Purchaser of tax sale parcels met constitutional, statutory notice requirements to property owners, IN Supreme Court affirms

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A company’s repeated efforts to notify a Madison County couple by mail that their properties had been sold at a tax sale met federal and state notice requirements, the Indiana Supreme Court affirmed Wednesday.

Justice Mark Massa wrote the court’s unanimous opinion in In Re the 2020 Madison County Tax Sale; James A. Crowe and Phyllis Lynn Crowe, 23S-TP-90.

In 1997, James and Phyllis Crowe acquired title to three parcels of land, where they have lived since 1998.

More than 20 years later in 2019, the Crowes received notice that their properties were sold in a tax sale due to the failure to pay their 2018 property taxes.

Phyllis went to the Madison County Auditor’s Office and paid the redemption amount. She believed the payment covered all taxes due for 2018 and 2019, but the payment only covered the 2018 delinquent taxes.

Thus, in September 2020, Madison County again certified the properties for a tax sale due to delinquent 2019 property taxes.

Pursuant to Indiana Code § 6-1.1-24-4(b), Madison County mailed notice of the 2020 tax sale to the Crowes’ mailing address by certified mail, return receipt requested, and first-class mail, informing them of the tax sale and their opportunity to redeem their properties.

This time, the Crowes did not redeem their properties, so the Madison Circuit Court ordered the properties to be sold.

That October, Savvy IN LLC purchased the properties at the tax sale.

On Feb. 10, 2021, Savvy IN notified the Crowes by certified mail, return receipts requested, that their properties had been purchased at the tax sale and that they had until Oct. 5, 2021, to redeem them.

When the Oct. 5 deadline had passed, Savvy IN petitioned the trial court to direct the county auditor to issue tax deeds for the properties and mailed notice of the verified petition to the Crowes via certified mail, return receipt requested, and a copy of the notice via first-class mail.

Neither the certified mail nor the first-class mail was returned to Savvy IN, which did not take further action to notify the Crowes.

The Crowes did not object to the petition within 30 days, so the trial court granted Savvy IN’s petition and the county auditor issued the tax deeds.

But on Feb. 10, 2022, the Crowes moved for relief from the judgment under Indiana Trial Rule 60(B)(6), claiming they did not receive any notice letters, rendering the judgment and tax deeds void.

The Madison Circuit Court denied the Crowes’ motion, and the Crowes appealed.

In a published opinion, the Court of Appeals of Indiana acknowledged the importance of notice, but declined to engage in an actual due process analysis applicable to the Crowes’ claims.

Instead, the Court of Appeals reversed on equitable grounds, affording the Crowes an extra 30 days to redeem their properties.

Savvy IN petitioned for transfer, which the Indiana Supreme Court granted.

Affirming the denial of the Crowes’ motion for relief from judgment, the high court found Savvy IN’s mailed notices satisfied the constitutional and statutory requirements, so it is entitled to the tax deeds issued by the trial court.

In examining whether Savvy IN satisfied constitutional due process, Massa pointed to Mennonite Bd. of Missions v. Adams, 462 U.S. 791 (1983), and Jones v. Flowers, 547 U.S. 220 (2006). He also pointed to the Indiana high court’s own precedent in Marion County Auditor v. Sawmill Creek, LLC, 964 N.E.2d 213 (Ind. 2012), M & M Investment Group, LLC v. Ahlemeyer Farms, Inc., 994 N.E.2d 1108 (Ind. 2013), and Indiana Land Trust v. XL Investment Properties, LLC, 155 N.E.3d 1177 (Ind. 2020).

Here, Massa noted the high court did not conduct an inquiry into whether the Crowes actually received the notice, but instead inquired into whether Savvy IN acted “as one desirous of actually informing” the Crowes that their property was sold at the tax sale and that the tax deeds had issued. The court determined the answer to that inquiry was yes.

“Neither the certified mail nor the first-class mail was returned to Savvy IN as undelivered. The Crowes did not present contrary evidence, and since none of the mailed notice letters were returned to Savvy IN marked undeliverable, Savvy IN was not required to take ‘additional reasonable steps,’” Massa wrote, quoting Jones. “As we explained in Land Trust, absent such evidence, Savvy IN is not constitutionally required to speculate whether notice was sufficient because the mailings indicate actual delivery at the Crowes’ address. … And because the Constitution does not require further actions when notice letters are not returned undeliverable … Savvy IN’s actions meet the federal constitutional threshold under the Fourteenth Amendment.”

Savvy IN actions were also in compliance with state law, the high court determined.

Massa noted that the owner of record and any interested party are entitled to two notices. The first notice must inform the parties of the sale, the redemption period expiration date, and the date on or after a tax deed petition will be filed. The second notice must inform the parties that the purchaser petitioned for a tax deed.

“Once again, neither the certified mail nor the first-class mail was returned to Savvy IN as undeliverable,” the justice wrote. “Yet the Crowes argued they did not receive any notices, rendering the judgment and the tax deeds void.

“But none of the four mailings, either certified mail or first class mail, that Savvy IN sent to the Crowes’ mailing address were returned marked undeliverable, confirming the notices were delivered and that no additional reasonable steps needed to be taken,” he concluded. “… ‘Failure by an owner to receive or accept the notice required … does not affect the validity of the judgment and order.’ I.C. § 6-1.1-24-4(a).”

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