Title: Douglass v. Grace Bldg. Co., Inc.
Citation: 383 A.2d 937, 477 Pa. 289
Docket Number: N/A
State: Pennsylvania
Issuer: Pennsylvania Supreme Court
Date: March 23, 1978

477 Pa. 289 (1978) 383 A.2d 937 Walter H. DOUGLASS, Jr. and Dallas Douglass, his wife, Appellants, v. GRACE BUILDING CO., INC. Supreme Court of Pennsylvania. Argued January 13, 1978. Decided March 23, 1978. *290 Ward E. Clark, Brenden E. Brett, Doylestown, for appellants. Alfred O. Breinig, Jr., Jenkintown, for appellee. Before EAGEN, C.J., and O'BRIEN, ROBERTS, POMEROY, NIX, MANDERINO and LARSEN, JJ. O'BRIEN, Justice. This appeal is from an order of the Commonwealth Court which affirmed the order of the Court of Common Pleas of Bucks County. The Bucks County court ordered and decreed that a treasurer's deed of conveyance was valid and effective to convey absolute title to appellee, Grace Building Co., Inc. (Grace Building). *291 An action to quiet title was brought by Walter H. Douglass, Jr. and his wife, Dallas Douglass, appellants. The facts are not disputed; the case has proceeded on stipulated facts which are as follows. In 1965 appellants bought a residence in Bucks County and thereafter paid the realty taxes through the mortgagee. However, appellants failed to comply with an agreement entered into at settlement whereby they became obligated to pay an interim school tax for the year 1966 in the amount of $191.10. In November of 1967 the Bucks County Treasurer sent a notice to appellants of the amount due, including the following clause in bold type: "PAYMENT ACCEPTED ONLY BY CASH, MONEY ORDER OR CERTIFIED CHECK." Similar delinquency notices were sent February 1, 1968, April 1, 1968, and June 3, 1968. The fourth notice also stated that a tax sale was to be scheduled for August 5, 1968, unless payment was made. No payment having been tendered by that date, the property, with a mortgage of $14,100, was sold to Grace Building. On June 1, 1970, appellants received a final delinquency notice informing them of their right of redemption and stating that "cash, certified check or money order" in the amount of $251.26 (which included interest) was payable to the treasurer. On July 27, 1970, nine days before the expiration date of the redemption period, appellants mailed to the Bucks County Treasurer a personal check drawn on their personal account at the Girard Trust Bank in the amount of $251.26.[1] Instead of depositing appellants' uncertified check on the day of receipt, the treasurer's office mailed it back to appellants with instructions that payment would be accepted only by "cash, certified check or money order." Appellants did not have the check certified until August 6, 1970, and it was not received by the treasurer's office until August 10, 1970. On August 6, 1970, the treasurer's office deeded the property to Grace Building. *292 Appellants then brought an action to quiet title, contending that their tender of a personal check to the treasurer's office constituted payment within the meaning of § 15 of the Act of May 29, 1931, P.L. 280, § 15, as amended, 72 P.S. § 5971o, which act provides: The Court of Common Pleas of Bucks County held that the treasurer's deed conveying the property to Grace Building was valid and effective. An appeal was taken to the Commonwealth Court, which in a five-to-two decision, affirmed the Bucks County Court. Douglass v. Grace Building Co., 22 Pa.Cmwlth. 174, 348 A.2d 435 (1975). We granted appellants' petition for allowance of appeal. *293 There has been and still is but one issue during prior proceedings and this appeal: did appellants' tender to the county treasurer of an uncertified personal check constitute "payment" for delinquent taxes under the above-quoted redemption statute? In its majority opinion, the Commonwealth Court stated: We believe, however, that the court's reliance on these Nineteenth Century cases is misplaced, because those cases did not take into account the realities of modern-day banking procedures. Douglass v. Grace Building Co., supra (dissenting opinion by Mencer, J.). In Ellison v. Buckley, supra, 42 Pa. at 283, for example, the court stated: These cases were concerned that a treasurer, by accepting a tender of other than cash, would be accepting a mere promise to pay. During the Nineteenth Century, this was a valid concern, since all of these cases deal with promissory notes, which are a promise to pay at some specified time in the future. With modern banking procedure, checks are a promise to pay for only a short period, as the collection process employed by commercial banks normally involves a short period. A treasurer will today know whether a check has been paid or dishonored shortly after processing a check. A treasurer accepting a check is hardly substituting "his *295 own responsibility for cash," thus doing nothing "contrary to his duty as a public agent." In Hill v. United States, 263 F.2d 885, 886 (3d Cir. 1959), the court was discussing payment under the Internal Revenue Code, and went on to state: This Redemption Statute, as applicable in Bucks County, allows an owner to redeem his property sold at a tax sale by "payment" of back taxes plus interest within two years of said tax sale. Since the Legislature has not designated in what form payment must be made, we believe the Bucks County Treasurer's Administrative Procedure refusing uncertified personal checks cannot be allowed to stand given modern-day banking procedures. One small problem remains, for it is clear that the mere acceptance of a check by a treasurer should not constitute absolute payment, because any check may be dishonored. In Wendkos v. Scranton Life Ins. Co., 340 Pa. 550, 553, 17 A.2d 895, 897 (1941), we stated: ". . . a creditor's acceptance of a check constitutes only a conditional payment, dependent on the check finally being honored. . . ." The question then becomes on which date is payment final? As Judge Mencer stated in his dissenting opinion to Douglass v. Grace Building Co., supra, 22 Pa.Cmwlth. at 180: We believe that this view is too restrictive and would cause as many problems as it solves. We can perceive, for example, a situation where a taxpayer's check might not clear until after the redemption date through no fault of the taxpayer. In Witt's Estate v. Fahs, 160 F. Supp. 521 (S.D.Fla. 1956), a taxpayer made a charitable contribution by mailing a check to a charity on December 31, 1946. The charity did not receive the check until January 4, 1947, with the check clearing shortly thereafter. The court held that payment was as of the date the check was placed with the post office, thus allowing the taxpayer a charitable deduction for 1946. The same principle is applicable to our situation. As long as a check is given to a treasurer on or before the redemption date, we can see no problem with the treasurer forgoing final action on the treasurer's deed until the check is either paid or dishonored. Order of Commonwealth Court reversed and case remanded for proceedings consistent with this opinion. MANDERINO, J., joins this opinion and files a concurring opinion. POMEROY, J., dissents. MANDERINO, Justice, concurring. I join in the opinion of Mr. Justice O'Brien and would like to note that his opinion ends the discriminatory practice of accepting certified checks and not personal checks. A certified check (or a cashier's check or a nongovernmental money order) is a promise to pay by a private person as is a *297 personal check. If a personal check were not to be considered payment, neither should a cashier's check nor a certified check. It may be that some promises to pay are issued by the "rich" and personal checks by the less affluent. Nonetheless banks fail just as individuals, and their promises to pay on a date certain are not always honored. [1] It is undisputed that appellants' checking account had sufficient funds to cover the check at all times between the date the treasurer's office received the check and August 5, the last day of the redemption period.