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AGO 1957 No. 15 - February 06, 1957
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John J. O'Connell | 1957-1968 | Attorney General of Washington

TAXATION, MORTGAGES, PRIORITY OF PERSONAL PROPERTY TAX OVER PRE‑EXISTING [[PREEXISTING]]CHATTEL MORTGAGE

The lien for personal property taxes against the property actually assessed for the tax is superior to a pre‑existing [[preexisting]]chattel mortgage on the same property and the property may be followed and the taxes collected after foreclosure of the mortgage.

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                                                                 February 6, 1957

Honorable James E. Duree
Prosecuting Attorney of Pacific County
P.O. Box 552
Raymond, Washington                                                                                                                Cite as:  AGO 57-58 No. 15


Dear Sir:

            You have requested our opinion as to the priority between a chattel mortgage and personal property taxes.  From the facts as set forth in your letter it appears that the mortgage was prior in time to the assessment of the taxes, and that after the taxes became due the mortgage was foreclosed.  We assume that the taxes were assessed against the specific property covered by the mortgage.  We further assume Pacific County was not a party defendant in the foreclosure proceedings.  Your specific questions are:

            (1) Is the mortgage lien to be given priority over the tax lien?

            (2) Does the foreclosure of the mortgage now prevent the county from distraining and selling the property in satisfaction of the lien for taxes?

             [[Orig. Op. Page 2]]

            We answer both questions in the negative and will discuss them together.

                                                                     ANALYSIS

            In your letter you mentioned RCW 84.60.010 wherein tax liens are given priority over mortgages and other liens against property.  However, the laws of 1925, Ex. Sess., chapter 130, section 99 from which the code section was derived, refers only to real property, and the language there used must take precedence over the code.

            However, RCW 84.60.030 (§ 1, chapter 34, laws of 1943) provides in part as follows:

            "The taxes assessed upon each item of personal property assessed shall be a lien upon such personal property from and after the date upon which it is listed with and valued by the county assessor, and no sale or transfer of such property shall in any way effect the lien of such taxes thereon.  The taxes assessed upon personal property shall be a lien upon each item of personal property of the person assessed, distrained by the treasurer as provided in RCW 84.56.070, 84.56.080, and 84.56.100, from and after the date of the distraint and no sale or transfer of such personal property so distrained shall in any way affect the lien of such taxes upon the property. . . ."

            In construing the above statute the court said in State ex rel. Peoples National Bank v. King County, 36 Wn. (2d) 10, at page 13:

            ". . . The lien which attaches at the time of assessment is prior to any existing chattel mortgage upon such item of property, but the lien of such mortgage is superior to the lien created by subsequent distraint of that property."  (Citing cases)

             [[Orig. Op. Page 3]]

            Another case in point involving almost the same facts as in the problem we are considering isMinshull v. Douglas County, 133 Wash. 650, at page 653:

            "Under the various statutes and under our own decisions, it is manifest that the personal property tax is a specified lien against the specific property assessed; that the assessed personal property may be followed into the hands of a transferee and the assessed taxes collected.  If it may be followed into the hands of a transferee and the tax collected, much more so may it be followed into the hands of a mere incumbrancer, even though the incumbrancer has a contract lien antedating the assessment of the taxes.

            "We hold, as the trial court did, that the lien for personal property taxes against the personal property actually assessed for the tax is superior and paramount to a pre‑existing [[preexisting]]mortgage on the same property."

            We hope the foregoing will be of assistance to you.

Very truly yours,

JOHN J. O'CONNELL
Attorney General

HENRY W. WAGER
Assistant Attorney General

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