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COMMUNICATION.

COMPTROLLER'S OFFICE,
Albany, April 10, 1833.

To the Assembly of the State of New-York.

The Comptroller considers it his duty to make the following communication to the Assembly, in relation to the application of Lucas Elmendorf; which has already been reported upon by the Comptroller, and also by the committee on claims.

The point to be decided in this case is, whether the Comptroller shall give a deed to Mr. Elmendorf for lands purchased by him at a tax sale, without the production of the original certificate given by the Comptroller to the purchaser.

At the close of a tax sale, and after the payment of the purchase money, the 65th section declares that "the Comptroller shall give to the purchaser of any such lands, a certificate in writing, describing the lands purchased, the sum paid, and the time when the purchaser will be entitled to a deed." These certificates are transferred by an endorsement of the name of the purchaser upon the back of the certificate; and the uniform practice of this office has been, to give the Comptroller's deed to the person who produces the certificate endorsed as before stated, or to such other person as the holder of the certificate may designate: and the origiginal certificate, with the endorsement of the purchaser, is filed in this office as a voucher for giving the deed to a different person than the one who appears by the sales book, to have been the pur

chaser.

In this way the custom of the office has made the Comptroller's certificates for tax sales, to all practicable purposes, negotiable: and this usage is so well understood by the whole community, that these certificates are transferred by a simple endorsement, in the same manner as negotiable notes are passed from one person to

another. In many cases, the person who bids at the tax sale is the agent of another; and the person really interested pays the purchase money and receives no other security for his advances than the delivery into his possession of the original certificates of the Comptroller, with the name of the bidder endorsed upon the back of each. If the Comptroller should establish the precedent of giving deeds according to the entry in the sales book, and without the production of the certificate, it would destroy at once the character for security which every person now attaches to the possession of the Comptroller's certificate.

Some estimate of the importance of this subject and of the extent of the interests which may be affected by any change in the established rules of the Comptroller's office in relation to the character of certificates for tax sales, may be formed from the fact, that about fifteen thousand certificates are issued by the Comptroller at each tax sale. There have been four general tax sales, to wit: in 1815, 1821, 1826, and 1830: and it is presumed that between fifty and sixty thousand certificates have been issued for lands sold at the four periods above named.

In the transaction of all this business, for a period of seventeen years, it is not known to any person in the office that a Comptroller's deed has ever been given without the production of the original certificate, or a special act of the Legislature obtained.

The committee on claims say in their report, that the entry on the Comptroller's books is more controlling, as evidence of the purchaser's claim to a deed, than the certificate given by the Comptroller. And the report adds-"The certificate required to be given is for the security of the purchaser, and furnishes him with the evidence of his right to the land. This certificate is not negotiable, but it may be transferred for good consideration, and the holder or assignee thereby becomes entitled in equity to a conveyance from the State; when no redemption has been made, the lands are to be conveyed to the purchaser by the Comptroller, unless he has evidence that the right of the purchaser has been transferred; in the absence of evidence no such transfer will be presumed, but the business of the office will be conducted upon the hypothe sis that no transfer has been made. If in fact the certificate has been transferred, it is throwing upon the holder or assignee no greater burthen than is cast upon other individuals who become

assignees of choses in action, who are required to give notice of the assignment or transfer. Their rights are then effectually secured. But suppose the land redeemed, the certificates then become ineffectual, so far as the land is concerned; but the money paid into the treasury remains there for him whose right it is to receive, and the same rule of practice would enable the owner of the certificate to obtain money which would secure to him the land, in case no redemption had been made.”

In answer to this part of the report of the committee, it may be remarked, in the first place, that although the certificates of the Comptroller may not be technically negotiable, yet the practice of the office has made them, to all intents and purposes, negotiable; and they are so considered by all persons who are familiar with the transactions connected with the sales of lands for taxes.

2. The committee say that the Comptroller is to give a deed to the purchaser, "unless he has evidence that the right of the purchaser has been transferred."

The practice of this office, however, is, and has been, to require evidence of the purchaser that he has not transferred his right. And this evidence is furnished by the production of the certificate without an endorsement. The turning point in this whole matter is, whether the Comptroller shall accept any other proof than the certificate itself, that the original purchaser has not transferred his right. The applicant himself concedes that he is to furnish the proof that there has been no transfer, and he furnishes the best evidence next to the certificate itself. If there was a general provision in the statute relating to the assessment and collection of taxes, that the Comptroller, on the production of satisfactory proof that a certificate was lost, should execute a deed to the purchaser, there would be no difficulty in the case of Judge Elmendorf. And the existence of such a provision would relieve the question from embarrassment, because the statute itself would be sufficient notice to all concerned, of the contingencies under which their purchases were made.

3. In case of redemption, the committee say that the "certificates then become ineffectual, so far as the land is concerned; but the money paid into the treasury remains there for him whose right it is to receive, and the same rule of practice would enable

the owner of the certificate to obtain the money which would secure to him the land."

The rule of this office is to require the same evidence for paying redemption money out of the treasury, as is required for giving a deed. The purchaser of lands at the tax sales, when those lands are redeemed, is required to produce the original certificate before he can draw the money from the treasury. And if the certificate has been transferred, the holder produces the certificate, which is received as satisfactory proof that he is entitled to the money, and in all cases, the original certificate is attached to the warrant drawn upon the treasury to refund to the purchaser or his assignee the moneys paid to redeem lands sold for taxes.

The committee conclude that the law now furnishes an ample remedy for the claimant; because, if the Comptroller refuses to give the deed, the claimant can compel him by an application to the supreme court. This, however, would be attended with expense; and in the opinion of the Comptroller it would be better to grant relief in the few cases in which certificates may be lost, by special acts of the Legislature, than to unsettle the practice which has so long governed the granting of deeds by the Comptroller, and which is universally understood by all the parties interested in these transactions.

If the Comptroller should give a deed without the production of the certificate, and relying upon the entry in the sales book, might not the person who should hold the certificate duly assigned, apply to the supreme court, and obtain a mandamus to compel the Comptroller to execute a deed, in fulfilment of his promise in the certificate?

If the Legislature directs a grant to a person, other than the one who is equitably entitled to it, the power of redressing the injury is in the same body. But not so with the Comptroller or the

supreme court.

If in the opinion of the Legislature the rule which has been adopted in the Comptroller's office, and adhered to for so many years, in relation to granting deeds, is too rigid, and that a true construction of the law requires a different rule, it would be satisfactory to the Comptroller to have a declaratory law on the sub

ject. If it is considered proper that the Comptroller shall grant deeds and pay redemption money on receiving proof of the loss of a certificate, it is desirable that a general law may be passed, saying so in distinct terms.

All which is respectfully submitted.

A. C. FLAGG.

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