Opinion ID: 2263122
Heading Depth: 2
Heading Rank: 2

Heading: jurisdiction

Text: We recently addressed the jurisdiction of the Circuit Court in foreclosure proceedings in Royal Plaza Community Ass'n, Inc. v. Bonds, 389 Md. 187, 884 A.2d 130 (2005). As discussed in Royal Plaza: `[T]he legislature has declared that the public interest in marketable titles to property purchased at tax sales outweighs considerations of individual hardship in every case, except upon a showing of lack of jurisdiction or fraud in the conduct of the foreclosure.' Id. at 192, 884 A.2d at 133 (quoting Thomas v. Kolker, 195 Md. 470, 475, 73 A.2d 886, 888 (1950)). This legislative intent is reflected in §§ 14-808 through 14-854 of the Tax-Property Article, which govern tax sales, and more specifically § 14-832 which states that: The provisions of §§ 14-832.1 through 14-854 of this subtitle shall be liberally construed as remedial legislation to encourage the foreclosure of rights of redemption by suits in the circuit courts and for the decreeing of marketable titles to property sold by the collector. The Tax-Property Article specifically confers jurisdiction upon the Circuit Court over foreclosure proceedings in § 14-834, which provides: The circuit court, on the filing of a complaint to foreclose the right of redemption, has jurisdiction to give complete relief under this subtitle, in accordance with the general jurisdiction and practice of the court, and with all laws and rules of court that relate to the circuit courts for the county in which the property is located, except as otherwise provided in this subtitle, to bar all rights of redemption and to foreclose all alienations and descents of the property occurring before the judgment of the court as provided in this subtitle and all liens and encumbrances on the property, except property taxes that arise after the date of sale, and to order an absolute and indefeasible estate in fee simple or leasehold to be vested in the holder of the certificate of sale. Under this Article, once the Circuit Court enters a judgment foreclosing the right of redemption in a tax sale foreclosure proceeding, that judgment can only be reopenedmore than thirty days after it is enteredin accordance with § 14-845, which states: (a) Reopening judgments generally. A court in the State may not reopen a judgment rendered in a tax sale foreclosure proceeding except on the ground of lack of jurisdiction or fraud in the conduct of the proceedings to foreclose; however, no reopening of any judgment on the ground of constructive fraud in the conduct of the proceedings to foreclose shall be entertained by any court unless an application to reopen a judgment rendered is filed within 1 year from the date of the judgment. (Emphasis added.) Appellant claims that failure to strictly adhere to the statutory provisions voids the sale and, consequently, the Circuit Court lacked any jurisdiction to foreclose the owner's right of redemption. In support of this assertion, appellant takes us back to the case of Polk v. Rose, 25 Md. 153, 159 (1866), where the Court stated: To sustain the power of the collector which is a specially delegated one and must be strictly pursued[, a] series of the acts preliminary in their character, are required by law to precede the execution of the power. Each and every step, from the assessment of the property for taxation, to the consummation of the title by delivery of the deed to the purchaser, is a separate and independent fact. All of these facts from the beginning to the end of the proceeding must exist, and if any material link in the chain of title is wanting, the whole is defective for want of sufficient authority to support it. The party claiming under the power is chargeable with notice of every irregularity in the proceedings of the officers, and the onus is upon him to show the faithful execution of the power. (Citations omitted.) In that case, the Collector did not attempt to first collect the taxes from the owner's personal property as required at the time, but sold the real property at a tax sale instead. In doing so, the Court found that the Collector had not met the specific requirements then existing. [17] One of those requirements was the filing of a statement with the court attesting to the fact that the taxpayer did not have any personal property that could cover the amount owed. The Collector failed to file the statement and the owner, in fact, had personal property amply sufficient to pay the taxes alleged to be due. Id. at 160. Furthermore, the Collector sold the two properties on the lot when selling one alone would be sufficient to cover the amount owed. [18] The tax sale purchaser obtained the property under a decree by the Circuit Court for Baltimore City. Subsequently, the delinquent owner sold the property to another, who in turn filed a complaint in the Circuit Court for Baltimore City seeking that the court clear the title to the property. The Circuit Court held a hearing and declared the tax sale deed null and void. Id. at 159. The Court of Appeals did not address whether the Circuit Court had jurisdiction to foreclose an owner's right of redemption, but it affirmed the Circuit Court's finding that the sale was void. Appellant argues that the City's failure to cite the properties as abandoned or vacant voids the sale in this case and therefore removes jurisdiction from the Circuit Court to issue a judgment foreclosing the right of redemption. In appellant's case, however, the City's actions do not amount to the type of conduct presented in Polk, where the statute required that as a condition precedent to a tax sale of real property, personal property be sold first to satisfy the lien. Sufficient personal property existed in that case. Polk, 25 Md. at 160; Md.Code (1860), Article 81, § 50. Accordingly, there was never any jurisdiction to sell the real property in Polk because the condition precedent had not been met. In the present case, once the taxes on the real property were not paid, jurisdiction existed for the sale of the real property. How the sale was conducted is a different issue; in this case not a jurisdictional issue. In a case very similar to the one at bar, Thomas v. Kolker, 195 Md. 470, 73 A.2d 886 (1950), the Court denied the delinquent owner's request to reopen foreclosure proceedings because of her mistaken belief that the properties sold at the tax sale were unimproved. On April 8, 1943, the City of Baltimore sold three of Thomas's lots at a tax sale because she had failed to pay taxes for the previous four years. After the sale, Thomas promptly redeemed one of the lots under the mistaken belief that the building, which she wanted to keep, was located on that lot alone, when in fact the building expanded over two of the lots. Kolker subsequently filed a claim to foreclose Thomas's right of redemption as to the other lots. Thomas did not answer the complaint, although she had been properly served with process. As a result, the Circuit Court entered judgment foreclosing her right of redemption to the two remaining lots. Almost three years later, Thomas filed a petition to reopen the foreclosure proceedings based upon lack of jurisdiction and fraud. The Court held that the Circuit Court had jurisdiction over the matter. In making its determination the Court said: The appellant acted, or failed to act, under a mistake of fact as to the location of the garages she erected, a mistake evidently shared by the Collector at the time the property was advertised and sold, although the true situation seems to have been known to him when the certificate was issued. Even if the mistake was mutual it manifestly could not affect the jurisdiction. Id. at 475-76, 73 A.2d at 888. The Court then affirmed the Circuit Court's denial of Thomas's request for relief stating: The initial mistake was clearly hers, in building the garage where she did and, as the chancellor states: `she stood by at the tax sale, she stood by when she redeemed one lot, she stood by when the bill of complaint was filed and served on her, and waited all this period of time before doing anything.' We think the case is not within the exceptions in the statute. Id. at 476, 73 A.2d at 889. In the case sub judice, appellant stood by at the tax sale, it had the opportunity to contest the sale and did so successfully on two of the properties sold; in so far as the record before us indicates, appellant did not contest the validity of any of the other sales by a motion to dismiss as to those properties and/or did not then raise the issues as to these parcels it now raises. Rather, it waited until after the judgments foreclosing the equities of redemption had been entered to complain on these grounds. Such failure to timely raise the issues below normally would bar appellant from bringing them at this stage of the proceedings. Some years later, the Court again visited the question of the jurisdiction of the Circuit Court in foreclosure proceedings involving defective descriptions of the property sold at a tax sale in Thomas v. Hardisty, 217 Md. 523, 143 A.2d 618 (1958). The Court determined that the Circuit Court lacked jurisdiction to foreclose the right of redemption because the property was improperly described throughout the proceedings. Importantly, the Court also pointed out that [t]here was no personal service on the appellant or actual notice to him of the proceedings, and hence he had no opportunity to correct the clearly wrong description. Id. at 534-35, 143 A.2d at 624. In the case sub judice, the appellant had every opportunity to raise the issues it now raises in this appeal at any time before the judgment was entered, which it failed to do. And, inaction by the owner has been grounds for a denial of a motion to reopen foreclosure proceedings. In Hauver v. Dorsey, 228 Md. 499, 180 A.2d 475 (1962), the Court determined that a purchaser's failure to file an affidavit as required by the Rules did not deprive the Circuit Court of jurisdiction to issue a judgment foreclosing the right of redemption. Hauver had received the property by will and failed to pay taxes on it. The property was sold at a tax sale seven years after the death of the original owner who was still the title holder according to the land records. All notices sent to the address of record were returned and the Circuit Court entered a decree foreclosing the right of redemption on the property. A year later, Hauver filed a petition to set aside the judgment, which was denied. In affirming that denial, the Court stated: We have frequently pointed out that the tax sales law was designed to improve the marketability of tax titles. Petitioner was less than diligent in failing to ascertain that taxes were in default, that the sale had been made, and a proceeding to foreclose instituted. We see no reason to hold that a procedural requirement, designed to prevent imposition upon the court and require a reasonable effort in good faith to locate and warn the owner, creates a jurisdictional defect in the fundamental sense of preventing the court from dealing with the subject matter and the parties before it. Id. at 505, 180 A.2d at 478 (citations omitted). In the case sub judice, we see no reason to hold that the citation of the properties, whichas explained supra is only a requirement to be able to collect from the delinquent taxpayer the difference between the sale price and the amount of the lien, creates a jurisdictional defect preventing the Circuit Court from foreclosing the owner's right of redemption on the property. As an active participant in the proceedings, appellant could have at anytime before the judgment was enteredpaid the taxes and redeemed the property.