BARRETT v. BROWN (1944)

Plaintiff appeals from an adverse judgment in an action to quiet title. Defendant claims title under a tax deed from the state, the validity of which is challenged. Although several elaims of invalidity are advanced, we find it necessary to decide only: (1) Whether the sale and deed to the state in 1937 were invalid because of a void publication of the delinquent tax list, and (2) whether the sale and deed to the state, if invalid, were validated by the curative Act of 1943. Stats.1943, chap. 458, p. 1993.

The property in question is situated in the incorporated city of Lynwood, Los Angeles County. The 1936–37 taxes were not paid and the property was sold to the state in 1937 and was sold to the defendant and deeded to him by the state July 20, 1942. Under Political Code section 3764 then in force, the tax collector was required to publish the list of delinquent taxes on or before June 8, 1937, stating the names of the persons and a description of the property delinquent and an amount equal to the amount of all taxes, assessments, penalties and costs due and which were a lien thereon. Section 3767 of the code required the publication to state the day and hour when the property would be sold to the state by operation of law. Under section 3766 the publication was required to be made once a week for three successive weeks in some newspaper of general circulation published in the county, or if there was no such newspaper, notice was to be given by posting. This was a general provision applying to all counties except those of the first class. As to that class a special and materially different procedure was directed. In each county of the first class the portion of the delinquent list covering property located in the unincorporated territory of the county and in the city in which the county seat was located, and as to certain other property in several contingencies not material here, was to be published in a daily newspaper of general circulation published at the county seat. That portion of the delinquent county or city and county tax list covering property located in any incorporated city or town, other than the county seat, wherein there was published at least once a week a newspaper of general circulation, was required to be published in the city or town in which the property was located. The tax list was published in accordance with these requirements. The list which was published in the county seat, Los Angeles, did not list the property that was located in Lynwood. That portion of the list covering property located in Lynwood was published once each week for three weeks in a paper published in the city of Lynwood. The provisions of section 3766, supra, which relate to publications to be made in counties of the first class would apply only to Los Angeles County, since it is the only county of that class. In all other counties the entire delinquent list and notice of sale was to be contained in one notice and was to be published in a single newspaper. Those provisions of the section which set up a procedure for Los Angeles County differing from the general law applicable to all other counties have been held unconstitutional as being an attempted local or special law for the assessment and collection of taxes, in violation of Article IV, section 25, subdivision 10, of the Constitution, which prohibits the passage of local or special laws for that purpose, and also as contrary to Article I, section 11, and of subdivision 33 of section 25, Article IV of the Constitution, the former of which provides that all laws of a general nature shall have a uniform operation, and the latter that the legislature shall not pass local or special laws where a general law can be made applicable. It was decided in Consolidated Printing & Publishing Co. v. Allen, 1941, 18 Cal.2d 63, 112 P.2d 884, 888, that the legislature has no power to classify counties for the purpose of prescribing different procedure for the assessment or collection of taxes, and that there was ‘no natural, intrinsic, or constitutional ground of distinction between the county of Los Angeles and other counties which would justify the application of a special procedure with reference to the sale of delinquent property.’ The provisions of former Political Code section 3766 were carried into section 3356 and sections 3391 to 3403 of the Revenue and Taxation Code in 1939, St.1939, pp. 1321–1325, without change in the features which we have to consider. The court was considering the sections of the Revenue and Taxation Code but the decision is conclusive of the unconstitutionality of the same provisions in former section 3766.

The only valid notice that could have been given by the tax collector was a single one which stated the facts with reference to names, descriptions, amounts for which the several parcels would be sold to the state, and the time of the sale, in a newspaper of general circulation published at the county seat and for the time required by law. Such a notice was not given and the attempted notice constituted no notice at all. Numerous cases, holding that a material defect in the publication of the delinquent tax list and notice will render void a sale pursuant to such notice, are cited in Miller v. McKenna, 1944, 23 Cal.2d 774, at page 777, 147 P.2d 531. Upon the authority of those decisions, which it is unnecessary for us to list here, we conclude that the deed to the state was void. Defendant seeks to escape this consequence by reliance upon section 3787 of the Political Code, which provides that the deed to the state is conclusive evidence of certain facts, contending that among them is the fact that due and proper notice of sale was given before the property was sold to the state. Section 3786 of the Political Code, which was in effect until the Revenue and Taxation Code was adopted, makes a deed to the state, as well as a deed from the state, prima facie evidence of the fact, among others, that ‘5. At a proper time and place the property was sold as prescribed by law, and by the proper officer.’ It was held in Bussenius v. Warden, 1925, 71 Cal.App. 717, 236 P. 371, that a deed to the state is primary evidence of the due publication of the delinquent list and notice of sale. The sale involved in that case was held invalid because of irregularities in the statements in the delinquent list. The same result has been reached in many later cases, among them being those above referred to, which are listed in Miller v. McKenna, supra. A sale for taxes to the state cannot be made ‘as prescribed by law’ if valid notice of sale has not been given, for the publication of notice is an indispensable prerequisite to a sale. Section 3787 does not apply and the deed is not conclusive evidence that notice has been given.

The final question relates to the so-called validating Act, State.1943, chap. 458, upon which defendant relies and which reads in part as follows:

‘Section 1. Every act and proceeding heretofore taken by any county, city and county or the officers thereof relative to the preparation, transmitting, computing, determining or fixing the budget or the tax rate or rates of any county or city and county, or to the assessment or equalization of property or to the levy of taxes thereon or to tax sales or certificates of tax sales, tax deeds or other conveyances resulting from such assessment, equalization and levy, are hereby confirmed, validated and declared legally effective.

‘Sec. 2. (a) This act is limited to the correction of defects, irregularities and ministerial errors which the Legislature originally could have omitted from the statutory requirements of law under which the acts hereby confirmed, validated and declared legally effective were taken.

‘(b) This act is limited to the validation of acts and proceedings to the extent to which the same can be effectuated under the State and Federal Constitutions.’

The adoption of an Act such as this would appear to have been called for to correct, if possible, the mistakes which defeated the levies held void in Otis v. Los Angeles County, 1937, 9 Cal.2d 366, 70 P.2d 633, and in the recent case of Gottstein v. Gray, 1944, 66 Cal.App.2d 587, 152 P.2d 742. Errors in adopting the budget and fixing the tax rate furnished the basis for those rulings. The curative Act is aimed at the several steps enumerated in section 1 from the adoption of the budget to the levy of the tax—not all of such steps, but only those which stand in need of validation. And also validated are ‘tax sales or certificates of tax sales, tax deeds or other conveyances resulting from such assessment, equalization and levy.’ (Emphasis added.) We think it may be doubted that it was the intention to attempt validation of sales, certificates and deeds other than those which needed validation because they rested upon irregular proceedings in the adoption of the budget, the fixing of the rate, the assessment, equalization or levy. All sales and deeds result from assessments and levies and yet many may be founded upon valid assessments and levies but void notices of sale. If the validation of any and all sales, certificates and deeds, and the notices upon which they depended was intended, we would then have a statute which purported to validate every tax sale and tax deed that had been issued in the history of the state and which could be validated, including countless deeds long considered void and worthless under former court decisions. We are not suggesting that it would be beyond the power of the legislature to do this, although, so far as we can discover, no former legislature has attempted it. The point has not been presented in the briefs nor has it required decision in any case which involved the Act. We do not regard it as one requiring decision here, inasmuch as there are other reasons why the Act must be denied effect to validate defendant's deed. There is, however, a question as to the proper construction of the Act, namely, whether it was the intention of the legislature to validate tax sales and deeds where there had been a void publication of the delinquent list. It cannot be doubted that the intention was to cure all purely technical irregularities and defects evidencing a failure to comply with the strict letter of the law as required in tax proceedings. The books are full of cases of this sort, where failure to observe the forms of law has been held to invalidate tax proceedings, even though the owner has been deprived thereby of no substantial right. The exceptions stated in section 2(a) and (b) of the Act exclude defects, irregularities and errors which the legislature could not have omitted originally from the statutory procedure and also to acts which under constitutional principles could not be validated. Evidently the legislature considered that a distinction could be drawn between the errors and omissions excluded by paragraph (a) and the failure to observe constitutional requirements mentioned in (b). There is, however, no such distinction. Under the doctrines stated in Chase v. Trout, 1905, 146 Cal. 350, 80 P. 81, and Baird v. Monroe, 1907, 150 Cal. 560, 89 P. 352, the legislature may enact schemes of taxation, from the assessment to the collection of taxes, with such procedure as it may see fit to prescribe, so long as the constitutional provisions for due process and other constitutional rights of the owner are observed, and it may validate proceedings which fail to meet statutory requirements if such proceedings could have been authorized originally. But we think it is clear that the legislature did not intend to attempt the validation of acts which the courts have held could not be validated. Such an omission was considered by the court in Warden v. Broome, 1908, 9 Cal.App. 172, 98 P. 252. In that case the delinquent tax list stated the amount for which the property would be sold as $19.90 instead of the correct amount of $19.40. The sale which followed was held void and it was held that it was not competent for the legislature under the circumstances to make the deed to the state conclusive evidence of the regularity and validity of the proceedings. It was said, at page 176 of 9 Cal.App., at page 254 of 98 P.: ‘As this is the only notice required as a condition of transferring the owner's title to the state, it follows that the giving of it in the manner prescribed by the Legislature must be regarded as a jurisdictional prerequisite to the making of a valid sale, as to which the deed is not conclusive. As to the performance of non-essentials—those things which the Legislature might in the first instance have dispensed with without affecting the validity of the proceeding—it mat make the deed conclusive evidence, but not as to the performance of those acts necessary to confer jurisdiction. ‘The Legislature cannot deprive one of his property by making his adversary's claim to it, whatever that claim may be, conclusive of its own validity, and it cannot, therefore, make the tax deed conclusive evidence of the holder's title to the land.’ [Citing cases.]' The conclusion which the court reached has not been questioned in any later case and the reasoning is persuasive, although the statement that section 3787 was intended to apply to the matter of publication of the delinquent list is contrary to the holdings of the later cases. A notice which did not describe the property or which stated an excessive amount for which it would be sold would not be sufficient to support a sale. The requirement that those essentials be stated is for the benefit of the owner and the omission to state them would deprive him of a substantial right. We think the curative Act was not intended to do away with such matters of substance, for, as we shall point out, publication of the delinquent list is an indispensable step in the state's scheme of taxation. It is not to be presumed that our legislature intended by the curative Act to do away with the essentials of the notice of sale which our courts have always held to be indispensable. The qualifications expressed in section 2 are a forceful indication that it was not intended that the broad provisions of section 1 should be given a construction which would upset the settled and well understood procedure in tax sales. Upon the contrary, it is to be presumed that the Act was passed with knowledge of earlier court decisions and with the expectation that the courts would continue to draw the same distinctions between acts which are susceptible of validation and those which are not, as had been drawn in the past. We are of the opinion that the Act should not be given the broad scope contended for by defendant, for the reasons stated and for the additional reason that section 2(b) forbids that construction, since the elimination of a valid notice would contravene the requirement for due process. That is the next point for discussion.

As to the limitations upon the power of the legislature to vitalize invalid steps in tax proceedings, it is enough to say here that an owner of property cannot be deprived of his property without due process of law, and if an act in the proceedings which has been omitted was essential to due process, its omission is fatal and beyond correction. We have such an omission here.

A tax levy unauthorized by law cannot be validated by curative legislation. Harper v. Rowe, 1878, 53 Cal. 233; People v. Goldtree, 1872, 44 Cal. 323; People v. Lynch, 1875, 51 Cal. 15, 21 Am.Rep. 677; People v. Van Nuys Lighting Dist., 1916, 173 Cal. 792, 162 P. 97, Ann.Cas.1913D, 255; Texas Co. v. Bank of America etc. Ass'n, 1935, 5 Cal.2d 35, 53 P.2d 127; Brady v. King, 1878, 53 Cal. 44; Kelly v. Luning, 1888, 76 Cal. 309, 18 P. 335. A levy upon real property in violation of the constitutional requirement that all property shall be taxed in proportion to its value cannot be validated. Gottstein v. Gray, supra, 66 Cal.App.2d 587, 152 P.2d 742. A tax sale made under proceedings lacking in the essentials of due process in respect of notice to the owner can have no more validity than a sale made under an assessment unauthorized by law due to the want of power to impose the tax, or to a sale under a levy which denies the equality and uniformity which the Constitution requires.

Due process of law requires notice of a proposed sale for taxes. Of the necessity for notice, Mr. Cooley says (Cooley on Taxation, 4th Ed., Vol. 3, section 1409): ‘The first proceeding usually required of the officer who is to make sale is, that he shall give public notice of his intention to do so. A notice of sale, as required by statute, is necessary to authorize a tax sale and the absence of the notice renders the sale void. This is one of the most important of all the safeguards that have been deemed necessary to protect the interests of persons taxed, and nothing can be substituted for it or excuse the failure to give it.’

Publication of the delinquent tax list has been a basic requirement of our tax laws since 1857, at least, and in the statutes of that year (p. 331, et seq.) are to be found provisions for publication of the list containing the essentials of the notice which is now required to be published. And it might be noted, as evidence of the importance the legislature attached to the notice, that in that early statute, while publication was to be made in each county where a newspaper was published or by posting if there was none, there was the additional requirement that in the County of Contra Costa, and in each county to the south, at least three notices in the Spanish language should be posted in each township. Throughout the history of later tax legislation scrupulous care has been taken to give landowners notice of tax delinquency. No form of law is better understood by landowners than the requirement that they will not be deprived of their property for nonpayment of taxes without notice of the delinquency. The extent to which compilation of a delinquent list and publication thereof is the accepted procedure in many states is shown in the cases listed in 61 C.J. pp. 1120 and 1142. Where land is involved, the methods of collection vary in different jurisdictions. A not uncommon procedure is by court action to foreclose the lien. Service of process as provided by law must be had in order that the court may have jurisdiction to enter a decree. See cases listed in 61 C.J. p. 1147, sec. 1558. We are aware of no principle under which a judgment void for failure to serve summons or other statutory process could be validated by legislative act. In our state the title of the owner is forfeited through a sale of the property, and that has been the method from the beginning as to real property, although the procedure has been changed from time to time and the conditions of forfeiture made less drastic. The notice given by publication of the delinquent list is the traditional procedure which the legislature has provided and the citizens of the state have expected as the due process to be followed in tax collections. In the absence of any other adequate notice to the property owner, publication of the delinquent list is an indispensable prerequisite to sale. The legislature is without power to dispense with it except by the substitution of some other form of notice which would meet the requirements of due process. Proceedings for the collection of taxes have long been governed by general laws, as they are required to be under the present Constitution. So far as the publication of the delinquent list is concerned, it was necessary that notice be given in the form and manner prescribed by general law. The notice that was published in the Lynwood paper was not such a notice. The legislature was without the power to authorize the method of publication here employed, and such publication was no more effective as a step in the proceedings by which plaintiff might be deprived of his property than would have been the publication of partial lists, without legislative authorization, in many newspapers in the several townships, cities and towns throughout the county. The state cannot exercise the power of taxation except by means of procedure authorized by the legislature. Where acts are performed under powers attempted to be given by statute but which could not lawfully be authorized for the reason that they are procedural steps forbidden by the Constitution, such as the publication here involved, the acts are void and cannot be validated. The sale and the deed to the state were void for failure to publish a valid notice of sale, which notice was necessary in order that the proceeding constitute due process of law. The validating Act recognizes the limitations of the legislative power in such matters, and the qualifications stated in sections 2 and 3 require the construction that it was not the intention to validate a published notice of sale so defective that it could not have been authorized by the legislature originally because it was expressly forbidden by the Constitution. Defendant's deed is no better than it was before the curative Act was passed.

Our holding upon the points discussed disposes of the case, and it is unnecessary to consider other alleged defects in the proceeding relied upon by plaintiff.

The judgment is reversed.

SHINN, Acting Presiding Justice.

PARKER WOOD, J., and FOX, Justice pro tem., concur.