In re Upset Sale of Properties
In re Upset Sale of Properties
Opinion of the Court
Opinion by
This is an appeal by the Tax Claim Unit of Northampton County (TCU) from an order of the Court of Common Pleas of Northampton County dismissing TCUs exceptions and entering judgment in favor of Windrift Real Estate Associates (Windrift) in the amount of $901.25. Windrifts claim against TCU arose out of a tax claim sale held on November 17, 1983, whereat Windrift purchased a property which sale was later voided by the common pleas court on the basis of a defective notice sent to the property owner by TCU. The common pleas court held that Windrift was dam
The material facts were stipulated by the parties and are as follows. In 1983, the TCU notified Alyce Skibo that claims for delinquent taxes had become absolute and that the property would be sold to satisfy those delinquent taxes. The TCU held an auction on November 17, 1983, at which auction Windrift was the successful bidder on Skibo s property for $25,200.00. The tax sale was made subject to certain publicized terms.
The sole issue presented in this appeal is whether a tax collection unit of a municipality is liable to a disappointed purchaser for costs the purchaser incurred in
There is no serious question that a disappointed purchaser at a tax sale cannot recover its costs incurred in participating in that sale from the property owner if the sale is later held to be invalid. Fidei v. Underwood, 291 Pa. Superior Ct. 375, 435 A.2d 1275 (1981); Gaul v. McLaughlin, 207 Pa. Superior Ct. 434, 217 A.2d 757 (1966). In Fidei, however, the Superior Court held that a disappointed purchaser of property has no right of reimbursement against the true owners where those owners were not notified of the tax sale and the costs were incurred by the purchaser without the owners’ knowledge, request or consent. 291 Pa. Superior Ct. at 380-81, 435 A.2d at 1277-78. There, the owners were the heirs of the former record owner of the property and
In the case at bar, however, a different set of circumstances is present. Here, the disappointed purchaser is seeking reimbursement for costs expended not from the true owner of the property, but from the municipal agency whose negligence caused the tax sale to be voided. In order for the TCU’s negligence to impose liability upon it for damages the voided sale caused Windrift, the TCU must owe some kind of duty to Windrift. If the TCU owed Windrift no duty, then its negligence in failing to properly notify the property owner of her redemption rights does not impose any liability upon it for Windrifts damages no matter how foreseeable those damages may have been. See e.g., Morena v. South Hills Health System, 501 Pa. 634, 462 A.2d 680
We begin our analysis of whether a municipal tax claim unit owes a duty to prospective bidders at its tax sales by noting that our Supreme Court has held that the presumption that acts of public officials are regular is fully applicable to tax sales. Hughes v. Chaplin, 389 Pa. 93, 132 A.2d 200 (1957). Thus, in the absence of evidence to the contrary, courts presume that taxing authorities comply with the applicable statutory requirements prior to placing a property for sale to satisfy delinquent taxes. Pennsylvania Bank & Trust Co., Youngsville Branch v. Dickey, 232 Pa. Superior Ct. 224, 335 A.2d 483 (1975). By inviting prospective buyers to bid at its tax auction, the TCU is representing or warranting to those prospective buyers that the statutory requirements for conducting such a sale have been met and that the successful bidder will be buying a parcel of real estate, not a lawsuit. The condition of sale that informs purchasers that they take only what title there is to sell pertains only to the state of the title held by the delinquent taxpayer, it in no way refers to or excuses any defects in the sale procedure caused by the TCUs negligence. That provision only alerts prospective buyers that the subject property may be encumbered by mortgages, judgment liens, municipal liens, and the like. In view of the foregoing, we are satisfied, as was the common pleas court, that a tax claim unit or bureau, such as the TCU, owes a duty to prospective tax sale bidders and purchasers to comply with the statutory requirements of exposing a property to sale for delinquent taxes and, where that duty is breached through negligence, the TCU can be held liable to the disappointed purchaser for damages that were reasonably foreseeable and proximately caused by the TCUs negligence in holding the sale.
Having disposed of the TCU s contentions in favor of Windrift, we shall affirm the common pleas courts order entering judgment in favor of Windrift and against the TCU in the amount of $901.25.
Now, November 9, 1987, the Order of the Court of Common Pleas of Northampton County at Docket No. 1983-CM-6737, dated July 22, 1985, denying the exceptions of the Tax Claim Unit of Northampton County, Pennsylvania, and directing the Prothonotary of Northampton County to enter a final judgment in accordance with that Court’s Order of May 13, 1985, is hereby affirmed.
The terms that governed the November 17, 1983, tax sale were as follows:
The properties hereinbelow described will be sold at auction to the highest bidder and the purchaser of any property at such sale shall, as soon as the property is struck down, pay to the Tax Claim Unit the entire purchase money. In case said amount is not so paid, the sale shall be void and the property shall be put up again at the same sale. The lowest bid accepted on any piece of property will be the Upset Price, the approximate amount of which is set forth below.
The owner or owners of any owner-occupied real estate may be entitled to an extension of the redemption period for up to twelve (12) additional months under and subject to the provisions of Section 502 and 503 of the Real Estate Tax Sale Law. Owners that qualify should contact the Northampton County Tax Claim Section for further details.
A purchaser at sale takes only what title there is to sell and the doctrine of Caveat Emptor applies. The Tax Claim Unit, its representatives, employees, and solicitors make no representation of warranties to any prospective purchasers as to the state of the title. The buyer or buyers take subject to any real estate taxes, municipal liens, mortgages, Federal tax liens, and other liens which are not divested by this sale.
ALL SALES ARE FINAL AND NO REFUNDS WILL BE MADE AFTER THE CLOSE OF THIS*36 SALE. FINAL PURCHASER MUST MAKE SETTLEMENT OF THE PENNSYLVANIA ONE PERCENT (1%) REAL ESTATE TAX BEFORE LEAVING THE COURTHOUSE.
Slip Op. at 2.
We note in passing that the TCU, as a local agency, would be immune from liability under Section 8541 of the Judicial Code, 42 Pa. C. S. §8541, and that the acts of the TCU asserted by Windrift as serving as the basis for liability do not fall within any of the eight enumerated exceptions to governmental immunity set forth in Section 8542(b) of the Judicial Code, 42 Pa. C. S. §8542(b). As governmental immunity is an affirmative defense that must be raised in a responsive pleading or it is considered waived, the TCU’s failure to assert the immunity defense before the common pleas court constituted a waiver. Heifetz v. Philadelphia State Hospital, 482 Pa. 386, 393 A.2d 1160 (1978); Department of Transportation v. Pace, 64 Pa. Commonwealth Ct. 273, 439 A.2d 1320 (1982); Pa. R.C.P. No. 1030.
Reference
- Full Case Name
- Re: The Upset Sale of Properties Against Which Delinquent 1981 Taxes Were Returned to the Tax Claim Union on or About the First Monday of May, 1982 (Skibo Property). Tax Claim Unit of Northampton County, Pennsylvania
- Cited By
- 2 cases
- Status
- Published