Court Opinion

ID: 9965854
Source: CourtListenerOpinion
Date Created: 2024-05-03 16:09:51.970556+00
Date Added: 2024-06-11T08:25:47.334358
License: Public Domain

05/03/2024
                   IN THE COURT OF APPEALS OF TENNESSEE
                                AT JACKSON
                                       April 10, 2024 Session

     SHELBY COUNTY v. DELINQUENT TAXPAYERS 2018 (BLIGHT
                 AUTHORITY OF MEMPHIS)

                  Appeal from the Chancery Court for Shelby County
           No. PARCEL 02701100000130 Melanie Taylor Jefferson, Chancellor
                      ___________________________________

                                No. W2023-00446-COA-R3-CV
                            ___________________________________

In this appeal, the trial court granted a motion to rescind a tax sale with respect to a
particular parcel. We vacate the trial court’s order and remand for the trial court to enter
an order containing sufficient findings of fact and conclusions of law reflecting the basis
for its decision. To the extent that a constitutional challenge is raised, the trial court should
also determine on remand whether notice must be provided to the Tennessee Attorney
General pursuant to Tennessee Rule of Civil Procedure 24.04.

 Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court Vacated
                                  and Remanded

CARMA DENNIS MCGEE, J., delivered the opinion of the court, in which J. STEVEN
STAFFORD, P.J., W.S., and ARNOLD B. GOLDIN, J., joined.

Marcus D. Ward, Memphis, Tennessee, for the appellant, Blight Authority of Memphis.

Gregory S. Gallagher, Memphis, Tennessee, for the appellee, Shelby County, Tennessee.

                                   MEMORANDUM OPINION1

       1
           Rule 10 of the Rules of the Court of Appeals provides as follows:

       This Court, with the concurrence of all judges participating in the case, may affirm, reverse
       or modify the actions of the trial court by memorandum opinion when a formal opinion
       would have no precedential value. When a case is decided by memorandum opinion it shall
       be designated “MEMORANDUM OPINION,” shall not be published, and shall not be
       cited or relied on for any reason in any unrelated case.
                               I.    FACTS & PROCEDURAL HISTORY

       This appeal arises from a delinquent tax sale. The original complaint for collection
of delinquent taxes was filed by Shelby County in March 2020.2 On June 29, 2022, the
chancery court entered a decree confirming the sale of a parcel at 1059 North Dunlap. On
September 7, 2022, the Shelby County Delinquent Tax Attorney filed a motion to rescind
the tax sale of this parcel. The motion simply stated that “since the sale of this parcel,
attorney for the Plaintiffs/Movants [Shelby County] has determined that a error occurred
and that this parcel should not have been sold.” Thus, Shelby County asked the court to
rescind the sale, divest title out of the buyer, Steve Lockwood, and vest title back in the
name of the original owner.

        On February 23, 2023, the chancery court entered an order rescinding the tax sale
of the subject parcel. The order states, in pertinent part:

                Upon the statement of counsel for the Plaintiffs/Movants advising that
        the Blight Authority of Memphis (BAM), a statutory land bank, through its
        counsel Marcus D. Ward, did provide notice prior to this Tax Sale that BAM
        intended to acquire this parcel by a preemptive bid pursuant to Tennessee
        Code Annotated 13-30-110(f)(1) & (2). Said notice was provided by a letter
        from Marcus D. Ward dated March 21, 2022, to the Shelby County Chancery
        Court Clerk and Master. Further, through additional statements from counsel
        for the Plaintiffs/Movants it appeared to the Court that even though there was

        2
          The original complaint was styled: “SHELBY COUNTY, in its own behalf and for the use and
benefit of THE STATE OF TENNESSEE and, if applicable, the INCORPORATED MUNICIPALITIES
OF ARLINGTON, BARTLETT, COLLIERVILLE, GERMANTOWN, LAKELAND, MEMPHIS and
MILLINGTON, TENNESSEE v. DELINQUENT TAXPAYERS as shown on the 2018 Real Property Tax
Records of the Shelby County Trustee.” A fourth amended complaint in the record is to the same effect.
However, other documents in the record contain a different style in which the names of the State and County
are switched as follows: “THE STATE OF TENNESSEE, in its own behalf and for the use and benefit of
SHELBY COUNTY and, if applicable, the INCORPORATED MUNICIPALITIES OF ARLINGTON,
BARTLETT, COLLIERVILLE, GERMANTOWN, LAKELAND, MEMPHIS and MILLINGTON,
TENNESSEE.” We will utilize the style listed on the complaint, as it states that it was filed pursuant to
Tennessee Code Annotated section 67-5-2405, which provides:

        (a) The attorney shall after February 1, and not later than April 1, file suits in the circuit or
        chancery court of the county for the collection of delinquent land taxes due the state, county
        and municipality, as well as the interest, penalties, and costs attached to and a part of such
        taxes, which taxes, interest, penalties, and costs are declared a lien upon the land; and, for
        the enforcement of this lien, suits shall be brought in the name of the county, in its own
        behalf and for the use and benefit of the state, municipality or other tax entity that has
        certified a delinquent tax list, or in the name of any such tax entity that has certified a
        delinquent tax list, in its own behalf and for its own use and benefit.

Tenn. Code Ann. § 67-5-2405(a) (emphasis added).
                                                     -2-
        an additional bid for an amount in excess of the minimum bid, BAM was the
        winning bidder and purchased this parcel for the minimum bid of [] ($3,078).
        The Court determined that as a result of the preemptive bid that the owner(s)
        of this parcel were deprived of the fair market value of the parcel.
                In its argument to the Court the Plaintiffs/Movants contended that the
        preemptive bid process used by BAM to successfully bid on this parcel was
        unlawful and unconstitutional. The Plaintiffs/Movants relied on the recent
        case decided and filed in the Sixth Circuit Court of Appeals, Twanda Hall,
        Curtis Lee, Coretha lee and Kristina Goven vs. Andrew E. Meisner, Oakland
        County Treasurer et al, No. 2:20-cv-12230 that the “preemptive bid”
        procedure used by BAM to obtain this parcel in Tax Sale 1804 was unlawful
        and unconstitutional.
                IT SATISFACTORILY APPEARING TO THE COURT that the
        Office of the Shelby County Trustee is ordered to refund to the Registry of
        the Office of the Shelby County Clerk and Master the taxes heretofore
        dispersed by the Clerk and Master for this parcel . . . .
                ...
                IT IS THEREFORE ORDER[E]D, ADJUDGED, AND DECREED:
        1.      That the sale of parcel 04800200000030 (legal description in “Exhibit
        A”) confirmed in an order of the Court on June 29, 2022, should be set aside
        and title to this parcel is hereby divested from Steve Lockwood/BAM and
        vested back in the names of Perry C. Little the owner at Tax Sale.

Blight Authority of Memphis timely filed a notice of appeal.

                                  II.    ISSUES PRESENTED3

       Blight Authority of Memphis presents the following issues, which we have slightly
restated, for review:

1.      Whether the motion to rescind the tax sale was properly before the Court pursuant
        to Tennessee Code Annotated section 67-5-2504, or in the alternative Rule 60.02 of
        the Tennessee Rules of Civil Procedure;
2.      Whether Defendant was properly noticed of the motion to rescind the tax sale and
        subsequent notice of hearing pursuant to Tennessee Code Annotated section 67-5-
        2504(i) and/or Rule 5.01 of the Tennessee Rules of Civil Procedure;
3.      Whether the chancery court made sufficient findings of fact and conclusions of law

        3
           Shelby County suggests that the notice of appeal in this case was untimely. In order to be timely,
a notice of appeal must “be filed with the clerk of the appellate court within 30 days after the date of entry
of the judgment appealed from.” Tenn. R. App. P. 4(a). However, “[t]he last day of the period so computed
shall be included unless it is a Saturday, a Sunday, or a legal holiday . . . in which event the period runs
until the end of the next day which is not one of the aforementioned days.” Tenn. R. App. P. 21(a). Due
to a weekend, the notice of appeal filed on Monday, March 27, 2023, was timely.
                                                    -3-
       as mandated by Tennessee Rule of Civil Procedure 52.01; and
4.     Whether the chancery court was the correct tribunal for Plaintiff to submit its
       constitutional challenge to Tennessee Code Annotated section 13-30-110(f)(1) &
       (2) pursuant to Rule 54 of the Tennessee Rules of Civil Procedure.

For the following reasons, we vacate the order of the chancery court and remand for further
proceedings.

                                      III.   DISCUSSION

        The chancery court’s order found that “as a result of the preemptive bid that the
owner(s) of this parcel were deprived of the fair market value of the parcel.” It also noted
Shelby County’s argument that the preemptive bid process was “unlawful and
unconstitutional,” citing a recent case from the Sixth Circuit. Beyond that, however, the
chancery court gave no explanation for its decision to rescind the tax sale. As it is, we are
left to wonder about the basis for the chancery court’s decision.

        Tennessee Rule of Civil Procedure 52.01 provides that “[i]n all actions tried upon
the facts without a jury, the court shall find the facts specially and shall state separately its
conclusions of law and direct the entry of the appropriate judgment.” “There is no bright-
line test by which to assess the sufficiency of factual findings, but the findings of fact must
include as much of the subsidiary facts as is necessary to disclose to the reviewing court
the steps by which the trial court reached its ultimate conclusion on each factual issue.”
Lovlace v. Copley, 418 S.W.3d 1, 35 (Tenn. 2013) (quotation omitted). Otherwise,
appellate courts are “left to wonder” about the basis for the trial court’s decision. In re
Houston D., 660 S.W.3d 704, 721 (Tenn. Ct. App. 2022). This Court has declined to
speculate as to a trial court’s rationale when we cannot discern the basis for the trial court’s
decision. See, e.g., Lugo v. Lugo, No. W2020-00312-COA-R3-CV, 2021 WL 507889, at
*4-5 (Tenn. Ct. App. Feb. 10, 2021). We have explained:

       ‘It is this Court’s purview to review, not assume or speculate. Without any
       facts in the trial court’s order, we are forced to guess at the rational[e] the
       trial court used in arriving at its decision. This we cannot do. Accordingly,
       we conclude that the trial court did not comply with Tennessee Rule of Civil
       Procedure 52.01.’

Id. at *5 (quoting Harthun v. Edens, No. W2015-00647-COA-R3-CV, 2016 WL 1056960,
at *5 (Tenn. Ct. App. Mar. 17, 2016)). “Generally, the appropriate remedy when a trial
court fails to make appropriate findings of fact and conclusions of law pursuant to Rule
52.01 is to ‘vacate the trial court’s judgment and remand the cause to the trial court for
written findings of fact and conclusions of law.’” Manning v. Manning, 474 S.W.3d 252,
260 (Tenn. Ct. App. 2015) (quoting Lake v. Haynes, No. W2010-00294-COA-R3-CV,
2011 WL 2361563, at *1 (Tenn. Ct. App. June 9, 2011)).
                                           -4-
       In this case, we recognize that Rule 52.01 does not apply, as the chancery court was
resolving a “motion” to rescind the tax sale. Rule 52.01 provides, “Findings of fact and
conclusions of law are unnecessary on decisions of motions under Rules 12 or 56 or any
other motion except as provided in Rules 41.02 and 65.04(6).” Tenn. R. Civ. P. 52.01.
However, even in cases where Rule 52.01 does not apply, this Court may deem it necessary
to remand for findings of fact and conclusions of law if we cannot ascertain the basis for
the trial court’s ruling. For instance, in Buckingham v. Tennessee Department of
Corrections, No. E2020-01541-COA-R3-CV, 2021 WL 2156445, at *3 (Tenn. Ct. App.
May 27, 2021), we explained:

       We acknowledge that findings of fact and conclusions of law are not required
       in resolving Tennessee Rule of Civil Procedure 12.02 motions to dismiss.
       See Tenn. R. Civ. P. 52.01 (“Findings of fact and conclusions of law are
       unnecessary on decisions of motions under Rules 12 or 56 or any other
       motion except as provided in Rules 41.02 and 65.04(6)”). In this case,
       however, appellate review is hampered because the trial court’s order does
       not apply any legal standard or contain legal conclusions regarding the
       sufficiency of the complaint or provide any reasoning for the dismissal. This
       Court has previously vacated a trial court’s Rule 12.02 dismissal where the
       order of dismissal did not sufficiently explain the basis for the dismissal.
       Huggins v. McKee, No. E2014-00726-COA-R3-CV, 2015 WL 866437
       (Tenn. Ct. App. Feb. 27, 2015). Because nothing in this record explains
       which of Mr. Buckingham’s claims were dismissed and why, we vacate the
       trial court’s dismissal of Mr. Buckingham’s complaint against Defendants.

We “remanded for entry of an order setting forth the appropriate legal standard and reasons
in support of the trial court’s decision.” Id. See also Matter of Conservatorship of Tapp,
No. W2021-00718-COA-R3-CV, 2023 WL 1957540, at *5 n.2 (Tenn. Ct. App. Feb. 13,
2023) (quoting Crenshaw v. Kado, No. E2020-00282-COA-R3-CV, 2021 WL 2473820, at
*6 (Tenn. Ct. App. June 17, 2021)) (“[A] trial court’s failure to provide any legal basis for
its dismissal o[n] a Rule 12.02 motion to dismiss can hamper this Court’s ability to review
the dismissal on appeal.”); Howard v. Howard, No. E2022-01385-COA-R3-CV, 2023 WL
6465223, at *4 (Tenn. Ct. App. Oct. 4, 2023) (quoting Parimore v. Parimore, No. W2016-
01188-COA-R3-CV, 2017 WL 657771, at *4 (Tenn. Ct. App. Feb. 17, 2017)) (“We
concede that the express language of Rule 60.02 places no affirmative duty on the trial
court to make findings of fact or conclusions of law in disposing of a Rule 60.02 motion.
However, this Court has previously indicated that, with respect to a Rule 60.02 motion, we
are ‘unable to adequately review’ a trial court’s discretionary decision and provide the
appropriate amount of deference to that decision when the trial court fails to make
appropriate findings of fact and conclusions of law.”).

       Thus, this Court has explained:
                                            -5-
       Although “[f]indings of fact and conclusions of law are unnecessary on
       decisions of motions,” Tenn. R. Civ. P. 52.01, “[w]e are a reviewing court.”
       Jackson v. Smith, No. W2011-00194-COA-R3-CV, 2011 WL 3963589, at
       *11 (Tenn. Ct. App. Sept. 9, 2011). As such, a trial court’s order must contain
       enough information “to disclose . . . the steps by which the trial court reached
       its ultimate conclusion . . . .” In re Estate of Oakley, No. M2014-00341-
       COA[-]R3-CV, 2015 WL 572747, at *11 (Tenn. Ct. App. Feb. 10, 2015)
       (quoting Lovlace v. Copley, 418 S.W.3d 1, 35 (Tenn. 2013)).

L. Offs. of T. Robert Hill PC v. Cobb, No. W2020-01380-COA-R3-CV, 2021 WL 2172981,
at *10 (Tenn. Ct. App. May 27, 2021); see also Regions Bank v. Blumberg Tr., No. E2020-
00051-COA-R3-CV, 2020 WL 4919783, at *3 (Tenn. Ct. App. Aug. 21, 2020). In this
case, the chancery court’s order setting aside the tax sale did not apply any legal standard
or contain legal conclusions providing any reasoning for its decision.

        We note that both parties on appeal interpret the trial court’s order as holding that
the preemptive bid process utilized in this case pursuant to Tennessee Code Annotated
section 13-30-110(f)(1) and (2) was unconstitutional. However, we must be “mindful of
the well-settled principle not to decide constitutional challenges unless the resolution of
that question ‘is absolutely necessary to determining the issues in the case and adjudicating
the rights of the parties.’” Mansell v. Bridgestone Firestone N. Am. Tire, LLC, No. M2010-
02093-SC-R3-WC, 2011 WL 3758562, at *4 (Tenn. Aug. 25, 2011) (quoting Waters v.
Farr, 291 S.W.3d 873, 882 (Tenn. 2009)).

       During oral argument before this Court, members of the panel also questioned the
attorneys regarding whether the Tennessee Attorney General received notice of any
constitutional challenge in this case, and counsel confirmed the Attorney General did not.
As a result, on remand, the trial court must also consider the applicability of Tennessee
Rule of Civil Procedure 24.04. See In re Adoption of E.N.R., 42 S.W.3d 26, 33 (Tenn.
2001) (explaining that where the Rule applies, “the court is required, pursuant to Tenn. R.
Civ. P. 24.04, to ensure that notice of the constitutional challenge has been provided to the
Office of the Attorney General,” as “the trial court sits as gatekeeper to inquire whether
notice has been provided to the Attorney General by the challenger and to suspend
proceeding on the constitutional challenge until such notice has been provided and a
response from the Attorney General received”). In addition, Blight Authority of Memphis
may present any arguments pertaining to Tennessee Code Annotated section 20-18-101 on
remand.

                                    IV.   CONCLUSION

      For the aforementioned reasons, the decision of the chancery court is hereby vacated
and remanded for further proceedings consistent with this opinion. Costs of this appeal are
                                          -6-
taxed equally to the appellant, Blight Authority of Memphis, and to the appellee, Shelby
County, for which execution may issue if necessary.

                                               _________________________________
                                               CARMA DENNIS MCGEE, JUDGE

                                         -7-