
    Cincinnati College v. Yeatman, Auditor of Hamilton County.
    1. There maybe several and distinct tenements in the same building, under the same roof, as well where one is oner the other, as where one is beside the other.
    2. When, in consideration of a gross sum in advance, an estate for years, renewable forever, is granted in realty, it is real and not personal property, within the meaning of the tax laws of Ohio.
    3. Where such an estate is granted in the second siory of a building, by the owner of the fee, who is under perpetual covenant to rebuild, in case of fire or other casualty, with the same rights to the lessee in the new building as in the old, the interest and estate of the lessee is taxable in his name, when, by the terms of the lease, such was the intention of the parties. „
    4. Whether there is such an estate in specified apartments of a building, which amounts to an interest in the realty, and whether, in such a case, the lessee should pay the taxes on such part of the whole, is to be determined by the terms of the lease.
    5. If there is, it is the duty of the auditor, upon proper application, to ascertain the comparative value of such part, having reference to the character of the lease and to the value of the whole as assessed for taxation, and transfer the same into the name of the owner on the duplicate for taxation.
    Application for mandamus.
    
      This is an application for a mandamus to compel the auditor of Hamilton county to transfer from the name of the relator, certain real estate, which stands on the duplicate in the name of the college, and on which it has been paying taxes, to the name of the Young Men’s Mei’cautile Libraiy Association.
    The relator and the library association are corporations duly organized under the laws of Ohio.
    The entire property is what is known as the Cincinnati College Building, between Fourth and Fifth streets, Cincinnati.
    The tract of gx'ound is mostly occupied by this building, used in pax’t for business purposes, in part for educational pui’poses, and in part by the Mercantile Libx’ary Association, under what is termed a lease, which is fully set forth in the statement of facts in a prior application, and which will be found in 22 Ohio St. 469. It is, in substance: That the college, as pax’ty of the first part, in consideration of ten thousand dollars, paid in advance by the association, pai’ty of the second part, and in pui’suauce of a previous contract, devised and leased to the association, “ all those cei’tain apartments in the Cincinnati College Building, . . . occupying the entire front of the second story of said building, one hundred and forty feet in length and fifty feet deep;” habendum., to said association, its successors and assigns for the full term of ten thousand years, to be fully completed and ended, free of all rent, ... renewable forever on the saxrxc tex’ms axxd the same privileges and provisions herein contained.”
    The lessee is to heat the premises, free of charge; to give the use of the lai’ge hall, fx’ee of charge', except lighting, twexxty-six nights in the year, for the sole use of the society; to keep the building in good x’epair. The lessee to keep their rooms in repair; to keep $10,000 insured, and the lessor a sufficient amount in addition to secure all parties against loss, and in case the building is destroyed by. fix’e or other casualty covered by the insurance, the lessor to rebuild as it was before, with the same rights to the lessee in the new building as the old, the insurance money received by the lessee to be used in rebuilding.
    The lessee is to have a right of way through the main entrance, with keys to the same, and free ingress and egress at all times. In case the lessee wishes to leave the premises, the lessor is to have the option to purchase, upon payment of the $10,000, and if unable or unwilling to do so, then it may be sold to others, subject to all the conditions of the lease. . The lessee is to suffer no use of the apartments, except for itself and the Chamber of Commerce, without the consent of the lessor.
    The only provision as to taxes will be found in the opinion of the court.
    This application is to compel the auditor to transfer, as real estate, the comparative valué of the estate granted by this lease, from the name of the relator to that of the association, and to deduct a corresponding amount from the assessed value of the property now in the name of the college corporation.
    
      McGuffey, Morrill § Strunk, for plaintiff,
    filed their brief in Cincinnati College v. La Rue, which is reported in 22 Ohio St. 469, and cited the following additional authorities, 12 Q. B. 787 (64 E. C. L. R.); 87 Penn. 430; 31 Penn. 482; 1 Am. L. R. (N. S.) 577, and also insisted that the following language of the lease, “ and the said party of the first part agrees to hold the said party of the second part secure and harmless against ail special assessments or taxes, such as paving and lighting the streets, etc., which maybe levied upon the said party of the second part, for city purposes, and against no other taxes whatsoever, and for delinquency in the payment of such other taxes the said party of the first part may re-enter,” shows that it was intended to impose upon the association the obligation to pay these “ other taxes.”
    
      Collins & Herron and Geo. T. Harrison, for defendant,
    also filed their brief in Cincinnati College v. La Rue (see 22 Ohio St. 469), and filpd a brief in this case in which they denied the power of the auditor to separate the room in question from the main building, and place it in one name for taxation, and leave the rest of the building and the lot on the tax duplicate to be taxed in the name of another. State v. Jersey City, 1 Met. 538; .1 Dutch. 525 ; 22 Pick. 22. By such division the state would have no lien on the ground for the taxes imposed on the second story room, contrary to the intention of the-statutes. S. & S. 763, sec. 53; S. & C. 1443, sec. 9; S. & C. 1469, sec. 95.
    And insisted, in regard to the question of'intention, as expressed in the lease, that the lessee could not have intended to pay the taxes on this room; that the natural meaning of the lines relied on by the plaintiff to support his position, is, that if any “ special assessments or taxes, such as paving and lighting the streets,” etc., should be placed on the lessee, then the lessor would save the lessee harmless. The sentence “ and against no other taxes whatsoever,” must be taken to mean personal taxes, “ taxes levied on the said party of the second part,” for this lease, which could not be transferred without the consent of the lessor, and which could not be sold on execution, surely could not take into account a share of the land which the auditor could not divide, as the laws of the state at that time did not sanction it, and do not now, as we claim, and parties to a contract can not covenant to do a thing which the law does not allow; and in this case, as we claim, the intention of the parties surely could not have been to do a thing which was unheard of, and unauthorized by the law's of the State of Ohio.
    
      King, Thompson, § Long-worth, for plaintiff,
    in reply filed their brief in the La Rue case, reported in 22 Ohio St. • 469.
   Johnson, J.

A former application for this purpose was considered by the supreme court in Cincinnati College v. La Rue, 22 Ohio St. 469.

It was there held, that the application, was premature ; that under the statute, and before the auditor can be compelled to make a transfer, evidence of the title of the person or party to whom it is to he made, must be presented, and that if the transfer sought is only of part of such property, satisfactory proof must, also be made of the value of such part, as compared with the value of the whole as charged on the duplicate.

The defects of the former application having now been supplied by the proper showing as to title and comparative value of the'part sought to be transferred, the question again presented is, whether the relator is entitled to a peremptory mandamus.

This depends upon the nature of the estate conveyed, and the intention of the parties, as evidenced in the indenture.

1. ■ As to the transfer of a second story to the name of a purchaser or lessee, where the whole lot and building stands in the name of the vendor or lessor for purposes of taxation.

The statute under which transfers are to be made (67 O. L. 105) is as follows:

“ Sec. 1st. The county auditor shall, on application and presentation of title, with such affidavits as may be required by law, or the proper order of a court, transfer any land, or town lot, or part thereof, charged with taxes on the duplicate, from the name in which it may stand into the name of the owner whenever rendered necessary by any conveyance, partition, devise, descent, or otherwise, and, if, by reason of the conveyance, or otherwise, a part only of any tract or lot, as charged on the duplicate, is to he transferred, the party or parties desiring the transfer shall make satisfactory proof of the value of such part, as compared with the valuation of the whole, as charged on the duplicate, before the transfer shall be made, etc.”

This section also prohibits the recording of any absolute conveyance without such transfer.

By the act in relation to permanent leasehold estates (2 S. & C. 1142), it is declared that:

“ Permanent leasehold estates, renewable forever, shall be subjeci to the same law of descent and distribution as estates in fee; ” and provides that “ sales thereof . . . shall be governed by the same laws that now, or may hereafter govern . . . sales of estates in fee.”

Again, by section 20 of the act relating to descents and distribution (1 S. & C. 505), it is declared that:

“ Permanent leasehold estates renewable forever, shall be subject to the same law of descent and distribution as estates in fee, etc.”

By section 2 of the tax law (2 S. & C. 1489): “ The terms ‘ real property’ and ‘laud,’ wherever used in this act, shall be held to mean and include not only the land itself, whether laid out in town lots or otherwise, but also all buildings, structures, and improvements, and other fixtures of whatever kind thereon, and all rights and privileges belonging or in any way appertaining thereto.”

This comprehensive definition for purposes of taxation is applicable as well to the statute governing transfers.

The constitution provides for the taxation of all property, where not exempted as therein authorized by a uniform rule, according to its value, and requires that laws shall be passed for that purpose.

By section 70 of the tax law (2 S. & 0.1468): “ It is the duty of every person seized of or holding lands not before listed, to list the same for taxation with the county auditor on or before the third Monday in May, after the same shall be subject to taxation, and imposes a penalty for a failure to do so.”

By section 71 it is provided that: “ It shall be the duty of each and every person holding lands as aforesaid, to pay the tax which may be assessed thereon, each and every year.”

These citations, and others that might be made, show that while the taxes are levied and assessed upon property, they are also a personal obligation of the owner of that property, which it is his duty to pay. The general rule then is, that whoever owns the property should pay the taxes assessed on it.

But it is said that said section 18 only makes if the duty of the auditor to make such transfer of land or town lot or part thereof, and that the transfer demanded is not of a lot, nor part of it, but of a part of a building, bounded by horizontal lines. In short, that no transfer can be made of part of real property, not divided by vertical lines.

We apprehend, that the building, whenever it isapermanent improvement, is land within the meaning of the law, for the purposes of taxation, and that the words “ part thereof” may be applied to it, as well as the lot on which it stands, and may consist of a part, by metes and bounds, or definite description of a separate part, or of an individual aliquot part of the whole, provided the conveyance in terms conveys a title and ownership in the estate which is liable t© be assessed. ‘

The question therefore remains, whether the Mercantile Library Association held such an estate as should be listed by it, and upon which it should pay taxes ?

It was in form a lease in perpetuity of a room of specified dimensions, in the second story of the building, with right of ingress and egress, and with perpetual covenants by the lessor to heat and to rebuild.

There is a limitation on tire power of alienation by the lessee, which may affect the value of the estate, rather than its character as real property within the meaning of the tax laws.

That there may be distinct and separate estates in land and structures thereon by other than vertical lines, has long been well settled. Coke on Littleton, 48 b.

Thus, if the owner of land grants the trees growing thereon to another and his heirs, with the right to cut and carry them away at his pleasure, forever, the. grantee acquires an estate in fee in the trees, with an interest in the soil sufficient for their growth, while the fee in the soil remains in the grantor. Clap v. Draper, 4 Mass. 34 ; Knotts v. Hydrick, 12 Rich. 314.

So, in eases of mines, quarries, and the like, there may be a double ownership, one of the mines, the other of the soil, each held by distinct and independent titles. 1 Wash-burn on Real Property, Ch. 1, secs. 11 and 12, and cases cited.

So a dwelling-house may be the subject of ownership in fee, although its owner may have no further interest in the land on which it stands than a right to have it remain there ; and one may hold such an estate in a single chamber in such house. Doe v. Burt, 1 Tenn. 701; Proprietors v. Lowell, 1 Met. 538, 541; Cheeseborough v. Green, 10 Conn. 318; Loring v. Bacon, 4 Mass. 575. 1 Washburn on Real Property, [5] sees. 11 and 12.

The case of the Proprietors v. Lowell, supra, is in point. It was an action by a church to recover back, taxes claimed to be illegally assessed.

The plaintiffs had purchased a lot and erected thereon a building, with a cellar, basement and second, story.

The cellar was used for purposes connected with the church; the second story was fitted up for use as a church, and the basement was made into store rooms, which were rented for that purpose.

These stores were assessed under the head of real estate, as “ six stores under church and vestry.”

It was held that these store rooms were not exempted under the statute, which provides that all houses of religious worship, and the pews and furniture within the same,” shall be exempted.

Shaw, C. J., said: “ There may be several distinct tenements under the same roof; and tenements are as essentially distinct, token one is under the other, as when one is beside the other.” The State v. Mayor, 1 Dutcher, 525 ; Detroit v. Mayor, 3 Mich. 172; The State v. Luster, 4 Dutcher, 103; Logan v. Washington Co., 29 Penn. St. 373; Coke, Litt., sec. 59 (486) ; Rhodes v. McCormick, 4 Iowa, 368.

An examination of the authorities, and the provisions of this instrument, leads to the conclusion that the association holds a permanent leasehold estate in the second story of this building, or any other that may be built to replace it, and an interest in the land and residue of the building, so far as necessary to the use and enjoyment of this estate, and that this is a distinct and separate estate in land, liable to taxation in the name of the owner, according to its true value in money.

What that valuation should be for the purposes of transfer, is a question for the auditor to determine in view of all the terms and conditions of the lease, as well as of the value of the property 'itself.

The remaining point is, whether, under this lease, it was the intention of the parties that the lessee should pay any portion of the taxes on the property ?

In the Larue case, 22 Ohio St. 469, it was assumed that specified apartments in a building might be transferred, if the proper proof was made to the auditor, and if the intention of the parties was to that effect.

This lease is said to have been prepared by an eminent lawyer. He doubtless had in his mind the then state of the law, on the subject of taxation, and the power of the legislature and of the city over the subject. By section three of the tax law of 1846 (2 Curwen, 1262), which was then in force, all buildings belonging to scientific, literary or benevolent societies, and used exclusively for such purposes, together with the land actually occupied, not leased or otherwise used with a view to profit, were exempt.

By section 12 of the same act (2 Curwen, 1266), each parcel of real property belonging to any such society, and school and ministerial land, held under lease, “ shall be valued at such price as the assessor believes could be obtained at private sale for such leasehold estate.”

Section 7 of the same act (2 Curwen, 1264), property held under lease, which is owned by any religious, literary, or scientific, or benevolent society, shall, for the purpose of taxation, be considered the property of the lessee, and shall be listed by him or his agent, as in other cases, unless such leasehold is exempt..

By the law now in force (2 S. & O. 1442), leasehold property for a term exceeding fourteen years, where the property is owned by the state, or any such society, and school and ministerial lands, are to be taxed as the property of the lessee; and by section 9 of the same act (2 S & O. 1443), it is to be valued at the value of the leasehold estate, as determined by what it would bring at private sale.

If this leasehold estate was bounded by vertical lines there would be no doubt that the auditor should make the transfer, but it is insisted that there is no law requiring such transfer when the estate is bounded by horizontal lines.

It is obvious that the association owns property of value, on which somebody should pay taxes.

At common law, an estate for years, renewable for ever, was a chattel; but by our statutes, and by the decisions of our courts, they are treated as real estate. Northern Bank of Kentucky v. Roosa, 13 Ohio, 336. It is there said, speaking of such estates : “ They have not, in fact, a single characteristic ” (since the act of 1821) “ of the old common law estate for years, except they may be granted to commence in futuro.”

They a.re immovable; they do not attend the person; can not be defeated by any act of the grantor, as, for example, a common recovery; are conveyed by the same formalities as freeholds; are subject to the same public burdens ; descend to the heir ; and can not be .subjected to the debts of the deceased owner, except by the proceedings necessary to subject freeholds.”

As the law then stood, as well as now, such estates were taxable in the name of the owner.

Then, as now, the taxing power of the state was limited only by the limitations on the legislative power. The same may be said of. the power to levy assessments and special taxes for city purposes.

Then, as now, the owner was made personally liable for the taxes on the property he owned which was subject to taxation.

In view of these considerations, and doubtless of the fact that the association objected to paying,special assessments, when they would be only remotely benefitted, the parties inserted the following clause on the subject of taxes :

“And the said party of the first part agrees to hold the said party of the second part secure and harmless against all special assessments or taxes, such as paving and lighting the streets, etc., which may be levied upon the said party of the second part, for city purposes, and against no other taxes whatsoever, and for delinquency in the payment of such other taxes the said party of the first part may.reenter.”

This was a covenant for the benefit of the lessee, that it should be held secure and harmless against special assessments or taxes for city purposes, but against no other taxes whatsoever. This is a clear implication of liability by the lessee for all other taxes and assessments for state, county, or municipal purpose, on the leasehold estate. It is also a guaranty by the'lessor to save the association harmless, for part only of such liability. This conclusively appears by the re-entiy clause, by which it is provided that the lessor will not save the lessee harmless for other taxes, and for delinquency in the payment of such other taxes the lessor may re-enter. If there was no obligation to pay, there could be no delinquency.

It is true there is no direct covenant of the lessee to pay taxes. This was unnecessary, for the reason that the law imposed that obligation, the same as in case of a vendee.

To exempt the association from this legal duty, required an express contract.

To the extent of the special assessments or taxes for city purposes the lessee is expressly exempted, but if it fails to pay “ all other taxes,” the lessor may re-enter.

We think it clear that the parties at the time intended this clause to fix the obligation of the parties to pay taxes on the estate granted.

Stress is laid on the words “ taxes that may be levied on the said party of the second part ” as meaning taxes on the association, as distinguished from taxes on the property.

This point is untenable. The parties were contracting as to this property, and fixing the obligations of the parties growing out of the lease.

Again, taxes assessed on property are also in fact taxes levied upon the owner as well, so that the taxes referred, to include only such as are levied on this property, or the association as its owner. It does not embrace, under the term “other taxes against such party,” taxes on other property it may own.

Therefore the clear and manifest intention was to relieve the lessees of all'public burdens imposed on them as owners, in the nature of special assessments for city purposes, and as to all other taxes, leave the association to its liability the same as other owners, with the additional provision in the contract that if it is delinquent in the payment of these other taxes, the lessor may re-enter. The difficulty that has been suggested in describing the property is easily obviated by giving the number of the lot and a description of the premises leased, with suitable reference to the lease, which is a matter of record.

Neither do we think that the association is a necessary party, nor that mandamus is not the proper remedy.

The association is not concluded by these proceedings. As between the relator, in whose name the entire property is taxed, and the auditor, the question is one of the non-performance of official duty. ' .

The relator has the statutory right to .be relieved from the payment of taxes on property it does not own and. has conveyed to another, whether it is charged to the association or not.

Peremptory mandamus awarded.

Scott, J., dissented.  