1. The law of Alabama fixes October 1st of each year as the tax
day as of which real property shall be assessed for the taxes of
the succeeding tax year, and provides a statutory process whereby,
in due course, valuations of properties and amounts of tax are
determined. Taxes are made liens on the properties taxed, relating
back to the tax day and continuing until the taxes have been paid.
The lien is effective not only against the owner on the tax day,
but also against subsequent purchasers.
(1) That the tax lien is not objectionable under the Federal
Constitution as applied to a purchaser who bought on or after the
tax day and before the amount of the tax had been fixed by levy and
assessment. P. 313 U. S.
(2) The fact that the purchaser, in such circumstances, was the
United States did not invalidate the lien. P. 313 U. S.
(3) Such a lien cannot be enforced against the United States
without its consent. P. 313 U. S.
2. A proceeding against property in which the United States has
an interest is a suit against the United States. P. 313 U. S.
Page 313 U. S. 275
This was a suit brought in this Court by the United States
against the State of Alabama in which the plaintiff sought to have
removed, as clouds on its title, tax liens imposed under the law of
the State upon lands purchased by the plaintiff.
The Court decrees that tax sales and certificates of purchase,
resulting from proceedings in an Alabama county court for
enforcement of the liens, shall be set aside, but, in other
respects, the bill is dismissed.
Page 313 U. S. 277
MR. CHIEF JUSTICE HUGHES delivered the opinion of the Court.
The United States brought this suit to quiet its title to land
in Macon County, Alabama. The complaint alleges that the Alabama is
asserting liens as attaching to the land on October 1, 1936, for
state and county taxes for the tax year 1937, and further that the
State claims an interest in the land by reason of tax sales and the
issue to the certificates of purchase. The Government asks a decree
declaring the liens, tax sales, and certificates of purchase to be
invalid and enjoining the State from asserting its claims. The case
was heard on bill and answer.
There are three tracts involved, which were conveyed by the
owners to the United States on October 1, 1936, December 10, 1936,
and March 10, 1937, respectively.
The applicable statute of Alabama [Footnote 1
] provides that,
"From and after the first day of October of each year,
Page 313 U. S. 278
when property becomes assessable, the State shall have a lien
upon each and every piece or parcel of property owned by any
taxpayer for the payment of all taxes which may be assessed against
him . . . which lien shall continue until such taxes are paid."
The county is to have a like lien for taxes assessed by it.
These liens are made superior to all other liens. and may be
enforced by sale as provided in the Act.
Under the statute, the process of assessment for the tax year
1937 began on October 1, 1936. The grantors in the above mentioned
conveyances, as the respective owners on that date, made their
returns and in due course the tax assessor listed and valued the
several tracts. [Footnote 2
Page 313 U. S. 279
valuations were certified as provided by the statute to the
county board of review, which, by virtue of its authority to fix
valuations, made the definitive assessments. [Footnote 3
] It appears that the board of review
met on March 8, 1937, and adjourned on March 20, 1937. It also
appears that the rate for state taxes had been fixed by the
statute, [Footnote 4
] and the
rate for county taxes was set on February 8, 1937, under the
authority given to the court of county commissioners. [Footnote 5
] The school district tax was
approved by the electors of the school district at an election held
on June 14, 1937. The taxes for the year 1937 became payable on
October 1, 1937, and became delinquent on January 1, 1938.
] Proceedings were
then instituted in the county court for the sale of the lands, and,
under its decrees, the sales took place on June 12, 1939. The lands
were sold to the State, and certificates of purchase were issued
The Government, invoking the principle that
lands owned by the United States cannot be taxed by a State
(Van Brocklin v. Tennessee, 117 U.
) contends that the asserted liens are without
validity because, at the time the tracts were acquired by the
United States, the amount of the taxes had not been ascertained, as
the values had not then been assessed and the rates of taxation had
not been fixed. Therefore, it is said that the taxes had not then
been imposed. The argument is that the Alabama tax statute does not
"impose taxes," but "secures their payment," and that, unless taxes
are imposed, the statute has no effect. The lien, it is urged,
becomes "fixed and final" only when the taxes have been ascertained
"by completion of levy and assessment."
There is no question however, as the Government concedes, that
the state statute purports to impose a lien as
Page 313 U. S. 280
of October 1, 1936, for the taxes which by the process of
assessment were to become payable for the tax year 1937. October
first is fixed as the tax day, and, as of that day, owners are to
make their returns, values are to be fixed, and the taxes laid.
There is no question that the State thus undertakes to create an
inchoate lien upon the lands as of the tax day, a lien which is to
be effective for the amount of the taxes for the ensuing year as
these are fixed by the defined statutory method. This lien by the
state law is made effective not only as against the owners on the
tax day, but also as against subsequent mortgagees and purchasers.
"It follows the land in the hands of the vendee, all persons being
chargeable with a knowledge of its existence." Driggers v.
71 Ala. 529, 534. See also Swann v. State,
77 Ala. 545; State v. Alabama Educational Foundation,
Ala. 11, 16, 163 So. 527. We find nothing in the Federal
Constitution which invalidates such a statutory scheme. Subsequent
lienors and purchasers have due notice of the tax liability imposed
as of the tax day and of the process of assessment, and that
liability, when its amount is definitely ascertained, relates back
to the day specified. We recognized the validity of such a
provision in New York v. Maclay, 288 U.
, 288 U. S. 292
where we observed that a tax lien created in a similar manner under
a statute of New York
"is effective for many purposes, though its amount is
undetermined. It is notice to mortgagees or purchasers, who are
held to loan or purchase at their own risk if they take their
mortgages or deeds before the tax has been assessed or paid."
The precise decision in that case allowing priority to the
United States under R.S. § 3466, for debts due by an insolvent
corporation over claims of the State for franchise taxes due but
not assessed or liquidated until after a receivership, in no way
detracted from the recognition of the effectiveness of the state
law creating a lien as against mortgagees and purchasers. As the
Page 313 U. S. 281
"Against mortgagees and purchasers, a lien perfected afterwards
may take effect by relation as of the date of the inchoate lien
through which mortgagees and purchasers become chargeable with
p. 288 U. S. 293
See also Osterberg v. Union Trust Co., 93 U. S.
, 93 U. S. 425
93 U. S. 428
People v. Commissioners, 104 U. S. 466
104 U. S. 468
Compare Shotwell v. Moore, 129 U.
, 129 U. S. 598
The lien in such a case, though inchoate on the day specified and
maturing when the extent of liability is ascertained by the
statutory process, is similar in that respect, as the court said in
case, to the lien of a transfer tax or duty
upon the estate of a decedent which is effective although the
amount is ascertained after death.
Our present inquiry is whether, assuming the validity of the
state statute creating a lien as of October 1, 1936, as against
other subsequent purchasers, it should be deemed invalid as against
the United States. The question is not whether such a lien could be
enforced against the United States. The fact that the United States
had taken title and that proceedings could not be taken against the
United States without its consent would protect it against such
enforcement. But that immunity would not be predicated upon the
invalidity of the lien. If, in this instance, title had been taken
by the United States in the summer of 1937, after the amount of the
taxes had been ascertained, and the respective liens were
concededly valid, still proceedings against the United States could
not be prosecuted without its consent.
The Government is not content with that measure of protection.
The Government brings this suit in the view that it is entitled to
have a marketable title and it seeks to remove the liens in
question as clouds upon that title which would interfere with the
disposition of the lands in the future. From that standpoint, the
Government asks a decree declaring the invalidity of the liens and
enjoining the State from asserting any claim in the lands
Page 313 U. S. 282
either adverse to the United States or to its successors in
title. We think that the United States is not entitled to that
relief. The United States took the conveyances with knowledge of
the state law fixing the lien as of October 1st. That law, in
creating such liens for the taxes subsequently assessed in due
course and making them effective as against subsequent purchasers,
did not contravene the Constitution of the United States, and we
perceive no reason why the United States, albeit protected with
respect to proceedings against it without its consent, should
stand, so far as the existence of the liens is concerned, in any
different position from that of other purchasers of lands in
Alabama who take conveyances on and after the specified tax date.
It is familiar practice for grantees who take title in such
circumstances to see that provision is made for the payment of
taxes, and the Government could easily have protected itself in
like manner. Finding no constitutional infirmity in the state
legislation, we think that the liens should be held valid.
We make no exception of the tract conveyed to the United States
on the tax day, October 1, 1936, as we think the state statute, as
contended by the State, is to be deemed effective from the moment
the tax day began. See Beck v. Johnson,
235 Ala. 323, 324,
179 So. 225.
-- With respect to the tax sales, the case has
a different aspect. The proceedings in the county court for the
sale of the lands were taken, and the decrees were rendered, after
the United States had become the owner of the tracts. A proceeding
against property in which the United States has an interest is a
suit against the United States. The
7 Wall. 152, 74 U. S. 154
The United States was an indispensable party to proceedings for the
sale of the lands, and, in the absence of its consent to the
prosecution of such proceedings, the county court was without
jurisdiction and its decrees, the tax sales and the certificates of
purchase issued to the State were void. Minnesota v. United
States, 305 U. S. 382
305 U. S. 386
Page 313 U. S. 283
pleading to the contrary in its answer, the invalidity of the
tax sales is now conceded by the State.
The United States is entitled to a decree setting aside the tax
sales and the certificates of purchase, and, in other respects, the
complaint is dismissed.
It is so ordered.
Section 372, Act No.194, General Acts Alabama, 1935, p. 566, is
"From and after the first day of October of each year, when
property becomes assessable, the State shall have a lien upon each
and every piece or parcel of property owned by any taxpayer for the
payment of all taxes which may be assessed against him and upon
each piece and parcel of property real or personal assessed to
owner unknown, which lien shall continue until such taxes are paid,
and the county shall have a like lien thereon for the payment of
the taxes which may be assessed by it, and if such property is
within the limits of a municipal corporation, such municipal
corporation shall have a like lien thereon for the payment of the
taxes which may be assessed by it. These liens shall be superior to
all other liens, and shall exist in the order named, and each of
such liens may be enforced and foreclosed by sale for taxes as
provided in this Act, or as other liens upon property are
The State also cites Section 8874 of Article 6, Chapter 314, of
the Code of Alabama, 1923, which provides:
"From and after the first day of October of each year, the state
shall have a prior lien upon each and every piece or parcel of
property, real or personal, for the payment of any and all taxes
which may be assessed against the owner, or upon such property,
during that year, for the use of the state, and the county shall
have a like lien thereon for the payment of the taxes which may be
assessed against such owner, or upon such property, during that
year, for the use of the county, and these liens shall exist as to
all lands bid in by the state at tax sales for the annual taxes
thereafter assessed on the value of the property so purchased, in
the event of the tax title failing."
Act No. 194, General Acts Alabama, 1935, § 29, p. 274.
§§ 50, 72, pp. 284, 292.
§ 7, p. 263.
§ 64, p. 288.
§ 11, p. 267.