Opinion
CASE NO. 8:97-cv-166-CIV-T-24TBM
April 12, 2001
DECREE OF FORECLOSURE AND ORDER OF SALE
The above-captioned federal tax lien foreclosure action is before the Court on the Application of United States for Entry of Default Judgment. The Plaintiff United States seeks the entry of a Decree of Foreclosure and Sale in order to foreclose its liens upon and sell at public sale the real property that is the subject matter of this action. In addition, the United States seeks entry of a deficiency judgment against the Defendant taxpayer, Glen W. Lake, for the amount remaining on his indebtedness following the sale. Pursuant to Rule 55(b)(2) of the Federal Rules of Civil Procedure, the Court makes the following findings of fact and conclusions of law.
FINDINGS OF FACT
1. The Defendants Glen W. Lake, Wilson Lake, Christine L. Lake, Janice L. Freeman, Allen R. Smith, and SouthTrust Asset Management Co. of Florida NA Escrow Agent FBO 1996 Transam Tax Cert. Corp., were was served with process in this action in February and March 1997. Each of the Defendants has failed to appear, plead responsively or otherwise defend in this action within the period of time allowed by law. On May 1, 2000, the Clerk of Court entered a default against each of the defendants in this matter.
2. A delegate of the Secretary of Treasury of the United States of America made assessments in accordance with law against Glen W. Lake for unpaid federal income tax liabilities, including penalties and interest, for the taxable periods indicated below, for which notice of the assessments and demand for payment thereof was given on the dates indicated below:Period Notice and Demand Assessments Balance $ 3,308.99[*] $131,380.57
The unpaid balance includes the assessments of (T) tax, (I) interest and (P)penalties against the Defendant Glen W. Lake as of the dates of the assessments.
The total includes the above amount, plus the aggregate amount of statutory interest accruals and other statutory additions as of November 30, 2000.
4. The tax liens of the United States attach to all property and rights to property of the Defendant Glen W. Lake as of the date of the earliest assessment on April 13, 1987.
5. The real property and any improvements, buildings and appurtenances thereon on which the United States seeks to foreclose its tax liens (hereinafter called the "Subject Real Property") is located at 244 Spirit Lake Road West, Winter Haven, Florida 33833, which is described as Lots 7, 8, and 9, Spirit Lake Commercial Park, an unrecorded subdivision in Section 26, Township 28 South Range 25 East, Polk County, Florida, and is more particularly described as follows:
Lot No. 7: Commence at the NE corner of the SE ¼ of the NE ¼, Section 26, Township 28 South, Range 25 East, Polk County, Florida, run thence North 80° 09'30" West, a distance of 50 feet, the same being a point on the West right of way of Spirit Lake Road, run thence South along said right of way a distance of 311.99 feet, run thence North 89° 21'00" West, a distance of 650.00 feet to the point of beginning for this description; run thence South a distance of 355.00 feet; run thence North 89° 21'00" West a distance of 100.00 feet run thence North 355.00 feet; run thence South 89° 21'00" East, a distance of 100.00 feet to the point of beginning. Subject to a drainage easement of 20.00 feet along the North side thereof.
Lot No. 8: Commence at the NE corner of the SE ¼ of the NE ¼, Section 26, Township 28 South, Range 25 East, Polk County, Florida, run thence North 89° 09'30" West, a distance of 50 feet; the same being a point on the West right of way of Spirit Lake Road, run thence South along said right of way a distance of 311.99 feet, run thence North 89° 21'00" West, a distance of 750.00 feet to the point of beginning for this description; run thence South a distance of 355.00 feet; rim thence North 89° 21'00" West a distance of 100.00 feet; run thence North 355.00 feet; ran thence South 89° 21'00" East, a distance of 100.00 feet to the point of beginning. Subject to a drainage easement of 20.00 feet along the North side thereof.
Lot No. 9: Commence at the NE corner of the SE ¼ of the NE ¼, Section 26, Township 28 South, Range 25 East, Polk County Florida run thence North 89° 09'30" West, a distance of 50 feet, the same being a point on the West right of way of Spirit Lake Road, run thence South along said right of way a distance of 311.99 feet, run thence North 89° 21'00" West, a distance of 850.00 feet to the point of beginning for this description; run thence South a distance of 355.00 feet; run thence North 89° 21'00" west, a distance of 100.00 feet; run thence North 355.00 feet; run thence South 89.21'00" East, a distance of 100.00 feet to the point of beginning. Subject to a drainage easement of 20.00 feet along the North side thereof.
6. The Subject Real Property was owned by Glen W. Lake before March 2, 1989.
7. The Subject Real Property was conveyed by Glen W. Lake to Christine L. Lake on March 2, 1989 by Quit-Claim Deed.
8. Exclusive use, ownership, and possession of the Subject Real Property was awarded to Glen W. Lake by virtue of the Final Judgment of Dissolution of Marriage entered by the Circuit Court of Polk County, Florida, in Case No. GCF-6920 on January 22, 1993.
9. A certified copy of the Final Judgment of Dissolution of marriage entered by the Circuit Court of Polk County, Florida, in Case No. GCF-6920 on January 22, 1993, was recorded in Polk County on January 26, 1993, at Book 3194 and Page 1748.
CONCLUSIONS OF LAW
Under Florida law, the recording of a certified copy of a judgment distributing marital assets consisting of real property in the county where the real property is located has the effect of a duly executed instrument of conveyance. Fla. Stat. Ann. § 61.075(4) (West 1997); Fla. R. Civ. P. 1.570(d); In re Suarez, 182 B.R. 916, 920 (Bankr. S.D. Fla. 1995). Thus, the recording of the certified copy of the Final Judgment of Dissolution of Marriage in Polk County, Florida, perfected the transfer of title from Christine L. Lake to Glen W. Lake. Consequently, Glen W. Lake is the sole beneficial owner of the Subject Real Property as of the date of the recording on January 26, 1993, and the federal tax liens against him attach thereto.
For the reasons set forth above, the Court hereby ORDERS, ADJUDGES, and DECREES as follows:
1. That the Defendant Glen W. Lake is indebted to the United States of America for assessed and unpaid federal income taxes for the taxable years 1987 through 1992 in the amount of $131,380.57, as of November 30, 2000, plus statutory interest accruing daily at the rate provided for by Sections 6621 and 6622 of the Internal Revenue Code (26 U.S.C.) to the date paid in full.
2. That pursuant to 26 U.S.C. § 6321 the United States has valid federal tax liens arising out of the Defendant Glen W. Lake's assessed and unpaid federal income tax liabilities for taxable years 1987 through 1992, upon all property and rights to property belonging to the Defendant Glen W. Lake, and all property and rights to property acquired by the Defendant Glen W. Lake thereafter, including the Subject Real Property.
3. That pursuant to 26 U.S.C. § 6322, said tax liens arise at the time of assessment and continue until the liabilities are satisfied or becomes unenforceable by reason of lapse of time.
4. That the federal tax liens described above are being foreclosed upon the Subject Real Property pursuant to 26 U.S.C. § 7403.
5. That the United States Marshal for the Middle District of Florida is authorized and directed pursuant to 28 U.S.C. § 2001 and 2002 to offer for public sale and to sell the Subject Real Property to the highest and best bidder for cash, subject to certain other rights as set forth in this Order. No further orders or process from this Court shall be required to effectuate the sale of the Subject Real Property.
6. That the United States Marshal or his representative is authorized to have free access to the premises during reasonable business hours prior to taking physical possession of the Subject Real Property. The United States Marshal shall take all actions appropriate to conserve and preserve the Subject Real Property until the deed thereof is delivered to the successful purchaser, including without limitation obtaining insurance coverage on the Subject Real Property.
7. That the sale by public auction shall be held at the Polk County Courthouse, the Florida county wherein the Subject Real Property is located, in accordance with the provisions of 28 U.S.C. § 2001 and 2002. After the Marshal has determined the date and time for the sale, the Marshal shall notify each of the following:
Glen W. Lake 244 Spirit Lake Road West Winter Haven, Florida 33880
Mary Apostolakos Hervey Trial Attorney, Tax Division United States Department of Justice P.O. Box 14198 Washington, DC 20044
8. That the date and time thereof shall also be announced by the United States Marshal by advertising a Notice of Marshal's Sale once each week for four consecutive weeks preceding the date fixed for the sale in at least one newspaper regularly issued and of general circulation in the county, state, or judicial district of the United States where the Subject Real Property is situated, and by any other notice the United States Marshal or his representative may in his discretion deem appropriate. The notice shall contain a description of the realty and shall contain the terms and conditions of sale as set forth in this Order.
9. That the terms and conditions of the sale are as follows:
(a) The sale shall be subject to all laws, ordinances and governmental regulations (including building and zoning ordinances), affecting the premises, and easements and restrictions of record, if any.
(b) The sale shall be subject to any unpaid real property taxes affecting the Subject Real Property.
(c) A minimum bid of $75,000 is required to purchase the Subject Real Property.
(d) The successful bidder shall be required to deposit with the United States Marshal a minimum often percent (10%) of the amount bid on the date of the sale, either by cashier's check or by cash deposit.
(e) The balance of the purchase price shall be tendered to the United States Marshal by the successful bidder within three business (3) days following the date of the sale. Payment shall be made by cashier's check payable to the United States Marshal for the Middle District of Florida. If the bidder fails to fulfill this requirement, the deposit shall be forfeited and applied to the expenses of sale, with any amount remaining to be returned to the bidder, and the Subject Property shall again be offered for sale under the terms and conditions set forth in this Order.
(f) The United States may bid as a credit against its judgment without tender of cash; however, if it is the successful bidder, the United States shall pay to the United States Marshal the expenses of sale not to exceed the amount of the successful bid.
(g) The sale of the Subject Property shall be subject to confirmation by this Court, and upon confirmation and receipt of the full purchase price of such sale, the United States Marshal shall execute and deliver a deed conveying the Subject Property to the purchaser.
(h) The Subject Property shall be sold free and clear of all liens and claims of any party to this proceeding.
10. That if the minimum bid set forth above is not met or exceeded, the United States Marshal or his representative shall, without further order of this Court, again offer the Subject Property for public sale under the terms and conditions of this Order, subject to a reduction of the minimum bid as established by counsel for the United States.
11. That the Defendant Glen W. Lake nor any other defendant shall not commit waste against the Subject Property, nor shall they cause or permit anyone else to do so. They shall not do anything that tends to reduce the value or marketability of the Subject Real Property, nor shall they cause or permit anyone else to do so. They shall not record any instruments, publish any notice, or take any other action (such as running newspaper advertisements) that may directly or indirectly tend to adversely affect the value of the Subject Real Property or that may tend to deter or discourage potential bidders from participating in the public auction. No person receiving notice of the entry of this Order shall take any steps to impede the United States Marshal in the execution of his duties, except pursuant to further order of this Court.
12. That all persons occupying the Subject Real Property shall deliver up the Subject Real Property to the United States Marshal, including all keys thereto, suitably labeled, and shall permanently vacate the Subject Real Property within thirty (30) days of the date this Order is entered. All such persons shall take with them their personal property, including without limitation any livestock, but without removing any improvements, buildings, fixtures and appurtenances on the Subject Real Property. If any such person fails or refuses to vacate the Subject Real Property as specified herein, the United States Marshal and his deputies are authorized and directed to take all actions reasonably necessary to eject that person. If any such person fails or refuses to remove his or her personal property from the Subject Real Property within the time specified herein, such personal property remaining on the Subject Real Property thereafter is deemed forfeited and abandoned, and the United States Marshal and his deputies are authorized to remove it from the Subject Real Property and dispose of it as the Marshal and his deputies deem appropriate. This Order shall serve as a Writ of Assistance or Writ of Possession, as appropriate, and no further order from this Court shall be required for this purpose.
13. That after confirmation of the sale of the Subject Real Property, the United States Marshal shall ascertain the expenses of the sale, including without limitation any costs of publication and any expenses of preservation, and shall pay those amounts out of the sale proceeds. The Marshal shall then remit the balance of the sale proceeds to the Clerk of the Court with a statement of his costs and expenses.
14. That upon confirmation of the sale of the Subject Real Property, the liens and claims of the parties to this action shall attach to the proceeds of sale in the same order that their liens and claims have attached to the Subject Real Property.
15. That after confirmation of sale and after the United States Marshal remits the balance of the sale proceeds to the Clerk of Court as set forth above, this Court shall enter an appropriate order directing the Clerk to distribute the balance of the sale proceeds to the United States by check made payable to the United States and delivered to Mary Apostolakos Hervey, Trial Attorney, United States Department of Justice, Tax Division, Room 6217, P.O. Box 14198, Ben Franklin Station, Washington, D.C. 20044.
16. That within thirty (30) days after the Clerk of Court gives notice to the parties that such funds have been received from the Marshal, the United States shall certify to the Court the amount of its claim.
17. That this Court shall retain jurisdiction over this cause for purposes of making any and all further orders and decrees as may be just and equitable, including without limitation orders confirming the sale, when and if confirmation shall appear proper, orders of distribution, and a deficiency judgment should the proceeds of the sale of the Subject Real Property be insufficient to satisfy the federal income tax liabilities of the Defendant Glen W. Lake, plus accrued statutory interest pursuant to 28 U.S.C. § 1961(c)(1) and 26 U.S.C. § 6621 and 6622.
IT IS FURTHER ORDERED that the Clerk of Court shall immediately mail a copy of this Order to all counsel of record herein and to the Internal Revenue Service at the address set forth below and shall deliver a copy to the United States Marshal.
SO ORDERED