Rushmore filed its motion asking the trial court to set
aside the order directing issuance of tax deeds and tax sale pursuant to Trial
Rule 60(B)(6). Motions filed pursuant to this subsection must be filed within a
“reasonable time.” T.R. 60(B). The determination of what constitutes a
reasonable time varies with the circumstances of each case. Levin v. Levin, 645
N.E.2d 601, 604 (1994). Relevant to the question of timeliness is the basis for
the moving party’s delay and prejudice to the party opposing the motion. Id. 6
Here, Rushmore claims that its motion was filed within a
reasonable time. In particular, the record demonstrates that Rushmore filed its
Trial Rule 60(B) motion on September 9, 2013, over 18 months after Oberleas
received the tax deeds to the parcels of Property. Rushmore claims that its
motion was filed within a reasonable time because: 1) Rushmore filed its motion
within three months of acquiring an interest in the Property, which Rushmore
claims is not unreasonable given the difficulty a mortgagee may have connecting
a tax sale notice with an erroneous property address to a particular mortgage loan;
and 2) This delay did not result in prejudice because Oberleas will still
retain a lien against the Property parcels in the event that the deeds are
invalidated.
We find these arguments, particularly the former, unavailing
and agree with Oberleas that the delay is unreasonable. While we do not condone
the errors made by Oberleas and caution that exactitude is important when recording
and notifying others of property interests, Rushmore’s challenge simply comes
too late.
One of the factors we consider when assessing whether or not
a motion was filed within a reasonable time is the basis for the moving party’s
delay. Here, Rushmore was not a party in interest during the time of the tax
sale or even when the deeds were issued. In fact, Rushmore did not acquire an
interest in the Property until 16 months after the deeds had been issued to
Oberleas. When a mortgagee takes an assignment of a mortgage, he acquires the
status of the mortgage at that time. Further, the mortgagee is charged with
constructive notice of all the facts that a proper examination of the record would
show. Keybank Nat’l Ass’n v. NBD Bank, 699 N.E.2d 322, 327 (Ind. Ct. App. 7 1998).
The record clearly shows the Oberleas’s tax deeds were recorded in the
Auditor’s Office on February 16, 2012 under an accurate lot number and property
description. Appellant’s App. 91-97. Therefore, Rushmore had constructive
notice of Oberleas’s tax deeds and thus was not a bona fide purchaser, despite
an error in the common address. See Union State Bank v. Williams, 169 Ind. App.
345, 350, 348 N.E.2d 683, 687 (1976). Had Rushmore checked the record prior to
acquiring the mortgage from Bank of America, it would have been aware that
Oberleas was issued tax deeds for four of the five parcels on the Property.
Additionally, it is apparent that Oberleas suffered prejudice
as a result of the delay. More specifically, for approximately 18 months,
Oberleas believed he was the rightful owner of the parcels and acted
accordingly. He has paid taxes and “mowed, cleared underbrush and weeds, and
provided general care to the [p]arcels.” Appellant’s App. 123.
Finally, this Court recognizes a general public policy
interest in having finality and closure to such transactions. As this Court
previously explained, “[i]n ruling on a T.R. 60(B) motion, the trial court must
balance the alleged injustice suffered by the party moving for relief against
the interests of the winning party and societal interest in the finality of
litigation.” Hoosier Health Sys., Inc. v. St. Francis Hosp. & Health Ctrs.,796
N.E.2d 383, 388 (Ind. Ct. App. 2003). Although Rushmore may not have had actual
notice of Oberleas’s deeds to the Property parcels, it is charged with
constructive notice; therefore, we do not believe Rushmore suffers grave
injustice if Oberleas retains ownership of the Property because Rushmore had
the opportunity to avoid the problem much earlier. See Union State Bank, 169
Ind. App. at 350, 348 N.E.2d at 687. In short, because of society’s interest in
the finality of litigation, we cannot indefinitely allow banks to shift any
potential issues associated with a mortgage to subsequent mortgagees if it
operates to the detriment of the tax sale purchaser as it does in this case.
Therefore, we conclude that Rushmore’s motion was not filed within a reasonable
period of time.
Moving onto Rushmore’s other claims, it also argues that the
property descriptions in the 4.5 and 4.6 notices Oberleas sent to the record
owners, Thomas and Hayes, were not in substantial compliance with Indiana Code
sections 6-1.1-25-4.5 and -4.6 because they omitted a digit in the common
address and failed to provide a full legal description per the statute.
Appellant’s Br. 7. Further, Rushmore argues that the notices were sent to Thomas
and Hayes at an address in Muncie, rather than the proper address on record
with the Auditor’s Office, meaning that the mailing itself was not in
compliance with the statute. Id. at 11. However, we need not address the
sufficiency of the 4.5 and 4.6 notices because, even if they possess merit, the
issue of reasonable timing discussed above is dispositive. The sufficiency
challenge simply comes too late.
Based on these facts, we cannot say that the trial court
abused its discretion in denying Rushmore’s motion to set aside the issuance of
the tax deeds and tax sale. Accordingly, we affirm the judgment of the trial
court.
