McGuire v. Rogers

• Decision Date: 22 September 2000
• Citation: 794 So.2d 1131
• Parties: Deborah A. McGUIRE and Dale Pugh v. Diane B. ROGERS, as executrix of the estate of William D. Rogers, deceased.
• Court: Alabama Court of Civil Appeals

794 So.2d 1131

Deborah A. McGUIRE and Dale Pugh v. Diane B. ROGERS, as executrix of the estate of William D. Rogers, deceased.

2990891.

Court of Civil Appeals of Alabama.

September 22, 2000.

Rehearing Denied December 1, 2000.

Certiorari Denied March 16, 2001.

James M. Kendrick, Birmingham; and A. Dozier Williams, Birmingham, for appellants.

Claiborne P. Seier, Birmingham; and William R. Justice, Columbiana, for appellee.

Alabama Supreme Court 1000526.

ROBERTSON, Presiding Judge.

On September 4, 1998, Dianne B. Rogers, as executrix of the estate of William D. Rogers, deceased, sued Deborah A. McGuire and Dale Pugh ("the defendants"). Rogers alleged that the defendants had, on May 17, 1989, purchased at a tax sale a parcel of property on which the decedent held a mortgage. Rogers's complaint presented three counts: (I) that she had a right to redeem pursuant to § 40-10-120, Ala.Code 1975, as a mortgagee without notice of the tax sale, (II) that she had a right to redeem the property pursuant to § 40-10-83, Ala.Code 1975, and (III) that the tax deed to the defendants was void because of a defect or defects in the tax sale.

The defendants answered the complaint and admitted the fact of the tax-sale purchase; they also raised several affirmative defenses and asserted a counterclaim. The counterclaim also had three counts: (1) a claim that title be quieted in favor of the defendants, (2) a claim that an equitable lien be imposed on the property to compensate the defendants for improvements and for harm caused by misrepresentations by Rogers, and (3) a claim for damages alleging a civil conspiracy on the part of Rogers and M. Duane Lewis. On October 27, 1999, the defendants filed a motion for a summary judgment. On November 9, 1999, Rogers filed a response in opposition to the defendants' motion for a summary judgment; Rogers also filed her own motion for a summary judgment. After considerable litigation, the parties submitted a statement of undisputed facts and argued their respective motions; the trial court entered a partial summary judgment on March 8, 2000.

In pertinent part, the partial summary judgment states:

"By agreement of the parties, Defendants are granted summary judgment as to Count I.

"There is no genuine issue as to any material fact regarding Count II. This case was commenced and the offer to redeem was made before the Defendants as tax sale purchasers had completed three years of adverse possession. Therefore [Rogers] is entitled to a judgment as a matter of law on Count II and is entitled to redeem from the tax sale. Judgment on this count is rendered on the issue of the right to redeem only, and determination of the amount necessary to redeem is reserved for further proceedings.

"There is no genuine issue as to any material fact regarding Count III. The tax sale deed from the State of Alabama to the Defendants is void for the reasons alleged by [Rogers] in her complaint. Defendants, as purchasers from the State, have the burden of proof in establishing the validity and regularity of the entire tax sale procedure, and they have not carried that burden. [Rogers] is entitled to judgment as a matter of law on Count III and is therefore entitled to possession of the real property in question, located in Shelby County, Alabama, described as:

". . . .

"The court finds, pursuant to Rule 54(b), [Ala.R.Civ.P.], that there is no just reason for delay and expressly directs entry of final judgment in favor of Defendants as to Count I and in favor of [Rogers] as to Counts II and III as set forth above.

"All other issues, including the redemption amount under Count II, the taxing of costs, and Defendants' motion for summary judgment on their counterclaim/third party complaint, are reserved for further proceedings."

The defendants appealed to the Supreme Court of Alabama; that court transferred the appeal to this court, pursuant to § 12-2-7, Ala.Code 1975.

The defendants make four arguments: (1) that the trial court erred in holding that Rogers was entitled to redeem the property under § 40-10-83, Ala.Code 1975, (2) that the defendants were entitled to quiet title to the property because they have been in possession of the property under color of title for more than 10 years, (3) that the trial court erred in declaring the tax deed void, and (4) that there was substantial evidence creating a genuine issue of material fact concerning the efficacy of the tax sale.

The record reveals that James Haggard executed a mortgage on the 50 acres of property in question to the decedent on May 29, 1986. The decedent died on August 29, 1988. On May 17, 1989, the property was sold to the State for nonpayment of the 1988 ad valorem real property taxes, and thereafter Haggard abandoned the property. On September 26, 1995, the defendants purchased the property from the State for payment of all the taxes due through 1996, approximately $23,000. The defendants paid the taxes on the property for the years 1997 and 1998 as those taxes accrued. The defendants recorded their tax deed on October 5, 1995, and they assessed the property in their names with the county tax assessor.

With respect to the tax sale, the tax collector's records showed that a notice of the tax delinquency was issued pursuant to § 40-10-4(a), Ala.Code 1975, on March 6, 1989, but there are no records showing service of the notice 10 days before the April term of the probate court from which the tax-sale judgment was issued as required by § 40-10-4(a). The tax collector's records also fail to show the dates of newspaper publication of the tax sale as required by § 40-10-12, Ala.Code 1975, nor do the records reflect the notice of the precinct in which the sale is to be conducted as required by § 40-10-14, Ala.Code 1975. Finally, the record does not show that any notice of an application to purchase the land was made pursuant to § 40-10-133, Ala.Code 1975

McGuire testified that on March 16, 1996, she had a conversation with Rogers in which she informed Rogers that the defendants had purchased the property for unpaid taxes. McGuire testified that Rogers told her that Rogers would not spend any money on the property and that Rogers did not intend to redeem the property. On May 17, 1996, McGuire sent Rogers a letter thanking Rogers for discussing the property and stating that the defendants had "worked hard to improve the appearance of the property. We have made many improvements to the barn and the grounds." On May 9, 1997, and again on February 16, 1998,¹ Rogers entered into a purchase agreement to sell the property to M. Duane Lewis. Subsequent amendments to this purchase agreement extended deadlines for various terms and required Lewis to redeem the property from the defendants by "judicial process." The purchase agreement as modified also provided that Lewis would sell a portion of the property in an attempt to settle an outstanding Internal Revenue Service tax lien of approximately $12,000,000 against the decedent's estate.

On July 17, 1998, Rogers foreclosed the mortgage from Haggard to the decedent and purchased the property as the executrix of the estate. On August 11, 1998, Rogers's lawyer wrote the defendants and notified them that Rogers had purchased the property at the foreclosure sale and that she desired to exercise her right of redemption.

Because this is an appeal from a partial summary judgment, we consider the defendants' arguments in light of the following standard:

"A motion for summary judgment tests the sufficiency of the evidence. Such a motion is to be granted when the trial court determines that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law. The moving party bears the burden of negating the existence of a genuine issue of material fact. Furthermore, when a motion for summary judgment is made and supported as provided in Rule 56, [Ala. R.Civ.P.,] the nonmovant may not rest upon mere allegations or denials of his pleadings, but must set forth specific facts showing that there is a genuine issue for trial. Proof by substantial evidence is required."

Sizemore v. Owner-Operator Indep. Drivers Ass'n, Inc., 671 So.2d 674, 675 (Ala.Civ. App.1995) (citations omitted), cert denied, 517 U.S. 1121, 116 S.Ct. 1354, 134 L.Ed.2d 522 (1996). Moreover, in determining whether a summary judgment was properly entered, the reviewing court must view the evidence in a light most favorable to the nonmovant. Long v. Jefferson County, 623 So.2d 1130, 1132 (Ala.1993). No presumption of correctness attaches to a summary judgment, and our review is de novo. Hipps v. Lauderdale County Bd. of Educ., 631 So.2d 1023, 1025 (Ala.Civ.App.1993) (citing Gossett v. Twin County Cable T.V., Inc., 594 So.2d 635 (Ala.1992)).

I. Rogers's Right to Redeem Under § 40-10-83

The defendants' first two arguments address the trial court's determination that Rogers was entitled to redeem the property pursuant to § 40-10-83, Ala.Code 1975. The defendants first argue that the statute does not apply to their situation. Section 40-10-83 provides:

"When the action is against the person against whom the taxes were assessed or the owner of the land at the time of the sale, his heir, devisee, vendee or mortgagee, the court shall, on motion of the defendant made at any time before the trial of the action, ascertain the amount paid by the purchaser at the sale and of the taxes subsequently paid by the purchaser, together with 12 percent per annum thereon, and a reasonable attorney's fee for the plaintiff's attorney for bringing the action, and shall enter judgment for the amount so ascertained in favor of the plaintiff against the defendant, and the judgment shall be a lien on the land sued for. Upon the payment into court of the amount of the judgment and costs, the court shall enter judgment for the defendant for the land, and all title and interest in the land shall by such judgment be divested out of

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