Opinion
May 7, 1940.
July 19, 1940.
Taxation — Penalties and interest on delinquent taxes — Abatement — Payment by purchaser after sale — Act of October 25, 1938, P.L. 88.
1. The tax abatement Act of October 25, 1938, P.L. 88, is not available to a bidder or purchaser at sheriff's sale, who has bid at said sale a sum sufficient to pay the taxes in full, without abatement.
2. In that event, as it is the duty of the bidder to pay his bid to the sheriff, and the taxes are divested as of the date of the sheriff's sale, upon a sum sufficient to pay them being paid to the sheriff in fulfillment of the bid, the payment by the bidder relates back to the date of sale, and is appropriated to the amount then due and owing.
3. Braun, Sheriff, to use of Louik, v. De Rosa, 128 Pa. Super. 318, and Penna. Trust Co., to use, etc. v. Earnest, 128 Pa. Super. 331, held controlling.
4. Under the Act of 1938, the benefits of its tax abatement provisions are extended and secured to a mortgagee; but this means a mortgagee who has an existing mortgage on the real estate, not a person whose lien has been discharged by a sheriff's sale and whose claim is transferred to the fund in the sheriff's hands.
5. The liens against real estate sold at sheriff's sale are divested-upon the sale being completed — as of the date of the sale; and liens against the purchaser attach as of that date.
6. The date of the sheriff's sale is the date upon which the property is knocked down to a bidding purchaser, who completes his bid; not the date when the sheriff's deed is acknowledged.
Appeal, No. 269, April T., 1940, from order of C.P. Allegheny Co., Jan. T., 1939, No. 224, in case of Keystone State Building and Loan Association v. Barbara Sabo et al.
Before KELLER, P.J., CUNNINGHAM, BALDRIGE, STADTFELD, PARKER, RHODES and HIRT, JJ. Order affirmed.
Proceeding upon issue framed to determine the distribution of moneys paid into court by the sheriff after sale of real estate upon foreclosure of mortgage.
The facts are stated in the opinion of the Superior Court.
Order of distribution entered, before PATTERSON, SMITH and MUSMANNO, JJ., opinion by SMITH, J. Plaintiff appealed.
Error assigned was order of distribution.
George F. Taylor, with him Alter, Wright Barron, for appellant.
N.R. Criss, with him William Alvah Stewart, Anne X. Alpern, Harry C. Beschel, Walter Smart and Harry V. Bair, for appellees.
Argued May 7, 1940.
The learned court below correctly ruled that the present case is governed by the principles set forth in our decisions in Braun, Sheriff, to use of Louik, v. De Rosa, 128 Pa. Super. 318, 194 A. 514, and Penna. Trust Co., to use, etc. v. Earnest, 128 Pa. Super. 331, 194 A. 520; that the tax abatement Act of October 25, 1938, P.L. 88, is not available to a bidder or purchaser at sheriff's sale, who has bid at said sale a sum sufficient to pay the taxes in full, without abatement. In that event, as it is the duty of the bidder to pay his bid to the sheriff, and the taxes are divested as of the date of the sheriff's sale, upon a sum sufficient to pay them being paid to the sheriff in fulfillment of the bid, the payment by the bidder relates back to the date of sale, and is appropriated to the amount then due and owing.
Appeal refused by Supreme Court, 128 Pa. Super. XXVII.
Our cases above cited support the following propositions:
1. Following a sheriff's sale of real estate, tax claims against the real estate are to be paid out of the fund realized from the sale, and their status is fixed as of the date of the sale.
2. If an amount is bid at a sheriff's sale sufficient to pay the taxes in full, including interest and penalties, the right of the taxing authority to payment of the tax in full attaches as of the date of the sheriff's sale, and cannot be affected by a subsequent tender by the bidder of less than that amount.
3. A mortgagee can take advantage of tax abatement statutes by paying the taxes before the sheriff's sale and having the taxes so paid included in his judgment. He is in no sense a volunteer. See Dehaven v. Roscon B. L. Assn., 107 Pa. Super. 459, 164 A. 69; Hogg v. Longstreet, 97 Pa. 255, 259. By this very Act of 1938, supra, (section 4) the benefits of its tax abatement provisions are extended and secured to a mortgagee; but this means a mortgagee who has an existing mortgage on the real estate, not a person whose lien has been discharged by a sheriff's sale and whose claim is transferred to the fund in the sheriff's hands.
4. Exemptions and abatements from taxes, including interest and penalties, are strictly construed.
The following legal propositions are also applicable:
5. The liens against real estate sold at sheriff's sale are divested — upon the sale being completed — as of the date of the sale; and liens against the purchaser attach as of that date: Hoyt v. Koons, 19 Pa. 277; Holmes' Appeal, 108 Pa. 23.
6. The date of the sheriff's sale is the date upon which the property is knocked down to a bidding purchaser, who completes his bid; not the date when the sheriff's deed is acknowledged. St. Charles B. L. Assn. v. Hamilton, 319 Pa. 220, 222 223, 179 A. 604.
The assignment of error is overruled and the order of the court below is affirmed.