Land USA, LLC v. Ga. Power Co.

• Decision Date: 01 June 2015
• Docket Number: No. S15A0406.,S15A0406.
• Citation: 773 S.E.2d 236,297 Ga. 237
• Parties: LAND USA, LLC v. GEORGIA POWER COMPANY.
• Court: Georgia Supreme Court

297 Ga. 237

773 S.E.2d 236

LAND USA, LLC

v.GEORGIA POWER COMPANY.

No. S15A0406.

Supreme Court of Georgia.

June 1, 2015.

John Antoine Bailey Ayoub, Carolina Dallal Bryant, Ayoub & Mansour, LLC, Atlanta, for appellant.

Douglas Alton Henderson, Benjamin Wayne Cheesbro, Troutman Sanders, LLP, Atlanta, for appellee.

Opinion

THOMPSON, Chief Justice.

Appellant Land USA, LLC (“Land USA”) filed suit against Georgia Power Company (“Georgia Power”) for quiet title, trespass, and ejectment, challenging the validity of an easement Georgia Power claimed on property owned by Land USA in Fulton County, Georgia. Finding that Georgia Power had a valid easement, the Fulton County Superior Court granted Georgia Power's motion for summary judgment on all counts. Land USA filed a timely appeal to this Court. For the reasons discussed below, we affirm the order of the trial court in part and reverse and remand to the trial court in part for further action consistent with this opinion.

The underlying facts are not in dispute. In 2009, the Georgia Department of Transportation (“GDOT”) began a road-widening project which required Georgia Power to update and relocate an electrical transmission line Georgia Power had maintained along Donald Lee Hollowell Parkway since the 1960s. Seeking to clarify its rights with respect to maintaining the electric line, Georgia Power sought an easement from L.J. Fuller, the owner of a piece of property (the “Property”) abutting the parkway.¹ Among other things, Georgia Power sought to explicitly prohibit Fuller and any future owner of the Property from building structures within 25 feet of the electrical line's center. Fuller, however, was behind on his property taxes and, on March 3, 2009, the Fulton County Sheriff sold the Property at a tax sale to Investga.com, LLC (“Investga”). On April 22, 2009, Investga recorded a tax deed on the Property. Although aware of the tax sale, Georgia Power continued to negotiate the easement with Fuller.

After negotiations between Georgia Power and Fuller stalled, Georgia Power filed a condemnation action against the Property on July 14, 2009, but dismissed the action without prejudice two months later when Fuller granted it the requested easement in exchange for $24,000.² Upon completion of the GDOT road-widening project in January 2010, Georgia Power's electrical line was re-energized and put back into service.

On March 3, 2010, Investga properly served notices of foreclosure of the right to redeem the Property to all interested parties, including Georgia Power. Interested parties had until June 10, 2012 to redeem the Property, but none did. Thereafter, Investga sold the Property to Land USA and, on December 6, 2013, Land USA filed the instant action challenging the validity of the easement Georgia Power had obtained from Fuller and sought to maintain over the Property. Land USA moved for partial summary judgment and Georgia Power filed a cross-motion seeking summary judgment on all of Land USA's claims. Granting summary judgment to Georgia Power, the trial court found Fuller not only had the ability to convey an easement to Georgia Power following the tax sale of the Property, but that the post-tax sale easement obtained by Georgia Power was not extinguished when the redemption period for the Property closed without the Property being redeemed. The trial court further determined that Land USA's claims for ejectment and trespass failed as a matter of law because the electric line was within the public GDOT right-of-way and did not materially encumber the Property,³ the electric line was a necessary and constituent part of Georgia Power's service to the public⁴ and, as Land USA was neither the true owner of the Property nor in possession at the time the line was re-energized, it lacked standing to assert a trespass claim against Georgia Power.⁵

1. Land USA contends that the trial court erred in finding Georgia Power had a valid and enforceable written easement over the Property. Land USA contends that the easement Georgia Power obtained from Fuller in 2009 after he had already lost the property to a tax sale became a nullity when the property was not redeemed after Investga properly invoked the state barment statutes set forth in OCGA § 48–4–45, et seq. We agree.

In Georgia, when property is sold for unpaid taxes, the tax sale purchaser obtains a deed to the property. See Bennett v. Southern Pine Co., 123 Ga. 618, 621, 51 S.E. 654 (1905). This deed, however, does not provide the tax sale purchaser with absolute title to the property, but rather gives the purchaser a defeasible fee interest therein with the title remaining subject to encumbrance for at least one year after purchase due to other interested parties' statutory rights of redemption. See National Tax Funding, L.P. v. Harpagon Company, LLC., 277 Ga. 41, 42(1), 586 S.E.2d 235 (2003). As previously outlined by this Court,

[a]fter the tax sale, the delinquent taxpayer or any other party holding an interest in or lien on the property may redeem the property by paying to the tax sale purchaser the purchase price plus any taxes paid and interest. If the property is redeemed, the tax sale is essentially rescinded and a quitclaim deed is executed by the tax sale purchaser back to the owner of the property at the time of levy and sale....This right of redemption, however, may be terminated by the tax sale purchaser anytime after one year following the tax sale. After that year has run, the tax sale purchaser may “terminate, foreclose, divest, and forever bar” all rights to redeem the property by giving notice under OCGA § 48–4–40, et seq. (“the barment statutes”) to all parties with redemption rights. The barment statutes apply to “all persons having ... any right, title or interest in, or lien upon” the subject property.

(Citations omitted.) Id. at 43, 586 S.E.2d 235.

It is undisputed that at the time Georgia Power sought an easement from Fuller in 2009, the last deed in the chain of title to the Property belonged to Investga. As the redemption period had not yet terminated, Fuller retained possession of the Property. However, he lacked a sufficient interest therein to grant Georgia Power the perpetual, express easement it sought. See Georgia Lien Services, Inc. v. Barrett, 272 Ga.App. 656, 658, 613 S.E.2d 180 (2005) (stating that after a tax sale, the record owner has only a right to redeem the property, and once that period expires, the former record owner has no interest in the property). At best, the easement granted to Georgia Power by Fuller conveyed an interest in the Property which provided Georgia Power with a right of redemption. See Leathers v. McClain, 255 Ga. 378, 338 S.E.2d 666 (1986) (parties acquiring an interest in property following a tax sale are entitled to notice and to exercise the right of redemption).

Here, Investga gave proper notice under the barment statutes to all interested parties, including Georgia Power, of Investga's intent to foreclose redemption of the Property. Had the Property been redeemed by any party, title thereto would have reverted to Fuller and the easement Georgia Power purchased would have been validated. See OCGA § 48–4–43 (“When property has been redeemed, the effect of the redemption shall be to put the title conveyed by the tax sale back into the defendant in fi. fa. ...”). See also Reece v. Smith, 276 Ga. 404, 406, 577 S.E.2d 583 (2003) (“[A] grantor who conveys by warranty deed an interest that he does not then own, but later acquires, will be estopped to deny the validity of the first deed.”). When no party redeemed the Property within the applicable period, however, the right of redemption was foreclosed and fee simple title to the Property vested in Investga. See National Tax Funding, LP, supra, 277 Ga. at 43, 586 S.E.2d 235. As a result, the easement Georgia Power obtained from Fuller following the tax sale was extinguished. See OCGA § 44–9–7.⁶

While OCGA § 44–9–7 does not directly address the viability of an easement granted by the defendant in fi. fa. following a tax sale of real property, we disagree with the trial court's determination that this statute has no applicability to the facts presented. It is an elementary rule of statutory construction that statutes relating to the same subject matter are “ in pari materia” and must be construed together and harmonized whenever possible. See Snyder v. State, 283 Ga. 211, 214, 657 S.E.2d 834 (2008) ; Iglesia Del Dios Vivo Columna Y Apoyo De La Verdad La Luz Del Mundo, Inc. v. Downing, 321 Ga.App. 778, 742 S.E.2d 742 (2013). Here, OCGA § 44–9–7, addresses the effect of tax sales of real property on easements and must be construed in relation to other statutes which similarly address the effect of tax sales on property rights.⁷ See Bennett, supra, 123 Ga. at 620, 51 S.E. 654 (“Tax sales are creatures of statute. When, how, and under what circumstances they are to be made, and their effect when made, are matters depending upon the statute governing them.”). Of particular relevance to this case are those statutory provisions dealing with the rights accorded an owner or interest holder in real property to redeem the property following a tax sale,⁸ as well as those providing a means by which the tax sale purchaser can foreclose this right of redemption.⁹

Construing OCGA § 44–9–7 in relation to these statutes, we conclude that by explicitly providing that easements recorded prior to the recording of a tax fi. fa. are not extinguished by a tax sale of the property, OCGA § 44–9–7 implicitly provides that any easement not so recorded is extinguished if the property is not redeemed.¹⁰ Once the right to redemption has been terminated, the tax sale purchaser obtains absolute and unconditional title to the land. See Forrester v. Lowe, 192 Ga. 469, 476, 15 S.E.2d 719 (1941). Thus, it follows that after a tax fi.fa. on real property has been recorded, the defendant in fi. fa. cannot successfully encumber the property with an express ...