Fortunatus v. Clinton Cnty.

• Decision Date: 04 April 2013
• Docket Number: Civ. No. 8:12–CV–458 (RFT).
• Parties: Tom FORTUNATUS, Plaintiff, v. CLINTON COUNTY, NEW YORK and Joseph Giroux, in his Official Capacity as Clinton County Treasurer and in his Individual Capacity, Defendants.
• Court: U.S. District Court — Northern District of New York

937 F.Supp.2d 320

Tom FORTUNATUS, Plaintiff,

v.CLINTON COUNTY, NEW YORK and Joseph Giroux, in his Official Capacity as Clinton County Treasurer and in his Individual Capacity, Defendants.

Civ. No. 8:12–CV–458 (RFT).

United States District Court,

N.D. New York.

April 4, 2013.

Law Office of Mark Schneider, Mark A. Schneider, Esq., of Counsel, Plattsburgh, NY, for Plaintiff.

Maynard, O'Connor and Smith, Robert A. Rausch, Esq., of Counsel, Albany, NY, for Defendants.

MEMORANDUM–DECISION and ORDER

RANDOLPH F. TREECE, United States Magistrate Judge.

Former Clinton County property owner Tom Fortunatus (“Fortunatus”) initiated this action, pursuant to 42 U.S.C. § 1983, alleging that his constitutional rights were violated when Defendant Clinton County acquired his property through a tax foreclosure but would not consider reconveyance of his property after the date of redemption as it had done for another taxpayer. Dkt. Nos. 1, Compl. & 32, Am. Compl. In essence, Fortunatus claims that the Defendants discriminated against him based upon race as well as a “class of one” equal protection claim and “denied [him] due process of law by not providing him with a hearing regarding his request for reconveyance of the tax acquired property.” Am. Compl. at ¶¶ 75–79.

Presently before the Court are the parties' competing Motions for Summary Judgment. Defendants were the first to file a Motion for Summary Judgment. Dkt. No. 42, Defs.' Mot. for Summ. J, dated Nov. 27, 2012.¹ Shortly thereafter, Fortunatus filed a Cross–Motion for Summary Judgment, which, additionally in material respects, opposes Defendants' Motion. Dkt. No. 46, Pl.'s Cross–Mot. for Summ. J., dated Dec. 19, 2012.² Defendantsfiled an Opposition to Fortunatus's Cross–Motion, Dkt. No. 47,³ to which Fortunatus filed a Reply, Dkt. No. 49.⁴ For the foregoing reasons, the Defendants' Motion for Summary Judgment is granted and Fortunatus's Cross Motion is denied.

I. BACKGROUND⁵

A. Tom Fortunatus

Fortunatus, who owned property in the Town of Plattsburgh, County of Clinton, had a history of being late in paying his property taxes, had been a party to prior foreclosures, and, on a previous occasion, the property was actually foreclosed. On that occasion, Fortunatus initiated a state lawsuit to vacate the default judgment while he concomitantly commenced a federal action challenging the constitutionality of the redemption deadline and alleging that he was denied due process and equal protection. Dkt. No. 42–34, Defs.' 7.1 Statement at ¶¶ 17–18.⁶ His litigation efforts were unsuccessful and he was required to redeem his property. Id.

For the tax years 2009 through 2011, Fortunatus did not pay his real estate taxes. Id. at ¶ 3. Fortunatus admitted to receiving most of the reminders, warning letters, and notices and was aware that he had not paid his property taxes. Dkt. No. 42–13, Ex. L, Fortunatus Dep., dated June 4, 2012, at pp. 11, 17–18, & 27; Dkt. Nos. 42–6 through 42–12, Exs. E–K (notices). Fortunatus had been sick for an extended duration, and because of his illness, during September 2010, Fortunatus and his daughter left for his native country of Uganda and did not return to Clinton County until April 2011. Fortunatus Dep. at pp. 19–21 & 32; Defs.' 7.1 Statement at ¶¶ 7 & 12. In his absence from this Country, Fortunatus's neighbor, Shirley Davis, was authorized by him to receive his mail. Fortunatus Dep. at p. 22. On October 8, 2010, a Notice and Petition for Foreclosure was served at Fortunatus's address by certified mail to which Ms. Davis accepted service by signing the certified mail receipt. See Dkt. Nos. 42–14, Ex. M & 42–15, Ex. N. On March 18, 2011, New York State Supreme Court Acting Justice Patrick McGill signed an order and judgment of tax foreclosure on numerous properties, including Fortunatus's, transferring title of the properties to Clinton County. Dkt. No. 42–18, Ex. Q. Three months later, on June 2, 2011, Fortunatus's property was sold at a public auction. See generally Am. Compl.

Upon his return from Uganda, Fortunatus was alerted that his property had been foreclosed, so he reached out to the County's Treasurer Office in order to determine how he could recoup his property. A woman in the Treasurer's Office advised Fortunatus that the redemption deadline had expired and that his only recourse would be to re-purchase the property at the auction. Fortunatus Dep. at p. 33; Defs.' 7.1 Statement at ¶ 13. Fortunatus and his attorney, Mark Schneider, Esq., reached out to several county legislators to see if he could have an audience with the Clinton County Legislature in order to make an appeal to regain his property; he also sought assistance from his United States Congressman. Fortunatus Dep. at pp. 35–48. Although he personally spoke with two county legislators ⁷ and Congressman Owen, receiving the same intelligence that, pursuant to County real property tax policy, his option was to re-purchase his property at auction, he never addressed the County Legislature nor did he appear at the auction on June 2. Id. at p. 41 & 49 (averring further that he did not have the resources to attend the auction); Defs.' 7.1 Statement at ¶ 21.

Approximately four months later, in September 2011, Fortunatus discovered that another landowner, Mark Liberty, whose property was subject to the same foreclosure order, was allowed to redeem his property through a private sale. Additionally, he learned that Liberty was allowed an opportunity to personally appeal to the County Legislature and eventually entered into a settlement with the County for a reconveyance of his property. Fortunatus Dep. at pp. 51–54; Defs.' 7.1 Statement at ¶¶ 19 & 20. After failing to secure a settlement agreement with the County, Fortunatus, on October 3, 2011, initiated litigation in New York State Supreme Court, pursuant to C.P.L.R. Article 78, against Defendants Clinton County and Joseph Giroux, alleging that he was entitled to a hearing before the County Legislature, the County and Giroux acted arbitrarily and capriciously, and their actions against him were discriminatory. Dkt. No. 42–22, Ex. U, Pl.'s Art. 78 Pet.

B. Mark Liberty

Likewise, Mark Liberty's real property taxes had not been paid timely. Liberty's wife had received a notice of foreclosure but failed to inform Liberty. Their property was foreclosed pursuant to the same March 18, 2011 Order. Dkt. No. 42–18, Ex. Q. By the time Liberty learned of the foreclosure, the deadline for redemption of the property had expired and the County Treasurer's Office had informed him that his offer to pay the delinquent taxes was too late. Defs.' 7.1 Statement at ¶ 19. Responding to that instruction and after the County Legislature denied his request for a private sale, Liberty but before the property was auctioned, filed an Order to Show Cause to vacate the foreclosure judgment, and a hearing was held on May 31, 2011, before Justice McGill. Id. at ¶ 20; Dkt. No. 42–27, Ex. Z, Liberty Hr'g Tr.

During the hearing, the parties debated at length whether New York Real Property Tax Law § 1166 gave the County Legislature ultimate authority to allow private sales of tax foreclosed properties.⁸See generally Liberty Hr'g Tr. Clinton County posited that the County Treasurer, Defendant Giroux, who was the statutorily empowered enforcement officer, had the sole authority to permit a private conveyance. Id. at pp. 4–7.⁹ Apparently, Liberty had previously approached the Legislature for a reconveyance under § 1166 but, based upon the advice of counsel, the County Legislature rejected his request. Id. at p. 6; Dkt. No. 46–5, Pl.'s Ex. 19, Clinton Cnty. Legis. Min., dated May 25, 2011, at p. 2.¹⁰ After the County Attorney reiterated its position that the County Treasurer controls any private sale process, Justice McGill inquired:

So is it an Article 78 proceeding against Mr. Giroux that's required? Has he made a wrong decision? ... So you have an Article 78 proceeding against Mr. Giroux, right? He's the one that if that's the case, he's the controlling entity, is he not?

Liberty Hr'g Tr. at pp. 7–9.

Realizing that he did not have any further legal authority to grant Liberty's Motion to direct a reconveyance of his property, Justice McGill denied Liberty's motion to vacate the foreclosure. Possibly prompted by Justice McGill's inquiry, Liberty's counsel stated that they would file an “Article 78 proceeding before the end of today” seeking to “pull[ ] the property out of the tax sale[.]” Id. at p. 12.

On that very same day, Liberty filed yet another Article 78 Petition alleging that both Giroux's actions and the County Legislature's non-action were arbitrary, capricious,and abuses of discretion. Dkt. No. 42–28, Ex. AA, Liberty Pet., at ¶¶ 13 & 28. Noting that the public foreclosure sale was scheduled two days hence for June 2, 2011, Liberty pleaded that without court intervention his property would be sold and he would be irreparably injured, id. at ¶¶ 34–35, and, accordingly, sought a stay and restraining order of the public sale of his property during the pendency of that action, id. at Wherefore Clause, ¶ C. On June 1, 2011, Judge McGill signed an Order to Show Cause removing Liberty's property from the public auction. Dkt. No. 20–1, Order to Show Cause, dated June 1, 2011, at p. 2.

Clinton County and Giroux filed an answer opposing Liberty's petition. See generally Dkt. No. 42–29, Ex. BB, Clinton Cnty. Ans. In addition to their answer, Giroux filed an affidavit in opposition stating, inter alia, that (1) “in [his] role as County Treasurer ..., [he has] an obligation ... to ensure that appropriate foreclosure procedures are followed;” (2) he and his predecessor “consistently declined all requests for a post-redemption deadline offers of payment;” (3) neither had “authorized the Legislature to approve a private sale of property back to a delinquent taxpayer;” (4) it would be “in the best interest of the County to deny Mr. Liberty's request;” and, (5) he had “e...