
    Chard et al. v. Holt et al.
    
    
      (Supreme Court, General Term, Fifth Department.
    
    April 13, 1892.)
    Tax-Titles—Notice to Mortgagors—Estoppel.
    Where defendant, the holder of a tax-deed and of a certificate of a tax-sale for the same land, representing sales for delinquent taxes of different years, gives notice to plaintiffs, the holders of a mortgage on such land, who are ‘ignorant of the ■ earlier tax-sale, requiring them to redeem the land from the later tax-sale, and plaintiffs pay the whole amount of such taxes, and defendant receives and retains such money, defendant is estopped to assert any title to the land under the earlier tax-sale.
    Appeal from circuit court, Chautauqua county.
    Ejectment by Louisa P. Chard and another, administrators with the will annexed of Bufus C. Palmer, deceased, against Horatio H. Holt and others. From a judgment for defendants, plaintiffs appeal.
    Beversed.
    
      For report of decision in the action to foreclose the mortgage, see 9 N. T. Supp. 575.
    Argued before Dwight, P. J., and Macomber, J.
    
      Thomas J. McKee, for appellants. Silas W. Mason and S. A, Simons, for respondents.
   Macomber, J.

The plaintiffs’ title to the lands for the possession of which this action was brought is derived by them through an action for and a judgment of foreclosure and sale of mortgaged premises, at which sale they, as administrators, became the purchasers. The title of the principal defendant, Horatio FT. Holt, is derived from certificates of tax-sales issued to him,—one from a tax-sale which occurred on the 27th day of October, 1885, and the other November 23, 1887. The facts in this action, as agreed upon, and as found by the court, are briefly as follows: On the 1st day of June, 1872, Amelia Holt, the owner of the premises, executed a mortgage thereon to Rufus C. Palmer. The debt secured by the mortgage having , become due and payable, proceedings were taken by these plaintiffs, who are the administrators with the will annexed of Rufus C. Palmer, to foreclose the mortgage, and a notice of pendency of such action was filed in the proper county, December 4, 1885.= Such proceedings were had therein that a judgment of foreclosure and sale was rendered in that action on the 29th day of August, 1889, and a sale of the mortgaged premises was had February 21,1890, at which sale the plaintiffs, being the highest bidders therefor, purchased the property, and a deed was properly executed to them by the sheriff of Chautauqua county. Having this title, and finding the defendant Horatio N. Holt and others in possession, a demand of possession of this land was made upon them, which was refused, and accordingly this action to recover the possession of the lands in dispute was begun.

The defense, which prevailed upon the trial, rests upon a tax-title in Horatio N. Holt. These lands were sold for county taxes on the 27th day of October, 1885, on a levy of taxes made in the year 1884, upon an assessment thereon against Amelia Holt, who was at that time the owner. One T. Charles Wilson became the purchaser at such tax-sale, and he received the certificate from the county treasurer of Chautauqua county on the 27th day of October, 1887, and subsequently such county treasurer executed and delivered to him a deed of the premises, to which he seemed to be entitled under such sale, which was recorded on the 14th day of May, 1888. Another sale for like taxes was had under an assessment made in the year 1886, and a sale of the same premises took place on the 23d day of November, 1887, under the direction of the county treasurer, and the same lands were again struck down to T. Charles Wilson, to whom a proper certificate of sale was subsequently delivered. Wilson, on the 17th day of January, 1888, by an instrument in writing, sold and assigned this certificate of sale, and all his rights thereunder, to the defendant Horatio N. Holt; and on the 15th day of May of that year Wilson quitclaimed the premises to Holt by a deed recorded on that day. But Wilson had no title to the land except that derived by him by virtue of the tax-sales hereinbefore mentioned. On the 11th day of November, 1889, and within two years after the sale for the taxes of 1886, the plaintiffs, as such administrators with the will annexed, filed a notice as mortgagees of the premises, which is set out in the case, to the effect that they claimed to be entitled to be served with any notice required by any provision of law by the purchaser or purchasers of the premises at any sale thereof made for taxes, and particularly of a notice required to be given by such purchaser or purchasers at the sale made on the 23d day of November, 1887, for the taxes of 1886. Thereupon, and on the 17th day of December, 1889, the defendant Holt served on the plaintiffs, and on the same day tiled a notice in the county treasurer’s office, requiring the plaintiffs to redeem these lands from the tax-sale made on the 23d day of November, 1887, for the taxes of 1886. On the 25th day of January, 1890, the plaintiffs paid to the county treasurer of Chautauqua county the whole amount of these taxes, being $358.59; and the treasurer subsequently handed over such money to the defendant Horatio 27. Holt, who received it in pursuance of such notice to redeem, and he has since retained such money as his own. At the time of the service of the notice to redeem, this defendant, Horatio 27. Holt, had notice of the existence of the above mortgage, and of the fact that there had been a judgment of foreclosure therein; but the sale of the mortgaged premises to the plaintiffs was not had. until February, 1890,—two months later. Upon the payment by the plaintiffs of the above-mentioned sum of money (viz., $358.59) the county treasurer executed and delivered to them a certificate of redemption in due form of law. Upon these facts the learned justice at the circuit held that the plaintiffs had failed to make a ease entitling them to the possession of the premises, and accordingly dismissed their complaint. In this conclusion we cannot concur. In our vie.w of the ease, whatever rights the defendant Horatio 27. Holt may have had by .virtue of the sale made in the year 1885, such rights were entirely surrendered in the recognition by him of the right which the plaintiffs had to redeerh under the tax-sale made 27ovember 23,1887, for the unpaid taxes of 1886. Mr. Holt having accepted the money deposited by the plaintiffs with the county treasurer for the redemption of the taxes laid upon these lands in 1886, it would seem to follow necessarily that the plaintiffs are subrogated to anyr and all of Mr. Holt’s rights acquired under the tax-sale of 1887. Having elected to keep alive the tax-sale certificate of 27o-vember 23, 1887, and having notified the plaintiffs to redeem from such tax-sale, with a knowledge of their interest in the premises, Holt is conclusively charged with the consequences of an election by the plaintiffs, as mortgagees or owners, to redeem, and he cannot now be permitted to recede therefrom. If the defendant relied upon the deed of the 28th of October, 1887, executed iu pursuance of the sale of 4885, for the taxes of 1884, it would seem to be hardly less than a fraudulent transaction for him to serve a notice to redeem the lands from the tax laid in 1886. Wood v. Seely, 32 N. Y. 105; Sherman v. McKeon, 38 N. Y. 266. We agree with the learned counsel for the respondents that chapter 229 of the Laws of 1879 provides an adequate system for the collection of taxes, and for the sale of lands for unpaid taxes, in Chautauqua county, and for the vesting of a fee in the purchaser at such sales. So far as we are able to observe, notwithstanding section 32 of this act, incorporating the general tax-law, (chapter 427 of the Laws of 1855,) no question relating to the eighty-second section, concerning notices to be given in cases of sales of lands for unpaid taxes by the comptroller of the state, can arise. By section 1 of chapter 285 of the Laws of 1862, section 82 of chapter 427 of the Laws of 1855 was repealed. By section 1 of chapter 280 of the Laws of 1870 the repealing statute was itself repealed, without any provision reviving the repealed section. This eighty-second section was again abrogated by chapter 556 of the Laws of 1890.

The question, as we deem it to be, is not whether the plaintiffs have conformed to the general tax laws of the state in so far as they may differ from the statute for levying and collection of taxes, and the sale of lands thereunder, in the county of Chautauqua; but it is rather confined to the precise situation brought about by the invitation in writing of the defendant Horatio FT. Holt to the plaintiffs to come in and redeem the lands from the tax-sale of 1887, with a necessary implication that, if such redemption was had, and the moneys paid to the county treasurer, and he in turn should turn them over to the defendant, any claim made by the defendant thereafter should be in subordination to the rights acquired by the plaintiffs through such redemption. The plaintiffs themselves were ignorant in fact of the sale made in 1885 for the tax of 1884, but had been made acquainted with the sale made in 1887. At the time of the notice served by the defendant Holt to redeem from the last-named sale, the title had not so ripened in the purchaser and his grantee under the sale made in 1885 so that it could not be divested by redemption thereunder under the general tax laws of the state. But, as we view the case, there is no question touching the rights of the parties under the tax of 1884, which, was followed by the sale of 1885. Under the evidence, the plaintiffs had a complete title to the premises by virtue of the mortgage foreclosure and sale above mentioned, except as the same might have been divested by reason of their omission to protect the property from taxation. But it is argued by the learned counsel for the respondents that, inasmuch as the notice of redemption contained a clause to the effect that the same should have no effect upon any previous sales heretofore completed and perfected under the law, hé can still claim title to the lands by virtue of the sale made in the year 1885, and that the only effect of such redemption was to add to the mortgage security the amount paid for such redemption. But, as it seems to us, this qualification can have no influence upon,the general question above considered. It does not specify what sales had theretofore been had; and it is stipulated, as a fact in the case, that the plaintiffs did not hear of the sale made in 1885 until after the entry of their judgment in the foreclosure action. Furthermore, we do not think it was competent for the defendant to qualify or limit the effect of her notice to redeem, provided the .same was actually followed by a payment by the plaintiffs of the moneys in pursuance of the notice, and a receipt and retention by the defendant thereof. If this conclusion be not correct, the defendant Holt .would be in the attitude of having received money from the plaintiffs to which he was not entitled, and a. fraud would be perpetrated under the guise of enforcing the Laws of 1879 applicable to the county of Chautauqua. For this reason we think that the judgment appealed from should be reversed. Judgment appealed from reversed, and a new trial granted, with costs to abide the event.  