Krstevski v. Nat'l Attorneys' Title Assurance Fund, Inc.

Decision Date18 November 2016
Docket NumberCAUSE NO.: 2:14-CV-179-TLS
CourtU.S. District Court — Northern District of Indiana

This matter comes before the Court on Defendant NASA Leasing's Motion for Summary Judgment [ECF No. 100], which was filed on April 22, 2016. On June 27, 2016, the Plaintiff filed his Response to Defendant NASA Leasing's Motion for Summary Judgment [ECF No. 109]. Defendant NASA Leasing entered its Reply [ECF No. 110] on July 7, 2016. The Court received the Final Report of Mediation [ECF No. 117] on September 1, 2016, which stated that the parties failed to reach an agreement. This matter is now ripe for the Court's review.


This case involves two adjacent parcels of land in Crown Point, Indiana. The following facts are not in dispute. On November 24, 2009, Defendant NASA Leasing purchased a Tax Lien for the following land parcel:

Key Number: 45-16-05-406-004.000-042
Brief Legal Description: Railroad Add. S.22 Ft. of L.2 Bl. 38
Commonly known as: 806 N. Grant, Crown Point, Indiana

(Pl.'s Resp. Ex. C, ECF No. 109-5.) Defendant NASA Leasing purchased 806 N. Grant at a Lake County Commissioner's tax sale, which was assessed solely as land without any improvements.

(Def.'s Reply 6, ECF No. 110; Pl.'s Resp. Ex. D, ECF No. 109-6.) On February 2, 2010, the Plaintiff closed his purchase for the following land parcel:

Key Number: 45-16-05-406-005.000-042
Brief Legal Description: Railroad Add. N.22 Ft. of L.2 Bl. 38
Commonly known as: 804 N. Grant, Crown Point, Indiana

(Pl.'s Resp. Ex. B, ECF No. 109-4; Id. Ex. E., ECF No. 109-7.) The Plaintiff received a Special Warranty Deed from the Secretary of Housing and Urban Development ("HUD") for 804 N. Grant. (Pl.'s Resp. Ex. B; Id. Ex. E.) In addition to land, the Deed included the home located on 804 N. Grant, which Lake County assessed as an improvement on 804 N. Grant. (Pl.'s Resp. Ex. G, ECF No. 109-9.)

Defendant NASA Leasing published a notice on May 4, 2010, which stated that it was filing an application for deed and a date of hearing. (Def.'s Reply Ex. C.) The notice enumerated the identifying information above—Key Number, Brief Legal Description, and Common Address. (Id.) Notice was provided both by publication and certified mail, addressed to the Secretary of HUD in Chicago. (Id.; Pl.'s Resp. Ex J, ECF No. 109-12.) On July 15, 2010, Defendant NASA Leasing submitted an Entry of Order to Issue Tax Deed for 806 N. Grant. (Def.'s Reply Ex. D.) Defendant NASA Leasing received its Tax Deed on September 2, 2010, which was duly recorded in the Lake County, Indiana, Office of the Recorder on October 25, 2010. (Def.'s Mot. Summ. J. Ex. A, ECF No. 100.)

By mid-February 2011, Defendant NASA Leasing and the Plaintiff were disputing their respective ownership rights in the adjacent parcels. (Def.'s Reply Ex. F.) Defendant NASA Leasing claimed a one-half interest in the Plaintiff's home, arguing that the home was partly located on 806 N. Grant. The Plaintiff argued that Defendant NASA Leasing had no interest in the Plaintiff's home. On April 17, 2014, the Plaintiff filed his initial Complaint [ECF No. 2],which was subsequently removed to federal court, pursuant to 28 U.S.C. §§ 1332, 1441, and 1446 [ECF No. 1]. In the Second Amended Complaint [ECF No. 82], the Plaintiff asserts claims against Defendant NASA Leasing, as well as Defendants National Attorneys' Title Assurance Fund, Inc. ("NATAF"), McColly Real Estate, Inc., the Secretary of HUD, County of Lake, Indiana, Becky Steininger, and Stephen W. Robertson. Defendant NASA Leasing filed its Answer and Counterclaim [ECF No. 90] on October 8, 2015. The Plaintiff seeks to set aside the "Tax Deed issued to Defendant NASA Leasing, Quiet Title judgment against them, declare the tax sale title to one-half of the home be declared null and void, and fee-simple title and interest to 804 N. Grant St. home be quieted as against any and all claims of the Defendant and past tax sales." (Second Amend. Compl. ¶ 15, ECF No. 82.) Only those claims asserted against Defendant NASA Leasing are pertinent to this Motion for Summary Judgment.


Summary judgment is warranted when "the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). Summary judgment is the moment in litigation where the nonmoving party is required to marshal and present the court with evidence on which a reasonable jury could rely to find in that party's favor. Goodman v. Nat'l Sec. Agency, Inc., 621 F.3d 651, 654 (7th Cir. 2010). A court should only deny a motion for summary judgment when the nonmoving party presents admissible evidence that creates a genuine issue of material fact. Luster v. Ill. Dep't of Corrs., 652 F.3d 726, 731 (7th Cir. 2011) (first citing United States v. 5443 Suffield Terrace, 607 F.3d 504, 510 (7th Cir. 2010); then citing Swearnigen-El v. Cook Cnty. Sheriff's Dep't, 602 F.3d 852, 859 (7th Cir. 2010)). A court's role in deciding a motion for summary judgment "is not to sift through the evidence, pondering the nuances and inconsistencies, and decide whom to believe.[A] court has one task and one task only: to decide, based on the evidence of record, whether there is any material dispute of fact that requires a trial." Waldridge v. Am. Heochst Corp., 24 F.3d 918, 920 (7th Cir. 1994). Material facts are those that are outcome determinative under the applicable law. Smith v. Severn, 129 F.3d 419, 427 (7th Cir. 1997). Although a bare contention that an issue of material fact exists is insufficient to create a factual dispute, a court must construe all facts in a light most favorable to the nonmoving party, view all reasonable inferences in that party's favor, see Bellaver v. Quanex Corp., 200 F.3d 485, 491-92 (7th Cir. 2000), and avoid "the temptation to decide which party's version of the facts is more likely true," Payne v. Pauley, 337 F.3d 767, 770 (7th Cir. 2003).


This Court has original jurisdiction over "any express or implied contract with the United States" pursuant to 28 U.S.C. § 1346(a)(2), and the Plaintiff alleges that the Secretary of HUD "fail[ed] to deliver full home ownership . . . in direct breach of the terms of agreement of sale." (Second Amend. Compl. ¶ 10.)1 Supplemental jurisdiction is appropriate, pursuant to 28 U.S.C. § 1367, over the Plaintiff's state law claim to quiet title against Defendant NASA Leasing.

Defendant NASA Leasing moves for summary judgment on the grounds that it received a valid Tax Deed to 806 N. Grant, which it claims is prima facie evidence of its fee simple title in that property, and thus a one-half interest in the Plaintiff's home. The Plaintiff challenges Defendant NASA Leasing's claim to a one-half interest by questioning the Tax Deed's validity on the grounds that (1) the Plaintiff was not given constitutionally adequate notice of the Defendant's claim, (2) the 806 N. Grant property was not subject to or assessed for the sametaxes as the 804 N. Grant property, and (3) the Tax Deed failed to describe the property with reasonable certainty.

A. Indiana's Tax Deed Regime

"A purchaser at a tax sale receives a tax certificate evidencing a lien against the property for the entire amount paid. The lien is superior to all other liens which exist at the time the certificate is issued." Calhoun v. Jennings, 512 N.E.2d 178, 181 (Ind. 1987) (citing Ind. Code § 6-1.1-24-9). Pursuant to the Indiana Code, "[a] tax deed . . . vests in the grantee an estate in fee simple absolute, free and clear of all liens and encumbrances created or suffered before or after the tax sale except those liens granted priority under federal law, and the lien of the state or a political subdivision for taxes and special assessments that accrue subsequent to the sale." Ind. Code. § 6-1.1-25-4.6(k). "However, the estate is subject to all easements, covenants, declarations, and other deed restrictions and laws governing land use, including all zoning restrictions and liens and encumbrances created or suffered by the purchaser at the tax sale." Id. The tax deed is prima facie evidence of "(1) the regularity of the sale of the real property described in the deed; (2) the regularity of all proper proceedings; and (3) valid title in fee simple in the grantee of the deed." Id.

There are certain prescribed ways for a party to defeat another's claim to title conveyed by a tax deed. See Ind. Code § 6-1.1-25-16. Specifically, a party may successfully challenge another's claim to title via tax deed only if:

(1) the tract or real property described in the deed was not subject to the taxes for which it was sold; (2) the delinquent taxes or special assessments for which the tract or real property was sold were paid before the sale; (3) the tract or real property was not assessed for the taxes and special assessments for which it was sold; (4) the tract or real property was redeemed before the expiration of the period of redemption . . . ; (5) the proper county officers issued a certificate, within the time limited by law for paying taxes or for redeeming the tract or realproperty, which states either that no taxes were due at the time the sale was made or that the tract or real property was not subject to taxation; (6) the description of the tract or real property was so imperfect as to fail to describe it with reasonable certainty; or (7) the notices required . . . were not in substantial compliance with the manner prescribed [under relevant Indiana Code sections].

Id. Here, Defendant NASA Leasing offered evidence in its Motion that it was the grantee of a Tax Deed for 806 N. Grant received on September 2, 2010, which was duly recorded with the Office of the Recorder of Lake County, Indiana on October 25, 2010. (Def.'s Mot. Summ. J. Ex. A.) Under Indiana law, this is prima facie evidence that Defendant NASA Leasing...

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