New Hanover County v. Whiteman, 190 N.C. 332 (1925)

Oct. 21, 1925 · Supreme Court of North Carolina
190 N.C. 332

NEW HANOVER COUNTY v. JOHN H. WHITEMAN, ARNITA B. WHITEMAN, L. G. WHITEMAN, and J. H. WHITEMAN, Jr.

(Filed 21 October, 1925.)

1. Government — Taxes—Liens—Statutes—Limitation of Actions.

Where a county proceeds to foreclose a tax lien under the provisions of C. S., 7990, as distinguished from an action to foreclose the tax-sale certificate, instead of under those of C. S., 8037, which it may elect to do, it proceeds as a part of the state sovereignty, and there is no bar of the statute of limitations, that of C. S., 8037 not applying.

2. Same — Judgments.

Where a county brings suit to foreclose a tax lien on the lands of the taxpayer and draws its complaint according to the provisions of C. S., 7990, other taxes due after the commencement of the action are properly included in the judgment therein rendered in its favor.

Appeal by defendants from New HaNOvee Superior Court. Dunn, J.

Tbe plaintiff sued tbe defendants, who are tbe heirs at law of Sarah Whiteman, deceased, to collect taxes assessed against tbe lands described in tbe complaint for tbe years 1916, 1917, 1918, 1919, 1921, 1922 and 1923, in tbe sum of, including interest as computed in tbe complaint, $292.68. Tbe defendants denied tbe levy of tbe taxes alleged, and set up that tbe suit was, in effect, an action to foreclose tax certificates purchased by tbe plaintiff in 1917 and 1918 on account of sale for tbe taxes for tbe years 1916 and 1917, and pleaded tbe five years bar, as set out in C. S., 8037. A consent reference was bad and tbe case was beard on exceptions to tbe report of tbe referee. From a judgment rendered in favor of tbe plaintiff tbe defendants appealed.

*333 Nathan Cole for plaintiff.

John D. Bellamy & Sons for defendants.

Vaeser, J.

Under C. S., 8037 every bolder of a certificate of sale of real estate for taxes is subrogated to tbe lien of tbe State (under tbe present taxation system there is now no tax levied on lands for state purposes), and of tbe county or other municipal corporation, for tbe taxes for which such real estate was sold, and each bolder (other than counties and other municipal corporations) who elects to proceed under this statute is required to give to tbe owner or occupant of tbe real estate which be seeks to sell, ten days written notice of bis intention to commence such action in foreclosure, and in bis complaint each certifi- . cate of sale held by tbe plaintiff and each sum expended by him for taxes, on such real estate shall be set out as a separate cause of action. It is further provided that inability to find tbe owner or occupant in tbe county in which tbe land is situated shall excuse tbe failure of plaintiff to give this ten-days notice.

An action under C. S., 8037 is in tbe nature of an action to foreclose a mortgage and must be commenced within two years from tbe date of tbe last certificate of sale held by tbe plaintiff when the' plaintiff is not a county or other municipal corporation.

Counties and other municipal corporations may proceed under C. S., 8037, if they shall so elect, when tbe tax-sale certificates, or tax deeds, held by them, remain unredeemed as much as four years from tbe dates of such instruments, but such corporations will be barred by tbe lapse of five years from tbe delivery of tbe certificate of sale, or deed sought to be foreclosed. This statute expressly provides that it may be invoked by those who elect to proceed thereunder, and when election is made to sue under O. S., 8037, tbe limitations therein prescribed apply, and tbe benefits accrue. Tbe bolder of a tax-sale certificate or deed is entitled to recover interest at tbe rate of twenty per centum per annum “on all amounts paid out by him, or those under whom be claims, and evidenced by certificates of tax sale, deed under tax sale, and tax receipts,” to be “computed from tbe date of each payment up to tbe time of redemption, or final judgment, and shall be added to tbe principal of tbe final judgment, which judgment shall bear interest as in other cases.” Tbe Legislature has provided a five years bar in actions under C. S., 8037.

When tbe action is to foreclose tbe tax lien, as distinguished from, an action to foreclose tbe tax-sale certificate, or tax deed under C. S., 7990, there is no statutory bar. Wilmington v. Cronly, 122 N. C., 383; Jones v. Arrington, 94 N. C., 541; R. R. v. Commissioners, 82 *334N. C., 259. C. S., 7987 provides that tbe lien on realty for taxes levied, “shall continue until such taxes, with any penalty and costs which shall accrue thereon, shall be paid.” Carstarphen v. Plymouth, 186 N. C., 90, 94; Vaughan v. Lacy, 188 N. C., 123.

Statutes of limitations never apply to the sovereign, unless expressly named therein. Nullum tempus occurrit regi is a principle of government which still retains its ancient vigor in respect to taxes. Wilmington v. Cronly, supra. Hence, the five years statutory bar in C. S., 8037 expressly limits itself to actions under that section, and, when considered in'the light of its own limitation, as well as the doctrine that time does not run against the sovereign, we are unable to hold that the five years statutory bar applies to the instant case.

The power to tax is the highest and most essential power of the government, and is an attribute of sovereignty, and absolutely necessary to its existence. R. R. v. Alsbrook, 110 N. C., 137; Faison v. Commissioners, 171 N. C., 411; Redmond v. Commissioners, 106 N. C., 123; Wilmington v. Cronly, supra; S. v. Petway, 55 N. C., 396; Pullen v. Commissioners, 66 N. C., 361, 362; McCulloch v. Maryland, 4 Wheat., 316.

The defendants’ contention that this is a hard case cannot be sustained. It is only requiring the defendants to pay their just and proportionate part of the expense of government. In its essential characteristics, a tax is not a debt, it is an impost levied by authority of government upon its citizens or subjects for the support of the state; it is not founded upon contract or agreement, it operates in invitum. Gatling v. Commissioners, 92 N. C., 536; Guilford v. Georgia Co., 112 N. C., 34; Wilmington v. Bryan, 141 N. C., 666; Commissioners v. Murphy, 107 N. C., 38; Graded School v. McDowell, 157 N. C., 317; Commissioners v. Hall, 177 N. C., 490.

The plaintiff fashioned its complaint under C. S., 7990, and the court found as a fact that the action was instituted under that section, and the judgment follows the law, as therein set out. The defendants’ exceptions present no contest as to the levy, but relate to the five years statutory bar in C. S., 8037; hence, they are without merit. The inclusion of taxes due after the action was instituted does not appear to be prejudicial to the defendant. This action is in the nature of a bill in equity to foreclose a lien and it is proper to include in the final judgment a disposition of all liens on the property. Jones v. Williams, 155 N. C., 179.

Therefore, let the judgment be

Affirmed.