TAXATION ‑- REAL PROPERTY ‑- LIENS ‑- STATUS OF PERSONAL PROPERTY TAX LIEN ATTACHING TO REAL PROPERTY UNDER RCW 84.60.020
(1) Where a given tract of real property has been charged for personal property taxes by a county treasurer acting pursuant to RCW 84.60.040, a tax lien for the personal property taxes involved runs against the real property so charged.
(2) A tax lien for personal property attaching to selected real property under RCW 84.60.020 does not take priority over a real property mortgage to which the selected real property was already subject at the time of the county auditor's action.
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May 28, 1975
Honorable Arthur R. Eggers
Walla Walla County
407 Drumheller Building
Walla Walla, Washington 98362 Cite as: AGLO 1975 No. 56
This is written in response to your recent request for our opinion on a question which we divide and paraphrase as follows:
(1) Where a given tract of real property has been charged for personal property taxes by a county treasurer acting pursuant to RCW 84.60.040, does a tax lien for the personal property taxes involved then run against the real property so charged?
(2) If question (1) is answered in the affirmative, does the lien then have priority over a real property mortgage to which the selected real property was already subject at the time of the county treasurer's action?
We answer question (1) in the affirmative and question (2) in the negative for the reasons set forth in our analysis.
RCW 84.60.040 provides that:
"When it becomes necessary, in the opinion of the county treasurer, to charge the tax on personal property against real property, in order that such personal property tax may be collected, such county treasurer shall select for that purpose some particular tract or lots of real property owned by the person owing such personal property tax, and in his tax roll and certificate of delinquency shall [[Orig. Op. Page 2]] designate the particular tract or lots of real property against which such personal property tax is charged, and such real property shall be chargeable therewith."
Once the procedures provided for in this statute have been taken by a county treasurer the first issue raised by your request is whether a lien for the payment of the subject delinquent personal property taxes then attaches to the real property designated for payment of the taxes by the county treasurer. The answer to this question is clearly in the affirmative by reason of another statute, RCW 84.60.020, which deals with the time of attachment of tax liens. Insofar as is here material, this statute reads as follows:
". . . The taxes assessed upon personal property shall be a lien upon the real property of the person assessed, selected by the county treasurer and designated and charged upon the tax rolls as provided in RCW 84.60.040, from and after the date of such selection and charge and no sale or transfer of such real property so selected and charged shall in any way affect the lien for such personal property taxes upon such property."
Thus, in effect, once a county treasurer has taken the action contemplated by RCW 84.60.040, the real property which he has thus designated becomes subject to the payment of the unpaid personal property taxes and the lien for unpaid personal property taxes then runs against the selected real property as well.
However, at least prior to the enactment of § 1, chapter 251, Laws of 1969, Ex. Sess., the personal property tax lien thus attaching to the selected real property didnot take priority over a mortgage or other voluntary encumbrance incurred by the owner of the selected real property prior to the county treasurer's action. See,Scandinavian American Bank v. King County, 92 Wash. 650, 159 Pac. 786 (1916). The second part of your question, in essence, inquires as to whether this is still true in view of the foregoing 1969 legislation.
Section 1, chapter 251,supra, amended the provisions of RCW 84.60.010 as follows:
[[Orig. Op. Page 3]] "All taxes and levies which may hereafter be lawfully imposed or assessed shall be and they are hereby declared to be a lien respectively upon the realand personal property upon which they may hereafter be imposed or assessed, which liens shall include all charges and expenses of and concerning the said taxes which, by the provisions of this title, are directed to be made. The said lien shall have priority to and shall be fully paid and satisfied before any recognizance, mortgage, judgment, debt, obligation or responsibility to or with which said realand personal property may become charged or liable." (New language underscored.)
The issue is whether this statute, as amended, now works to give a personal property tax lien attaching to real property under RCW 84.60.020,supra, the same priorities as apply by reason of the last sentence of the statute in the case of (a) an ordinary real property tax lien or (b) a personal property tax lienas against the subject personalty under the amendment.
As we have previously informed you, this office in a letter opinion dated March 25, 1970, to then State Representative R. Ted Bottiger [[an Informal Opinion, AIR-70543]]concluded that the above underscored 1969 changes in RCW 84.60.010 do not have the effect of providing a lien either upon personal property with respect to unpaid real property taxes or, conversely, a lien upon real property with respect to unpaid personal property taxes. Addressing ourselves to the language of the statute, as amended, we there said:
"From this language, it would appear clear to us that the legislature intended that personal property taxes would become a lien only upon the personal property upon which the tax is imposed, and that real property taxes would become a lien only upon real property upon which the tax is imposed. We believe that the word 'respectively' in the statute renders this intent apparent."
[[Orig. Op. Page 4]] Thus, the priority status provided for in the concluding sentence of RCW 84.60.010 is only applicable in the case of a tax lien attaching under the provisions of that statute. Accord,Scandinavian American Bank v. King County,supra, at page 652. A tax lien for delinquent real property taxes has a priority over either an existing or later acquired real property mortgage lien running against the same real property; and by the same token (as a consequence of the 1969 amendment) a tax lien for delinquent personal property taxes has a priority over any similar existing or later acquired lien for a security interest with respect to the subject personalty. However, a lien for delinquent personal property taxes which becomes a lien against selected real property under RCW 84.60.020, supra, doesnot thereby acquire a priority status as against an existing real property mortgage because the lien in that case attaches to the real property through the operation of another statute and not RCW 84.60.010, supra.
Repeated for ease of reference, the critical sentence of this last cited statute reads as follows:
". . . The said lien shall have priority to and shall be fully paid and satisfied before any recognizance, mortgage, judgment, debt, obligation or responsibility to or with which said real and personal property may become charged or liable." (Emphasis supplied.)
What lien? Answer: A lien attaching under RCW 84.60.010 ‑ and not a lien provided for by some other statute such as, in this case, RCW 84.60.020, supra.
Therefore, in conclusion, while the answer to the initial part of your question is clearly in the affirmative, we believe it necessary to respond to the second part of your question in the negative.
We trust that the foregoing will be of some assistance to you.
Very truly yours,
TIMOTHY R. MALONE
Assistant Attorney General