Duffitt v. Tuhan , 28 Kan. 292 ( 1882 )

The opinion of the court was delivered by

Hobton, C. J.:

1.Title, when not acquired by tenant. Defendant in error (plaintiff below) claims that she is the owner of the lot in controversy by virtue of the several tax deeds set forth in the findings of fact, and the actual possession of the premises thereunder for such length of time that the statute of limitations has run, and therefore that the plaintiffs in error (defendants below), holding under the owner of the patent title, have no rights whatever to the lot. The defendant in error, with the consent of the original owner, in 1865 went into possession of the premises, and occupied a house which was built for her thereon by the city of Leavenworth, until 1876, when she left. All of the tax deeds were issued for taxes due and payable during the time that she was in the actual possession of the premises. The deed •of April 29, 1870, embraces the taxes levied for 1867; the city deed of May 10, 1872, embraces the taxes levied for 1869; the county deed of May, 1872, embraces the taxes levied for the year 1868 and the subsequent taxes of the years 1869 and 1870; the tax deed of October 5, 1880, embraces the taxes levied for the year 1875. The important question therefore is, in our view, not whether these several ■tax deeds are regular and valid in form, but whether the holder thereof is estopped from setting up title thus acquired. This involves the question whether defendant in error was precluded from becoming a purchaser of the lot at the tax sale for taxes levied and payable during her actual occupation of it. If her relation as occupant of the lot with the consent of the owner, without agreement as to rent or taxes, and receiving all the benefits of its use and paying no rent- therefor, forbade her divesting the owner of his property by the purchase of it at a tax sale for taxes levied and payable.while she was in the actual occupancy thereof, she grounds her title on her own misconduct, and such title would be fraudulent as against the owner. If a tax deed is acquired fraudulently, although it is regular on its face, and all the requirements of the statute have been strictly complied with so far as the tax proceedings are concerned, that avails not. Nothing passes to the fraudulent holder, because such holder is not in a position to take anything, and a tax deed that is fraudulent as against the owner of the premises is void, and a void deed never starts the statute of limitations relating to tax titles to running. (Carithers v. Weaver, 7 Kas. 110; Taylor v. Miles, 5 Kas. 498.) The statute of limitations as to lands sold for taxes, applicable to persons in general, has no application as against the original owner where the person purchasing the tax title is precluded by his relation from becoming the purchaser. (McMahon v. McGraw, 26 Wis. 614; Cooley on Taxation, 345.) In Carithers v. Weaver, supra, it was held by this court that a tax deed issued to a tenant or lessee who had contracted ,to pay the taxes for which the deed was issued was absolutely void; and it was further held therein that the fact that the party acquired no interest in the tax proceeding until after the termination of the lease would not change the rule, if, during the lease or agency, the taxes became due and payable and the tenant neglected to pay them. In Weichselbaum v. Curlett, 20 Kas. 709, we held that a tenant under no-.obligation to pay taxes might purchase property in his possession at a tax sale made during his term. The former case was decided upon the principle that the tenant was under legal obligation by his contract to pay the taxes, and he could not, by neglecting to pay the same and allowing the land to be sold in consequence of such neglect, obtain a title by purchasing at the tax sale. The latter case was decided upon the principle that as the tenant had agreed to pay rent for the premises in his possession, and had properly paid all the rent prior to the tax sale, he was at the time under no obligation to his landlord to pay the taxes or discharge the property from the lien thereof. This case differs from the cases just cited, as the occupant went into the possession of the lot with the consent of the owner without any agreemént as to the payment of rent or taxes. We interpret the findings of fact to mean that there was nothing said about rent at the time the original owner consented for plaintiff below to take possession, and this interpretation is sustained by the evidence of Callaghan, who testified: “I owned the lot in controversy about 1865, when H. T. Green applied to me for permission to erect a house for the plaintiff and her children on the lot. I learned she was very poor, and I consented she might put a house on the lot. There was nothing said about rent, or who should pay the taxes. I permitted the plaintiff to remain on the lot as long as she wanted to. She moved the shanty and left the lot about 1876. From that time until I sold it to the defendants, the lot was vacant. Since they purchased the lot of me, the defendants took possession and built a brick house thereon.”

2. Owner’s title; tenant's purchase at tax sale. Had the trial court accepted the evidence of the plaintiff below as wholly truthful, we think the finding would have been that she went into possession of the premises with the consent of the owner under an agreement that she was not to pay any rent. With our interpretation of the findings of fact, the occupant was under an implied obligation to pay rent. Continuing in the possession of the premises for about eleven years, with a house erected thereon for her own use, which added to the valuation of the premises, and thereby increased its assessed value, and also the taxes levied annually thereon, it ought not to be assumed that having paid no rent, she would also neglect to pay the taxes and thereby risk the hazard of dispossession by a tax sale. Her landlord could hardly suppose that being permitted to occupy the premises without the collection of the rent, she would neglect the duty of protecting her own possession by failing to pay the taxes, and then thereafter attempt to cut off his title by buying in the land at a tax sale. Taking all the circumstances of . . . . . . n . this case together, we think that the tenant acquired no rights as against the original owner or his grantees by neglecting to pay the taxes levied upon the premises during her actual occupancy thereof, and thereafter purchasing such premises at tax sales. At least, while thus occupying the premises, if during such occupancy the taxes became due and payable and she neglected to pay them, as against the party who put her into possession and his grantees she ought in all justice to be precluded from setting up a title acquired upon the sales on defaults in the payment of the taxes while the premises were so occupied by herself. The aggregate of the taxes represented by the various tax deeds is only $64.85, and yet the holder of these titles insists that as she occupied the premises with the consent of the owner thereof, without any agreement as to the payment of rent or taxes thereon, she has acquired by the payment of this small sum, not only absolute title to the premises, but is also the owner of all the improvements thereon, including the brick building recently constructed by the grantees of the original owner. It would cause a shock to the moral sense, if the law were to permit such a result, and we cannot consent to the establishment of any such doctrine. Ingratitude thus exhibited is not commendable, and when it attempts to call to its protection judicial support, it deservedly calls in vain. As the tenant paid no rent during all the ten or eleven years she occupied the lot, the most she can in common honesty demand is to offset the taxes paid by her against the-value of the use of the premises while in her exclusive possession.

Owing to her .disqualification to take title, neither the statute of limitations of 1868 nor 1876 applies. But counsel for defendant in error contend that even if there had been upon her part an obligation to pay the taxes, and instead of paying them she obtained the deeds to herself in fraud of the rights of the owner, that such fraud is now beyond his reach or inquiry of his grantees, as a suit to set aside the deeds has long since been barred by the general limitation law.

3. Tenant’s title fraudulent limitation of action. In our view of this case, the only statute of limitations applicable is the one for relief on the ground, of fraud. The .statute requires such an action to be brought within two years> but further provides that the cause of action in such case shall not be deemed to have accrued until the discovery of the fraud. In a case like this, the statute does not begin to run until the fraud is discovered. For this purpose there is no constructive discovery. If an agent or tenant should fraudulently allow the lands of his principal or landlord to be sold for taxes and take the deed himself and put it on record, this would not be notice to the principal or landlord that would set running the statute that would bar him from an action for relief against the fraud. (McMahon v. McGraw, 26 Wis. 622.) There is no finding that the tenant ever notified her landlord or any of his grantees of her claims under her alleged tax titles, until the plaintiffs in error were erecting a building on the premises. This was in the year 1880, and only a few months prior to the commencement of the action in the court below. The defendant in error therefore is not protected by the general limitation law.

The judgment of the district court must be reversed, and the case remanded with direction to the court below to enter judgment upon the findings of fact in favor of plaintiffs in error.

All the Justices concurring.