Opinion
No. CV 08 5022687S
February 1, 2011
MEMORANDUM OF DECISION ON MOTIONS FOR SUMMARY JUDGMENT BY DEFENDANT (#139) AND PLAINTIFF (#140)
The plaintiff, Frederick Cornelius, and the defendants, Lydia Rosario and the City of Hartford ("Hartford"), have both filed motions for summary judgment in this action where the plaintiff seeks to quiet title and nullify a tax sale of property located at 78 Beacon Street, Hartford, Connecticut (the "Property"). The plaintiff has alleged that he acquired the Property by a warranty deed dated November 22, 2004 from the Mercury Mortgage Company ("Mercury"). He further alleges that the warranty deed was never recorded by virtue of a mistake of the attorney who handled the purchase of the Property for the plaintiff.
The defendants argue that Hartford complied with the requirements of Connecticut General Statutes § 12-257, giving notice of the tax sale only to those who had recorded interests. The defendants have appended multiple affidavits, depositions transcripts and documents in support of their motion. The plaintiff's motion is unsupported by any affidavits, not even his own, or any other admissible evidence.
Facts
The material facts in this case are undisputed. The defendants have presented evidence that the plaintiff is a sophisticated real estate investor who has owned his own mortgage broker company and numerous investment properties. On November 22, 2004, the plaintiff purchased 78 Beacon Street, Hartford, Connecticut (the "Property") from Mercury Mortgage Company, Inc., as an investment property. Neither the plaintiff nor the attorney who represented the plaintiff in the purchase of the Property from Mercury, recorded the Warranty Deed in Hartford's land records. The plaintiff has not sued the aforementioned attorney for malpractice.
The real estate taxes were not paid on the Property from January 1, 2004-July 1, 2007. The defendants filed tax liens against the Property on June 11, 2004, May 2, 2005, June 16, 2006, and May 25, 2007. On July 12, 2007, the defendants executed a tax levy on the Property for unpaid taxes in the amount of $18,698.94, and sold the Property to Albertina Ward and Patricia Franklin, the highest bidders at the tax sale.
Prior to executing the tax sale, the defendants provided notice to all record owners/taxpayers, lien holders, mortgagees and encumbrancers of the Property after performing a search of the Hartford land records, City Assessor's records and the tax division records to determine who was entitled to receive notice. The search of the records revealed that the owner of record was Mercury and that Hunt, Leibert, Chester Jacobson, P.C. ("Hunt Leibert"), the Metropolitan District Commission ("MDC"), and Hartford held liens on the Property. It is undisputed that there was no record of the plaintiff's interest in the Property in Hartford's Land Records or the Assessor's Records and no record of the plaintiff ever paying any taxes on the Property.
The defendants provided notice of the tax sale via certified mail to Mercury, Hunt Leibert, and the MDC. Hunt Leibert and the MDC received notice of the tax sale. The notice to Mercury was returned as undeliverable. Defendant attempted to find another address and locate an agent of Mercury. Ultimately, the defendants sent notice to Mercury's attorney, Hunt Leibert. The defendants did not provide notice to the plaintiff because his interest in the Property did not appear of record.
The plaintiff argues that Due Process required the defendants to undertake efforts beyond the requirements of § 12-157 to ascertain his unrecorded interest and provide him notice. Specifically, the plaintiff claims that the defendant should have undertaken any one of the following measures to discover his unrecorded interest: examined building permit records and sanitation ordinance citations; visited the Property; posted a notice of sale on the Property; mailed a notice of sale to Property addressed to "occupant"; noted license numbers of cars parked on the Property and researched the owners of those cars through the Department of Motor Vehicles; contacted the utility company and Hunt Leibert, Mercury's attorneys; and finally, that the defendants should have known of the plaintiff's unrecorded interest in the Property because several employees of the City's License and Inspection Department were aware of that interest.
The plaintiff has produced no evidence to support the foregoing arguments either in his motion for summary judgment or in opposition to the defendants' motion for summary judgment. The defendants argue that even if the plaintiff had produced the aforementioned, evidence, they are entitled to summary judgment because they complied with the requirements of Connecticut General Statutes § 12-157 and gave notice to all those who had a "reasonably ascertainable" interest in the Property. The plaintiff did not have reasonably ascertainable interest because he did not record his deed to the Property and, therefore, was not entitled to notice under § 12-157.
Discussion of Law and Ruling
Practice Book § 17-49 provides that summary judgment shall be rendered forthwith if the pleadings, affidavits and any other proof submitted show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. "In deciding a motion for summary judgment, the trial court must view the evidence in the light most favorable to the nonmoving party . . . The party seeking summary judgment has the burden of showing the absence of any genuine issue [of] material facts which, under applicable principles of substantive law, entitle him to a judgment as a matter of law . . . and the party opposing such a motion must provide an evidentiary foundation to demonstrate the existence of a genuine issue of material fact." (Citations omitted; internal quotation marks omitted.) Schilberg Integrated Metals Corp. v. Continental Casualty Co., 263 Conn. 245, 251-52, 819 A.2d 773 (2003). "A material fact . . . [is] a fact which will make a difference in the result of the case . . . Finally, the scope of our review of the trial court's decision to grant the plaintiff's motion for summary judgment is plenary." (Citation omitted; internal quotation marks omitted.) H.O.R.S.E. of Connecticut, Inc. v. Washington, 258 Conn. 553, 560, 783 A.2d 993 (2001). Summary judgment is "designed to eliminate the delay and expense of litigating an issue where there is no real issue to be tried." Wilson v. City of New Haven, 213 Conn. 277, 279, 567 A.2d 829 (1989).
Connecticut General Statutes § 12-157(a) provides the notice requirements for tax levies of real estate for delinquent real estate taxes and states, in pertinent part.
Sec. 12-157. Method of selling real estate for taxes.
a) When a collector levies one or more tax warrants on real estate, he shall prepare notices thereof, containing the name of the taxpayer, a legal description of the real property, including the street address, upon which taxes are due, the amount of the tax or taxes due, including any interest and charges attributable to the property as of the last day of the month immediately preceding the notice, a statement that additional taxes, interest, fees and other charges authorized by law accruing after the last of the month immediately preceding the notice will be added to the amount indicated as due and owing in the notice, and the time and place of sale. The collector shall post one notice on a signpost in the town where such real estate is situated, if any, or at some other exterior place near the office of the town clerk, which is nearest thereto; one shall be filed in the town clerk's office of such town and such town clerk shall record and index the same as a part of the land records of such town, and one shall be sent by certified mail, return receipt requested, to the taxpayer and each mortgage, lienholder and other record encumbrancer of record whose interest will be affected by the sale. Such posting, filing and mailing shall be done not more than twelve and not less than nine weeks before the time of sale and shall constitute a legal levy of such warrant or warrants upon the real estate referred to in the notice. Such collector shall also publish a similar notice for three weeks, at least once each week, in a newspaper published in such town, if any, otherwise in a newspaper published in the state having a general circulation in such town. The first notice shall be published beginning not more than twelve and not less than nine weeks before the time of sale and the last shall be published not more than four weeks nor less than two weeks before such sale. He shall also send by certified mail, return receipt requested, to the delinquent taxpayer and to each mortgagee, lienholder and other record encumbrancer whose interest in such property will be affected by such sale, a similar notice which shall not be required to list information pertaining to properties in which the person to whom the notice is directed has no interest. The notice shall be sent at least twice, the first not more than eight nor less than five weeks before such sale and the last not more than four weeks nor less than two weeks before such sale. The notice shall be addressed to his place of residence, if known to the collector, or to the address, or the agent of such person, to which such person has requested that tax bills be sent. If there is no address of such person, or if no such agent is given in the records of such town, the notice shall be sent to the place where such person regularly conducts business or other address as the collector believes will give notice of the levy and sale. If a person is a corporation, limited partnership or other legal entity, the notice may be sent to any person upon whom process may be served to initiate a civil action against such corporation, limited partnership or entity. If no place of residence or business is known and cannot be determined by the tax collector for any owner, taxpayer, mortgagee, lienholder or other encumbrancer whose interest in the property will be affected by the sale, in lieu of notice by certified mail as provided in this subsection, the notice, together with the list of mortgagees, lienholders, and other record encumbrancers whose interests in the property will be affected by such sale, shall be published in a newspaper published in this state, having a daily general circulation in the town in which such property is located at least twice, the first not more than eight weeks nor less than five weeks before such sale and the last not more than four weeks nor less than two weeks before such sale.
(Emphasis added.)
The defendants have presented unrefuted evidence that they complied with the requirements of § 12-157. In addition to the notice given to the record owners set forth above, the defendants published a notice of the tax sale in the Hartford Courant on May 10, 2007 and May 31, 2007.
The defendants also visited the Property prior to the beginning of the notice process for the tax sale and observed no sign that the Property was inhabited and nothing else that would suggest any unrecorded interests.
The defendants conducted the tax sale of the Property on July 12, 2007, and the highest bidder was Albertina Ward and Patricia Franklin. Defendants published notice in the Hartford Courant on August 13, 2007 stating the date of the tax sale, the amount of the successful bid, and the date that the redemption period was to expire as required by § 12-157. The notice was also mailed to Mercury, Hunt Leibert and the MDC. A notice that no redemption had been made was mailed to Mercury, the MDC and Hunt Leibert on January 16, 2008. The tax collector's deed conveying title to Albertina Ward and Patricia Franklin was recorded in the Land records.
On February 18, 2010, this court, Satter, J., granted a motion to strike this action as to Albertina Ward and Patricia Franklin on the basis that they were shielded from plaintiff's complaint by the Connecticut recording statute, Connecticut General Statutes § 47-10. The plaintiff did not replead or appeal from that ruling of the court. Judgment entered in favor of Ward and Franklin on March 22, 2010 and the plaintiff did not appeal from that judgment.
On April 8, 2009, this court, Freed, J., ruled that the protection of Connecticut General Statutes § 47-10 did not extend to the defendants and that the plaintiff's challenge to the tax sale was equitable and, therefore, declined to strike the complaint as to the defendants.
The plaintiff does not contest that the defendants complied with the notice requirements of 12-157. Rather, he argues that Due Process required the defendants to go beyond the requirements of § 12-157 to ascertain the plaintiff's unrecorded interest in the Property and provide him with notice.
Mullane v. Central Hanover Bank Trust Co., 339 U.S. 306 (1950) and Mennonite Board of Missions v. Adams, 462 U.S. 791 (1983) set forth the constitutional notice requirements where governmental action leads to a deprivation of property. In Mullane, the Court held that "due process requires `notice reasonably calculated, under all the circumstances, to apprise interest parties of the pendency of the action and afford them an opportunity to present their objections.'" Id. Mennonite included a more focused examination of whether the names of persons with protected interests are "reasonably ascertainable." Bender v. City of Rochester, 765 F.2d 7, 10 (1985) (Citing Mennonite). When the name of a person with a protectable interest in property is "reasonably ascertainable," the notice that is "reasonably calculated" to inform him of the impending event must be notice by mail or other equivalent means. Id.
In Bender, the Second Circuit considered whether the interests of the heirs of a deceased property owner were "reasonably ascertainable" in the context of a tax foreclosure. The administrator of the estate of the deceased owner did not file a death certificate or anything else on the land records which notified the city that the owner had died. Although the court conceded that the city could have searched Surrogate Court records to find the identities of the owner's heirs, it held that the interests of the heirs were not "reasonably ascertainable." This was based on a balancing of the administrative burden that the city would have to undertake to identify those who had an interest in the property with the claimant's ability to protect his interest. The court stated that "we think the City was entitled to expect that those appointed to administer estates that include real property would place something on the land record to put the world on notice of the owner's death . . ." Bender, supra at 11 (emphasis added).
In this case, the plaintiff's ability to protect his interest was even greater than that of the claimant in Bender, who was an administrator of a relative's estate. Unlike the plaintiff in this case, it did not appear that the plaintiff in Bender was a real estate professional, yet the court held, in essence, that his ability to protect his interests by recording them on the land records was greater than the city's ability to discern those interest through a search of other city records. Here the plaintiff is in the real estate business and clearly was aware that he could protect his interest in the Property by filing the deed on the land records. The plaintiff has alleged, although has presented no evidence, that the deed was not filed due to the negligence of his attorney. But the plaintiff obtained the deed in 2004 and the tax sale occurred in 2007. Didn't the plaintiff ever wonder why he received no tax bills from Hartford?
Regardless of whether the plaintiff should reasonably have discovered that his deed was not filed, it is clear that under the Bender analysis, the plaintiff's ability to protect his interests by filing the deed to the Property on the land records was far greater than Hartford's ability to discover that interest by searching other city sources. The plaintiff's argument that Due Process required the defendants to take the extraordinary measures alleged in his complaint to ascertain his unrecorded interest is meritless. "A city is not required to engage in impracticable and extended searches," and is not required to make "extraordinary efforts to discover the identity and whereabouts of the alleged owners." Mennonite, supra, at 798.
In Sallie v. Tax Sale Investors et al., 998 F.Sup. 612 (D.Md. 1998), the city of Baltimore held a tax sale and provided notice to the record owner and all record encumbrancers. Notice was not provided to the occupants who had a leasehold interest in the property, but had failed to record their leasehold. The plaintiffs challenged the tax sale, arguing that Due Process required the City to provide them with notice of the tax sale since they had an interest in the property. The Court held that the plaintiffs' interest was not "reasonably ascertainable" and, therefore, Due Process did not require the City to provide the plaintiffs with notice. In explaining why the City was not required to send the plaintiffs notice, the Court stated.
I am constrained to the view that neither the holding nor the rationale of Mennonite undermines the presumed constitutionality of Maryland's election to employ constructive notice by publication to extinguish the unrecorded leasehold interest of one in actual possession of real property in a tax sale setting. The Mennonite decision is rooted in principles enunciated in Mullane, in which the Supreme Court held that "notice [must be] reasonably calculated, under all circumstances, to apprise interested parties of the pendency of the action and afford them an opportunity to present objections." Mullane, 339 U.S. at 314. The reasonableness of a particular method of notice requires a balancing of "th[e] interest of the State" and "the individual interest sought to be protected by the Fourteenth Amendment." Id.; see also Bender v. City of Rochester, N.Y., 765 F.2d 7, 10-12 (2d Cir. 1985) (analyzing Mennonite's reinvigoration of the Mullane balancing test).
Applying the Mullane/ Mennonite test here, I am persuaded that Maryland has a significant interest in encouraging participation in its tax sale program and in decreeing marketable title. Further, Maryland's tax sale mechanism is an effective means of collecting property taxes for the state, and is critical to the state's need to provide a source of revenue for a host of governmental services provided to its citizens. Requiring a local tax collector or a tax sale purchaser to identify holders of unrecorded interests at the early stages of the process would be extraordinarily burdensome, and would very likely discourage prospective purchasers from participating in tax sales. If this were to happen, the state's significant interest in combating abandonment of properties, especially in urban areas, and in securing for its citizens the revenue necessary to carry out important governmental functions, would be frustrated.
Sallie v. Tax Sale Investors et al., supra at 618-19.
Based on the foregoing, the court finds that the plaintiff did not record his deed to the Property, so his interest was not "reasonably ascertainable" within the meaning of Mennonite and Bender. Therefore, he was not entitled to mail notice under § 12-157. The plaintiff did receive constructive notice of the tax sale of the Property via publication in the Courant and posting at the City Hall. The Appellate Court has ruled that the actual and constructive notice provisions of § 12-157 comply with constitutional Due Process requirements consistent with the ruling of the Supreme Court in Mennonite. Associates Financial Ser. of Am., Inc. v. Sorensen, 46 Conn.App. 721, 700 A.2d 107 (1997). The defendants' Motion for Summary Judgment is granted.
The plaintiff has moved for summary judgment on the grounds that the defendants did not provide notice to Mercury in accordance with § 12-157. The plaintiff has presented absolutely no evidence to support his motion.
The defendants argue that the plaintiff has no standing to assert the Due Process rights of Mercury. The court agrees. "A party may not assert a civil rights claim on behalf of another." Sterngass v. Bowman, 563 F.Sup. 456, 459 (S.D.N.Y. 1983). A party must assert his own legal rights and interest, and cannot rest his claim on the legal rights or interest of third parties. Kowalski v. Tesmer et al., 543 U.S. 124, 129 (2004).
Defendants also argue that they did satisfy the notice requirements of § 12-157 with respect to Mercury. The court agrees. The defendants have presented evidence that they mailed to Mercury notice of the tax sale on May 10, 2007, which was not more than twelve and not less than nine weeks before the tax sale. This notice was returned as undeliverable. Thereafter the defendants performed two Accurint searches to confirm that Mercury's mailing address was accurate. Defendants also attempted to locate Mercury's agent of service through the California Secretary of State website and discovered that the agent of service had resigned and a new agent had not been appointed. Subsequent notices to Mercury were clearly not required because they would have been futile. Instead, the defendants sent all other notices required by § 12-157 to Hunt Leibert, Mercury's counsel, complying with the requirements of § 12-157.
Accurint is a search tool that provides investigative tools to government entities, enabling them to locate people, detect fraud, uncover assets and verify identity.
The plaintiff's Motion for Summary Judgment is denied.