Norman Eggers
appeals the sale of his real property at a tax sale. He raises three issues,
which we consolidate and restate as: whether the County proved the tax sale
purchaser paid all taxes, special assessments, penalties, and costs; and whether
the County improperly applied the surplus from the sale. On cross-appeal, MLP
Services LLP, the tax sale purchaser, argues Eggers’ appeal is frivolous and
brought in bad faith, and therefore it is entitled to attorney fees for its
defense of the appeal. We affirm and remand.
…
In October 2010,
Jefferson County sold two parcels of Eggers’ real estate at a tax sale. MLP
Services, LLC, bought a parcel on Hooten Boulevard in Madison that included
Eggers’ home, and John Etherton bought a parcel on Fourth Street. Although
Eggers disputed certain liens and assessments on the properties, he knew he was
responsible for the taxes on them, and he knew they were being sold at the tax
sale. He did not redeem the properties by the statutory deadline, and tax deeds
were issued to MLP and Etherton. Each property sold for more than the amount of
its tax arrearage, and the surplus from the Etherton property was returned to
Eggers. At the time of the hearing on MLP’s request for issuance of a tax deed,
the County had not returned the surplus from the sale to MLP.
…
1. Payment of
Subsequent Taxes
Eggers asserts
“there is a complete lack of evidence to support the finding by the Trial Court
that all subsequent taxes had been paid as required by I.C.
6-1.1-25-4.6(b)(3)[.]” (Br. of Appellant Norman L. Eggers (hereinafter “Eggers
Br.”) at 7) (bold type in original). There was ample evidence to support the
finding.
Ind. Code §
6-1.1-25-4.6(b)(3) provides:
Not later than
sixty-one (61) days after the petition is filed under subsection (a), the court
shall enter an order directing the county auditor (on the production of the
certificate of sale and a copy of the order) to issue to the petitioner a tax
deed if the court finds that the following conditions exist:
* * * * *
(3) Except
with respect to a petition for the issuance of a tax deed under a sale of the
certificate of sale on the property under IC 6-1.1-24-6.1 or IC 6-1.1-24-6.8,
all taxes and special assessments, penalties, and costs have been paid.
MLP’s attorney
submitted a verified petition that said “Purchaser has paid the real estate
taxes and assessments on the parcel that are due and payable subsequent to the
year of the tax sale.” (Appellee’s App. at 41.) MLP offered that verified
petition into evidence, and Eggers’ trial counsel, who now represents Eggers on
appeal, explicitly stated he had no objection. That evidence permitted the
trial court’s finding. See, e.g., Campbell v. State, 229 Ind. 198, 205,
96 N.E.2d 876, 879 (1951) (when verified petition is introduced in evidence it
becomes competent proof of the facts therein contained).
The record
contained additional evidence the subsequent taxes had been paid. An employee
of the Auditor’s office testified no taxes were owed on the property and
“everything was current.” (Tr. at 85.) Eggers testified he was told by the
Auditor’s office that MLP’s principal had “come to pay the uh . . . taxes that
would have been payable and due on November the 10th.” (Id. at 35.) The
trial court’s finding was supported by ample evidence.
2. Application
of Surplus
Eggers next
argues the County Auditor and Treasurer did not properly apply the surplus
money from the tax sale. Ind. Code § 6-1.1-24-7(a)4 provides in pertinent part:
When real
property is sold under this chapter, the purchaser at the sale shall
immediately pay the amount of the bid to the county treasurer. The county
treasurer shall apply the payment in the following manner:
(1) first, to
the taxes, special assessments, penalties, and costs described in section 5(f)
of this chapter;
(2) second, to
other delinquent property taxes in the manner provided in IC 6-1.1-23-5(b); and
(3) third, to
a separate “tax sale surplus fund.”5
Both of
Eggers’ properties were sold at the same tax sale, and Eggers asserts the County
did not properly apply the surplus. His reasoning appears to be that the County
was obliged to apply the surplus from the property Etherton bought to pay
delinquent property taxes on the separate parcel that MLP bought at the same
tax sale: “In this case, rather than applying the surplus on either property to
the other property’s unpaid taxes, the county chose to just hold onto the
funds. Clearly, the government attempted to exercise its power to gain the most
money from Mr. Eggers’ financial problems.” (Eggers Br. at 11.)
The statute
cannot be read to impose an obligation on the County to apply money from the
sale of one property to taxes due on some other property sold at the same time.
The tax sale statutes were not designed to protect those who receive actual
notice of a tax sale but do nothing further to protect their interests in the
property. Green Tree Servicing, LLC v. Random Antics, LLC, 869 N.E.2d
464, 471 (Ind. Ct. App. 2007). Nor does the statute require the County, after
selling one of Eggers’ properties, to determine whether he owned additional
property that was sold at the same time, and then pay the taxes on that
different property for him.
Eggers relies
on Ind. Code § 6-1.1-24-7(c)(2), which directs the county treasurer to apply the
payment at a tax sale, after paying the taxes, special assessments, penalties,
and costs described in Ind. Code § 6-1.1-24-5(f),6 “to other delinquent
property taxes.” But that subsection could not require the County to apply the
surplus from the Etherton purchase to the MLP purchase at the same sale. When
MLP bought the property at the tax sale, the statute required MLP to
“immediately pay the amount of the bid to the county treasurer,” Ind. Code §
6-1.1-24-7(a), which bid must be enough to cover the delinquent taxes on the
parcel. Ind. Code § 6-1.1-24-5(f). The treasurer was then required to apply the
payment “first, to the taxes, special assessments, penalties, and costs” due on
that parcel. Ind. Code § 6-1.1-24-7(a).
The effect of
those requirements is that after the Eggers parcels were sold, there were no
“delinquent” property taxes for either parcel. The County therefore was
not obliged to apply the surplus from one parcel to Eggers’ other parcel that
had been sold at the same time.
...
Because we find
Eggers’ appeal was brought in bad faith, we remand to the trial court pursuant
to Indiana Appellate Rule 66(E) for a determination of appellate damages, which
may include attorney fees. Poulard v. Laporte Cnty. Election Bd., 922
N.E.2d 734, 736 (Ind. Ct. App. 2010).
