Hanson v. Burris

The complaint herein pleads two causes of action: (1) The short form to quiet title; and (2) title to the property by virtue of purchase from Millard county after said county had acquired title thereto by purchase or foreclosure of tax lien for nonpayment of taxes, setting forth in detail the procedure from the tax levy through to sale and issuance of auditor's deed to the county and subsequent purchase by plaintiff from the county. The land described consists of 80 acres within the boundaries of the Millard county drainage district No. 3 in Millard county, Utah. The steps in the tax proceedings of assessment, levy, notice of due date, delinquency notice, sale, issuance of certificate of sale, failure to redeem, execution of auditor's tax deed, publication of notice of the May sale (so-called) and the sale and transfer of the described property by the county to plaintiff were alleged. The amount paid for the property including taxes for subsequent years from delinquency with interest and penalties is set forth. The plaintiff prayed that title to the property be quieted in him and for other relief.

Plaintiff joined in the action as defendants all parties who appeared of record to have any interest in the issues including the original owner, the mortgage holder, easement holders, judgment creditors, Millard county drainage district No. 3, and certain bondholders. All defendants defaulted except appellants Millard Realty Corporation, George S. Ingraham, Sherwood Green, and Edward P. McKenna. Ingraham, Green, and McKenna compose the bondholders' committee of drainage district No. 3. They and the Millard County Realty Corporation, a bondholders' operating company, set up similar defenses. The drainage district did not appeal.

Four cases bearing more or less directly upon the same issues were argued together, and though the drainage district had not appealed, legal counsel appeared upon consent of all parties, filed a brief, and stated the position of the drainage district.

The amended answer of the appellants, after admitting some of the allegations of the complaint and denying others, sets out the organization of the defendant drainage district and the issuance and sale by the district on August 1, 1918, of drainage district bonds in the sum of $1,250,000. The form of the bond, the numbers, denominations, amounts, and dates of maturity are set out. All bonds issued are identical in wording and differ only in number, denomination, and date of maturity. Defendants alleged the drainage district was duly organized before the bonds were sold; that the drainage district estimated and equalized the assessment of drainage benefits under the Drainage Act of Utah, and set out in haec verba or in substance Comp. Laws Utah 1917, § 2055, relating to such proceedings; section 2057, relating to computing the drainage tax and placing the same upon the assessment roll; section 2058 relating to when drainage taxes become a lien, when delinquent, and the time and manner of collection; section 2071, relating to issuance of drainage district bonds; and section 2072, making the bonds a lien upon all lands within the drainage district; also the substance of sections 5910, 5912, 6010, 6016, 6018, 6020, and 6021, Comp. Laws Utah 1917. These latter sections provided how the county tax roll is made up by the county assessor, the delivery of the tax roll by the assessor to the county treasurer, the treasurer's duties in relation thereto, notices to taxpayers, publication of delinquent tax lists, notices of sale, time and manner of sales for delinquency, duties of the auditor and treasurer in relation to tax sales, issuance of tax sale certificates, form thereof, and sales to the county with the recordation thereof. Sections 2055, 2057, 2058, 2071, and 2072, supra, are found in the chapter of the Compiled Laws relating to drainage districts; the other sections are found in the chapters relating to assessment and collection of taxes generally.

Appellants contend the amendment of section 2058, Comp. Laws Utah 1917, by chapter 47, Session Laws 1921, and chapter 109, Session Laws 1925, are unconstitutional and "the crux of this suit." Appellants reduce the controversy to one, as they assert, revolving "around the impairment of the obligation of contract under the Federal Constitution."

"Briefly it is the contention of appellants that there is under the taxing laws of Utah, as in the sections above indicated, but one annual tax roll or tax book in each County in which must be placed all of the taxes, both general and special, one notice of sale, one certificate of sale and one tax deed, in all of which instruments the general and special taxes must be included and both general and special taxes, when delinquent, must be sold at the same instant of time and when paid all taxes or none shall be paid and the treasurer shall issue but one receipt, which shall include receipt of payment for all of both general and special taxes. By special tax here we intend and include drainage taxes.

"* * * Under the above provisions of the Utah statutes which were in force and effect when these drainage bonds were sold, August 1st, 1918, each description of land with the ownership must be set out separately. Opposite this description must be itemized all state, county, school, road district, drainage district, and other special taxes, if any, and computed in one total sum of taxes due and that this total of taxes must be published in one notice and carried on through in the sale, certificate of sale and tax deed and that the sale for delinquent taxes must be for one lump sum, including all of these taxes.

"Much contention will be made in this cause over the construction of the words contained at the end of section 2055, Comp. Laws Utah 1917, which reads as follows: ``and it shall be the duty of the County Treasurer to collect such taxes at thetime and in the same manner that the said county taxes are collected and pay the same to the treasurer of the Board of Supervisors as soon as moneys are received by him,' and the words in the last sentence of section 2058 which read as follows: ``Drainage taxes shall become due and delinquent at the sametime shall be collected by the same officers and in the same manner as state and county taxes, and when collected shall be paid to the treasurer of the Board of Supervisors. (Italics appellants'.) It it the contention of appellants that the words ``at the time' and ``at the same time and in the same manner' can mean but one thing.

"These answering defendants further alleged that by and through the said amendments, of said section 2058, Compiled Laws of Utah, 1917, as hereinbefore alleged, and by and through the taxing proceedings carried on by the said county officials from the year 1921 to 1929, inclusive, hereinbefore alleged the State of Utah and said taxing officials have unlawfully impaired the obligation of contract between the defendant drainage district, these answering defendants and the State of Utah, as so provided by the statutes of the State of Utah, for the payment of drainage bonds, as aforesaid, in violation of section 10, article 1, of the Constitution of the United States and of section 1 of the Fourteenth Amendment to the Constitution of the United States; and in violation of section 7, 18, and 22 of article 1 of the Constitution of the State of Utah, and by reason thereof the said amendments to said Section 2058, in so far as the rights of these answering defendants and other holders of said drainage bonds, as herein set out, are unconstitutional and void and of no force and effect and a denial of the due process of law provisions of said Constitution.

"That in the year 1926, the lands described in plaintiff's complaint in Millard County, Utah, to-wit: West half of the Northwest quarter of Section 21, Township 16 South, Range 7 West, S.L.M. were subject to taxation for State, county, school and drainage taxes and the lien of said bonds as herein alleged and were in the manner hereinbefore alleged assessed for state, county and school taxes in one book and for drainage taxes in another and different book and, if any notices were served notifying landowners of said taxes, one separate notice was served upon the purported landowner of the land last described for the state, county, and school taxes and another separate notice was served, if any, on said purported landowners for the delinquent drainage taxes for that year on said last above described tract of land. Said state, county and school taxes went delinquent on said tract of land and the treasurer of Millard County caused a notice of sale of said lands for delinquent state and county and school taxes to be published, if any notice were published, fixing the time and the day for the sale of said lands for delinquent state, county and school taxes for the year 1926. Said drainage taxes went delinquent on said described tract of land for the year 1926 and the said County Treasurer caused a separate and different notice of the sale of said land for said delinquent drainage taxes to be published, if any notice at all were published, fixing a separate and different day for the sale of said lands for said delinquent drainage taxes for that year, and sold said lands for said state, county, and school purposes on one day and for said drainage taxes on a different day and caused one tax sale certificate to issue to the purchaser for said delinquent state, county and school taxes and another and separate and different tax sale certificate to issue to the purchaser for the sale of the same tract of land for the delinquent drainage taxes, and after four years had expired, the said Auditor of Millard County issued one deed to the purchaser for said lands for said state, county and school taxes and another, different and separate deed to the purchaser for the said delinquent drainage taxes. The said tax notice, certificate of sale and Auditor's tax deed, made with reference to said state, county and school taxes did not mention nor include said or any drainage tax."

No question is raised by this appeal as to the regularity of the tax proceedings as to levy, notice, sale, issuance of certificate of sale, period of redemption, description of land, nor as to form or substance of any of the documents or records affecting the proceedings, except as may be drawn from the failure to adhere to what may be termed "unit proceedings," and "pay all or none," in collection and payment of taxes.

In appellants' language:

"We think it more convenient to consider these assignments together as they all revolve around the impairment of the obligation of contract under the Federal Constitution."

Appellants and respondent in their briefs and arguments have so treated the matter. The facts, as pleaded by the parties, were generally either admitted or proved, and no questions are raised thereon except as to ultimate ownership of the land. The trial court found in plaintiff's favor, concluded that the proceedings were regular, and that the lien for general taxes was superior to the lien for drainage taxes.

Appellants submit that if this court holds that the amendments to section 2058, Comp. Laws Utah 1917, impair the obligation of contract between the bondholders and the drainage district by providing a separate proceeding for collecting drainage district taxes the other issues raised become immaterial; but that if this court holds that the said amendments to section 2058 and the proceedings thereunder do not impair the obligation of contract between the bondholders and the drainage district, it becomes material to inquire as to the "nature, character, extent and operation of the lien of the drainage bonds under the provisions of sections 2058, 2072, and 2073, Comp. Laws Utah 1917." Appellants further state:

"It is the contention of appellants that this Auditor's tax deed is null and void because it impaired the said obligation of contract, but if the court holds that it did not impair said contract and this court holds the said Auditor's tax deed was valid, and that the quit claim deed from Millard County to the respondent conveyed the title the county held to the respondent, it is the contention of appellants that the respondent took such title as he acquired, subject to the lien of the drainage bonds, the equalized assessment of drainage benefits and the delinquent drainage taxes levied after the year 1926; that the only effect of this tax deed was that it extinguished the drainage taxes levied prior to and including the drainage taxes for the year 1926, the year in which the land was sold for state and county tax, on which respondent's title is based; but, that thedrainage taxes assessed and levied against the lands beginningwith the year 1927 and subsequent years has not been affected norextinguished by the tax title respondent holds." (Italics added.)

In our view the fundamental and controlling issue is the nature, character, extent, and operation of the respective tax liens — the general tax lien on the one hand, the drainage tax lien on the other. It is claimed that the statute in force at the time the contract with the bondholders was made required that no taxpayer be permitted to pay any tax unless he pays all taxes, including the drainage taxes, and that there can be no redemption from such tax sale unless all taxes including the drainage taxes are paid. Any distinctions between a redemptioner, as defined by the statutes, and a purchaser of a county title after the period of redemption has expired are not involved. The plaintiff in this case is not a redemptioner within the terms of the statute, and such rights or title as he has come to him as a purchaser from the county after expiration of the redemption period.

The regular redemption period is four years after the date of sale for taxes. Comp. Laws Utah 1917, § 6024, now R.S. Utah 1933, 80-10-59. Where property is sold to the county, it appears a further period of redemption is provided for by Comp. Laws Utah 1917, § 6056, amended by Laws Utah 1921, c. 140, p. 384; R.S. 1933, 80-10-68; Laws Utah 1933, c. 62, p. 111. In that section as last amended, after providing for the sale of real estate to which the county has received a deed because of sale to the county for delinquent taxes, the board of county commissioners during the month of May in each year is required to offer such property for sale. A detailed procedure is provided. It is then further provided:

"The board of county commissioners shall, at any time after the period of redemption has expired and before the sale as herein provided, permit the redemption of such property."

In case a situation arises where a county claims a lien for delinquent taxes and elects to proceed by foreclosure under sections 80-10-41 to 80-10-44, a period of redemption after sales upon execution is provided by R.S. 1933, 80-10-45.

Plaintiff in the instant case is a purchaser from the county at private sale after the county had taken the auditor's deed and offered the property at the May sale. Appellants recognize, as it is apparent they must, that the case of Robinson v. Hanson,75 Utah 30, 282 P. 782, 783, does decide that taxes for general governmental purposes, lawfully imposed by the state, are paramount to all other demands against the property to which the tax lien attaches. If one person claims title under a drainage tax deed and another under a deed based upon a general tax lien, the proceedings in both instances being regular, the former must yield to the latter. The parties to this cause agree that the lien which supports the bonded indebtedness is extinguished by the tax deed to the county to the extent of all drainage taxes that have been levied or assessed before the county takes title pursuant to sale for delinquent general taxes, and that a purchaser (not a redemptioner) from the county takes title from the county free and clear of all claims up to the time title is transferred from the county to the purchaser. This concession eliminates much from the discussion.

May the drainage district, after a sale by the county to a purchaser, not a redemptioner, and after the redemption period has expired, proceed to levy and collect drainage district taxes upon the land thus sold? Is the lien, securing the bonds, extinguished when the tax deed to the county is made? If not then, when, if at all? Lands within the drainage district are subject to assessment for maintenance and repairs, it is conceded. That there is a subsisting debt created by the issuance and sale of bonds to purchasers in good faith must be conceded. That such debt should be paid is admitted. Unless there is some fundamental principle or policy of the law that makes the contemplated method of payment impossible, or interferes with a sound public policy, the lien or the means whereby the debt may be liquidated and discharged should not be cut off as to the remaining balance of assessed benefits.

The situation is not the ordinary one of a breach of a contract between the parties to the contract. The refusal or failure of the landowner to pay his taxes has created a situation and set in motion a procedure, the consequence of which affects governmental functions and purchasers for value not parties to the creation of the original debt. Had the owner of the land at the time of the organization of the district and sale of the bonds done what it was anticipated he would do, this case would not have arisen. The landowner evidently in good faith voted in favor of the proceedings that created, pursuant to law, a drainage district, a body corporate and politic with the powers to do what was done. He may have subsequently in good faith concluded the land he held was not worth the assessed benefits and taxes and thereupon refused to pay. He had the same option as to drainage taxes that he had as to general taxes, viz., pay or lose title. He could offer to pay or refuse to pay drainage or general taxes or both and abide the consequences. The original owner has in the instant case settled the "all or none" argument by electing to pay "none." When he chose to pay neither and accept the alternative of loss of his land, the further procedure referred to and provided by statute for the satisfaction of the tax claims was set in motion. There are at least three aspects to the problem: (1) The nature of the respective liens; (2) the procedure whereby the liens may be enforced and made effective; and (3) the result as to liens and title when the statutory procedure has been regularly pursued.

"It is a recognized principle of law that taxes for general governmental purposes, lawfully imposed by the state, are paramount to all other demands against the taxpayer, although the statute imposing the tax does not expressly declare such priority. This rule rests upon public policy and necessity. Civil government cannot exist or be 1 maintained without revenues, and taxes levied by the state for its support are founded upon a higher obligation than other demands. It is essential to the dignity and power of the sovereign state that taxes levied by it be promptly collected without fail." Robinson v. Hanson, supra, and cases cited.

By the terms of the bonds sold by the drainage district, it acknowledges itself to owe the amount specified in the bond and promises to pay the bearer of the bond the sum specified therein, with interest. The principal and interest are made payable by taxes to be assessed and levied upon the lands embraced within the district and declared to be benefited to the amount determined by the improvement.

The bonds were dated the first day of August, 1918. The laws of Utah, as then existing, relating to drainage districts, entered into and formed a part of the contract "as if they were expressly referred to or incorporated in its terms. This principle embraces alike those which affect its 2 validity, construction, discharge, and enforcement."Von Hoffman v. City of Quincy, 4 Wall. (71 U.S.) 535, 550, 18 L.Ed. 403, 405; Walker v. Whitehead, 16 Wall. (83 U.S.) 314, 21 L.Ed. 357.

The levy of a tax and the enforcement of the lien created by statute for payment of drainage bonds is an application of certain governmental processes whereby money is raised to pay a private debt. There is, therefore, a fundamental difference between the purposes and character of the 3, 4 general tax lien and the drainage tax lien. One is general, the other special. One is superior, the other is inferior; one is governmental, the other private in character. The drainage tax lien upon the land within the district is security for payment of the bonds sold, and when collected or paid, pro tanto extinguishes the bond lien or assessed benefits to the extent of payment, and when the amount levied or assessed up to the limit of benefits upon which the bond issue is based is paid, the lien is extinguished. Campbell v. Millard CountyDrainage Dist. No. 3, 72 Utah 298, 269 P. 1023; Elkins v.Millard County Drainage Dist No. 3, 77 Utah 303, 294 P. 307. Whether or not there is a separate lien for state taxes, county taxes, school taxes, or other taxes levied for governmental purposes, and whether such liens attach in January (R.S. 1933, 80-10-1, 80-10-2, 80-10-3), in May (R.S. 1933, 80-5-30, 80-5-52), in August (R.S. 1933, 80-9-1, 80-9-7), or at any other time, upon default in payment the net result is the same. Whether there is one sale for general taxes and drainage taxes, one certificate of sale, one tax deed, there is no merger of the liens or of funds derived therefrom. The one supports government, the other pays a private debt.

The argument of plaintiff seems to assume that if the bookkeeping in the county offices relating to taxes is kept in one book, the valuation fixed as one total, one notice of assessment, one notice of taxes due in one total, one notice of delinquency including all taxes, general and drainage, and one sale for delinquency and issuance of one certificate, that such procedure would merge the tax liens, general and drainage, into one. The argument would destroy the superiority of the general tax lien and repudiate the concession made, and is contrary to the decision in Robinson v. Hanson, supra. The real difficulty is not that of procedure or sale. Whether procedure up to the time of sale and issuance of certificate is conducted jointly or separately could make no difference. Both liens are preserved and recognized, no matter what the procedure. If the landowner pays the general tax, the county will nevertheless sell for drainage taxes, and the drainage district may bid in the property and take title to it, subject to the taxes that may be levied and collected for general purposes. If, however, the landowner pays the drainage tax and neglects or refuses to pay general taxes, the county will nevertheless sell the property as it would for the drainage tax. The owner would lose title. The drainage district, the bondholder, any redemptioner to protect the lien, must pay the general tax, otherwise lose his lien and in time his right of redemption.

Where the taxpayer neglects or refuses to pay either, and the procedure has been carried on as appellants contend it should be, by the "unit" process, and sale for both drainage and general taxes and foreclosure of both liens "at the same time," and "in the same manner, pay all or none," what difference is there in result? Who takes title? The county or the district? There can be but one answer, and that is the county takes title subject to the right of redemption by any redemptioner as provided by law. Comp. Laws Utah 1917, § 6024, reads:

"Real estate sold for taxes may be redeemed by any person interested therein, at any time within four years after the date of the sale thereof, by such person paying into the county treasury for the use of the purchaser or his legal representatives the amount paid by such purchaser, and all penalties and costs as aforesaid, together with the sum of 50 cents for a redemption certificate, and all taxes that have accrued thereon and which have been paid by the purchaser after his purchase to the time of redemption, together with interest at the rate of 1 per cent per month on the whole from the date of payment to the day of redemption; provided, and when two or more parties are interested in a piece of property which has been sold for taxes, either party may redeem the property in which he is interested, upon a payment of that portion of the taxes, interest, penalties, and costs which his property bears to the whole, together with the sum of 50 cents for redemption certificate."

The above section was amended and appears in R.S. 1933, 80-10-59, as follows:

"Real estate sold for taxes may be redeemed by any person interested therein at any time while the certificate of the tax sale is held by the county, within four years after the date of the sale thereof, by such person paying into the county treasury the amount due the county, including the sum of fifty cents for redemption certificate, all taxes subsequently assessed and all interest, penalty and costs that have accrued thereon; provided, that real estate sold and assigned as provided in section 80-10-36 may be redeemed by any person interested therein, at any time within four years after date of the sale thereof, by such person paying into the county treasury for the use of the assignee or his legal representatives the amount paid by such assignee, the sum of fifty cents for a redemption certificate, and all taxes that have accrued thereon and which have been paid by the purchaser after his purchase to the time of redemption, together with interest at the rate of one per cent per month on the whole from the date of payment to the day of redemption."

And was again amended by Laws Utah 1933, ch. 61, p. 111, to read:

"Real estate taken over by the county for delinquent taxes may be redeemed by any person interested therein at any time while the certificate of tax sale is held by the county, within four years after the date of the sale thereof, by such person paying into the county treasury the amount due the county, including the sum of fifty cents for redemption certificate, all taxes subsequently assessed and all interest, penalty and cost that have accrued thereon; provided, that where any real estate is taken over by the county and remains unassigned, the date provided by law for redemption may be extended for an additional year upon payment, at any time within the redemption period, of an amount equal to that part of the delinquent tax which is four years delinquent plus penalty, plus interest accrued on such part of the delinquent tax; provided further, that real estate sold and assigned as provided in section 80-10-36 [Laws Utah 1919, c. 122, p. 339, Comp. Laws Utah 1917, § 6023] may be redeemed by any person interested therein, at any time within four years after the date of the sale thereof, by such person paying into the county treasury for the use of the assignee or his legal representatives the amount paid by such assignee, the sum of fifty cents for a redemption certificate, and all taxes that have accrued thereon and which have been paid by the purchaser after his purchase to the time of redemption, together with interest at the rate of 8% per annum on the whole from the date of payment to the day of redemption.

"The county treasurer shall accept and credit on account for the redemption of property sold for delinquent taxes, at any time prior to the expiration of the period of redemption and thereafter until the date of the public sale provided for in 80-10-68, payments in amounts of not less than $10 except the final payment which may be in any amount. For the purpose of computing the amount required for redemption and for the purpose of making distribution of the payments received on account hereof, all such payments shall be applied in the following order:

"First, against the interest accrued upon the delinquent tax for the last year included in said delinquent account at the time of payment;

"Second, against the penalty charged upon the delinquent tax for the last year included in the delinquent account at the time of payment;

"Third, against the delinquent tax for the last year included in the delinquent account at the time of payment;

"Fourth, against the interest accrued upon the delinquent tax for the next to last year included in the delinquent account at the time of payment;

"And so on until the full amunt of the delinquent tax, penalty and interest upon the unpaid balances shall have been paid within the period of redemption as aforesaid."

The county cannot be a redemptioner from itself nor for the other governmental units for which the county collects general taxes. Construing section 6024, Comp. Laws 1917, in the case ofSorensen v. Bills, 70 Utah 509, 261 P. 450, 451, the court said:

"The owner of the property, within the period allowed for redemption, had redeemed the property from that tax sale, and thereafter any right that the county had by reason of the levy and the tax in the year 1917 was extinguished to the same extent that its claim would have been had the taxes been paid prior to the delinquent tax sale. * * *"

When the period of redemption has expired and the county has received a tax deed for any real estate sold for delinquent taxes, the county tax lien merges into the title as effectively as by execution sale with such further rights of redemption as the statute provides. Purchasers from the county then take with a "new and complete title in the land, under 5 an independent grant from the sovereign authority, which bars or extinguishes all prior titles and incumbrances of private persons, and all equities arising out of them." Hefner v. Northwestern Mut. Life Ins. Co., 123 U.S. 747, 8 S.Ct. 337,338, 31 L.Ed. 309, citing Crum v. Cotting, 22 Iowa 411;Turner v. Smith, 14 Wall. 553, 20 L.Ed. 724. Bondholders or others having liens who desire to protect them and prevent their being cut off must do so as any inferior lienholder; that is, pay the superior lienholder's claim. They may protect their security either by paying the taxes before sale or redeeming the land after sale at any time before the expiration of the period of redemption. The lien of the bondholders is of necessity extinguished when the county takes the title. The purchaser from the county (not a redemptioner) takes title free and clear of liens, otherwise the county would be hampered in collection of taxes and prevented from again having the property returned to the assessment rolls. The bonds are not general obligations of the district, "but are a charge against the lands within the district, and * * * delinquent assessments for the payment of the bonds and interest may not be included in future assessments made against the other lands of the district. The lands remain liable, however, to assessment for maintenance and repairs." State exrel. Malot v. Board of County Commissioners of Cascade County,89 Mont. 37, 296 P. 1, 19.

In what way, if at all, have the amendments to section 2058 affected the procedure or effectiveness of the remedy applicable when the bonds were sold? There are really two procedures, one relating to the levy of taxes and procedure up to payment, and another in the event the taxpayer fails to 6, 7 pay. When he fails to pay, the second and further procedure is set in motion. If all the taxes are paid, the second series of procedural steps relating to foreclosure or extinguishment of the landowner's title does not become operative. If he fails to pay, then the state or the county on behalf of the state must proceed to clear the land of liens and get it back into private hands for taxation purposes in support of government.

The statutes of this state accord to the holder of a lien on land — whatever the type of lien — the right to pay the general taxes and redeem the property if the landowner fails to pay. The holder of a mortgage then has his opportunity, and if he neglects or refuses to pay the general taxes levied against the land upon which he holds a mortgage, the land may go to tax sale. If he then permits the redemption period to expire and the title to become vested in the county or a purchaser after the redemption period expired, his mortgage lien is extinguished, although the contract and debt obligation between the mortgagor and mortgagee may still subsist. The same principle applies to special assessment liens for local municipal improvements. The same principle must of necessity apply to drainage tax assessments or liens. State ex rel. Malott v. Board of County Commissionersof Cascade County, supra.

Among the federal cases cited is that of Moore v. GasSecurities Co. (C.C.A.) 278 F. 111, 122, in which many of the other cases analyzed and submitted by appellants are referred to. The case of Moore v. Gas Securities Co. is put upon a different basis than the statutes and former decisions of this court permit. In that case the liens are held to be equal. Instead of the taxes for general purposes being held as superior, the Circuit Court of Appeals, citing a Colorado case says:

"The statute thus clearly set forth the remedy which the law gave to the holder of the bonds for their collection and became a part of the contract between him and the district. The taxeswhich were to be levied and paid for his benefit were coupledwith and put on the same footing as county taxes. Nile IrrigationDistrict v. English, 60 Colo. 406, 409, 153 P. 760." (Italics added.)

The Nile Irrigation District Case cited contains the following statement at page 761 of the Pacific Reporter citation:

"We see no reason why taxes regularly assessed and levied for the use and benefit of a duly organized and lawfully existing irrigation district are not of equal validity and dignity with, or why they should not be respected and enforced the same as other taxes."

In the concluding lines of the opinion in the case of Moore v. Gas Securities Co., supra, the following appears:

"The mode of procedure now adopted is a discrimination against district taxes by which they are put on a lower level than other taxes. Under the prior remedy there was compulsion on the taxpayer to pay all or none, and with it the patriotic impulse to promptly meet all just obligations to sustain schools, and state and county governments. Of course, the Legislature was not without power to change the remedy, but in doing so it was obliged to give the bondholder some other equally adequate remedy, otherwise it would impair the obligation of his contract with the district. Von Hoffman v. City of Quincy, 4 Wall. 535, 18 L.Ed. 403; Walker v. Whitehead, 16 Wall. 314,21 L.Ed. 357; Tennessee v. Sneed, 96 U.S. 69, 24 L.Ed. 610; NewOrleans C. L.R. Co. v. State of Louisiana ex rel. City of NewOrleans, 157 U.S. 219, 15 S.Ct. 581, 39 L.Ed. 679; Seibert v.Lewis, 122 U.S. 284, 7 S.Ct. 1190, 30 L.Ed. 1161."

As heretofore decided by this court, drainage taxes in this state are "put on a lower basis than other taxes" levied and assessed for governmental purposes. Robinson v. Hanson, supra. The last seentence of section 2055, Comp. Laws Utah 1917, reads:

"The board of county commissioners shall sit as a board of equalization of district drainage taxes, and shall equalize and finally determine the assessments to be made and levied upon each tract of land within the district, at the time and in themanner provided for by law for equalizing state and county taxes, and shall thereupon certify the same to the county treasurer of the county within which such district is located; the county treasurer shall enter the same in the tax rolls in the county, and it shall be the duty of the county treasurer to collect such taxes at the time and in the same manner that the said county taxes are collected, and to pay the same to the treasurer of the board of supervisors as soon as moneys are received by him." (Italics added.)

The amendment adding to and repealing parts of the drainage district law (chapter 41, Laws Utah 1919) amended section 2055 to read:

"The Board of Supervisors shall, on or before the first Monday in March of each year, prepare a statement and estimate of the amount of money to be raised by taxation within said district for the purpose of constructing canals, drains, drain ditches, and other works, and maintaining the same; liquidating district warrants and notes and paying interest thereon, paying the interest on the bonded indebtedness of the district; creating a sinking fund for redeeming such bonds; meeting all payments due or to become due under any contract between the district and the United States; and for the purpose of maintaining and repairing drainage canals, flumes, and conduits, bridges, culverts and other works within said district; and for the management and control of such drainage system; and shall levy the entire amount required in each year against the lands within said district in proportion to the equalized benefits and after adding 15 per cent of each amount to the respective assessments to provide for incidentals and possible delinquencies, shall certify the same to the county assessor of the county within which such district is located."

It is to be noted all reference to the equalization and collection of taxes is omitted from the new section 2055. It is also to be observed that section 2058, Comp. Laws Utah 1917, which reads as follows:

"All drainage taxes levied and assessed under the provisions of this title shall attach to and become a lien on the real property assessed from and after the second Monday in March.Drainage taxes shall become due and delinquent at the same timeand shall be collected by the same officers and in the samemanner as state and county taxes, and when collected shall bepaid to the treasurer of the board of supervisors" (italics added),

was omitted from chapter 41, Laws of Utah 1919. Section 2045, Comp. Laws 1917, and all laws and parts of laws in conflict with the provisions of chapter 41 were repealed. In 1921 certain sections of the drainage district law were amended (Laws 1921, c. 47) among which was section 2058, Comp. Laws 1917. It reads as amended:

"All drainage taxes levied and assessed under the provisions of the title shall attach to and become a lien on the real property assessed from and after the second Monday in March. Drainage taxes shall become due and delinquent at the same time, and shall be collected by the same officers and in the samemanner and at the same time as state and county taxes, and when collected shall be paid to the treasurer of the board of supervisors. The revenue laws of this state for the assessment, levying and collecting of taxes on real estate for county purposes, except as herein modified, shall be applicable for the purposes of this Act, including the enforcement of penalties and forfeiture for delinquent taxes; provided, that lands sold for delinquent district taxes shall be sold separately for such tax and a separate certificate of sale shall issue therefor. On or before the second Monday in December of each year, the county treasurer must publish a delinquent list, which must contain the names of the owners, when known, and a description of the property delinquent or subject to lien of drainage district taxes with the amount of taxes due exclusive of penalty. The county treasurer must publish with such a list a notice that unless the delinquent drainage taxes, together with the penalty, are paid before third Monday of December next thereafter, the real property upon which such taxes are a lien will be sold for taxes, penalty and costs, beginning on said date, at the front door of the county courthouse. The delinquent list shall be published three times if in a daily newspaper, twice if in a semi-weekly and once if in a weekly newspaper, commencing on or before the second Monday in December. On the third Monday of December of each year, the county treasurer shall expose for sale between the hours of ten A.M. and three P.M., sufficient of all delinquent real estate to pay the drainage district taxes, penalty and costs for which such real estate is liable, at public auction, at the front door of the county courthouse, and sell the same to the highest responsible bidder for cash, and the treasurer shall continue to sell from day to day between such hours until the property of all delinquents is exhausted or the taxes, penalty and costs are paid. In offering such real estate for sale, the treasurer shall offer the entire tract assessed, and the first bid received in an amount sufficient to pay the taxes and costs shall be accepted unless a further bid in the same amount for less than the entire tract shall be received; and the highest and best bid shall be construed to mean the bid of that bidder who will pay the full amount of the taxes and costs for the smallest undivided portion of said real estate. After receiving a bid for the full amount of the taxes and costs it shall not be the duty of the treasurer to attempt to secure a higher bid, but he shall accept it if made. The treasurer shall make a record of all sales of real property in a book to be kept by him for that purpose therein describing the several parcels of real property on which the taxes and costs were paid by the purchasers, in the same order as the published list of delinquent sales contained in the list of advertisements on file in his office. Separate columns shall also be provided in said record in which the treasurer shall enter the description of any tract sold that is less than the entire tract on which the taxes are due, the date of sale, to whom sold, the penalty, and costs, and the date of redemption. The purchaser shall be required to pay the penalty to the treasurer, which penalty shall in all cases accrue to the benefit of the drainage district. When all sales have been made the treasurer shall file the record in his office, in loose-leaf bound form. It shall be the duty of the county treasurer to issue a receipt to any person paying drainage district taxes on an undivided interest in real estate, showing the interest on which taxes are paid, and in case any portion of the drainage district taxes on such real estate remains unpaid, it shall be the duty of the treasurer to sell only such undivided interest in said real estate as belongs to the co-owners who have not paid their portion of the taxes. In absence or default of purchaser at any such public sale of drainage district taxes, the drainage district in which taxes are delinquent may purchase upon the same terms as any individual purchaser the real estate upon which drainage district taxes are delinquent and shall hold the same in the same manner as a county or an individual may hold lands upon which state or county taxes are delinquent, subject to the same rights of redemption. In all respects, a drainage district shall be the beneficiary of taxes assessed and levied by it, provided, however, that the county treasurer shall retain the costs and expense provided by law for the advertisement, sale and redemption of drainage district taxes. All lands upon which drainage district taxes have become delinquent, before the passage of this Act whether such lands have been purchased by the county or not shall be sold as provided herein by the county treasurer on the third Monday in June, 1921, after like advertisement and notice as provided herein has been given to the owners thereof, and upon the same terms and conditions as herein provided."

The words "at the same time" which were contained in section 2055, Comp. Laws 1917, and not found in the 1919 amendment nor in section 2058, Comp. Laws 1917, were restored to section 2058 when the section was amended in 1921 and 1925, and thereby a procedure was expressly provided for the collection of drainage district taxes.

The changes made in sections 2055 and 2058 by the amendments of 1919, 1921, and 1925 are by appellants maintained to be the changes that work an impairment of the obligation of the bondholders' contract and infringe the constitutional provisions relating thereto. With this view we are unable to concur. The manner by which the drainage tax lien is made effective for the purpose of reaching the security to which the bond lien attaches is substantially the same since the amendment as before, even considering the statutory references in the drainage tax law as making the procedure for the collection of general taxes applicable. By the procedure prescribed, no added burden is placed upon the drainage district nor the bondholder whereby the lien provided by the statute is impaired, nor is it made more difficult of enforcement. When the contract relating to the sale of the drainage district bonds was entered into, it was entered into with reference to the law as it then existed. The law as it then existed was in contemplation of the parties. The land within the drainage district was and always would be subject to being taken for the nonpayment of general taxes. That the lien for general taxes was superior to the lien for drainage district taxes was as much the law then as it is now. No right to pursue and make effective the drainage tax lien has been taken away or impaired. In the event of failure to pay either drainage or general taxes, the officers charged with the duty of collecting those taxes pursue the methods provided by law until the landowner's title is extinguished. Between the time of sale and expiration of the redemption period, and during which there is outstanding a certificate of sale for both delinquencies for nonpayment of general and drainage taxes, the drainage district may pay general taxes and take tax sale certificate. After the period of redemption has expired, the drainage district, upon payment of the general taxes, is entitled to a deed vesting it with title to the property sold for drainage taxes, if general taxes have been paid and drainage taxes have not. This is the ultimate limit to which the drainage district and the bondholders were entitled to go at any time, whether before or after the amended statutes. Had the Legislature declared the drainage lien paramount to the general tax lien, and by a procedure subsequently enacted the Legislature had sought to reduce or render subordinate the drainage tax lien, a different question would be presented.

"The obligation of a contract is the law which binds the parties to perform their agreement. Sturges v. Crowninshield, 4 Wheat. 122, 197, 4 L.Ed. 529; Story, op. cit., 1378. This Court has said that ``the laws which subsist at the time and place of the making of a contract, and where it is to be performed, enter into and form a part of it, as if they were expressly referred to or incorporated in its terms. This principle embraces alike those which affect its validity, construction, discharge, and enforcement. * * * Nothing can be more material to the obligation than the means of enforcement. * * * The ideas of validity and remedy are inseparable, and both are parts of the obligation, which is guaranteed by the Constitution against invasion.' VonHoffman v. City of Quincy, 4 Wall. 535, 550, 552,18 L.Ed. 403. See, also, Walker v. Whitehead, 16 Wall. 314, 317,21 L.Ed. 357. But this broad language cannot be taken without qualification. Chief Justice Marshall pointed out the distinction between obligation and remedy. Sturges v. Crowninshield, supra, 4 Wheat. 122, 200, 4 L.Ed. 529. Said he: ``The distinction between the obligation of a contract, and the remedy given by the legislature to enforce that obligation, has been taken at the bar, and exists in the nature of things. Without impairing the obligation of the contract, the remedy may certainly be modified as the wisdom of the nation shall direct.' And in Von Hoffman v. City of Quincy, supra, 4 Wall. 535, 553, 554, 18 L.Ed. 403, the general statement above quoted was limited by the further observation that ``it is competent for the States to change the form of the remedy, or to modify it otherwise, as they may see fit, provided no subsantial right secured by the contract is thereby impaired. No attempt has been made to fix definitely the line between alterations of the remedy, which are to be deemed legitimate, and those which, under the form of modifying the remedy, impair substantial rights. Every case must be determined upon its own circumstances.' And Chief Justice Waite, quoting this language in Antoni v. Greenhow, 107 U.S. 769, 775,2 S.Ct. 91, 96, 27 L.Ed. 468, added: ``In all such cases the question becomes, therefore, one of reasonableness, and of that the legislature is primarily the judge.'" Home Building LoanAss'n v. Blaisdell et al. 290 U.S. 398, at page 429,54 S.Ct. 231, 237, 78 L.Ed. 413, 88 A.L.R. 1481.

That neither general nor special taxes have been paid does not alter the relative positions as to the superiority of the liens. The drainage tax lien must suffer the same fate as all other inferior liens unless it is protected before the period of redemption expires. This, of necessity, is the result, otherwise the collection of taxes levied for carrying on the functions of government would be hampered and interfered with.

The amendments of 1921 and 1925 about which appellants complain, in so far as a procedure not before provided is concerned, are in some respects enlargements of power. More effective methods whereby the bondholders' remedy to reach the security available in satisfaction of the indebtedness are provided. At no time could the drainage district or the bondholder rest upon the presumption that his security would remain unimpaired as against the right of the state to levy and collect taxes for governmental purposes. The necessary steps must always be taken to maintain the effectiveness of a lien while the oppotrunity is open. The remedy under the amended statute is as adequate as the remedy before the statute was amended.

When it was determined that the tax lien for governmental purposes was superior to all other liens (Robinson v. Hanson, supra), the fundamental issue of the case was decided. No reason for departing from the doctrine of that case is suggested. When the drainage district was organized and the bonds sold, the taxpaying procedure relating to reaching the property assessed and benefited was made available. The procedure whereby the land so benefited can be reached and applied is still available. No change in the relative status of the taxing units has been made as to the ultimate purpose to be reached, nor as to the effectiveness thereof.

This is an action to quiet title of the plaintiff in the described tract of land. The answer broadened the scope of the inquiry and included the issues we have discussed. The trial court was invited to make findings upon those issues. As presented upon this appeal and upon the questions raised, we are of the opinion the amendments to the statutes are not subject to the attack made. We find no reversible error.

The judgment is therefore affirmed. Costs to respondent.