Garcia v. Ted Parks, L.L.C.

• Decision Date: 07 October 2008
• Docket Number: No. 105,176.,105,176.
• Citation: 2008 OK 90,195 P.3d 1269
• Parties: Dolla GARCIA, Plaintiff/Appellant, v. TED PARKS, L.L.C., Forest "Butch" Freeman, the Treasurer of Oklahoma County; and the Board of County Commissioners of Oklahoma, Defendants/Appellees.
• Court: Oklahoma Supreme Court

195 P.3d 1269

2008 OK 90

Dolla GARCIA, Plaintiff/Appellant, v. TED PARKS, L.L.C., Forest "Butch" Freeman, the Treasurer of Oklahoma County; and the Board of County Commissioners of Oklahoma, Defendants/Appellees.

No. 105,176.

Supreme Court of Oklahoma.

October 7, 2008.

CERTIORARI TO THE COURT OF CIVIL APPEALS, DIVISION 1; Honorable Bryan C. Dixon, Trial Judge

¶ 0 The appellant landowner, Dolla Garcia, neglected to pay the 2002 property taxes on her home. The appellee, Ted Parks, Inc., purchased the property at a tax sale and applied for a certificate of tax deed. The landowner petitioned to set aside the tax deed asserting that: 1) the tax deed was void because she was not given sufficient notice of the application for tax deed; and 2) she was entitled to redemption. Parks filed a motion for summary judgment which the trial court granted. The landowner filed a motion for new trial insisting that a guardian had been appointed for her because of her mental condition and that the Social Security Administration had determined her to be disabled since March 5, 2002. The trial court denied the motion for a new trial, the landowner appealed, and the Court of Civil Appeals affirmed. We hold that: 1) due process requires that the landowner be given actual notice of the sale, otherwise the sale is void; 2) the notice requirements for issuing the tax deed were not met, which voided the tax deed; and 3) because the landowner is legally disabled, she is entitled to redeem the property.

CERTIORARI PREVIOUSLY GRANTED; COURT OF CIVIL APPEALS OPINION VACATED; TRIAL COURT REVERSED AND CAUSE REMANDED.

Jennifer Jones, James Patrick Kelley, Oklahoma City, OK, for Plaintiff/Appellant.

Jeffery S. Ludlam, Oklahoma City, OK, for Defendant/Appellee Ted Parks, L.L.C.

KAUGER, J.

¶ 1 This cause concerns a dispute over title to a home owned since March 12, 1981, by the appellant, Dolla Garcia, also known as Dolla Moore (landowner). The appellee, Ted Parks, Inc. (Parks) asserts an interest in the property by virtue of his Certificate of Tax Deed. The legitimacy of Park's interest in the property is contingent on: 1) whether the Oklahoma County Treasurer's October 6, 2003, tax sale and the issuance of the September 6, 2007, Certificate of Tax Deed complied with the constitutional and statutory procedures authorizing the sale of real property for delinquent taxes; and 2) whether, under the facts of this cause, the landowner should have been allowed either exemption or redemption.

¶ 2 We hold that: 1) due process requires that the landowner be given actual notice of the sale, otherwise the sale is void; 2) the notice requirements for issuing the tax deed were not met, and the tax deed is void; and 3) because the landowner is legally disabled, she is entitled to redeem the property.

FACTS

¶ 3 In 2002, the landowner neglected to pay the ad valorem taxes on her home located in southeast Oklahoma City, Oklahoma. On October 6, 2003, the county treasurer placed the property for bid at public auction, and it was purchased by Heartwood 88, Inc. That same day, Heartwood assigned its interest to Parks after Parks paid the delinquent taxes for 2002, totaling $509.28.¹ It appears Parks also subsequently paid the 2003 and 2004 ad valorem taxes on the property of $449.95 and $470.06.

¶ 4 In March of 2002, the landowner sought, but was denied, disability insurance benefits from the Social Security Administration. The record indicates that the onset of her disability began in 2001, and it initially consisted of degenerative back impairments of the cervical and lumbar discs, affective mood disorder, and a tear of her rotator cuff. The nature of the landowner's physical and mental condition continued to decline over the next several years, and it grew to include chronic neck and back pain, anger problems, emotional disorders including anxiety and depression, neck surgery, pain and muscle spasms, memory and concentration problems, knee problems including knee surgery, and shoulder and arm problems. She has undergone many different medical treatments, several surgeries, psychotherapy, and several hospitalizations. In addition to her physical decline, she became depressed, suicidal, and socially withdrawn.

¶ 5 On May 10, 2006, Parks filed an Application for a Tax Deed to the landowner's home. Finally, on May 26, 2006, after another hearing from the Social Security Administration, an administrative law judge determined that the landowner had in fact been disabled under the Social Security Act since March of 2002 and that she qualified for benefits. The record is unclear as to when, but at some point after she was determined totally disabled by the Social Security Administration, she started receiving a monthly check of $1,226.00.

¶ 6 The landowner was again admitted to the hospital on June 28, 2006. A few days later, on July 4, 2006, Johnny Moore, the landowner's son (son) who lived in Tulsa, Oklahoma, was in town to visit his mother. While he was dropping off his belongings at his mother's house for an overnight stay, a process server appeared at the house. Even though he told the process server that he did not reside at the home, the process server handed him a "Notice of Application for Tax Deed." According to the process server, the son stated that he did reside at the home. Regardless, the son, without reading the paperwork, left it on the kitchen table for his mother to find.

¶ 7 The landowner was released from the hospital on July 9, 2006, and allegedly she did not discover the "Notice" until late July. On July 28, 2006, the landowner signed an application for exemption from tax sale stating that: 1) she was the record owner of the disputed property; 2) she was 65 years old or older or is totally disabled; 3) the fair market value of the property does not exceed $125,000.00; and 4) her gross household income had been $300.00 monthly or approximately $4,300.00 annually (she does not mention whether she was also receiving the additional social security benefits at this time). On September 7, 2006, the Oklahoma County Treasurer issued a Certificate of Tax Deed for the disputed property to Parks. The deed was recorded on September 8, 2006.

¶ 8 On December 11, 2006, the landowner filed a Petition to Set Aside Tax Deed and to Quiet Title. She sought to clear her title of the cloud the tax deed presented on her property. She alleged that: 1) the purported tax deed was void because she was not given sufficient notice of the Application for Tax Deed; and 2) she was entitled to redemption of any alleged past-due tax assessments. The landowner tendered $2,210.78, the amount of taxes, penalties, costs and interest which she believed to be due as of March 6, 2006, to the county.

¶ 9 The trial court ignored the existence of disputed fact issues regarding whether the son lived with his mother, as the process server claimed, or whether he lived in Tulsa, as he and the landowner claimed. It granted summary judgment in favor of Parks and against the landowner on June 22, 2007.

¶ 10 Because the landowner suffered from a mental condition which severely limited her ability to manage her financial affairs, Wilmer Louis Garcia, her ex-husband, was appointed her limited guardian on July 31, 2007. She filed a Motion for New Trial/Reconsideration on August 20, 2007, arguing that: 1) notice of the tax deed application was improperly served and inadequate; and 2) new evidence had come to light regarding the July 31, 2007, guardianship appointment over her because of a mental condition and a determination of disability by the Social Security Administration in May of 2006, that declared her disabled since March 5, 2002. The trial court denied the motion for new trial, and the landowner appealed. The Court of Civil Appeals affirmed, and we granted certiorari on June 16, 2008.

I.

¶ 11 DUE PROCESS REQUIRES THAT THE LANDOWNER BE GIVEN ACTUAL NOTICE OF THE SALE. OTHERWISE, THE SALE IS VOID.

¶ 12 It is unclear from the record whether the initial tax sale was valid. Delinquent taxes owed on real property are considered a lien upon the property for seven years from the date they are due and payable.² The procedures for collecting delinquent ad valorem taxes are set forth in the Oklahoma Tax Code, 68 O.S.2001 §§ 3101 et seq. Pursuant to 68 O.S. Supp.2007 § 3105, a county treasurer may sell real property located within the county to pay delinquent taxes.³ However, before a tax sale is held, notice to the landowner is required. Title 68 O.S.2001 § 3106 requires the county to publish notice of the sale of real property for delinquent taxes in a newspaper, and it also mandates actual notice to the record owner by certified mail.⁴ However, the statute also provides that failure to receive notice shall not invalidate the sale.⁵ The record does not disclose when or if the landowner was served actual notice that her property was going to be sold by the county assessor on October 6, 2003 — the event that triggered this dispute.

¶ 13 This Court has long recognized that the statutory notice provisions for a tax sale are mandatory, and the absence of such notice nullifies the sale of the property.⁶ Recently, in Southwestern Commercial Capital, Inc. v. Cornett Packing Co., 2000 OK 19, ¶ 16, 997 P.2d 849, when discussing the due process requirement of notice of a tax sale to interested parties, we noted that:

It is a fundamental tenet of constitutional law that one may not be deprived of a valuable property interest without first giving notice `reasonably calculated under all circumstances, to apprise interested parties of the pendency of the action and afford them an opportunity to present their objections.... It would be idle to pretend that publication alone ... is a reliable means of acquainting interested parties of the fact that their rights are before the courts.' Mullane v. Central Hanover Bank & Trust Co., 339 U.S. 306, 70 S.Ct. 652, 94 L.Ed. 865 (1950). Notice by...