Montana Attorney General Opinion 17-35

Opinion No. 35. Counties-Taxation-Tax Sales. Ac- cepting Bids At. HELD: The county must sell lands for delinquent taxes, in units, as appraised, and may not divide such lands and sell on any other basis. The County may not reject any bid, if the same is within the appraised value. The sale must be made at time adver- tised, or new bids called for. February 5, 1937. Mr. O. G. Johnson Chairman. Board of County Commis- sioners Valley County, Glasgow, Montana Dear Sir: You have submitted the following set of facts to this office, asking for an opinion as to the validity of your procedure. It appears that notice of tax sale of certain lands was given November 10, 1936. giving notice of the sale December 11, 1936, at 10:00 o'clock A. M., at public auction to the highest bidder. and at a price not less than 90% of the appraised value. On the date of the sale no bid was made for the southwest quarter of section 32, and its appraised value is $1760 00. One bid was offered for the north half of the southwest quarter in the sum of $880.00. The Board refused to accept this bid. No bid 'was offered for the south half of the south west quar- ter, and therefore the same was struck off to the County. Thereafter, we re- ceived a subsequent letter from your County Clerk and Recorder stating an interested party, at a time later than the time and date advertised for the sale of the property, made a bid for the entire tract, in the sum of $1760.00, and is willing to buy the entire quarter. Your advertisement states that the Board has the right to reject any and all bids. Since the receiving of your com- munication, your county attorney has appeared at this office and has given us further information upon this ques- tion. This office has suggested that if there be any conflict in the facts, that an agreed statement be sent here, so as to avoid any confusion. However, it appears now that the facts necessary for the determination of this matter as submitted to us in your two letters, and as advised by the county at- torney, so far as are necessary for this opinion are substantially in ac- cord. Section 2208.1 provides in part: "Whenever the county shall ac- quire any land by tax deed, it shall be the duty of the board of county commissioners. within six mont hs after acquiring title, to make and enter an order for the sale of such lands at public auction at the front door of the court house, provided, however, that thirty days' notice of such sale shall be given by publica- tion in a newspaper printed in the county, such notice to be published once a week for three successive weeks, and by posting notice of such sale in at least three public places 38 OPINIONS OF THE ATTORNEY GENERAL in the county. Notice posted and published shall be signed by the county clerk and one notice may include a list of all lands to be of- fered for sale at one time. It shall describe the lands to be sold, the appraised value of same, the time and place of sale, and no sal·e shall be made for a price less than the fair market value thereof, as deter- mined and fixed by the board of county commissioners prior to making the order of sale, which value shall be stated in the notice of sale. And it shall be the duty of the board of county commissioners to so appraise, order and advertise for sale all lands heretofore con- veyed to the county by tax deeds within ninety days from and after this act takes effect. In the event any of said lands are not sold at such public sale, the coun- ty commissioners may at any time either again appraise. advertise and offer the same at public auction or sell the same at private sale at the best price obtainable. but at not less than ninety per cent of the last ap- praised value. and on such terms as may he agreed upon, provided the rate of interest on deferred payments shall not exceed four per cent per annum, and provided further that the terms other than price, as to each class of land, grazing, farming and irrigated. shall be uniform in each county. If a sale is made on terms, the chairman of the board of county commissioners shall execute a deed to the purchaser. or his assignee conveying the title of the county in and to the lands so sold." The law req uires this property to be appraised at its fair market value, to be determined and fixed by the Board of County Commissioners. The Board appraised the southwest quarter of Section 32 as one unit, and it can only be sold as one unit by virtue of that appraisement. Supposing one half of this unit was sold for $880.00, the entire unit being appraised for $1760.00, it may be that the portion not sold would not have an equal value with the portion sold, and may have a con- ceivable value of only $120.00, there- fore vour board would only receive $1,000.00 for this land, altho it was appraised in the the sum or $1760.00. Therefore, the board acted quite prop- erly in refusing to accept the bid for the one-half of this unit. Your notice states that the board reserves the right to reject any and all bids. However, we do not think the board has the right to reject any and all bids if those bids received are within the appraised value of the prop- erty as determined and fixed by the Board of County Commissioners, It is assumed that when the board appraised this property it fixed a fair market value for the property, and in the short space of time elapsing between the appraisal of the property and the sale of the property, no situa- tion could reasonably arise substan- tially altering and increasing the value of the property. The Board of County Commissioners must make an order to advertise these lands within six months after acquiring same. In the event the lands are not sold at such public sale, the board may again ap- praise. advertise and offer the same at public sale. It is the purpose of the law to require lands to be sold im- mediately after acquiring the same and be replaced on tax rolls. In State ex reI Malott v. Cascade County, 94 Mont. 394, at page 406. the court said: "It is also the duty of the county to apply for a tax deed and to sell the land as speedily as possible." If the Board of County Commis- sioners has pursued the law in sub- mitting this land for sale, thpn trere should be no reason after a valid bid is made for the lands, to reject that bid. However, Section 2208.1 does pro- vide that this notice of sale. among other things. shall orovide the time and place of sale. The Board, in its notice of sale, advised the public that the property would be sold on the 11th day of December, 1936, at 10:00 o'clock A. :'II. At 1 hat time the pros- pective purchaser appeared and made a bid of $880.00, for one half of a unit. which bid was improper and rightly re- jected by the Board. However. the Clerk and Recorder has advised us that nothing further occurred at such time, but since that time, and prior to the next regular session of the Board, an interested party did make an offer for this particular tract of land in the sum of $1760.00. The statute requires this land to be sold at a particular time and that it he so advertised. The gen- eral public has a right to make com- OPINIONS OF THE ATTORNEY GENERAL 39 petitIve bids, and if a bidder should appear at a later date than the time set, you would exclude competitive bidders and may cast a cloud upon the title you give. Therefore, it is my conclusion, that you must sell these lands in the units as appraised. Second, that if the bidder appears at the time and place advertised for the sale of these tracts, and at that time and place bids within the appraised value for the property on the unit ap- praised, you have no right to reject his bid. Third, if as it appears in this particu- lar case, the bidder appeared after the time specified for the sale as aelver- tisp.d bv your board, and did make a bid, within the appraised price for the entire unit, yet inasmuch as this bid was not made at the time specified for the sale of the property, you must reject that bid and readvertise the property and reappraise it, and sell the same on the basis of competitive bids. Opinion No, 36. County Commissioners - Counties - Taxes-Special Improvemen't Tax- Liability of County for, HELD: A County must pay im- provement taxes on tax deed lands from date of purchase, provided, lands were acquired after March 1929; If acquired prior to that date, county need not pay such taxes. February 6, 1937. Mr. Eugune L. Murphy County Attorney Choteau, Montana Dear Mr. Murphy: You have requested an opinion from this office as to whether or not Teton County is liable to pay special im- provement assessment taxes for the City of Choteau, by reason of the fact that the county, on October 31, 1931, acquired some lots by tax deeds; and whether or not it would be legal for the county to pay these assessments; and whether or not your board is au- thorized to sign an agreement where- by a special improvement district is created. Section 2215 R. C. M., provides: "All deeds * * * executed more than three years after any tax sale shall be deemed to convey to the grantee the absolute title to the lands * '" * except the lien for taxes which may have attached subsequent to the sale, * * * ." Under the above section it has been held that the tax deed extinguished the lien of these improvement districts, and that the deed conveyed the titk free of all encumberances. (State v. Jeffries, 83 :\lont. 111.) In the cases of City of Kalispell v. School District, 45 Mont. 221 and Ricker v. City of Helena, 68 ?lIont. 350, the court held that the city, as well as the county, was liable to pay special improve- ment district assessments. However, in those two cases the tax statutes were not in question, and it does not appear from those cases whether or not the property was acquired by tax deed. Section 2215 was amended by Section 2215.9, which provides: "The deed hereafter issued * * * shall convey to the gran tee the absolute title * * * free of all en- cumbrances * * * except the lien for taxes which may have attached subsequent to the sale and the lien of any special or local improvement assessments levied against the prop- erty payable after the execution of said deed. * * *" This amendment was made to Sec- tion 2215 in the year 1929, as Section 9, Chapter 100 of the Twenty-First Legislative Assembly. Section 2215 was amended in the year 1929 to obvi- ate and eliminate the situation as ex- isted under Section 2215, as interpre- ted in the case of State v. Jeffries, 83 Mont. Ill, exempting counties from improvement assessments. However, in the case of State v. Osten, 91 Mont. 76, the tax deed lands were acquired in the years 1926 anel 1927, and the court held that to apply Section 2215.9 would be retroactive. It therefore is implied, that if t,he lands had been acquired by tax deed after the year 1929, the county would have been liable for the special improvement taxes. Your lots were acquired in the year 1931, and Section 2215.9 is ap- plicable, and all liens which have at- tached subsequent to the date of sale