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Justices to review whether sewer lien can trigger tax sale

February 10, 2014

The Indiana Supreme Court will review the question of whether a sewer lien placed on a property for unpaid bills is by itself sufficient for the property to be sold at tax sale to satisfy the debt.

Justices agreed to review the question when they granted transfer in In Re: The Carroll County 2012 Tax Sale Twin Lakes Regional Sewer District v. Steven E. Hruska, Virginia Hanna, and Equity Trust Company FBO #80677 and Carroll County, Indiana, by and through the Caroll County Auditor, 08S02-1402-MI-78.

Carroll Circuit Court ruled in favor of Steven Hruska and Virginia Hanna and removed their properties from a county tax sale list. Twin Lakes Regional Sewer District appealed, arguing that the trial court misread I.C. 13-26-14-4, but the Indiana Court of Appeals unanimously affirmed the trial court ruling. The COA held the sewer district could sue to collect on the late fees but lacked authority to seek a county tax sale.

The statute explicitly says, “A lien under this chapter that is the only lien on a property may not be foreclosed.” The Court of Appeals opinion observed in a footnote, however, that the Indiana Regional Sewer District Association filed an amicus brief in the case arguing the “misinterpretation of Ind. Code § 13-26-14-4 by the trial court and its application to all collection processes ... is of paramount importance and will affect all sewer districts’ ability to collect unpaid sewer bills.”

The case is one of eight granted transfer by the Indiana Supreme Court for the week ending Feb. 7. The others are:


Justices rejected transfer petitions in 27 cases. The transfer disposition list may be viewed here.




 

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