Opinion
No. 1292 C.D. 2013
05-20-2014
Ralph Ferrell and Elizabeth M. Ferrell, Husband and Wife, Kenneth W. Connelly, and The Firm of Sebring and Associates v. The Westmoreland County Tax Claim Bureau v. Will Sanders, a/k/a Billy Joe Sanders, North Huntingdon 134 Trust, Will Sanders Trustee, Appellants
BEFORE: HONORABLE ROBERT SIMPSON, Judge HONORABLE ANNE E. COVEY, Judge HONORABLE ROCHELLE S. FRIEDMAN, Senior Judge
OPINION NOT REPORTED
MEMORANDUM OPINION BY JUDGE SIMPSON
Will Sanders, a/k/a Billy Joe Sanders, North Huntingdon 134 Trust, Will Sanders Trustee (Bidder) appeals from an order of the Westmoreland County Court of Common Pleas (trial court) denying Bidder's post-trial motions and reconfirming its decision to set aside a tax upset sale because the Westmoreland County Tax Claim Bureau (Bureau) did not serve notice in compliance with the Real Estate Tax Sale Law (Tax Law). Bidder argues the trial court's decision is not supported by substantial evidence or governing law where the trial court improperly closed the record and precluded Bidder from presenting additional evidence, and the record shows the property owner had actual or constructive notice of the tax upset sale. Discerning no error, we affirm.
The Honorable Anthony G. Marsili presided.
Act of July 7, 1947, P.L. 1368, as amended, 72 P.S. §§5860.101-5860-803.
I. Background
On September 10, 2012, the Bureau held an upset tax sale for property located at 10496 Cannas Street, North Huntingdon, Pennsylvania 15462 (Property) as a result of delinquent property taxes (tax sale). Bidder successfully bid on the Property. Thereafter, the Bureau petitioned for confirmation of the sale, which the trial court entered absolute.
In response, Ralph Ferrell and Elizabeth M. Ferrell, Husband and Wife (Ferrells), Kenneth W. Connelly (Owner), and the Firm of Sebring and Associates (Law Firm) (collectively, Objectors) filed exceptions and objections to the confirmation. Owner was the sole owner of the Property at the time of the tax sale. The Ferrells purchased the Property from Owner and closed title on September 12, 2012. The Law Firm handled the closing on behalf of the Ferrells. Objectors asserted the tax sale was improper, invalid, and unlawful because Owner did not receive notice prior to the tax sale.
Bidder filed a motion to intervene in the objection proceedings, which the trial court granted. The trial court then held a hearing on the exceptions in April 2013. At the hearing, counsel for Objectors, Bidder and the Bureau appeared. Owner and Elizabeth M. Ferrell (Mrs. Ferrell) testified. The parties stipulated the Bureau complied with the publication notice requirements. Reproduced Record (R.R.), Tr. Ct. Hr'g, Notes of Testimony (N.T.), 4/17/13, at 7.
Bidder titled the Reproduced Record the "Appendix."
Solicitor for the Bureau advised the trial court that the Bureau did not properly mail notice to Owner. According to the Bureau file, on May 7, 2012, the Bureau sent notice to "CONNELLY PAUL F CONNELLY KEN W" at the Property's address. R.R. at 18. However, on May 29, 2012, the United States Post Office returned the notice to the Bureau, marked "RETURN TO SENDER UNCLAIMED UNABLE TO FORWARD." Id. Solicitor stated the file contained no file notes regarding any efforts to locate Owner. Based on the defective mail notice, Solicitor chose not to call any witnesses or submit evidence in support of the tax sale. N.T. at 6. Solicitor notified Bidder well in advance of the hearing of the Bureau's position. Id.
With regard to the posting, Solicitor advised, pursuant to the affidavit of the deputy sheriff, the deputy sheriff posted notice of the tax sale at the Property on August 8, 2012. Id. at 8. The Bureau did not call the sheriff to testify because of the defect in mail notice. At Bidder's request, the trial court attempted to locate the deputy sheriff to testify, but he was unavailable. Id. at 60.
Owner testified he jointly owned the Property with his father, Paul F. Connelly (Decedent), who died in 2010. Id. at 20, 41. Upon Decedent's death, Owner became the sole owner by right of survivorship. Id. at 41; R.R. at 11, Objectors' Exceptions, Ex. A (Deed). He and his brother co-administered Decedent's estate, but his brother was principally responsible for the estate's administration. N.T. at 20.
Owner further testified he never received any notice of the tax sale. Id. at 24, 28. Mail to the Property was not forwarded to another address. According to Westmoreland County records, Owner's address is listed as 281 Ruffsdale Road, Ruffsdale, Pennsylvania 15679. Id. at 22; see also id. at 11-12; R.R. at 26, Objectors' Exceptions, Ex. G. Owner testified he receives mail at the Ruffsdale address. N.T. at 39. Additionally, Owner denied having any knowledge regarding the pre-estate lien certification, which showed outstanding taxes were due and owing to the Bureau. Id. at 34, 49-50.
Although Owner was briefly hospitalized in April and September of 2012, he testified he regularly maintained the Property by mowing the lawn and trimming hedges. Id. at 23-24. He visited the Property after August 8, 2012, the date the deputy sheriff allegedly posted the Property, but he did not see a tax sale posting on the Property. Id. at 24.
The Ferrells purchased the Property from Owner on September 12, 2012. Mrs. Ferrell testified she and her husband thoroughly inspected the Property on September 10, 2012, the day of the tax sale, prior to closing. Id. at 47. During the inspection, they did not see any notice posted on the Property. Id. at 47-48.
Bidder did not present any testimony at the hearing. Bidder requested a continuance to call the deputy sheriff and Owner's brother as witnesses. Id. at 55. The trial court denied the request. Id. at 60. The trial court explained Bidder had three months between the order granting his petition to intervene and the scheduled hearing to prepare his case. Tr. Ct. Order, 6/28/13, at 2; see N.T. at 59. Further, Solicitor for the Bureau advised Bidder of its position regarding defective notice, and that the Bureau would not be calling any witnesses to defend the tax sale. N.T. at 59. Moreover, the trial court opined such testimony would be irrelevant because, even if Bidder could prove the co-administrator received notice of the tax sale, it would not establish that Owner had actual notice of the sale.
Based on the evidence presented, the trial court determined the Bureau did not comply with the statutory notice requirements, and Owner did not have notice of the tax sale. Thus, the trial court declared the sale null and void. Tr. Ct. Order, 4/17/13.
Thereafter, Bidder filed a motion for post-trial relief. Specifically, Bidder alleged the trial court erred by not granting his request to continue the hearing to another date so that he could call additional witnesses to testify. Additionally, Bidder asserted the trial court erred by declaring the tax sale null and void where the facts reveal Owner had actual or constructive notice of the delinquent taxes. The trial court denied the motion. From this decision, Bidder filed the present appeal.
Although the trial court did not invite post-trial motions, the trial court considered Bidder's motion and disposed of it by order dated June 28, 2013. Bidder filed his appeal with this Court on July 25, 2013, from the denial of the post-trial motion. The Westmoreland County Rules of Civil Procedure do not prohibit post-trial motions in statutory appeals. See Westmoreland Cnty. R.C.P. No. W227.1; cf. Pa. R.C.P. No. 227.1(g) (prohibiting post-trial proceedings in a statutory appeal). Therefore, the appeal lies from the denial of the post-trial motion. See In re Upset Price Tax Sale for Springfield Twp., 700 A.2d 607 (Pa. Cmwlth. 1997).
II. Contentions
On appeal, Bidder asserts the trial court's ruling is contrary to the holding in Stanford-Gale v. Tax Claim Bureau of Susquehanna, 816 A.2d 1214 (Pa. Cmwlth. 2003), which provides that notice to one co-administrator of an estate is sufficient to bind the estate in the absence of notice to the remaining co-administrator. The trial court should have continued the hearing to allow additional evidence to establish Owner's brother, the co-administrator of the estate, received notice or had actual knowledge of the tax sale, and that the deputy sheriff properly posted the property. Contrary to the trial court's opinion, such evidence would be relevant to proving knowledge of the tax sale, thereby curing any defects in notice. However, by closing the record and precluding receipt of additional evidence, the trial court abused its discretion and committed an error of law.
In tax sale cases, this Court's review is limited to determining whether the trial court abused its discretion, clearly erred as a matter of law or rendered a decision with a lack of supporting evidence. Rice v. Compro Distrib., Inc., 901 A.2d 570 (Pa. Cmwlth. 2006).
Objectors counter the Bureau did not provide mail notice to Owner or undertake reasonable efforts to provide notice as required by the Tax Law. As the Bureau admittedly did not comply with the statutory notice requirements, the tax sale can only be valid if all owners had actual notice of the tax sale. Owner credibly testified he had no knowledge of the tax sale. Thus, the trial court properly set aside the sale.
Objectors further respond that Bidder's reliance on Stanford-Gale is misplaced because title to the Property vested solely in Owner, by right of survivorship. Therefore, the Bureau was required to provide notice to Owner, as the sole owner of the Property, and not to Decedent's estate. As a result, the issue of whether or not the co-administrator of the estate had any knowledge of the sale is completely irrelevant. Thus, Objectors maintain, the trial court properly declined Bidder's request to continue the hearing.
The Bureau did not participate in this appeal.
III. Discussion
The Tax Law provisions governing upset sales require the tax claim bureau to provide three types of notice: published notice, mail notice and posted notice. Section 602 of the Tax Law, 72 P.S. §5860.602. Of relevance here are the provisions governing mail notice and posted notice, which provide, with emphasis added:
(e) In addition to such publications, similar notice of the sale shall also be given by the bureau as follows:72 P.S. §5860.602(e)(1), (3). Section 102 of the Tax Law, 72 P.S. §5860.102, defines "owner," in relevant part, as the person in whose name the property is last registered, or the person whose name last appeared as owner of record on any deed.
(1) At least thirty (30) days before the date of the sale, by United States certified mail, restricted delivery, return receipt requested, postage prepaid, to each owner as defined by this act.
* * *
(3) Each property scheduled for sale shall be posted at least ten (10) days prior to the sale.
In addition, Section 602(e)(2) of the Law provides that if the return receipt for the mail notice is not received from "each owner," then:
[A]t least ten (10) days before the date of the sale, similar notice of the sale shall be given to each owner who failed to acknowledge the first notice by United States first class mail, proof of mailing, at his last known post office address by virtue of the knowledge and information possessed by the bureau, by the tax collector for the taxing district making the return and by the county office responsible for assessments and revisions of taxes. It shall be the duty of the bureau to determine the last post office address known to said collector and county assessment office.72 P.S. §5860.602(e)(2) (emphasis added).
The tax claim bureau must make reasonable, but not extraordinary, efforts to provide notice under the Tax Law. Stanford-Gale. Those reasonable efforts must include a search of dockets and indices of the county tax assessment offices, recorder of deeds, prothonotary's office, and contacts to any apparent alternate address that may have been written on or in the file pertinent to the property at issue. Id.
The primary purpose of the Tax Law is to insure the collection of taxes, not to strip away a citizen's property rights. Id. Therefore, adequate notice is a prerequisite before the execution of any tax sale. Id. However, actual notice of a pending tax sale waives strict compliance with statutory notice requirements, and technical deficiencies in those notice requirements do not invalidate a tax sale. Id.; Sabbeth v. Tax Claim Bureau of Fulton Cnty., 714 A.2d 514 (Pa. Cmwlth. 1998).
Here, the Bureau attempted to notify the owners of the Property by United States certified mail, restricted delivery, return receipt requested to each owner as required by Section 602(e)(1) of the Tax Law. However, the notice sent to "CONNELLY PAUL F CONNELLY KEN W" at the Property's address was returned to the Bureau unclaimed. R.R. at 18. The Solicitor stated the Bureau file contained no indication of any efforts to locate and notify Owner pursuant to Section 602(e)(2) of the Law, quoted above. Thus, the mail notice was defective.
Notwithstanding this defect in notice, Bidder claims Owner had implied actual or constructive notice of the tax sale that would cure any noncompliance with the statutory notice requirements. However, Owner credibly testified he did not receive any notice of the tax sale and had no knowledge of it. N.T. at 24, 26, 28. Nevertheless, relying on Stanford-Gale, Bidder maintains if the co-administrator received notice of the tax sale, such would constitute proper notice to the Owner. Bidder contends the trial court should have continued the hearing to allow additional evidence regarding the co-administrator's knowledge of the tax sale as well as the proper posting of the Property.
In Stanford-Gale, the tax claim bureau, unaware the property owners had died, sent notice of an impending tax sale to the decedents' former address as recorded in the tax assessment office. The notice was actually received by one of two co-administrators of the decedents' estate. After the sale of the property, the estate petitioned to set aside the tax sale, claiming defective notice. The trial court agreed and set aside the sale. On appeal, we reversed.
This Court held notice to one co-administrator constituted proper notice to the other co-administrator and the estate, thereby waiving strict compliance with statutory notice requirements. We recognized where multiple owners exist, each is entitled to notice under Section 602. However, when the property is owned by an estate, co-administrators of the estate are regarded as one person, each possessing full power and control over the estate. Id.
Here, however, Bidder's reliance on Stanford-Gale is misplaced. Although Owner and his brother served as co-administrators of Decedent's estate, the Property was never part of the estate. Rather, Decedent and Owner jointly owned the Property. Upon Decedent's death, the Property passed to Owner. Owner, as the sole owner of the Property, was entitled to notice. Owner credibly testified he did not receive notice from the Bureau and had no knowledge of the tax sale. N.T. at 24, 26, 28. As the trial court aptly concluded, because Owner was the sole owner of the Property, and did not receive notice, it was irrelevant whether the co-administrator of the estate had any notice of the tax sale.
Had the Property passed to the estate, we would agree that Stanford-Gale would apply and a determination as to whether the co-administrator had actual knowledge of the tax sale would be relevant. However, those are not the facts here. --------
Moreover, Bidder had ample time to prepare his case and call any witnesses or present evidence to support the validity of the sale. Solicitor advised Bidder of the Bureau's position long before the hearing. N.T. at 6. Bidder knew going into the hearing that the only way to overcome the defect of statutory notice was to establish Owner's actual notice. Bidder failed to present any evidence to support his position at the hearing. We therefore conclude the trial court did not err by foreclosing additional evidence and declaring the tax sale null and void.
IV. Conclusion
For these reasons, we conclude the trial court properly set aside the tax sale upon determining the Bureau did not comply with the statutory notice requirements, and Owner did not have actual notice of the sale. Accordingly, we affirm.
/s/_________
ROBERT SIMPSON, Judge ORDER
AND NOW, this 20th day of May, 2014, the order of the Court of Common Pleas of Westmoreland County is AFFIRMED.
/s/_________
ROBERT SIMPSON, Judge