Mohave County v. James R. Brathovde Family Trust

• Decision Date: 17 December 1996
• Docket Number: CA-CV,No. 1,1
• Parties: , 232 Ariz. Adv. Rep. 15 MOHAVE COUNTY, a political subdivision of the State of Arizona, and Dora Goodmiller, the County Treasurer thereof, Plaintiffs-Appellees, v. JAMES R. BRATHOVDE FAMILY TRUST, Defendant-Appellant. 96-0260.
• Court: Arizona Court of Appeals

Page 1247

928 P.2d 1247

187 Ariz. 318, 232 Ariz. Adv. Rep. 15

MOHAVE COUNTY, a political subdivision of the State of Arizona, and Dora Goodmiller, the County Treasurer thereof, Plaintiffs-Appellees, v. JAMES R. BRATHOVDE FAMILY TRUST, Defendant-Appellant.

No. 1 CA-CV 96-0260.

Court of Appeals of Arizona Division 1, Department C.

Dec. 17, 1996.

[187 Ariz. 319] William J. Ekstrom, Jr., Mohave County Attorney by Lance B. Payette, Deputy County Attorney, Kingman, for Plaintiffs-Appellees.

Jack H. Simon, Mesa, for Defendant-Appellant.

OPINION

GRANT, Judge.

This is an appeal from summary judgment in favor of plaintiffs/appellees in a declaratory judgment action. Arizona Revised Statutes Annotated ("A.R.S.") section 42-451(A) as amended in 1994 provides for judicial actions to foreclose real property tax liens to be brought "in superior court in the county in which the real property is located." The issue in this appeal is whether bringing the suit in the county in which the real property is located is a mandatory requirement which renders the judgment of foreclosure a nullity when this requirement has not been met, or whether it is merely a matter of venue that can be waived under applicable Arizona law. We hold that judicial actions to foreclose real property tax liens may be brought in any superior court in the state, even though "proper" venue is in the superior court of the county in which the real property is located.

FACTS AND PROCEDURAL HISTORY

The facts in this case are undisputed. Appellant, the James R. Brathovde Family Trust (hereinafter "Trust"), acquired a tax lien on a lot in Mohave County. After the requisite period of time passed with no redemption by the property owner, the Trust filed suit to foreclose the tax lien in the Maricopa County Superior Court on February 17, 1995, under Cause No. CV 95-90338, naming the property owner of record as the defendant.

The Trust complied with the notice provisions in A.R.S. section 42-451(B), sending the required notice to both the property owner of record and the Mohave County Treasurer ("Treasurer"). The Trust also personally served the defendant property owner. The defendant did not enter an appearance, and default judgment foreclosing the right of redemption was entered by the Maricopa County Superior Court on May 4, 1995. The judgment directed the Treasurer to issue a treasurer's deed for the property to the Trust.

The Treasurer refused to issue a treasurer's deed and thereafter filed this declaratory judgment action in the Mohave County Superior Court. While the Treasurer did not dispute that the Trust would be entitled to a deed if the foreclosure action had been filed in the Mohave County Superior Court, she does dispute the propriety of the deed issued in Maricopa County. She therefore requested the trial court to declare that the judgment rendered by the Maricopa County Superior Court in this case does not bind the Treasurer.

Upon considering cross-motions for summary judgment, the trial court granted judgment for the Treasurer. The trial court found that A.R.S. section 42-451(A) requires that an action to judicially foreclose a real property tax lien must be brought in the superior court of the county in which the real property is located, and not elsewhere. The trial court found that the Treasurer was not bound by the judgment of the Maricopa County Superior Court rendered in CV 95-90338, and thus the Treasurer could properly refuse to issue a treasurer's deed unless and until a judgment was entered by the Mohave County Superior Court in accordance with A.R.S. section 42-451(A). This appeal timely followed.

DISCUSSION

Arizona law provides that when real property taxes are delinquent, the treasurer of the county in which the property is located sells the tax lien at a public sale. See A.R.S. §§ 42-381-405. The successful bidder receives a certificate of purchase as provided in A.R.S. sections 42-395 and 42-396.

If the lien is not redeemed within "the specified time," the certificate holder may foreclose the right of redemption in two ways, either "judicially" or "administratively." The holder may foreclose judicially through the court system three years after the sale by filing an action pursuant to A.R.S. sections 42-451 through 42-454, thereby obtaining a judgment entitling the holder to a treasurer's deed. The holder may also foreclose "administratively," five years after the sale, by applying directly to the treasurer for a deed pursuant to A.R.S. sections 42-461 through 42-464.

This appeal concerns the procedure for judicial foreclosure of tax liens. Specifically, it concerns the meaning of the portion of A.R.S. section 42-451(A), as amended in 1994, which specifies where a tax lien foreclosure suit is to be brought. We review issues of statutory interpretation de novo. Hawkins v. Dep't of Economic Security, 183 Ariz. 100, 103, 900 P.2d 1236, 1239 (App.1995).

Prior to amendment of section 42-451 in 1994, the statute had provided merely as follows:

At any time after the expiration of three years from the sale of a tax lien, if the lien is not redeemed, the purchaser, his heirs or assigns, or the state if it is the assignee, may bring an action in a court of competent jurisdiction to foreclose the right to redeem. The provisions of law and rules of civil procedure relating to civil actions shall control the proceedings, including the right of appeal.

(emphasis added).

The 1994 amendment redesignated the above provision as subsection (A) of A.R.S. section 42-451. The only change made in the language of what is now subsection (A) was to provide for the bringing of foreclosure suits "in superior court in the county in which the real property is located" instead of "in a court of competent jurisdiction." The rest of the language remains the same, and provides in its entirety as follows:

A. At any time after the expiration of three years from the sale of a tax lien, if the lien is not redeemed, the purchaser, his heirs or assigns, or the state if it is the assignee, may bring an action in superior court in the county in which the real property is located to foreclose the right to redeem. The provisions of law and rules of civil procedure relating to civil actions shall control the proceedings, including the right of appeal.

(emphasis added). See A.R.S. § 42-451(A) (Supp.1994). The amendment also added subsection (B) which provides certain notice requirements. ¹

A.R.S. section 42-381(B) explains that "[i]nsubstantial failure to comply [with the statutory provisions relating to the selling of tax liens and the foreclosing of the right to redeem] does not affect the validity of ... the sale of a tax lien or the foreclosure of the right to redeem by which tax collection is enforced." As our supreme court has observed about statutes similar to this one, "[m]any legislatures ... including that of Arizona, have passed statutes relaxing the strict requirements of the common law in regard to proof of the validity of tax sales...." Consolidated Motors, Inc. v. Skousen, 56 Ariz. 481, 488, 109 P.2d 41, 43 (1941). Our supreme court additionally noted in Consolidated Motors that "the modern tendency of the courts is to regard many provisions heretofore considered to be jurisdictional as merely directory." Id. In this case, we must decide whether the Trust's filing of the action in Maricopa County, rather than in Mohave County--the county in which the property was located--was an "insubstantial failure to comply" with A.R.S. sections 42-451(A) and 42-381(B). In other words, we must decide whether this statutory provision is merely directory rather than mandatory.

The Trust argues that the provision is not mandatory, but that the legislature was merely reiterating the proper venue for the suit and intended that the regular statutory provisions pertaining to venue in civil proceedings apply, including the provision in A.R.S. section 12-404(A) that venue is not jurisdictional and can be waived. The trial court ruled that section 42-451 restricted the jurisdiction of any court other than the branch of the superior court sitting in Mohave County to render judgment. The Treasurer takes a third position, agreeing with the Trust that the provision deals with venue rather than with jurisdiction of the court, but arguing that the legislature intended that there be a "mandatory initial venue" with the result that some of the regular provisions pertaining to venue in civil cases would not apply to these suits.

Despite the trial court's holding, we reject the notion that A.R.S. section 42-451(A) restricts the jurisdiction of branches of the superior court sitting in counties where the property is not located from entering judgments foreclosing tax liens. In pointing out the difference between jurisdiction and venue, our supreme court has said that "[j]urisdiction is the power to decide a case on its merits whereas venue relates to the place where the suit may be heard." Sil-Flo Corp. v. Bowen, 98 Ariz. 77, 82, 402 P.2d 22, 26 (1965) (citations omitted).

Article 6, Section 13, of the Arizona Constitution specifies that all of the superior courts of the state constitute a single court, and the judgment of any one judge of the superior court shall have the same force and effect as if rendered by any other judge of the court. Article 6, Section 14(2) of the Arizona Constitution provides that the superior court has original jurisdiction of cases involving title to real property. Had the legislature intended to restrict the jurisdiction of some of the branches of the superior court by A.R.S. section 42-451(A), it would have specifically restricted the court's jurisdiction. See Daou v. Harris, 139 Ariz. 353, 357, 678 P.2d 934, 938 (1984) (The court will not infer that the legislature meant to divest the superior court of jurisdiction; the legislature must enunciate such an intent explicitly and clearly.)

A.R.S. section 42-451(A) contains no language to...