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Home Owners' Loan Corporation, a Corp. v. City of Phoenix

Supreme Court of Arizona

March 28, 1938

HOME OWNERS' LOAN CORPORATION, a Corporation, Appellant,
v.
THE CITY OF PHOENIX, a Municipal Corporation, and MARICOPA COUNTY, Appellees

APPEAL from a judgment of the Superior Court of the County of Maricopa. J. C. Niles, Judge. Judgment affirmed as modified.

Mr. M. L. Ollerton, Messrs. Rawlins & Rawlins and Mr. Arthur M. Davis, for Appellant.

Mr. I. A. Jennings, City Attorney, Mr. Hess Seaman, Assistant City Attorney, and Mr. Richard F. Harless, Assistant City Attorney, for Appellee City of Phoenix.

Mr. John W. Corbin, County Attorney, and Mr. Lin H. Orme, Jr., Deputy County Attorney, for Appellee Maricopa County.

OPINION

Page 819

[51 Ariz. 456] ROSS, J.

This is an action by the Home Owners' Loan Corporation to foreclose a mortgage on lot 23, block 2, Princeton Heights, and addition to the City of Phoenix, given to it by Imogene and S. T. Bekins, wife and husband, April 18, 1934, and placed of record April 27, 1934. Of those made defendants, only the County of Maricopa and the City of Phoenix filed answers. The county's answer was that it had a prior and superior [51 Ariz. 457] lien upon the premises for county and state taxes for the amounts and years following:

1934

$ 58.14

1935

59.39

1936

60.51, and for personal property taxes for

the year 1934 in the sum of $9.34.

The city's answer was that it had a prior and superior lien on the premises for the amounts and years as follows:

Real Estate:

Personal Property:

1934

$ 28.94

$ 3.69

1935

27.18

1.54

1936

28.24

2.40, together with interest,

penalties and costs thereon; also city real

estate and

personal taxes for the year 1937.

The county and city prayed that their tax liens be decreed to be prior and superior to the plaintiff's mortgage lien, and the court so decreed. The plaintiff has appealed.

The reason for the appeal is not that the county and city are not entitled to prior and superior liens on the realty for taxes assessed and levied against the realty -- it is conceded that they are entitled to such liens -- but because they were given preferred liens on the realty for the taxes assessed and levied on the personal property of the Bekins, it being contended that the law gives no liens either to the county or city on the realty for the taxes on the owner's personal property.

We will refer to the parties as they were in the trial court.

Plaintiff's assignments present two questions for decision: (1) Whether the county and city under the law have a lien upon the taxpayer's real property for the taxes upon his personalty, and (2), if they do have, is it prior and superior to plaintiff's mortgage on such realty. These questions require a construction of our [51 Ariz. 458] revenue statutes, and of the city's charter and ordinances as they may bear on the city's rights. We will first consider the question as it relates to the county.

The right and power of the legislature to make the real property assessed to a person liable for the taxes on his personal property and to make such taxes a lien thereon prior and superior to any other lien or encumbrance is unquestioned. Maricopa County v. Equitable Life Assur. Soc., 42 Ariz. 569, 28 P.2d 821. In Walker v. Nogales Building & Loan Assn., 28 Ariz. 484, 237 P. 1094, the question was whether personal property taxes assessed to the owner of realty were a prior lien to a mortgage given on such real property before the tax lien attached. We held that, while the Civil Code of 1913, paragraphs 4845, 4902 and 4903, created a lien upon the realty of the person assessed for the personal property tax, the statutes did not make such lien prior and superior to the mortgage. We construed such provision of the statute as giving a prior and superior lien upon the property assessed for the taxes on such property, but not for taxes on other property. In the 1928 revision of the Code, paragraphs 4845, 4902 and 4903, supra, were consolidated into section 3101 to read as follows:

"Every tax levied under the authority of this chapter upon real or personal property shall be a lien upon all of the property assessed in the name of the particular taxpayer owning or controlling the same. The lien shall attach on the first Monday in January in each year, and shall not be satisfied or removed until such taxes, penalties, charges and interest are all paid, or the property has finally vested in a purchaser under a ...


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