Case Information
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The Attorney (General of Texas Augunt 28, 1985 JIM MAlTOX
Attorney General Honorable Carry l4auro Opinion Ro. m-347
Suprema Court Bullding Come.issioner P. 0. BOX 12549 General Land Off ice Be: Whether school land AU#lh. TX. 75711.2545 5121475.2501 Stephen P. Austin Bullding board Is authorized sell Telex 9101874-1397 Austin, Texas 78701 certain tracts of land acquired wecopier 5121475-0256 thiough tax foreclosure sales Dear Commissioner Matwo: 714 Jackron. Sub 700 Oallas. TX. 75202.4509 2W742BQU
You inquire whether the School Land Board has authority to sell
two tracts land acquired through tax sales. You advise us that, pursqant to court-ordered tax foreclosure 4924 Albena Ave., Suite 160 sales following the iioreclosure of tax liens , title to certain lots E, Paso. TX. 799052793 9151533-3484 Bracken ln Coma1 County were bid off to the state In 1922 and title
certain lots in Aappy In Swisher County were bid off to the state 1951. For lack of bidders, the land was sold to the state as a taxing 1 Texas. Suite 7W unit which YSB a pa1:t.y to the suit, and apparently there , ,oustcn. TX. 77OQ2.3111 has not been a resallc by the purchasing taxing unit. 71Y2255996 You first ask lrhether section 15.01(a)(2) of the Education Code 806 Broadway, Suite 312 places these tax foreclosure tracts In the permanent school fund. It Lubbock. TX. 794012479 is our opinion thal: land question does not belong 8061747.5239 permanent school fund and that School Land Board does not have authority to sell the land.
4209 N. Tenth. Suite S McAllen. TX. 75501.lS55 Section 15.01(a)(2) of the Education Code provides 512l552-4547
(a) The permanent fund, which shall constitute a perpetual endowmant for the public 200 Main Plaza. Suite 400 San Antonio. TX. 702052797 free schools of this state, shall consist of:
. . . . An Equal OpportunityI (2) all the unappropriated public domain Allmmalive Action EmPlOYOf
remeinhg in Texas, including all land recovex,ed by state by suit or othervise except pine forest land as defined in Section 12, Article 2613. Revised Civil Statutes Texas, 1925, as amended. . . .
Aonorable Carry Mauro - Page 2 (Jl+367)
The issue is whether lam. in question is “laad recovered by the state by suit or otherwise” within the meaning of rection 15.01(a)(2).
Originally, article 5616, Texas Revised Civil Statutes, 1925. vhich contained same prov~lslons as article 5385, Revised Civil Statutes of 1911. end the Settlemant Act of 1900, provided that
all of the unapprop,r?tated public domain remaining in the State, of vtstever character and vhereso- ever located, including any lands recovered by the State, except that included in lekes, bays, and islands along the GIrlif of Mexico within tidewater limits and except p:Lne forest lands as defined In 2613 . . . 4s set apart and granted to the Article permanent school fuc.d of the state.
Article 5620, Texas Revised Civil Statutes of 1925. vith same provisions as article 5668, Revised Civil Statutes of 1911. and the Settlement Act of 1900. and uov codified as section 11.077 of Natural Resources Code, direc(,ed that
when any public l,ands are held, occupied or claimed by any perscn. association or corporation. adversely the S,:ats. or to any fund or when lands are forfeited to the State for any cause. the Attorney Genccsl shall institute suit therefor. . . .
We believe language section 15.01 (a) (2). stetlng permanent fund shall c.onsist. in part, of all the unappro- priated public domain includ:lug all land recovered by the state by suit or otherwise, is applict&le to land recovered by the state reasons such as fraud or nisttike or failure to comply vith conditions of the lav which authorized the! grant or sale of public land or school land. See Barber v. Giles , :!C18 S.W.2d 553. 556 (Tex. 1968); Main v. Cartwright, 200 S.W. 867, 8!iC1 (Tex. Civ. App. - El Paso 1918. no writ). Such land would lnclt.de that recovered by suits by the state to cancel patents CO public, land. Recovery of land by suit trespass to try on behalf of the state to forfeit a sale failure to reside on or imprave land or to comply with lav as an actual settlor would constitute land recovered by the state. Cf.
State v. Hughes, 79 S.W. 608 IJ!ex. Civ. App. 1906). aff’d, 80 S.W. )24 (Tex. 1906); Duncan v. State, 67 S.W. 903 (Tex. Cmpp. 1902, uo writ). Another example vould be land forfeited to the state for non- payment of interest on purchaw price.
A tax sale and the right11 acquired thereunder are governed by the lav in force at the time of the sale. & Land v. Banks, 256 S.W. 786, 788 (Tex. 1923); Bente v, Sullivan, 115 S.U. 350 (Tex. Clv. App.
.p. 1580 *3 Roaorable Carry klauro - Page 3 (a-367)
1908. vrit ref’d). The tax sale In 1922 was conducted under article 7689, Texas Revised Civil ,;tatutes of 1911, vhich provided, in pertinent part:
[Ilf there shall be no bidder for such land, the county attorney aihall bid said property off to the state the emount of all taxes. penalties. interest and costs trd,judged against said property; and, the absenclc of the county attorney, the sheriff is authorized to bid to the state, when there are no bidd~rlrs. . . . And, all such cases vhere the property Is bid off to the state, shall be the duQ of the sheriff to make and execute deeds to the state, using forma to be prescribed and furnished comptroller, shoving each case. amount of taxes, interest, penalty clud costs for which sold, and the clerk’s fee for recording deeds as hereinafter provided. . . . And. when lands thus sold to the state shall be redeemed, it shall be the duty of the collector t,):ces, vhen any such redemption is made, to make t,he proper distribution of moneys received by him in such redemption, paying to each officer the amount of costs found to be due, and to and county taxes, interest and penalties due each respectively.
Substantially the same provisions vere carried forvard in article 7328, Texas Revised Civil St;itutes of 1925, but with the addition the follovlng language:
If any of the land thus sold to the State is not redeemed within tlms prescribed by this lav. the sheriff shall sell the same at public outcry the highest bMder. . . . The sheriff shall sand the amount rrcelved from such State Treasurer afl:ar deducting the amount of the county taxes, interest and penalty of the county tax which he ahal: pay to the county treasurer. The sheriff. In behalf of State, shell execute a deed conveying to said property when sold and paid for.
Prior enactment of arc:icle 7365b. Texas Revised Civil Statutes, in 1937, each taxing unit could separately enforce its tax lien against the.same property vi131 different suits, judgments, executions, sales and conveyances and with the resulting extra cost and confusion of titles and rights. See City of El Paso v. Porti, 181 S.W.Zd 579 (Tex. 1966) ; Pearsall Iade@ndent School District v. Widner. *4 (m-242)
honorable Carry Mauro - Page 4 S.Y.2d 647 (Tex. Civ. App. - !itm Antonio 1940, no nit). TO prevent multiplicity of suits and inc:.ude all taxing unltr in a suit brought by any one of them, article 1345b provided, In pertinent part. the follovlng:
Sec. 2. In sny s~~:Lt hereafter brought by or in behalf of my ss above defined, for levied l gslnst delinquent ad vrlorem taxes property by my such tsxing unit, the plaintiff may implead as parties defendant any or all other taxing units having delinquent ad valorem tax claims against such p’roperty, or sny part thereof, end it shall be the duty of each defendant taxing unit. upon being sewed with citetion as provided by law to appear in said cause and file its claim for delinquent ad vslorem taxes against such property, or sny part thereof.
. . . . Sec. 9. If the property be sold to any taxing unit vhich is e party to the judgment under decree of Court in said su:lt, the title to said property shall be bid In and held by taxing unit purchasing sme the use and benefit of Itself and all other taxing units which ere parties the suit and which have been adjudged in said suit to hsve tsx liens s]tsinst such property, pro rats and in proportion to the amount of the liens tsx favor said respective taxing units as established judgment sefd suit, and costs and expenses rhsll not be payable until by such taxing unit 80 purchsslng same . . . When euch property is so sold st public or private the proceeds rB,ereof &all be received by or paid over to the trc:Lng unit which purchased said at tw: sale, account itself .and all other taxing units adjudged to have a 1:a.x lien against such property. and all taxing uniw so receiving said proceeds shall first pay out of same ell costs and expenses of Court a!rd of sale, end distribute reminder emong all taxing units for which purchasing taxing ,mit purchased sad held ssid pro rstn end in proportion property.
amounts of their tm liens egsinst said property as established solid judgment.
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Aonorsble Gerry Msuro - Psge 5 (Jn-347)
If the Stste of Texxm ie the ruing unit which purchssed mid propcay et tsx foreclosure sale, the Comirsioners Court of the county In which the property ia loceted shell heve suthority to set the Ststc! of Texsm in msking privste ssles snd conveysncerl of ssld property, AS herein provided, or in ret,u.esting the Sherfff. or appointing A Coumis~~:loner. to meke public ssle thereof, and in receiving snd distributing proceeds of such sslee; and sll l sles end con- veysncer msde in behalf of the Stste of Texss by the Cownisslonere Court, or msde by the Sheriff or say Commissioner spplwinted by the Comissioners Court. under the provisions hereof, shall operate to transfer to the *purchaser at such ssle sll right, title snd interest ecquired or held by the Stste of Texss AS pwcheser et the tsx foreclosure . . . At time of the 1951 tsx esle, the provisions of article 7345b were cumuletivc: of snd in addition srticle except that, ss to A confl:tct, the provisions srticle 7345b prev&ed. Tex. Rev. Civ. Stilt. srt. 7j45b. $13 (1937). See Little v. Dennis, 187 S.W.2d 76 (Tex., 1945); Uillscy County PeterControl h Improvement District v. Levis, 119 S.W.2d 159 (Tex. Civ. App. - San Antonio 1938, no writ). In 1979, both srticle 7328 sad article 7345b were repealed end incorporsted into the Property Tex Code. See TAX - Code, ch. 34, eubchspter A.
We belleve lenl&mge of the sheriffs’ deeds conveying title to the stste In 1922 sod 1951 conforms to the lsnguege of the ststutes suthorizing ruch deedo on those dates. Article 7689. Texas Revised Civil Statutes lS,ll, directed s&Tiff to meke end execute deeds to the stste. wing forms prescribed snd furnished the comptroller and. as direcl:ed. the deed shovs the amount of state ’ snd county texes, interest, penalty. sad costs. Ye do not know the but ve note that virtuslly form prescribed by the compt::oller.
seme lsngusge of conveyence slIpears in the tax deed litigated in Land v. Banks, m, In 1923. As directed by section 9 of srticle 7345b, the deed in 1951 expressly provides thst the title
Swisher County vss bid in snd lheld by the stete trust use snd benefit of itself snd sll other taxing units which were psrties the suit.
No psyment of money occurs st the time of the first to A taxing unit but, instead, occurs when the property Is redeemed or resold by the purchasing taxing unit. The .purchsslng taxing unit holds to tha! property for the benefit itself snd the other units until is asold and the proceeds from that sale are *6 Aonorsble Carry Msuro - Psge (m-347)
epportioned. See Tu Code, 13~L,Ol(c); Attorney Genersl Opinion O-974 (1939). -
We conclude lsnd scqulred st the tsx ssles st thst which the stste vss the purcharing is not “land recovered state by euit or oth(Lrvlse” within the mesalog of section 15.01(s) (2) of the Educstion &de. It is not A recovery of lsnd by the state but A tsx esle to the ante for the benefit of itself sad AS trustee for the other ruing units, with the ultlmste purpose of selling snd thereby procuring the money to psy the texes due each tsxing unit. See Chlldress County v. Schultz, 199 S.W.2d 860, 862 (Tex. Civ. App. - brillo 13146, no writ). Cf. Attorney Genersl At the, l xpirstion Opinion V-782 (1949). th‘;rtedemption period, vests in the purchssing taxing unit, which then holds the title for resale sad for the purpo!,e of collecting the delinquent taxes.
See State v. City of San Aht~nlio. 209 S.W.2d 756, 758 (Tex. 19481; Lubbock Independent School Dd;zct v. Owens. 217 S.W.Zd 186, 188 (Tex. Civ. App. - Amarillo 194lc, writ ref’d).
There are or hsve be& st;Ltutes thst specified certsln conditions under which land would become part of the permanent school fund or Arclcle 5304. Texss Revised Civil Statutes pert of the stste forest.
of 1911, first enacted in 1879. spplied only in unorganized counties. t The legislature provided thsl. when lands were sold in unorgenixed
counties and bid in by the comptroller the state for delinquent taxes and not redeemed by the ‘nmer , the land thus sold and unredeemed became vscsnt and reverted to tbe public free school fund, to be sold and disposed of ss other laude belonging to the public free school fund. Section 71.202 of the Prl>perty Code also expressly appropriates and sets apart to the permsmult fund ell real property thst eschests stste of Tert,ns under Title 6 of code. See Attorney Genersl Opinion IS?-18 (1979). T%is office 1180 determined~ Attorney General Opfnton IN-18 that lend devised state of Texas under terms of so individusl’e ~~111 snd not deslgneted to a perticulsr use becomes e psrt of the permsnent school fund.
In 1935. prior to the l nnmctment In 1937 of erticle 7345b. Texss Revised Civil Statutes of 192!5!, which consolideted the foreclosure tsx liens different taxing units lo one suit snd one ssle. legirlrture added section 12 to srtlcle 2613. Texas Revised Civil Statutes ofi 1925, and amended srticle 5416. Texas Revised Civil Statutes 1925. Chapter 312, Forty-fourth Of Legislature, 1935. now codific!d in sections 15.01(s)(2) and 88.111 of the Education Code. provides thst , when pine forest lend is sold the peyment elf taxes. interest, penslty. snd costs edjudged against the lsnd AS Ilrwided by article 7328 snd not redeemed or resold se provided by erticle 7328. lend shall be withdrawn from the market end shall be held, protected, snd administered by the Board of the Texas A&M University System as state forest. Thus, *7 ; ' -.
Bonorsble Gsrry Hsuro - Pege 7 (JM-347)
legislsture l xpreeely rpecifietl intention thst l tete retein its pine forest lsnd bought in by the stste st A tu foreclosure rele under srticle 7328 vhen the lsnd WAS not redeemed or resold snd rtsted its intention tbst euch pine foreet lsnd is not retsined ss psrt of It :Ls our opinion thst the ststus of sll the permanent school fund.
other lsnd purchseed st A tu foreclosure esle by A tuing unit is not sltered by the fact thst the LcSislsture expresrly directed thst pine forest lsnd ecquired by the state et A tax foreclosure ssle conducted under article 7328 be retsinei. snd sdministered ss state forest snd See that it not be retained AS part of the permanent school fund. - Attorney General Opinion O-2871 (1941).
We find nothing in the statutes or esses which indicates that the legislature intended thst title to reel property scquired by the state as s taxing unit st e tax forec’losure in Comsl County in 1922 or in Swisher County in 1951 uou:k(L become psrt of the permanent school fund. is our opinion thst statutes authorizing acquisitions It title by the state st tsx foret:losure ssles provide otherwise.
You slso inquire vho has nahority to sell the lands in question if the land is not the pemsnent fund vhere it would be subject to sale by the School Iand Board snd how the proceeds would be sllocsted.
Since the Coma1 sad Svishcr County trscts have not been resold by the state since the stste became the purchasing taxing unit at the sales. rem&l!5 in the state. The power and duty to provide the sale and conveyance of such title Is the legisls- ture .
The authority of s purc’wwing to resell Acquired at e tsx foreclosure wle appears in section 34.05 of the TAX Code. Prior to 1983, section :)4.05(e) provided thst
(A) If property is; sold to e taxing unit ie A psrty to the judgment, taxing unit msy sell the property at any time, subject to any rixht of redemotion existinn at time of . . If prop&ty is eold & the state. the com- sale. missioners court of ?:he county in which the pro- perty is loceted msyikct for the state. (Emphssis added).
Unless the property is sold by the sheriff et s public ssle, It msy not be sold less than the market vslue specified in the judpent or total amount of judgments against property, whichever is less, vtthout the cdnsrnt of each taxing unit entl~tled to proceeds Tax Code 434.05(b). Section 34.05(c) provides, in pert, th,nlt
Ronorsble Gsrry Msuro - Page 8 (JM-347)
(c) The taxing un:it purchssing the property by resolution of its governing body mey request the sheriff to sell the Froperty st A public sale. If ruing unit hss not sold purchsring the pro- perty vlthin six months sfter the date on which the ovner’s right of redemption terminates, l ny taxing unit that is entitled to receive proceeds of the ssle by resolution of its governing body may request the sheriff in writing to sell the property at A public ssle,
In 1982. article 8, section l-e of the Texas Constitution was amended to provide that no stilte ad vslorem taxes shall be levied on any property in this stste, end. in 1983, the legislature amended the Property TAX Code to conform it that and other changes the constitution concerning property taxation. See Bill Analysis prepared for House Ways snd Means Comictee. filed % Bill File on E.B. No.
1203. Legislative Rdference Li’b,rsry (1983). In so doing, chapter 851, Sixty-eighth Legislature. 198:#, deleted last sentence -in section 34.05(s) which, prior-to-thst” had authorized the commissioners time, court of the county in which t.he property is locsted to set In the sale of property u,hen title to the property WAS scquired by the state at s tsx foreclosure Chapter 851 also repealed all of section 34.08. which had specified that the state vss a tsxing unit for purposes of chapter 34 of the Property Tax Code.
As a result of the 1983 ~nlendments to the Property Tax Code, the code no longer authorizes the commissioners court of the county which the property lo located to ect for the stste in making A private ssle of the property or in s request sheriff to sell sale. With the repesl of section 34.08. is st public questionsble whether the state is a taxing unit for purposes of the chapter of the code which suthorizes the sale of such property.
We ere unable to find tuly statute suthortzing any officisl or governments1 entity to make a ssle the stste where the stste was the purchasing taxing unit. ‘Where the purchssing tsxing unit has not sf ter the owner’s right of sold the property vithin six months redemption expires, section 34.05(c) still authorizes eny Is entitled to receive proceeds ssle to request ssle. Rowever, ve find no nhrriff to sell the property ,at A public statute that authorizes soy person to make A d$strlbutlon proceeds of such a public sale when title is In the stste.
Section 34.06 of the Property Tax Code is the legislsture’s grant of authority for distribution the proceeds of s resale. It provides
P. 1586 *9 Aonorable Gsrry tlsuro - Pege UM-347)
(A) The proceeds of a ressle of property purchesed by e taxfnt unit et A tsx foreclosure ssle shsll be psid to the purchssing tsxing unit. (b) The purchasing tsxing unit ,shell pey sll costs snd expenses cf court and ssle snd shall distribute reminder the proceeds AS provided by section 34.02 of this code for dls- tribution of proceeds after peyment of costs.
If the stste no longer is a texing unit for purposes of a tax sale snd no person or entity is suthorimd to set for the stste at A ressle property sold state st foreclosure ssle. the proceeds of a resale csnnot be paid to or distributed by the purchasing tsxlng unit AS directed by section 34.06.
We conclude legi.trlsture hss made no genersl provision for the resale and conveyance of its to tracts of land acquired by the through tax ssles. Rowwet, Chspter 953.
Acts of the 69th Legislature, 1985. which becomes effective August 26.
1985, authorizes the comaisslot.er of the General Land Office to convey of the st,srte in Lots 8 snd 9, Block 9, City of ell of interest Bracken, Coma1 County. S IJ M M A R Y
-- The real property .rcquired by the state AS the purchssing taxing unit at A tax foreclosure does not belong to c:be permsnent fund snd the School Lend Bosi,d, does not have suthority sell such land. Gn!.y purchssing is authorized by statute to resell lsnd which acquired et A tsx fc’reclosure sale and to receive end distribute :?roceeds of A resele of such property. Current ot.stutes do not authorize sny officisl or governmntsl entity to act stste In a ressle end distribution of proceeds when the state was tae purchasing taxing unit st a prior tax Eovever, effective August 26, 1985. legislsture has authorized conveyance specific in Coma1 County.
Jrn WATTOX Attorney Genersl of Texas *10 (Jn-347) Honorable Carry Uauro - Page 10
TON GREEN
First Assistant Attorney General
DAVID R. RICRUDS
Executive Assistant Attorney Ccnsral
ROBERT GRAY
Special Assistant Attorney General
RICK GILPIN
Chairman, Opinion Conmittct
Prepared by Nancy Sutton
Assistant Attorney Generel
APPROVED:
OPINION COMnITTEE
Rick Gilpin. ChaIrman
Colln Carl
Susan Garrison
Tony Gulllory
Jim Hoellinger
' Jennifer Riggs
Nancy Sutton
Sarah Woelk
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