Federal Land Bank v. Newsom , 175 Miss. 134 ( 1936 )

DISSENTING OPINION. I am unable to concur in the opinion of Judge GRIFFITH, and I do not think the authorities cited, either in the original or the present opinion, support the conclusions arrived at by him. Those cases are either ones where the mortgagee has paid the taxes for the mortgagor, which he was under duty to pay, and for that reason has acquired a right or subrogation, or else they are based upon statutes different from the statutes and decisions of Mississippi.

It is the duty of the life tenant to pay the taxes, and the remaindermen are under no duty to the life tenant, or those holding under him, to pay the taxes. To hold otherwise, would enable the life tenant, and those holding under him, to evade their duty to keep the taxes paid for the remaindermen.

Furthermore, it is the law in this state that, unless a statute gives a right to subrogation or a lien to one who pays the taxes, no such right exists. This was expressly held in Griffing v. Pintard, 25 Miss. 173, in which it was said that the doctrine of subrogation does not apply in cases of rights and remedies of the state against delinquent taxpayers. In that case the sheriff paid the taxes for the taxpayer, and, not being repaid, undertook to subject the land to his demand, and the court held that it was "manifest, that the land was not sold for the purpose of collecting any taxes due by Bowen to the State or county, but only to reimburse Moore the money which he had advanced. If it be contended, that he had power to sell for this purpose, then it must be shown, to sustain the proposition, that on payment of the taxes he was subrogated to the rights and remedies of the State against delinquent taxpayers. Nothing can be found in either the letter or policy of the law, giving countenance to this position."

In Cannon v. Barry, 59 Miss. 289, it was held that only the rights of the life tenant pass to a purchaser at a tax sale. It was also there held that the life tenant took the land as a whole and was bound to preserve it, and that the taxes were his individual debt, and, if he did not pay the tax, the court should appoint a receiver to take charge of the life estate and pay the taxes from rents and profits. Therefore, under this case, it being the duty of the life tenant to pay the taxes, and he having failed to do so, the land was sold, and the court ordered him to pay the taxes and redeem the land. This case clearly holds that the life tenant alone is to pay the taxes accruing during his tenancy.

In the case at bar the court should, instead of decreeing a portion of the taxes against the remaindermen, have taken possession through a receiver, and applied the rents and profits to the payment of the taxes, or should have sold the life estate and paid the taxes from the proceeds of the sale.

In Chiles v. Gallagher, 67 Miss. 413, 7 So. 208, it was held that, where defendants set up a tax title which they acquired, and some of them occupied such trust relation that they could not assert it, and the complainant failed to show a right to relief, it was conceded that the tax title was invalid, and the complainant not entitled to a decree. It was also held that one in possession of land, receiving the rents and profits therefrom, was under obligation to pay the taxes, and that one holding a tax title from the life tenant merely holds same as trustee, ex maleficio, for the real owner. The facts of this case are interesting, and a discussion of the applicable law shows that it is the settled principle of law in this state to compel the life tenant to pay the taxes, and that those dealing with him know of his relation to the remaindermen, and cannot defeat their rights by permitting tax sales to be made, and then undertaking to charge the remaindermen with the obligation to pay the taxes.

It seems to me that these cases alone show the law to be that one who deals with a life tenant cannot acquire a greater right than the life tenant as against the remaindermen.

The remindermen, certainly, owe no duty to the mortgagee of the life tenant. He took his mortgage, and, by so doing, acquired only the rights of the mortgagor. It was charged with notice of everything in its chain of title, and we have held that mortgagees, in such cases, are charged with notice of the will creating such remaindermen.

In 21 C.J. 942, sec. 74, it is said: "An outstanding title or interest cannot be acquired by the life tenant for his own exclusive benefit. . . . Neither a life tenant, nor one claiming under him, who allowed the property to be sold for taxes, or the satisfaction of an incumbrance or interest thereon, can acquire title adverse to the remaindermen or reversioner by purchasing at the sale himself." The authorities cited in the note to this statement show that the mortgagee of the life tenant cannot purchase at a tax sale and secure a title against the remaindermen.

In Whitfield et al. v. Miles, 101 Miss. 734, 58 So. 8, it was held that a life tenant cannot buy at a tax sale and set it up against the remaindermen, and neither could his wife. See, also, Grace v. Reed, 143 Miss. 427, 108 So. 799, 47 A.L.R. 516; Stewart v. Matheny, 66 Miss. 21, 5 So. 387, 14 Am. St. Rep. 538; Deanes v. Whitfield, 107 Miss. 273, 65 So. 246; Leflore v. Flowers,117 Miss. 682, 78 So. 513; Fox v. Coon, 64 Miss. 465, 467, 1 So. 629; Cogburn v. Hunt, 57 Miss. 681, and McLaughlin v. Green, 48 Miss. 175.

In 25 R.C.L. at page 1315, under the title of "Subrogation," it is said that: "To entitle one to subrogation, his equity must be strong and his case clear. It is generally held that the doctrine of subrogation requires that the person seeking its benefit must have paid a debt due to a third person before he can be substituted to that person's rights; and that it is not a liability to pay, but an actual payment to the creditor which raises the equitable right to subrogation."

The mortgage of the life tenant to the Federal Land Bank contained a provision that the life tenant would keep the taxes paid and furnish evidence thereof to the mortgagee by January 1st of the year involved, and it also contained a contractual stipulation that, if there was a failure of the mortgagor so to do, the bank could pay same and foreclose, having a right to advance the deferred payments due under the mortgage.

Other authorities could be cited to sustain this position, but it seems to me that those cited are ample to sustain my views. However, if authorities of other jurisdictions are desirable, they may be found in the following cases: Jeffers v. Sydnam,129 Mich. 440, 89 N.W. 42; Mansfield v. Neff et al., 43 Utah, 258, 134 P. 1160; Lyman v. Hollister, 12 Vt. 407; American Bonding Co. v. National Mechanics' Bank, 97 Md. 598, 55 A. 395, 99 Am. St. Rep. 466, 467; Mersick v. Hartford, etc., R. Co., 76 Conn. 11,55 A. 664, 100 Am. St. Rep. 977; Hunt v. Rabitoay, 125 Mich. 137, 84 N.W. 59, 84 Am. St. Rep. 563; Pruitt v. Holly, 73 Ala. 369, and Mason v. Wingate, 275 Ill. 117, 113 N.E. 975.

In addition to what has been said, the redemption by the mortgagor deprived the remaindermen of their right to bring action for waste and to terminate the estate of the life tenant. When the mortgagor redeemed, this right was cut off. See 21 C.J. 971, sec. 118, and McMillan's Lessee v. Robbins, 5 Ohio 28.

These views might be sufficient to answer all that has been said in Judge GRIFFITH'S opinion, but, if there was any duty devolving upon the remaindermen to pay the taxes to prevent the title from vesting in the purchaser at the tax sale, the duty certainly was no greater on the remaindermen than on the mortgagor. The remaindermen owed the mortgagor no duty with reference to paying the taxes.

If the mortgagee had a right to a separate estate from the life tenant, he could redeem his separate estate under sections 3264-3266 of the Code of 1930, but I do not contend that the mortgagee had any rights other than such as would be derived from the life tenant, and the law contemplates that the life tenant should bear the burden of the taxes and that the assessment of the lands should be to the life tenant. This assessment is of the whole fee, and the life tenant is to pay the taxes on the whole fee to preserve his own estate, because he is in possession, receiving the rents, profits, and usufructs of the entire estate during his life.

As this case has been sent here to settle the principles, I think that the court below should either appoint a receiver to take charge of the property during the life estate, and apply the profits therefrom to the discharge of the taxes, or order a lien to be declared upon the life estate and a foreclosure, in default of payment, and sale to pay the amount of the decree.

The life estate in this case is still existing, and its further duration could be ascertained by the life expectancy, and there may elapse a considerable period of time before the rights of the remaindermen accrue.

I desire to stress the rule of equity that the doctrine of subrogation will not be applied where innocent persons will be injured. The minor remaindermen in the case at bar are of tender years whose rights may be materially injured by presently enforcing any kind of lien on their estate — the fee. In fact, I cannot see how it can be accomplished effectively without casting a cloud upon their title.

May the Federal Land Bank foreclose as to the interest — a life estate — and the purchaser be freed from the obligation to pay the taxes accrued or to accrue?

My view is that the Federal Land Bank must be held to have paid these taxes for its own benefit in order that it might have its security enforced or preserved against the life estate.

These minors made no agreement with the Federal Land Bank as to the payment of these taxes by it, if, indeed, any such agreement could have been made by them or for them by the chancery court.

There is no room to invoke here either legal or conventional subrogation against the estate of these minors.

Therefore it is wholly inequitable and unjust to charge the remaindermen with any part of these taxes until, at least, the life estate has been exhausted.

I think the judgment should be reversed for a decree in accordance with these views.

CONCURRING OPINIONS.