Opinion
No. 432 C.D. 2003.
Submitted: September 11, 2003.
Filed: March 2, 2004. Order Filed: May 4, 2004.
BEFORE: FRIEDMAN, Judge, LEAVITT, Judge, MIRARCHI, JR., Senior Judge.
ORDER
NOW, May 4, 2004, having considered appellee's request for reconsideration, the request is grantd and this Court's opinion and order of March 2, 2004 are vacated.
Having vacated the opinion and order of March 2, 2004, the Court hereby grants appellant's motion to withdraw its appeal and the record in this matter shall reflect that the appeal is withdrawn.
Lackawanna County Tax Claim Bureau (Bureau) appeals from the order of the Court of Common Pleas of Lackawanna County (trial court) that granted the petition of Arthur Williams (Williams) to set aside an upset tax sale conducted by the Bureau. We reverse.
The subject property is located in the City of Scranton, a city of the second class A, and was acquired by the City in 1997, pursuant to a treasurer's deed, following a failed attempt to sell the property at a delinquent tax sale. In 2001, David Palukonis (Palukonis) and Williams submitted bids to purchase the property pursuant to the Act of June 28, 1967, P.L. 122 (Act), as amended, 53 P. S. § 30901-30915. Palukonis submitted his bid in June 2001; Williams submitted his bid in July 2001. Williams had the high bid of $6800, and he submitted a deposit with his bid. The City did not act on the bids or return Williams' deposit, but rather delayed the sale as it attempted to sort out a discrepancy with the legal description of the property. The City informed Williams that his bid was still under consideration, however.
In the meantime, the Bureau, pursuant to the Real Estate Tax Sale Law, Act of July 7, 1947, P.L. 1368 (Tax Sale Law), as amended, 72 P. S. § 5860.101-5860.803, exposed the property to upset sale for delinquent county and City school district taxes. No written notice of the sale was provided to the City or to Williams. On November 16, 2001, the Bureau conducted an upset sale at which Palukonis was the successful bidder, with a bid of $4352. A deed to the property was issued to Palukonis by the Bureau in May 2002. In mid-May 2002, Williams observed construction activity on the property and later ascertained that Palukonis had obtained title to the property from the Bureau. Williams thereupon filed an action in the trial court to overturn the upset sale.
The trial court first determined that Williams had standing to bring the action, having demonstrated an immediate and pecuniary interest in the property by submitting a bid and placing a deposit on it. The trial court then examined the issue of whether the Bureau had authority to sell the property pursuant to the Tax Sale Law. Section 102 of the Tax Sale Law, 72 P. S. § 5860.102, defines a "Taxing District" empowered to sell property under its provisions as:
[A]ny county, borough, incorporated town, township, home rule municipality, optional plan municipality, optional charter municipality, school district, institution district or any similar general purpose unit of government which may be created or authorized by statute except counties of the first and second class and cities, boroughs, incorporated towns, townships, home rule municipalities, optional plan municipalities, optional charter municipalities, school districts or institution districts therein and cities of the second class A and school districts therein.
Lackawanna County is a county of the third class.
The trial court rejected the Bureau's argument that the exception from the definition of "Taxing District" pertaining to "cities of the second class A and school districts therein" related only to those cities of the second class A and their school districts that were found in counties of the first and second classes. Instead, the trial court determined that Section 102 meant that any city of the second class A, and its school districts, notwithstanding what county it lay in, could not be considered a "Taxing District" under the Tax Sale Law. Accordingly, the trial court determined that the Bureau, although it could act against the property to collect some delinquent county taxes, could not act under the Tax Sale Law to collect school taxes of a city of the second class A, since the school districts of such cities were not "Taxing Districts" as defined by the Tax Sale Law.
Of course, there is presently only one city of the second class A in the Commonwealth, namely, Scranton.
Further, the trial court determined that the Bureau could not proceed against the property for the collection of county taxes for the years 1999 and 2000, since the City held title to the property since 1997. Pursuant to Section 909 of the Act, 53 P. S. § 30909, no taxes may be assessed while a property is owned and held by a city of the second class A following a transfer of title to that city under the provisions of the Act. Accordingly, the trial court ordered that the Bureau tax sale held on November 16, 2001 was invalid. The Bureau thereupon filed the present appeal.
The record does not disclose what years of county tax delinquency the Bureau was proceeding under when it placed the property up for tax sale, however.
Our scope of review in tax sale cases is limited to a determination of whether the trial court abused its discretion, rendered a decision with lack of supporting evidence, or clearly erred as a matter of law. In re Upset Sale Tax Claim Bureau of Wayne County Held September 12, 2000, 798 A.2d 845 (Pa.Cmwlth. 2002). The Bureau argues that the trial court erred by holding that (1) Williams had standing to challenge the tax claim sale when he never was an owner of the property; (2) the Bureau lacked authority to sell the property for delinquent school taxes; and (3) the Bureau lacked authority to sell the property because the City of Scranton held title to the property.
We agree that Williams did not have standing to bring the present action. Here, Williams challenges the Bureau's authority to sell the property under the Tax Sale Law. Pursuant to Section 607 of the Tax Sale Law, 72 P. S. § 5860.607, only "owners" or "lien creditors" may file objections to a tax sale pursuant to the Tax Sale Law. Plank v. Monroe County Tax Claim Bureau, 735 A.2d 178 (Pa.Cmwlth.), petition for allowance of appeal denied, 560 Pa. 753, 747 A.2d 373 (1999). All others, including the purchasers of the property, lack standing. Id. Further, if no objections or exceptions are timely filed, or if filed are overruled, the trial court shall enter a decree of absolute confirmation of the sale pursuant to Section 607(g) of the Tax Sale Law, 72 P. S. § 5860.607(g). Once the sale has been absolutely confirmed in this manner, no person may, by judicial proceedings, challenge the Bureau's sale process, except on the issue of lack of proper notice of the sale. Plank. The record indicates that the sale of the property to Palukonis in this case was made absolute by the trial court on January 29, 2002.
Williams was not an owner or lien creditor of the property. He contends, however, that the restrictions of the Tax Sale Law do not apply to him because he did not file an action under that statute; rather he filed one under the trial court's local rules. There is no question, however, that the Bureau, as the appropriate agency of a county of the third class, may file an action under Section 102 of the Tax Sale Law to collect delinquent county taxes and undoubtedly delinquent school taxes for a city of the second class A as well. The Bureau's action was therefore authorized by the Tax Sale Law. Williams' argument that he could avoid the provisions and requirements of the Tax Sale Law by simply bringing a general action under local rules is wholly without substance.
Specifically, Williams argues that he brought his action under Lacka. Co. R.C.P. No. 206(a), which generally provides for an action commenced by a petition and rule to show cause for any proper matter for which no specific procedure is prescribed.
Williams also argues that the issue of standing had been waived because Palukonis had raised the issue of Williams' standing in his preliminary objections filed against Williams' Petition to Set Aside, but then later withdrew the preliminary objections. We disagree that the issue of standing had been waived for two reasons. Although Palukonis may have withdrawn his preliminary objections, the issue had apparently been raised by one of the parties to an extent sufficient enough for the trial court to address it in his opinion. This fact indicates that Williams had the opportunity to address the issue of standing, and he in fact prevailed before the trial court on this issue.
Also, we agree with the assessment of the Superior Court in In re Adoption of W.C.K., 748 A.2d 223 (Pa.Super.), petition for allowance of appeal denied, 567 Pa. 745, 788 A.2d 378 (2000). In that case, the Superior Court noted that generally the issue of standing is distinct from that of subject matter jurisdiction, and that a failure to raise the issue of standing at the earliest level results in a waiver of that issue. The Court noted, however, that when a statute creates a cause of action and designates the parties that may pursue such action, the issue of standing "becomes interwoven" with that of subject matter jurisdiction. Id., 748 A.2d at 228. The issue of subject matter jurisdiction may be raised at any time, even by a court sua sponte. Id. Thus, a court may lack subject matter jurisdiction over a statutory action raised by a party precluded by that statute from bringing the action.
Further, the Tax Sale Law provides that once an upset sale is made absolute by the trial court, the only issue that may be raised is that of lack of proper notice of the sale. Plank. The Tax Sale Law does not provide that notice must be provided to the high bidder on an unconsummated City tax sale. Also, Williams does not otherwise argue that the Bureau failed to provide notice as required by the Tax Sale Law. Thus, Williams lacks a justiciable argument.
The substantive issues raised by Williams concern the authority of the Bureau to collect delinquent school taxes on the property and its authority to assess and collect county taxes while the property was under the ownership of the City. Again, the record is silent as to whether the Bureau also sought by the upset sale delinquent county taxes that accrued prior to City's ownership of the property. The Tax Sale Law quite clearly authorizes the Bureau to collect such delinquent taxes by means of an upset sale. In any event, standing to assert the substantive issues raised by Williams does not reside with an individual who had placed a bid on the property from a sale in process under another statute, but with the owner of the property, namely the City. The City has not joined this action or, as far as the record indicates, raised a separate action. The trial court therefore erred by granting Williams' petition to set aside the tax sale.
Accordingly, the order of the trial court is reversed.
ORDER
AND NOW, this 2nd day of March, 2004, the order of the Court of Common Pleas of Lackawanna County in the above-captioned matter is hereby reversed.