Case Title: Marathon Inv. Corp. v. Spinkston

Citation: 644 S.E.2d 133

Docket Number: S07A0523

State: georgia

Court: Georgia Supreme Court

Date: 2007-04-24T00:00:00Z

Document:
644 S.E.2d 133 (2007) MARATHON INVESTMENT CORPORATION v. SPINKSTON et al. No. S07A0523. Supreme Court of Georgia. April 24, 2007. Terry C. Blanton, Amelia Terry Phillips, Perrie, Bone & Burr, LLC, Atlanta, for Appellant. Luann M. Evans, Law Offices of Kenneth R. Luther, Kennesaw, Jennesia Marie Primas, William A. Castings, Jr., Atlanta, for Appellee. CARLEY, Justice. At a tax sale, Marathon Investment Corporation (MIC) was the successful bidder for a vacant lot located at 321 Hills Avenue in Atlanta and a tax deed was executed and delivered. The owners of the parcel and defendants in fi. fa. were listed as Janet Spinkston and Roxie Taylor, in their representative capacities as trustees for the Hills Avenue Baptist Church (Church). At the *134 time of the sale, the Church was an unincorporated religious association. The Church sanctuary and the subject property were separated by the main parking lot for the parishioners' vehicles. The parcel at 321 Hills Avenue was used for overflow parking. A year after receiving the tax deed, MIC filed notice of foreclosure of the right to redeem the property. Ms. Spinkston and Ms. Taylor (Trustees) were personally served, but neither they nor the Church tendered the redemption price to MIC. Thereafter, MIC initiated this quiet title action. The Trustees answered, and asserted that, because the property actually belonged to the Church, it was tax-exempt and that the tax sale was, therefore, void or voidable. The proceeding was heard by a special master, who found in favor of the Trustees. The superior court approved and adopted the special master's report, vesting title in Trustees and declaring the tax sale void. MIC appeals from the superior court's order. 1. OCGA § 48-5-41(a)(2.1)(A) provides that "[a]ll places of religious worship" are exempt from ad valorem taxes. "[T]he words `religious worship' import a concept of a congregation assembling in a place open to the public to honor the Deity through reverence and homage." Leggett v. Macon Baptist Assn., 232 Ga. 27, 30(II), 205 S.E.2d 197 (1974). 321 Hills Avenue is the site of the Church's auxiliary parking lot, not its actual sanctuary. However, OCGA § 48-5-41(a)(2.1)(A) is phrased in inclusive general terms of "all places of religious worship," and does not Roberts v. Atlanta Baptist Assn., 240 Ga. 503, 508-509, 241 S.E.2d 224 (1978). Certainly, the proper use, occupancy and enjoyment of places of religious worship can require that accommodation be provided for the vehicles of the members of the attending congregation. There does not appear to be any dispute that the Church's primary parking lot, which is located between the sanctuary and the subject parcel, is exempt from taxes. Thus, "[t]he evidence in the case sub judice showed that the two contiguous tracts [to that where the sanctuary was located] were principally or even exclusively used as a `place of religious worship.'" Roberts v. Atlanta Baptist Assn., supra at 509, 241 S.E.2d 224. It follows that "[t]he vacant lot here involved was, for reasons indicated above, properly held exempt from taxation." Elder v. Trustees of Atlanta Univ., 194 Ga. 716, 720(1), 22 S.E.2d 515 (1942). 2. Prior to the tax sale, the Trustees did not contest the tax assessment and claim tax exempt status for the parcel. However, the evidence also shows that the opportunity to do so was never provided, because all tax notices for 321 Hills Avenue were sent to an address on Cascade Road at which neither of them had ever resided. Moreover, the Church pastor testified that no past or present member of the congregation had ever lived at the address to which the tax notices were sent. There was no evidence that, after the notices sent to Cascade Road proved ineffective, any additional effort was made to locate the Trustees, even though their names and correct addresses were listed in the telephone directory. Thus, the special master was authorized to make the following finding: *135 "[D]efects in following the notice provisions of the tax sale statute may give an injured party a claim for damages, but will not render the tax sale or the deed therefrom void. [Cit.]" GE Capital Mortgage Services v. Clack, 271 Ga. 82, 83(1)(a), 515 S.E.2d 619 (1999). However, the circumstances here show more than a mere "defect" in providing a taxpayer with notification of a sale to be conducted for the failure to pay taxes assessed on property that is unquestionably taxable. Compare GE Capital Mortgage Services v. Clack, supra; Haden v. Liberty Co., 183 Ga. 209, 210(1), 188 S.E. 29 (1936); Harper v. Foxworthy, 254 Ga.App. 495, 497(1), 562 S.E.2d 736 (2002). What is involved is property which is otherwise tax-exempt, coupled with the lack of notification to the owner so that the tax records can be corrected and the proper exemption can be claimed. Under those circumstances, the "defect" is potentially of constitutional magnitude. "Constitutional due process of law includes notice and hearing as a matter of right where one's property interests are involved. [Cit.]" Hamilton v. Edwards, 245 Ga. 810, 811, 267 S.E.2d 246 (1980). Blizzard v. Moniz, 271 Ga. 50, 53-54, 518 S.E.2d 407 (1999). That policy of favoring the rights of the owner is certainly no less applicable where, as here, the taxes that were collected pursuant to the sale were unauthorized because the property was exempt from taxation. As a practical matter, the owner of taxable property will generally have at least constructive or implied notice that taxes will be assessed and that, unless they are paid, the parcel may be sold. However, that is in stark contrast to the present circumstances in which, as found by the special master, "it is uncontroverted that neither [Trustee] expected a tax billing statement as the [s]ubject [p]roperty was thought to be tax exempt due to its use solely by the Church." Hamilton v. Edwards, supra. However, that notice was never received. Hamilton v. Renewed Hope, 277 Ga. 465, 467, 589 S.E.2d 81 (2003). Because the Trustees were never given that requisite notice, their due process rights were violated by the tax sale and the deed to MIC resulting from that unconstitutional sale is, therefore, void. 3. MIC urges that the Trustees lack standing to contest the tax sale because they did not tender the amount of unpaid taxes for which the property was sold. However, the requirement that the redemption price be tendered before the validity of a tax deed can be challenged does not apply if "it clearly appears that . . . [t]he tax or special assessment for the collection of which the execution under or by virtue of which the sale was held was not due at the time of the sale. . . ." OCGA § 48-4-47(b)(1). That exception to the tender requirement is applicable here, since taxes were not due at the time the property was sold because of its tax-exempt status. Judgment affirmed. All the Justices concur.