38 So. 2d 111 | Miss. | 1948
Lead Opinion
The record before us contains the theory of an agreed simultaneous trial of two suits in the Chancery Court *3 of Wayne County. In both suits, appellees, as complainants, sought cancellation of tax sales of appellee, Foote's, fractional oil, gas and mineral interests, assessed and sold as fractions of two separate tracts, in 1941 for Foote's default in payment of his 1940 taxes on said fractions in each whole tract of oil, gas and minerals. Confirmation of appellees' title was also prayed. Appellant, in each case, made his answer a cross-bill, seeking cancellation of the claims of appellees to these same fractional interests of the entire mineral estate which he had bought at the aforesaid tax sales, claiming the sales to be valid. Appellees, on the other hand, denied and attacked the validity thereof.
There were several defendants in addition to appellant here, but they have disappeared from the record in one way or another, leaving appellant as the sole prosecutor of this appeal.
In one suit, relief was sought to cancel the cloud of appellant's tax purchase, and to confirm appellees' titles and claims in and to an undivided one-half interest in the oil, gas and other minerals in and under NW 1/4 of NW 1/4 and SW 1/4 of NW 1/4 of Section 31, Township 10 North of Range 8 West in said county, belonging to Alfred Foote. There was an over-all mineral lease to Gulf Refining Company, and a trust deed from Alfred Foote and Urban B. Hughes, on their interests, for benefit of the Commercial National Bank and Trust Company of Laurel. But, in view of the conclusion we have reached, it is not necessary to discuss further their connection with the situation.
In the second suit, the same relief was asked by the respective parties, involving, however, different land, and an undivided one-fourth interest in and to the oil, gas and other minerals in and under SW 1/4 of NE 1/4 and NE 1/4 of SE 1/4 of Section 3, Township 6 North of Range 7 West in Wayne County.
The gravamen of the complaint in both suits was that the tax assessor assessed these fractional interest against *4
Alfred Foote for the year 1940, under the provisions of Section 9770, Code 1942, Chapter 185, Laws 1932, as construed in Stern et al. v. Parker,
There are other contentions in support of their right to the relief sought by appellees, and sustained by the chancellor, but we pretermit discussion of them, as, in our judgment adjudication of the one issue described, supra, will settle both cases.
In 1941, these fractional interests of appellee Foote were sold for non-payment of his taxes of 1940, and appellant Hendrix became the purchaser. It is this tax sale, which is at issue in the two suits. There is considerable evidence in the record, and much argument in the briefs, as to the claimed redemption thereof by appellee Foote, but, as stated, it is not necessary for us to reach that precise question here. The descriptions of the two tracts at issue as assessed, entered on the tax rolls, and sold, are respectively as follows: "1/2 of min. Int. NW NW SW NW Sect. 31, Town. 10, Range 8", and "1/4 Min. Int. SW NE NE SE, Sect. 3, Town. 6, Range 7." The surface was owned and separately assessed to another.
Section 9770, Code 1942, Chapter 185, Laws 1932, in part provides that all oil, gas, and mineral rights "shall be assessed and taxed separately from such surface rights and interests in said real estate, and shall be sold for *5 taxes in the same manner and with the same effect as other interests in real estate are sold for taxes."
Appellee Foote owned these mineral interests in common with others, who were owners of the other half thereof in the one case, and of the other three-fourths in the companion case. It seems to us, therefore, that the assessment and tax sale were both void because violating Sections 9772, Code 1942, Section 3148, Code 1930, quoted supra. Parties owning undivided interests in underlying minerals in land are tenants in common. Wight v. Ingram-Day Lumber Company,
The tax lien is on the land, every part of it. A fractional undivided interest could not be redeemed in case of a tract of land containing such interests, at a tax sale, because the tax liability, like the lien, extends to every acre of the land taxes, and the attempted redemption of an undivided fraction therein would result in a simple credit on the total tax due on the entire tract, unless in such redemption the tax due on the whole tract and all undivided interests therein were paid. We are not here dealing with payment of taxes in installments, under statute permitting that method, where assessment is properly made, but with assessment and sale of fractional interests in the same parcel of land.
The tax assessor may assess lands to the unknown owners thereof, but surely no one would contend he could lawfully assess many different undivided fractions in a piece of land, and balance of the undivided interests to *6 named owners. He is required to state in his assessment roll that more than one person claims to be the owner of the same tract. Thereupon, "the tax collector shall only collect the taxes on one assessment." Section 9772, Code 1942. This seems clear and plain to us, and the assessments and sales here being violative thereof, and the statute being mandatory, the appellant acquired no title by his purchase at the tax sale. An assessment of land for taxes described as a fractional interest therein does not so describe the land as to identify the fractional interest, since such interest is undivided and extends to and is an integral part of the whole tract.
The reasonableness of this interpretation of the Statute, Section 3148, Code 1930, Section 9772, Code 1942, is further supported by our decisions dealing with the right of contribution, which one co-tenant may require of the others, where he pays the taxes on the entire tract for the owners of undivided interests therein. We held in Davidson v. Wallace,
Section 9775, Code 1942, Section 3151, Code 1930, requires that "In assessing land, a description of it as a part of a designated tract or division, shall be held to embrace such part as is the subject of separate ownership, as one tract or division, whether owned by one or several jointly; and when part of a designated tract or division shall be sold for taxes, the sale shall pass the title of such part as was the subject of such separate ownership *7 when it was assessed; and the sale of a specified number of acres of a tract containing more, or a specified portion of a tract, shall pass an undivided interest in the whole tract equal to the proportion which the number of acres or portions sold bears to the whole tract; and when part of a known tract or division of land is assessed by a description which identifies it, any other part of it which is assessed but not so identified, shall be held to embrace all of such tract or division not included in the part identified; . . ." This statute deals with identifiable parts of tracts of lands, whereas the subject before us involves fractional interests in lands, not capable of identification, separate and apart from any other acre in the tract. This statute must be read in harmony with Section 9772, Code 1942, Section 3148, Code 1930, which provides that the record of assessment show that several different owners have interest in the tract, and the tax collector shall "only collect the taxes on one assessment." Section 9775, Code 1942, supra, concludes that "parol testimony shall always be admissible to apply a description of land on the assessment roll, or in a conveyance for taxes, where such testimony will show what land was assessed and sold, and there is enough in the description on the roll or conveyance to be applied to a particular tract of land by the aid of such testimony." A fractional interest in land is not a particular tract of land, and is incapable, as stated, of separate allocation to any portion of the parcel of land, since it pervades all of it.
Section 9775, Code 1942, was Section 3776, Code 1892, when we decided Illinois Central Railroad Company v. Le Blanc,
In Stevenson et al. v. Reed,
The wisdom of the decision just quoted is demonstrated upon contemplation of the fact that sometimes these fractional interests become almost infinitesmial. In such case, the courts nave adopted the numerous party rule in litigations, holding that process on a representative group is sufficient service upon all. Floreen v. Saucier et al.,
We are here dealing with statutes and decisions thereon in force prior to the passage of the Documentary Stamp Act, Chapter 409, Laws 1946, and what we say is not in construction of that Act, which was passed after the matters here adjudicated came to pass.
The chancellor so decreed here, and his decrees cancelling the claims of appellant under the two tax sales of the lands involved, as clouds upon the titles of appellees, and confirming their titles thereto, accordingly, are affirmed.
Affirmed.
Dissenting Opinion
The majority opinion takes comfort from Stern v. Parker,
In my judgment, the Suggestion of Error should be overruled.
Griffith, C.J., concurs in the above opinion. *43
Addendum
This matter is now before us on Suggestion of Error. For former opinion see Hendrix v. Foote et al., Miss., 36 So.2d 145.
There are two questions necessary for our decision: First, did the failure of the President of the Board of Supervisors to sign the minutes of the Board for July 13, 1940, recessing to convene on Monday, July 15, 1940, invalidate the order of the Board, entered on July 15, 1940, which preliminarily approved the assessment rolls, and if not, then second: Does Section 9770, Code of 1942, permit the separate assessment and sale for taxes of a fractional interest in the oil, gas, and other minerals.
Let us proceed to the consideration of the first question hereinabove set out. On September 21, 1942, the Tax Collector of Wayne County sold for delinquent taxes for 1941 the property described as "1/2 min. int. SW 1/4, NW 1/4 and NW 1/4 NW 1/4 Section 31, Township 10, Range 8". This mineral interest had been assessed upon the assessment roll of the County for 1941 to Alfred Foote. That same assessment roll assessed to Masonite Corporation the land and assessed to Gulf Refining Company the mineral leasehold interest in and to the same.
On the same day, September 21, 1942, the Tax Collector of Wayne County sold for delinquent taxes for 1941 the property described as "1/4 min. int. SW NE and NE SE Sev. 3 Township 6 Range 7". This mineral interest had been assessed upon the assessment roll for 1941 to Alfred Foote. This same assessment roll assessed the mineral leasehold interest to Gulf Refining Company and the land to E.D. West. *31
The Board of Supervisors of Wayne County at the July, 1940, meeting of said Board met in regular session on July 1, 1940, and by minutes duly signed recessed to convene on July 2d 1940. In this same manner legal meetings of said Board were duly held on the 3rd, 5th, 6th, 9th, 10th, and 12th. On the 12th the Board recessed to convene again on the 13th and on the minutes of the 13th there is an order recessing to Monday July 15th. The minutes for the 13th have never been signed. On July 15th the Board reconvened in regular session and entered upon that day's minutes an order approving the real property assessment roll for 1940 and 1941. The minutes for July 15, 1940, were duly signed. Does the failure of the President of the Board of Supervisors to sign the Board's minutes for July 13, 1940, on which minutes there was an order recessing to convene on July 15, 1940, invalidate the proceedings of the Board had and done on July 15, 1940? We think not.
Section 2877, Code of 1942, provides as follows:
"At the meetings for the transaction of business under the revenue law, the board of supervisors may continue in session as long as business may require, but at other regular meetings, they may sit for a period of not longer than six days in any one month; provided, that in counties having a population of more than forty thousand, the board may continue in session at any other regular meeting than the revenue meeting of not longer than ten days in any one month; and provided further, that the board of supervisors may recess from time to time, subject to the limitation herein provided, to convene on a day fixed by an order of the board entered on its minutes, and may transact any business coming before it for consideration."
Section 2886, Code of 1942, provides:
"It shall be the duty of the clerk of the board of supervisors to keep and preserve a complete and correct record of all the proceedings and orders of the board. *32 He shall enter on the minutes the names of the members who attend at each meeting, and the names of those who fail to attend. He shall safely keep and preserve all records, books, and papers pertaining to his office, and deliver them to his successor when required. The minutes of each day shall be read and signed by the president before the final adjournment of the board."
Section 2886, Code of 1942, was amended by Chapter 305, Laws of 1946, but we are not here concerned with the amendment. We are concerned on with the statute as it stood in July 1940, when the meeting of the board was held.
It will be noted that Section 2877 provides that ". . . the board of supervisors may recess . . . to convene on a day fixed by an order of the board entered on its minutes . . ." and that Section 2886 requires that ". . . The minutes of each day shall be read and signed by the president before the final adjournment of the board."
While Gardner et al. v. Price et al.,
(Hn 1) Sections 2877 and 2886 are in pari materia and must be construed together and, if possible, read into each other, so as to make a consistent whole. Clarksdale Bldg. Loan Ass'n v. Board of Levee Com'rs for Yazoo-Mississippi Delta,
(Hn 2) Construing Sections 2877 and 2886 together as a constituted whole it appears that while Section 2877 does require an order by the board, entered on its minutes in order to recess to convene on a day named in the *33 order, still it is further provided, under Section 2886 that none of the minutes are required to be signed by the president until the last day of the meeting. Section 2886 is very clear in its terms. (Hn 3) The board of supervisors can meet and recess from day to day without signing the minutes for any day's meeting, and, just so long as the minutes are signed on the last day, the terms of both Sections 2877 and 2886 are literally complied with. Hence, when the Board of Supervisors met on July 15, 1940, they had the right to so meet and full jurisdiction to proceed with the business before the Board regardless of whether or not any of the minutes of the previous days of the meeting had been signed. Hence, the board was lawfully in session on July 15, 1940, and the order approving the real property assessment roll for 1940 and 1941 having been entered on that day's minutes, and the minutes having been duly signed by the President, the assessment roll for 1940 and 1941 thereupon stood duly and lawfully approved by the order entered on the minutes of that day. It is only the unsigned minutes of July 13, 1940, that conflict with the statute and that day's minutes only are invalidated by it.
Let us now consider the second question: Does Section 9770, Code of 1942, authorize the separate assessment, and, if the taxes are not paid, the subsequent sale for delinquent taxes of a fractional interest in the oil, gas, and other minerals? The former opinion held that it does not. We have carefully reconsidered this whole matter, and a majority of the Judges agree that the Suggestion of Error should be sustained and the former opinion withdrawn.
One hundred years ago, in 1848, the Legislature enacted what now appears as Section 9772 of the 1942 Code, which reads as follows:
"In making his land roll the assessor shall commence the assessment with the lowest number of range and township in his county, and with the northeast corner *34 of each township, and shall proceed numerically, with all the sections, townships, and ranges in his county, first setting down all the subdivisions of each section, if they belong to different individuals, or the whole section together, if owned by one person, and not divided on account of parcels being of different values; and if more than one person shall claim to be the owner of the same tract or parcel of land the assessor shall so state in his assessment roll, and the tax collector shall only collect the taxes on one assessment. . . ."
In Stevenson v. Reed,
It is beyond dispute that in 1930, when the Legislature enacted Chapter 171 of the Laws of 1930, which now appears as Section 9770 of the Code of 1942, fractional undivided interests in land could not be separately assessed to the respective fractional owners, so that each such fractional owner could have his undivided fractional interest separately assessed to him. Neither could he pay the taxes due only on his fractional interest and in default thereof have the tax collector sell only such fractional undivided interest. It was required by the statute that all of said fractional interests be assessed as a whole, and that the assessor state on the assessment roll that the tract was claimed by more than one person *35
as owner, and the tax collector was required to collect the whole taxes on all the fractional interests under the one assessment. But, in Davidson v. Wallace, 1876,
The Legislature knew this status of the law on the assessment of undivided fractional interests in land, at the time it enacted Chapter 171 of the Laws of 1930. They knew that fractional interests in land could not be separately assessed.
The Legislature in 1930 also knew that in Stokely v. State et al.,
The Legislature, at that time, also knew that the Amory and Jackson gas fields had been discovered and that large scale buying and selling of mineral interest in lands in said fields was a matter of common daily occurrence. They knew, too, that customarily the owner of the fee would execute a lease to a producing company, conveying an undivided seven-eighths interest in the oil and gas; that the fee owner would reserve an undivided one-eighth interest therein; that frequently the holder of the lease would convey an overriding royalty; that the owner of the fee would convey to purchasers a part of his royalty and these purchasers would split up their purchases in sales to many others, resulting quickly and shortly in large numbers of owners, owning small undivided fractional interests in the minerals. *36
The Legislature also knew that under the law, as it then stood, no individual owner could have his small undivided fractional interest separately assessed to him. They knew that if landowner A had given a seven-eighths oil and gas lease on his lands, to B, retaining a one-eighth royalty and had then sold one-half of his royalty to C, that there would have occurred a severance of the seven-eighth leasehold interest belonging to B and the one-sixteenth royalty interest owned by C, but neither B nor C could have their fractional undivided interest separately assessed to them, but that the whole mineral interest was required by the statute to be assessed as a unit belonging to more than one person and the tax collector was required to make one sale of the whole unit on the one assessment. If John Doe should be the owner of an undivided .0002 interest in the unit, the value of which unit was six hundred thousand dollars, and the taxes due on the whole unit amounted to $18,000.00, then John Doe would find it impossible to have his .0002 interest separately assessed to him at its proportionate value of $120.00, but the whole mineral unit was required by law to be assessed as a unit, and if the taxes were unpaid, the law placed on John Doe the duty of paying the entire tax bill of $18,000.00 on the entire unit in order to avoid the sale of his interest, though on it there was due for taxes only the proportionate sum of $3.60, and then sue his numerous and sundry cotenants for a contribution of the respective amount due proportionately by each of them. He would find it impossible to raise so large a sum and accordingly his interest would be confiscated for taxes.
So, in 1930, the Legislature, realizing the necessity for relief, enacted Chapter 171 of the Laws of 1930, now appearing as Section 9770, Code of 1942, which reads as follows:
"Whenever any buildings, improvements or structures, mineral, gas, oil, timber or similar interests in real estate, *37 including building permits or reservations, are owned separately and apart from and independently of the rights and interests owned in the surface of such real estate, or when any person reserves any right or interest, or has any leasehold in the elements above enumerated, all of such interests shall be assessed and taxed separately from such surface rights and interests in said real estate, and shall be sold for taxes in the same manner and with the same effect as other interests in real estate are sold for taxes. All interests in real estate herein enumerated shall be returned to the tax assessor within the same time and in the same manner as the owners of land are now required by law to list lands for assessment and taxation and under like penalties. The tax assessor shall enter the assessment of the interests herein enumerated upon the assessment roll by entering the same upon the next succeeding line or lines of the roll following the assessment of the surface owner, the name of the owner and the name of the interest, and by placing the value in the appropriate column or columns on the roll; or the assessor may enter the assessment of any or all of such interests upon a page or pages in the land roll following the assessment of the lands of the county, and the value of all such interests shall be included in the recapitulation of the roll. And the value of said interest or interests shall be determined and fixed in the same manner and by the same officials now required by law to value and assess property for taxation."
It is known to everyone that many large producing oil companies own fractional leasehold interests in this State which have been assessed to them and upon which they have paid the taxes. In many instances, the taxes due upon the assessment against the surface of the lands have contained no exception of the minerals, so separately assessed to such companies, and said taxes have not been paid, and said lands have been sold for the payment of such taxes. If such fractional leasehold interests are not *38
separately assessable for taxes and said attempted assessments thereon are void, then many fractional leasehold interests, some producing oil, would be lost to their owners and title thereto passed to such purchasers at such tax sales. Stern v. Parker,
It is also well known that for twenty years owners of separately owned minerals, royalties and leaseholds have been separately assessed with and have paid taxes on such separately owned interests. These oil and gas interests were fractional undivided interests and often of trivial value. The Legislature recognized the nuisance connected with the assessment and taxation of separate minerals, royalty and leasehold ownerships, and passed the Documentary Stamp Act of 1946, being Chapter 409, Laws of 1946, Section 2 of which reads as follows:
"To encourage the purchase of leases upon and interests in oil, gas and other minerals in the state of Mississippi, to encourage drilling for and production of such minerals, and to relieve the taxing officials of the counties of the state of the onerous duties of assessment for, collection of and sale for ad valorem taxes for such interests (which the legislature finds are generally assessed at nominal values resulting in taxes not commensurate with the services required of such officers), all nonproducing leasehold interests upon all oil, gas and other minerals in, on or under lands lying within the state of Mississippi, created or assigned after the effective date of this act, and also all nonproducing interests in such oil, gas and other minerals (including royalty interests therein) hereafter conveyed to a grantee or purchaser or excepted or reserved to a grantor separately and apart from the surface, shall be exempt from all ad valorem taxes levied on or after January 1, 1947, by the state of Mississippi, or any county, municipality, levee district, road district, school district, drainage district or other taxing district within the state or becoming a lien on or after said date. Any *39 sale for taxes of the surface or of the remainder of the fee shall not in any manner whatsoever affect the interest or interests hereby exempted.
"For the same purpose and with like effect there is hereby likewise exempted from such ad valorem taxation all such interests created prior to the passage of this act which are owned separately and apart from the surface, provided that as a condition precedent to obtaining such exemption upon existing interests the then owner thereof shall make application for exemption of the interest then owned by him as hereinafter provided and pay, by the purchase of documentary tax stamps, a sum equivalent to the tax herein levied by section 4, et seq., on instruments hereafter executed creating, transferring or reserving corresponding or similar interests. If any such sum is paid after January 1, 1947, then such exemption shall apply only to taxes becoming a lien after such sum is thus paid."
Stern v. Parker, supra, holds that the fractional mineral interest must be separately assessed or it will pass under a tax sale of the fee in the land. Section 9770 permits assessment where "owned separately and apart from and independently of the rights and interests owned in the surface of such real estate." Suppose A owns a tract of land and executed to B an oil and gas lease upon the same, conveying to B a determinable fee in an undivided seven-eighths of the oil and gas in place and reserving to A an undivided one-eighth royalty interest therein; then A sells to C one-half of his royalty or an undivided one-sixteenth interest. Now the one-sixteenth royalty retained by A is not "owned separately and apart from and independently of the rights and interests owned in the surface of such real estate" and is not subject to assessment under Section 9770, so unless Section 9770 permits a separate assessment to B of his leasehold interest and a separate assessment to C of his royalty interest, then there could be no assessment as it would be impossible to *40 include all of the separately owned interests, including A's retained royalty, under one unit assessment of the whole.
(Hn 4) The Armory and Jackson gas fields had been discovered when the Legislature enacted Section 9770, and the Legislature was dealing with an entirely new and independent subject matter that had arisen with reference thereto. The assessment of interests in oil and gas could not be handled adequately, justly and conveniently under the then existing law. They established and had the right to establish a different method of assessment, just as had been done in the case of banks, corporations, and joint stock companies, so long as the law applied equally on all within the class and was not discriminatory against others occupying a like position. Section 9770 does not deal with the same subject matter as Section 9772 and is not in pari materia with it. The language contained in Section 9772: "and if more than one person shall claim to be the owner of the same tract or parcel of land the assessor shall so state in his assessment roll . . ." cannot control Section 9770 which is a later enactment and is not in pari materia with it.
If it be said that Section 9770 is dependent upon Section 9772 for a part of the plan of assessment or collection, this does not make Section 9770 in pari materia with Section 9772. The Legislature, in enacting Section 9770, was dealing with an entirely new subject matter, not known of at the time of the enactment of Section 9772, nearly one hundred years previous. The most that can be made of such an argument is that it portends to make Section 9770 ambiguous and uncertain as to whether the language in Section 9772 "and the tax collector shall only collect the taxes on one assessment" shall apply to sales under Section 9770. We think it does for there is no ambiguity. when the undivided fractional interest is separately assessed to the owner it would still follow that the "tax collector shall only collect the taxes on one assessment". *41
Such is the clear legislative intent. There is no ambiguity here. But, if there were an ambiguity, this Court has repeatedly held that where the meaning of a statute is not clear, resort is had to the real purpose and intention of the Legislature in adopting the statute, which, when ascertained, the Court will give effect thereto, even though the letter of the statute be violated. What is within the intention is within the meaning of the statute, although not within the letter. Gunter v. City of Jackson,
It is evidence that this Court, speaking through Judge Griffith, in ruling on the Suggestion of Error in Stern v. Parker,
(Hn 5) We have reached the conclusion that Section 9770 permits and requires the separate assessment of undivided fractional interests in oil, and gas, in place, to each separate owner of such a fractional undivided interest, insofar as not exempted by Chapter 134, Laws of 1944, and that the assessments of the undivided interests in the case at bar to Alfred Foote were valid assessments and the sale thereof passed title to Tom Hendrix, the purchaser. *42
If there be any conflict between this opinion, based as it is on the facts of this case, and the holdings in Gulf Refining Company v. Stone,
The suggestion of error will be sustained, and the former opinion withdrawn, causes reversed and remanded.
