A tract of land in South Carolina was sold in 1863 under the
direct tax acts for nonpayment of the direct tax to the United
States, and was bid in by the United States. It was then subdivided
into two lots, A and B. Lot A, the most valuable, was resold at
public auction to E, who had a life estate in it, and it was
conveyed to him. Lot B was also resold, but the present controversy
relates only to Lot A. This lot was purchased by a person who had
been a tenant for life of the whole tract before the tax sale.
After the purchase and during his lifetime, it was seized under
execution and sold as his property. No part of the property has
come
Page 164 U. S. 374
into the possession of the remaindermen, claimants in this
action, nor have they repurchased or redeemed any part of it from
the United States, nor has any purchase been made on their account.
Under the Act of March 2, 1891, c. 496, 26 Stat. 822, they brought
this suit in the Court of Claims to assert their claim as owners in
fee simple in remainder, and to recover one-half of the assessed
value of the tract.
Held that, as they were admittedly
owners, as they themselves neither purchased nor redeemed the land,
and as they are not held by any necessary intendment of law to have
been represented by the actual purchaser, they are entitled to the
benefit of the remedial statute of 1891.
The facts of the case, as found by the Court of Claims, were as
follows:
On March 13, 1863, block 91 in the Town of Beaufort, South
Carolina, was sold by the United States direct tax commissioner for
South Carolina, under the direct tax acts, Act of August 5, 1861,
c. 45, § 8, 12 Stat. 293, 294, Act of June 7, 1862, c. 98, 12
Stat. 422, to satisfy a tax, with penalty and interest, of $127.42
assessed against it, and was bid in by the United States. Said
block was assessed for taxation by the said commissioner at
$10,000. Subsequently it was divided into two lots,
viz.,
lot A, containing buildings, and measuring on the north line 103
feet, and lot B, measuring on the north line 207 1/2 feet.
Lot A was resold November 1, 1866 at public auction, to T. R R.
S. Elliott, for $200, and conveyed to him. Lot B was resold at
public auction to Thomas M. S. Rhett for $225. At the time of the
said sale for taxes, the titles in lots A and B, save so much
thereof as lies west of a line drawn parallel to the west line of
lot A 103 feet west therefrom, were vested in T. R. S. Elliott, as
tenant for life, with remainder in fee in Alfred, William, Phoebe,
Ann C., James C., Arthur H., Isabella R., Seignley C., Montrose and
Apsley H. Elliott, children of the said T. R. S. Elliott. The said
Apsley H. Elliott died in the year 1867, and the other mentioned
children are his heirs at law. The said Thomas R. S. Elliott died
in 1876. The surviving children, who are the claimants, were of
tender years during the late Civil War. The value of that part of
block 91 owned by the claimants is twenty-nine thirtieths of the
whole value of said block.
Page 164 U. S. 375
Thomas R. S. Elliott, the tenant for life, adhered to the cause
of the Rebellion, and on the occupation of Port Royal by the Union
troops, in November, 1861, left St. Helena Island, with all the
population of those islands, and remained away until after the
close of the war. During the entire period of his absence, St.
Helena Island and the adjacent islands were occupied by United
States troops, and had been entirely abandoned by the original
inhabitants. After the purchase, in November, 1866, by T. R. S.
Elliott, the property was seized under execution, and sold as his
property. Subsequently the purchaser of the property at sheriff's
sale handed to the widow of T. R. S. Elliott the value of her dower
in the property. No part of the property has come into the
possession or ownership of the claimants, or any one of them,
through the said T. R. S. Elliott. The claimants have not
repurchased or redeemed any part of said property from the United
States, nor has any purchase been made or intended to be on their
account.
On this state of facts, the Court of Claims found that the
claimants were entitled to recover, and on May 8, 1893, entered
judgment in their favor for the sum of $4,185.98. From this
judgment an appeal was taken and allowed to this Court.
Page 164 U. S. 376
MR. JUSTICE SHIRAS, after stating the facts as above, delivered
the opinion of the Court.
The Act of February 6, 1863, c. 21, 12 Stat. 640, provided for
the collection of direct taxes in insurrectionary districts within
the United States, by subjecting lands on which such taxes had been
assessed, and remained unpaid, to public sale to the highest bidder
for a sum not less than the taxes, penalty, and costs, and ten
percentum per annum on said tax. The act contained a provision that
the tax commissioners should be authorized to bid in such lands for
the United States at a
Page 164 U. S. 377
sum not exceeding two-thirds of the assessed value thereof,
unless some person should bid a larger sum. It also gave a right of
redemption to minors, nonresident aliens, loyal citizens beyond the
seas, guardians, or trustees of persons under legal disabilities at
any time within two years of such sale.
The land of the claimants was sold on March 3, 1863, and bid in
by the United States for the sum of $1,100. Subsequently, November
1, 1866, the United States sold at public auction that portion of
its land described as lot A to T. R. S. Elliott for two hundred
dollars, and the same was conveyed to him. Said Elliott died in
1876. During his lifetime, the land was seized under execution as
his property, and sold, and never afterwards came into his
possession or that of the claimants.
The Act of March 2, 1891, c. 496, 26 Stat. 822, provided for the
return to the owners of lands bid in for taxes and subsequently
resold of any excess received by the United States beyond the
amount of the tax assessed thereon, and also for a certain rate of
compensation to the owners of property sold for direct taxes. The
fourth section of that act contained the following:
"That it shall be the duty of the Secretary of the Treasury to
pay to such persons as shall apply therefor and furnish
satisfactory evidence that such applicant was, at the time of the
sales, the legal owner, or is the heir at law or devisee of the
legal owner of such lands as were sold in the Parishes of St.
Helena and St. Luke in the State of South Carolina, under the said
acts of Congress, the value of said lands in the manner following,
to-wit: to the owners of the lots in the Town of Beaufort, one-half
of the value assessed thereon for taxation by the United States
direct tax commissioners for South Carolina; to the owners of lands
which were rated for taxation by the State of South Carolina as
being usually cultivated, five dollars per acre for each acre
thereof returned on the proper tax book; to the owners of all other
lands, one dollar per acre for each acre thereof returned on said
tax book,
provided that in all cases where such owners, or
persons claiming under them, have redeemed or
Page 164 U. S. 378
purchased said lands, or any part thereof, from the United
States, they shall not receive compensation for such part so
redeemed or purchased, and any sum or sums held or to be held by
the said State of South Carolina in trust for any such owner under
section three of this act shall be deducted from the sum due to
such owner under the provisions of this section,
and provided
further that in all cases where said owners have heretofore
received from the United States the surplus proceeds arising from
the sale of their lands, such sums shall be deducted from the sum
which they are entitled to receive under this act. . . ."
This suit was brought by the appellees in the Court of Claims to
assert their claim as the owners in fee simple in remainder of
block 91, composed of lots A and B, to 29/30 of one-half of the
value assessed for taxation on said block by the United States
direct tax commissioners for South Carolina. The Court of Claims
found, among other findings, that the claimants had not repurchased
or redeemed any part of lot A from the United States, nor had any
purchase been made intended to be on their account, and rendered
judgment for the claimants in the sum of $4,709.22, being 29/30 of
one-half of the assessed value of block 91, less the taxes assessed
thereon under the direct tax acts. From so much of this judgment as
relates to one-half of the assessed value of lot A, the United
States has appealed to this Court. There is no controversy as to so
much of the judgment as relates to lot B.
The United States do not claim that the appellees, as
remaindermen in fee, are not owners within the meaning of the
statute, but they contend that the claimants are within the
exclusion of the proviso that in all cases where such owners or
persons claiming under them have redeemed or repurchased said lands
or any part thereof from the United States, they shall not receive
compensation for such part so redeemed or purchased.
As already stated, the Court of Claims found as a fact that the
claimants had not redeemed or repurchased any part of lot A, nor
had any purchase thereof been made on their account. But this
finding is alleged by the United States to
Page 164 U. S. 379
have been based on an erroneous view of the law, that the
claimants must be deemed to have repurchased lot A because T. R. S.
Elliott, the life tenant, had purchased said lot A at the public
sale made by the government in 1866.
The theory of the government is that the life tenant was so far
a trustee or representative of the remaindermen that when he
purchased at the public sale in 1866, he acted as well for those in
remainder as for himself. To sustain this view, the counsel for the
United States point to the numerous cases in which it has been held
that a tenant for life cannot purchase for himself at a tax sale,
or acquire an interest adverse to the reversioner or remainderman
by obtaining an assignment of the tax title.
Unquestionably, those cases do declare that, as it is the duty
of the life tenant to pay the taxes, he cannot, by buying the
property at a tax sale, or by buying from a purchaser at such sale,
take advantage of his own wrong, and set up a title so acquired
against the remaindermen.
But does the principle of such decisions apply to a case like
the present?
That principle is that one whose duty it is to keep the taxes
paid cannot, as against those who had a right to rely on his
performance of such duty, successfully assert a title originating
in his dereliction of duty. In all the cases cited, the question
was between the life tenant and the remaindermen. In the present
case, the doctrine is invoked not in protection of the
remaindermen, but to their detriment. The argument is that, because
the remaindermen might, by proceeding in equity, have had it
declared that the title purchased by the life tenant at the public
sale inured to their benefit, it therefore follows that they must
be regarded to have been purchasers at said sale, and be now
precluded from the benefits of the act of 1891.
An important circumstance is that T. R. S. Elliott did not buy
the property at the tax sale in 1863, nor did he buy from an agent
or go-between who bought at that sale, nor did he redeem the land
under the provisions of the tax law. He bought at the public sale
in 1866, the time for redemption
Page 164 U. S. 380
having long expired, when the United States gave a fee simple
title, free from incumbrances, to the purchaser. If anyone else
than the former life tenant had purchased at that sale, it is
indisputable that the present claimants would have had a right to
recover the money coming to them as owners under the act of 1891.
T. R. S. Elliott was under no obligations to bid, and we are unable
to see that his doing so changed the relations between the United
States and the appellees. If the creditors of T. R. S. Elliott,
instead of awaiting his action in possessing himself of the title
of the United States to the property and then seizing it in
execution, had themselves bought at the sale, the substantial facts
would have been just what they now are. It was found as a fact by
the Court of Claims that in buying at the auction sale, T. R. S.
Elliott did not act for or on account of the remaindermen, and we
do not feel constrained to extend a doctrine devised for the
protection of
cestuis que trustent so as to operate to
their injury.
As, then, the appellees were admittedly owners, as they
themselves neither purchased nor redeemed the land, and as they are
not held by any necessary intendment of law to have been
represented by the actual purchaser, it follows that they are
entitled to the benefit of the remedial statute of 1891, and the
decree of the Court of Claims to that effect is accordingly
Affirmed.
