Smith v. Henley

Citations: 330 P.2d 712; 53 Wash. 2d 71; 1958 Wash. LEXIS 276Docket: 34379

Court: Washington Supreme Court; October 23, 1958; Washington; State Supreme Court

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The Supreme Court of Washington addressed a property dispute concerning a 175-foot-wide strip of land and a dwelling. The appellant, James P. Smith, claims ownership through a tax deed, while the respondents, Floyd Henley and others, assert that they paid the taxes on the property. The land in question is described as the west half of a specified quarter-section in Snohomish County, with the defendants holding a contract for the adjacent east half. The original agreement in 1929 identified a county road as the boundary, which both parties recognized. A house was built on the east half, with the tax assessor listing it as an improvement to that property. The original owner of the west half paid taxes until 1947, after which she abandoned it. Upon acquiring the tax deed, Smith had the property surveyed and found the house actually on the west half, prompting him to initiate an ejectment action. The trial court concluded that as the house was taxed as part of the east half, the assessment was based on a mistaken belief regarding the boundary. Smith contends the defendants' rights were extinguished by the tax deed, arguing that the trial court erred in inferring that taxes on the disputed portion were paid. The case does not involve adverse possession claims, with both parties acknowledging that tax foreclosure nullifies such rights. The legal framework governing property assessment and taxation is outlined in RCW 84.40.040, detailing the roles of county assessors in determining property values for taxation.

RCW 84.40.030 mandates the assessment of real property to include the value of land and improvements, excluding crops and certain growing stock. In this case, the county assessor is presumed to have followed the proper procedure, resulting in an improvement on the west half being incorrectly assessed to the east half, based on the assumption that the land was included in that description. The plaintiff contends that the house could have been assessed separately to the defendants as a severed improvement under RCW 84.56.360, which allows for segregation of improvements only if they are owned separately from the land. However, there was no evidence of separate ownership in this matter.

Tax statements indicated that improvements belonged to the east half, with no record suggesting a segregation was intended. RCW 84.64.180 states that a real property tax judgment is conclusive unless the tax has been paid or the property was not liable. The case of Berry v. Pond established that payment under an inaccurate land description can be a defense in actions to quiet title. The burden is on the defendants to prove tax payment. The trial court noted confusion in the assessor's records regarding the assessment of the house, which had been transferred between the two halves but was ultimately assessed as part of the east half.

The court inferred that the assessor included the whole improved land in the assessment based on the continuous occupation and improvement of the east half. The legislature’s intent was not to allow foreclosure on land with paid taxes, and claims of errors in description may be used to prove payment. Established case law supports the notion that a tax deed can be invalidated if the owner attempted to pay taxes but was hindered by the county treasurer’s actions.

The defendants and their predecessors, along with the assessors, made an honest mistake regarding tax payments, which the court found to be excusable. Based on the evidence presented, the court concluded that the defendants successfully proved that the taxes on the disputed land had been paid, leading to an affirmation of the judgment. However, Chief Justice Hill dissents, arguing that while the majority reached a fair outcome, the principle cited from Pierce County v. Newbegin—suggesting that no landowner should lose property due to an excusable mistake—does not reflect the applicable law. Instead, he refers to RCW 84.64.180, which establishes that county treasurer deeds serve as prima facie evidence regarding the tax status of property and that judgments regarding tax deeds preclude objections unless certain conditions are met, such as payment of the tax or non-liability of the property. Hill disputes the majority's interpretation of the evidence and the application of the statute to the case. The plaintiff acquired a tax deed for a portion of land in Snohomish County, while the defendants hold a purchase contract for another portion of the same tract. The case revolves around the validity of the tax title and the implications of the evidence concerning tax payments.

The contract in question is not present as evidence, leading to reliance on a statement regarding title insurance for the property's description. The term 'tract' is used to refer to a specific parcel of land identified as the southwest quarter of the southeast quarter of the southwest quarter of section 2, township 29 north, range 6 east W.M., with an exception for certain areas called 'Red Tracts.' Ella M. Johnson acquired the entire tract in 1926, which is assumed to be her separate property based on her testimony. A county road, 40 feet wide, runs through the tract, positioned closer to the west line. It is noted that the distance from the center line of the road to the west line of the tract is 106.2 feet, and to the dividing line between the west and east halves of the tract is 175.6 feet. The land under dispute is determined to be 155.6 feet wide after accounting for half of the county road.

In 1929, Johnson first divided the property by entering into a contract (which is not in evidence) with Burr Smith, selling him everything east of the county road. Smith built a house on the property but abandoned it after a couple of years, returning full ownership to Johnson. In 1940, Johnson sold the portion east of the road to Myron Henderson, although it remains unclear whether this was a cash sale or contract, and no deed or contract exists in evidence. Johnson consistently referred to the land east of the county road as the east half, while the west half was described as short by "between two and three acres." Johnson stopped paying taxes on the west half and abandoned it in 1947. The Hendersons sold the property in 1950 to Wallace G. Mackie, who intended to sell it on contract to Floyd Henley. The Henleys took possession from the Hendersons and currently occupy the property, but no documentation linking the title from Johnson to the Henleys is present in the record. Henley's testimony suggests he paid taxes based on the description from his title insurance, which aligns with the legal description of the east half of the west half of the south half of the southeast quarter of the southwest quarter of the section. All parties in the title chain agreed that the county road served as the western boundary of the property sold by Johnson, confirming her intent to convey all land east of the road, amounting to 281.88 feet in width along the south line and 155.6 feet of the west half along its south line.

The main issue is whether the Henleys and their predecessors paid taxes on the 155.6 feet of the west half of the tract, east of the county road. According to the statute, the tax deed for the west half serves as prima facie evidence that taxes were unpaid. The statute also prohibits collateral attacks on the judgment from the tax foreclosure unless taxes were paid or the property was exempt. The plaintiff established a prima facie case by presenting the tax deed and demonstrating title transfer from the grantee. The defendants were then tasked with proving tax payment for the disputed portion. Evidence indicated taxes were paid on 'RT-12B- E 1/2 SW 1/4 SE 1/4 SW 1/4 Section 2, Township 29, Range 6,' where 'R.T.' denotes 'Red Tract,' and the relevant maps confirmed that the land east of the county road fell under 'Red Tract 12,' not 'Red Tract 12B.' Testimony revealed that taxes on 'Red Tract 12' were delinquent and had led to foreclosure, with no evidence provided by the defendants to counter the presumption of unpaid taxes on the west half. The plaintiff waived claims to any improvements on the property. Thus, it was determined that the plaintiff owns the specified portion of land and is entitled to prevail in the ejectment action against the defendants, leading to a recommendation to reverse the trial court's dismissal and direct judgment for the plaintiff.