Wisner v. Vandelay Invs., L.L.C.
| Decision Date | 24 August 2018 |
| Docket Number | No. S-16-451.,S-16-451. |
| Citation | 300 Neb. 825,916 N.W.2d 698 |
| Parties | Robin J. WISNER, as Personal Representative of the Estate of Gladys P. Wisner, deceased, appellant, v. VANDELAY INVESTMENTS, L.L.C., a Nebraska limited liability company, et al., appellees. |
| Court | Nebraska Supreme Court |
David W. Pederson, of Pederson & Troshynski, for appellant.
Robert S. Lannin and Chris S. Schmidt, of Baylor, Evnen, Curtiss, Grimit & Witt, L.L.P., Lincoln, for appellee Vandelay Investments, L.L.C.
Funke, J.Robin J. Wisner, personal representative of the estate of Gladys P. Wisner, deceased, appealed from a district court judgment that quieted title to certain property in favor of Vandelay Investments, L.L.C. (Vandelay), and dismissed his complaint—which requested that the court set aside Vandelay’s tax deed and permit him to exercise a right of redemption. The Nebraska Court of Appeals reversed the district court’s decision and remanded the cause after finding Vandelay had failed to comply with the statutory notice requirements before applying for the tax deed, which failure rendered Vandelay’s deed void.
On further review, we conclude that (1) Robin had standing to question Vandelay’s tax deed, (2) Vandelay complied with the statutory notice requirements before applying for the tax deed, and (3) Robin failed to prove that the extension to the statutory redemption period for an owner with a mental disorder applied. Therefore, we reverse the decision of the Court of Appeals and remand the cause with directions that the Court of Appeals affirm the judgment of the district court.
This case involves the purchase of real property due to delinquent real estate taxes.1 The purchaser of any real property sold by the county treasurer for taxes is entitled to a certificate in writing, commonly known as a tax certificate or tax sale certificate.2 This certificate represents a transfer of the state’s lien on the property to the purchaser and describes the property, the amount paid by the purchaser, and the date that the purchaser will be entitled to a deed.3 Tax certificates can be assigned by endorsement, and the assignee steps into the shoes of the purchaser.4
A property owner may redeem his or her property by paying the county treasurer the amount shown on the certificate and all subsequent taxes, along with the interest accrued thereon and any statutory costs.5 If the property is not redeemed within 3 years, however, the tax certificate holder may pursue either one of two options: (1) apply for a deed of conveyance for the property, commonly known as a tax deed, with the county treasurer6 or (2) proceed in district court to foreclosure on its lien and compel the sale of the property.7 Tax sale certificates and the sale of tax certificates are governed by chapter 77, article 18, of the Nebraska Revised Statutes, and the foreclosure of tax certificates is governed by chapter 77, article 19, of the Nebraska Revised Statutes for all tax sale certificates sold and issued between January 1, 2010, and December 31, 2017.8
Vandelay elected to pursue the tax deed method. Under this method, the holder of the tax certificate has a 6-month period, commencing 3 years from the date of the sale of the property, to apply for a tax deed from the county treasurer.9 Upon a county treasurer’s delivery of the tax deed to the tax certificate holder, a property owner loses the ability to redeem the property through the county treasurer.10 If the certificate holder waits longer than 3 years 6 months from the sale to apply for a tax deed, the certificate ceases to be valid and the lien of taxes for which the property was sold is discharged.11
However, at least 3 months before applying for the tax deed, the holder of the tax certificate must serve the record owner and encumbrancers of record with sufficient notice that application for a tax deed will be made.12
After a tax deed has been issued, the owner of the property may recover the property by proving the tax deed issued to the tax certificate holder is either void or voidable. A tax deed is void if the tax certificate holder did not substantially comply with the notice requirements.13 A tax deed is voidable if the property owner has a right to redeem the property and has exercised such right.14 While a property owner’s ability to redeem property typically ends upon the delivery of a tax deed, an owner with a mental disorder at the time of the property’s sale may redeem the property within 5 years from the date of the sale.15
Here, Robin claims that Vandelay did not sufficiently comply with the notice requirements to obtain the tax deed. He further contends that he has a right to redemption under this extended redemption period due to the mental disorder of Gladys, the record owner of the property.
The real estate involved in this action consists of 480 acres, containing irrigated cropland, rangeland, and a homestead; is located about 9 miles southeast of North Platte, Nebraska; and has the following legal description: "The North Half (N½) and the North Half of the South Half (N½S½) of Section Twenty-Nine (29), Township Thirteen (13) North, Range Twenty-Nine (29) West of the 6th P.M., in Lincoln County, Nebraska."
Gladys and her husband moved onto the property in 1949 and inherited it upon the passing of Gladys’ father in 1971.
They had two sons, Robin and Roger Wisner, and two daughters. After Gladys’ husband died in 2007, Roger primarily cared for Gladys and handled her affairs until his own death in 2009. Robin then assisted Gladys in moving from the homestead to a retirement community and arranged for her bills to be paid from her trust by a bank’s trust department.
Robin testified he assumed the trust department was paying the real estate taxes, because he thought Roger had probably paid them from the trust previously. While Robin stated that he had access to semiannual records from the trust, he testified that he did not typically check them closely or at all and that he never saw that the real estate taxes were being paid from it.
In 2010, the real estate taxes on the property became delinquent. In March 2011, the Lincoln County treasurer sold a tax sale certificate on the property to Acron Business Services, Inc. In February 2014, Vandelay purchased the tax sale certificate from Acron Business Services. Randy James, one of Vandelay’s owners, obtained the address where Gladys received her property tax statements, which was that of the retirement community. In March 2014, Vandelay sent notice of its intent to apply for a tax deed to Gladys at that address by certified mail with a return receipt requested, which was returned as "unclaimed."
Despite the return of the certified mailing, James believed he had Gladys’ actual address because it was not returned as sent to a vacant address or not deliverable as addressed. In addition, James had found a newspaper article, dated June 11, 2011, indicating that Gladys, in fact, lived at the retirement community.
Vandelay then published notice of its intent to apply for a tax deed in the Sutherland Courier-Times newspaper (Courier-Times) for 3 consecutive weeks. Evidence was presented that the Courier-Times covers events affecting Lincoln County, Nebraska, and residents in Sutherland, Hershey, and Paxton, Nebraska, and that approximately 1,300 weekly editions are sent to subscribers and distributed to racks in those three communities. In ZIP codes covering North Platte, there are about 100 Courier-Times subscribers but no distribution racks. Vandelay also sent a copy of the publicized notice to Gladys’ address by first-class mail, which was not returned.
In August 2014, Vandelay applied for a tax deed. Included with its application were a copy of the certified mail return receipt, a proof of publication in the Courier-Times, and an affidavit from James attesting that he had complied with the service requirements. The proof of publication attested that the Courier-Times is a legal newspaper in general circulation that is published in Sutherland and that the attached notice was published for 3 consecutive weeks, dates specified. The county treasurer delivered a tax deed to the property to Vandelay in September 2014.
Through the relevant period, the property was under lease, but the lease was not recorded. Shortly after the tax deed was filed, however, the lessee informed Robin that a deed had been issued in Vandelay’s favor. Robin, as the holder of a power of attorney for Gladys, attempted to redeem the tax sale certificate with Vandelay, which Vandelay rejected.
Gladys, by and through Robin, filed a complaint against Vandelay, requesting to have Vandelay’s tax deed voided, have her deed redeemed pursuant to the mental disorder extension, and title quieted in her name. Vandelay filed a counterclaim seeking to quiet title in its favor. Robin was substituted as the party plaintiff after Gladys’ death.
The court ruled Vandelay had complied with the statutory requirements for notice and publication. It reasoned that "[i]f Gladys could not be served after compliance by [Vandelay] with [§] 77-1832, she was therefore not found for service within the meaning of [§] 77-1834." The court also found the publication in the Courier-Times complied with the statutory requirement. Further, the court ruled Robin failed to prove Gladys had a mental disorder, and it rejected Robin’s equity argument. Thus, the court dismissed Robin’s complaint with prejudice and quieted title in favor of Vandelay.
Robin filed a timely appeal.
Before the Court of Appeals, Robin assigned, restated, that the district court erred in (1) finding Vandelay complied with the statutory notice and publication requirements for obtaining a treasurer’s tax deed, (2) finding Robin failed to prove Gladys suffered from a mental disorder, and (3)...
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