Monday, June 01, 2015

Montana Supremes Say 'No Way' To Tax Lien Investor Who Ostensibly Attempted To Screw Property Interest Owners Out Of Their Redemption Rights By Taking Title To Tax-Delinquent Premises Without First Obtaining Mandatory Property Title Guarantee & Providing Them w/ Proper Notice

From an Opinion Summary from Justia US Law:
  • Catherine E.W. Hansen Trust (Hansen Trust), which was issued a tax lien and a tax deed on certain property, filed a complaint to quiet title to the tax deed.

    The district court granted summary judgment for [the current property owner and the former owner, who holds a purchase money deed of trust] and declared the tax deed void as a matter of law, finding that Hansen Trust had not obtained the required property title guarantee and had not provided notice to parties listed in the title guarantee.

    The court subsequently directed payment of the tax lien and entered final judgment. The district court denied Hansen Trust’s post-judgment motions.

    The Supreme Court affirmed, holding that the district court (1) correctly granted summary judgment and declared the tax deed void after determining that Hansen Trust failed to provide adequate notice or obtain a property title guarantee; (2) did not err when it directed payment of Hansen Trust’s tax lien; and (3) did not err when it denied Hansen Trust’s post-judgment motions.(1)
Go here for the Justia Opinion Summary.

For the court ruling, see Catherine E.W. Hansen Trust v. Ward, 2015 MT 131 (May 19, 2015).

(1) With regard to the voiding of the tax deed, the Montana Supreme Court stated:
  • ¶30 Under the plain language of the statute, the purchaser must notify all parties listed on the property title guarantee, excluding utilities, of the possibility that a tax deed will be issued unless the tax lien is redeemed. Section 15-18-212(1)(b), 4(a), MCA. Although "property title guarantee" is not defined, the notice requirement is mandatory. Section 15-18-212(1)(b), MCA.

    Moreover, the statute clearly dictates the manner in which the notice must be made (certified mail), as well as the method for determining the parties who are due notice (a property title guarantee). Section 15-18-212(4)(a), MCA; Certain, ¶ 17. Notice is a necessary aspect of due process, essential to the redemption rights of the interested parties.

    The plain language of the statute does not make the title guarantee optional, rather it mandates that the notice must be made to "each party . . . listed on a property title guarantee."

    ¶31 The District Court correctly granted summary judgment after determining that Hansen Trust failed to provide adequate notice or obtain a property title guarantee. It is undisputed that Hansen Trust did not obtain the mandatory property title guarantee. Failure to comply with this mandatory obligation renders the tax deed void.

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