the city to terminate the right of redemption on the date a deed is issued to the city contrary to the intent of the tax ordinance.’ Taxation for municipal purposes, argues the city, is a ‘municipal affair’ citing Keyes v. City and County of San Francisco, 177 Cal. 313, 173 P. 475; Brewer v. Feigenbaum, 47 Cal.App.2d 171, 117 P.2d 737. ‘Whereas now the owner of property cannot redeem without paying all the taxes, interest and penalties to the date of redemption, the purchaser of a deed from the state under appellant's theory could get clear title to the property upon payment of only six years' city taxes. The property thus escapes taxation for intervening years, the city is deprived of revenue, contingent as it may be, a speculator is favored over the owner, and the city's tax system becomes a shambles and a nullity.

‘Should the court accept appellant's theory, an owner would be foolish, indeed, to redeem his property at great cost if through the medium of a dummy buyer at a county tax sale he could acquire the state's title and after partition obtain clear title by paying only six years' city taxes. The city could not save itself from this anomalous situation by putting up for sale the hundreds of lots to which it holds a tax deed at the full price as required by section 57 of its tax ordinance because no person would be naive enough to buy knowing that he could avoid all delinquency penalties and all taxes for the years after the deed to the city by buying the property at a county tax sale and then partitioning. * * * The protection of the integrity of the city's tax ordinance demands that the city's lien be fixed at the full amount necessary to redeem.’

Section 15 of Article 12 of the Charter of the City of Pasadena provides that: ‘The city shall have such other rights, claims and liens for the amount of such municipal taxes as may now or hereafter be given to or exercised by the people of the State of California for and on account of the assessment of State and County taxes levied in Los Angeles County. The mode and manner of collecting such municipal taxes and enforcing such tax lien, and the proceedings thereafter, shall be prescribed by ordinance and shall conform, as nearly as practicable to the general law governing county taxes; * * *.’

Section 16 of Article 12 provides that all sales for delinquent taxes shall be made to the City of Pasadena unless otherwise regulated by ordinance.

When Parcel 1 was sold to the city Ordinance No. 490 was in effect. It was superseded in 1933 by Ordinance No. 3108. Ordinance No. 490 provided that upon the date fixed for sale by the city tax collector of delinquent property, all such property shall be operation of law and the declaration of the city tax collector be sold to the City of Pasadena. Section 44 of the ordinance provides that a redemption may be made by the owner or any person in interest within five years from the date of sale to the city, ‘or at any time prior to the entry upon or sale of said land by the city.’ Section 45 provides that ‘If the property is not redeemed within the time allowed by law for its redemption, the Tax Collector, or his successor in office, must make the city a deed of the property * * *.’ Section 54 provides: ‘In case property assessed for taxes is purchased by the city pursuant to the provisions of this ordinance, it shall be assessed each subsequent year for taxes until a deed is made to the city therefor in the same manner as if it had not been purchased.’ Section 55 contains the following provision: ‘In case an assessment is made under the provisions of Section 54 of this ordinance, and the land is not redeemed from the previous sale had under the provisions of this ordinance, no sale shall be had under the assessment authorized by Section 54.’ Section 56 provides: ‘In case property is sold to the city pursuant to the provisions of this ordinance, and is subsequently assessed pursuant to Section 54 of this ordinance, non person shall be permitted to redeem from such sale except upon payment also of the amount of such subsequent assessment costs, fees, penalties and interest.’

Ordinance No. 3108, adopted in 1933, and superseding Ordinance No. 490 (except as to proceedings theretofore had under Ordinance No. 490) provided that property on which taxes were delinquent should be sold, ‘by operation of law and the declaration of the * * * tax collector’ to the city. Section 47 of the Ordinance provides: ‘In all cases where property has been sold or may hereafter be sold to the City for delinquent taxes and the City has not disposed of same, or made entry thereon, the person whose estate has been or may hereafter be sold, his heirs, executors, * * * shall, at any time after the same has been sold to the City and before the City shall have disposed of the same, or made entry thereon, have the right to redeem such property by paying to the City Controller of the City:

‘(1) The amount of taxes, penalties for delinquencies and costs due on said property at the date of such sale; (2) All taxes that were a lien upon the said property at the time said taxes became delinquent; (3) All unpaid city taxes of every description assessed against or which are a lien against the property for each year since the sale and all penalties and costs as shown on the delinquent assessment roll, and if not so assessed, then such taxes as may be fixed by the City * * * Tax Collector. * * * at the time of redemption for each of said years not so assessed. * * *.’

Under section 53 of Ordinance No. 3108, if the property is not redeemed within five years after sale to the city for nonpayment of taxes, the city tax collector must deed the property to the city. Under section 57, when the city has by deed become the owner of property sold for taxes pursuant to section 53, the legislative body may direct the sale of the property or any part thereof, and the right of redemption terminates at the time fixed for sale, whether a sale is effected or not, unless the sale is legally postponed pursuant to section 57(a). If the sale is not legally postponed, the right of redemption is terminated, and the city may thereafter deal with the property as its own.

The language of the ordinances herein-above quoted supports the argument of respondent city that the right of redemption under such ordinances does not terminate upon the execution of a deed to the city, but continues until the city has disposed of the property by sale, or has entered thereon for a public purpose, or has given notice as provided in subdivisions (g) to (k) of section 57 of Ordinance No. 3108. This ordinance contains the further provision in section 57 that when the city has become the owner of property sold for taxes and a deed has been filed and recorded, the legislative body may direct the tax collector to sell the property at public auction, but that no bid shall be accepted for less than the amount of all the taxes levied upon such property and all costs and penalties for every year delinquent and also all tax liens up to the date of execution of the deed to the city, all expenses to date of sale, and also the redemption penalties required under section 47 of the ordinance, unless the legislative body by resolution declares that the property is not of sufficient value to be sold for the amount of all taxes, penalties, costs, and expenses due and that it would be to and best interest of the city to sell the property for a lesser sum.

In Imperial Irrigation Dist. v. Varney, 87 Cal.App.2d 264, 196 P.2d 820, an irrigation district held deeds issued to it for nonpayment of assessments levied by the district, the several deeds each having been given for one year's delinquency. The defendant county treasurer was proceeding to foreclose certain improvement bonds upon the property, and the irrigation district sought to enjoin the foreclosure. It was held that the foreclosure should proceed and that the bondholder was entitled to receive deeds upon such foreclosure and to hold the property as tenant in common with plaintiff ‘under an ownership now known as the parity rule.’ See Monheit v. Cigna, 28 Cal.2d 19, 168 P.2d 965, 167 A.L.R. 995. There is nothing in the decision in the cited case to support appellant's argument.

It may be conceded that taxation for municipal purposes is not purely a ‘municipal affair’ when questions of overlapping tax liens arise, Brewer v. Feigenbaum, 47 Cal.App.2d 171, 174, 117 P.2d 737, and cases cited. But we are cited to no case, and our research has revealed none, indicating that the mode of taxation provided in the ordinances of the city of Pasadena pursuant to its charter is in conflict with superseding general law. On the contrary, the provisions of Chapters 8 and 9 of Division 1, Part 6, the Revenue and Taxation Code, confirm the view that the city is entitled to receive the amount which it claims.

The reviews expressed in the case of Sutter-Yuba Investment Co. v. Waste, 21 Cal.2d 781, 784, 785, 136 P.2d 11, 13, 14, also lend support to respondent's position. In that case, the purchaser of a deed from a reclamation district contended that in redeeming from county tax delinquency no taxes should be computed for the period during which the district held the property after deed to it for delinquent district assessments, on the theory that the property owned by the district was exempt from taxation under section 1, Article XIII of the California Constitution. The contention was rejected. The court sustained the validity of statutes there involved requiring payment of an amount equivalent in taxes for the unassessed years, and stated: ‘The immunity of such property from taxation does not preclude, any more than the immunity of property deeded to the state, the imposition of such conditions to redemptions as the state deems advisable.’ Further the court said: ‘In the interest of returning tax delinquent property to the tax rolls, the State has enacted liberal provisions for the redemption of such property, so designed as to discourage tax avoidance. If they did not require that redemption take into account the taxes that would be imposed had the property not been deeded to the state, owners would find it advantageous to allow their property to be deeded to the state with the intention of delaying redemption as long as possible to escape the taxes that attend ownership, secure in the knowledge that the state must give them notice before disposing of the property. * * * Likewise he (the taxpayer) cannot escape such taxes by allowing his property to be deeded to any other taxing unit such as a reclamation district and subsequently regaining the title free of intervening taxes. * * *’

In our view, similar reasoning answers appellant's contention that it is inequitable to permit the city to have the property sold to it for delinquent taxes, then await a sale for delinquency of county taxes, and thereafter to be reimbursed the taxes which would have been due the city for intervening years. We perceive no inequity in this procedure, because were the rule otherwise, a property owner could permit his city taxes to become delinquent, then permit the county taxes to become delinquent, await an eventual sale of taxdeeded property and purchase from the state, thus extinguishing the city's claim for its unpaid taxes. The inequity of such a situation is recognized by section 3695 of the Revenue and Taxation Code, which provides for the preservation of the liens of all taxing agencies who object to the sale by the state. There is no showing in the record before us that respondent city did not so object, as it had a right to do.

Appellant's contention with respect to the allowance of attorney's fees is without merit. A party is not entitled to attorney's fees except where authorized by statute or by contract, Los Angeles Trust & Sav. Bank v. Ward, 197 Cal. 103, 239 P. 847. Section 796 of the Code of Civil Procedure authorizes the allowance in a partition action of attorney's fees expended by a party for the common benefit. The trial court in the instant case, with reference to the parcels sold and as to which no appeal was taken, fixed attorney's fees as to such parcels and allowed no fees incurred in quieting title. Under section 798 of the Code of Civil Procedure, a party is entitled to reimbursement for expense of other actions or proceedings necessarily prosecuted or defended ‘for the protection, confirmation, or perfecting of the title * * * except counsel fees, * * *.’ The court properly declined to allow attorney's fees so far as the quiet title aspect of the proceedings was concerned. See Deacon v. Deacon, 101 Cal.App. 195, 281 P. 533.

For the foregoing reasons, the judgment is affirmed.

WHITE, Presiding Justice.

DORAN and DRAPEAU, JJ., concur.

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