Subcarrier Communications, Inc. v. Nield

• Decision Date: 01 December 2005
• Docket Number: No. 32752.,32752.
• Citation: 624 S.E.2d 729
• Court: West Virginia Supreme Court
• Parties: SUBCARRIER COMMUNICATIONS, INC. A New Jersey Corporation, Plaintiff Below, Appellee, v. Ronald E. NIELD, John B. Lusk, Patrick Lee Nield, and LL & N Investments, LLC, A West Virginia Limited Liability Company, Defendants and Third-Party Plaintiffs Below, Appellants, v. Neil A. REED and The County Commission of Preston County, A West Virginia Statutory Commission, Third-Party Defendants Below, Appellees.

624 S.E.2d 729

SUBCARRIER COMMUNICATIONS, INC. A New Jersey Corporation, Plaintiff Below, Appellee, v. Ronald E. NIELD, John B. Lusk, Patrick Lee Nield, and LL & N Investments, LLC, A West Virginia Limited Liability Company, Defendants and Third-Party Plaintiffs Below, Appellants, v. Neil A. REED and The County Commission of Preston County, A West Virginia Statutory Commission, Third-Party Defendants Below, Appellees.

No. 32752.

Supreme Court of Appeals of West Virginia.

Submitted: November 15, 2005.

Filed: December 1, 2005.

COPYRIGHT MATERIAL OMITTED

Syllabus by the Court

1. "A circuit court's entry of summary judgment is reviewed de novo." Syllabus point 1, Painter v. Peavy, 192 W.Va. 189, 451 S.E.2d 755 (1994).

2. "Where the issue on an appeal from the circuit court is clearly a question of law or involving an interpretation of a statute, we apply a de novo standard of review." Syllabus point 1, Chrystal R.M. v. Charlie A.L., 194 W.Va. 138, 459 S.E.2d 415 (1995).

3. "Where the language of a statute is free from ambiguity, its plain meaning is to be accepted and applied without resort to interpretation." Syllabus point 2, Crockett v. Andrews, 153 W.Va. 714, 172 S.E.2d 384 (1970).

4. W. Va.Code § 11A-3-6(a) (1994) (Repl.Vol.2005) is plain in stating that "No sheriff, . . . shall directly or indirectly become the purchaser, or be interested in the purchase, of any tax lien on any real estate at the tax sale or receive any tax deed conveying such real estate." There is nothing in this statute to limit its prohibition to only the sheriff conducting the tax sale.

5. Where a sheriff is among the principals of a corporation, the corporation cannot, for purposes of W. Va.Code § 11A-3-6(a) (1994) (Repl.Vol.2005), be deemed a bona fide purchaser of real estate that has been acquired by virtue of a tax deed.

Robert S. Kiss, Camden P. Siegrist, Heather G. Harlan, Bowles Rice McDavid Graff & Love LLP, Charleston, for the Appellant.

William J. Leon, William J. Leon, L.C., Morgantown, for Appellee Subcarrier Communications, Inc.

Justice DAVIS delivered the Opinion of the Court.

DAVIS, Justice.

In this action to set aside a tax deed, the holders of the tax deed appeal summary judgment in favor of the landowner. In granting summary judgment and setting aside the tax deed as void, the circuit court found that, based upon the undisputed facts, there was no question that after the purchase of the tax lien, the tax lienholder failed to exercise due diligence in obtaining the landowners correct address in order to provide notice to the landowner of its right to redeem the property. After reviewing the parties arguments, the record submitted on appeal and the relevant authority, we find that, because the tax lienholder held the position of sheriff, he is prohibited from purchasing the tax lien or receiving the tax deed. Accordingly, we affirm the circuit court's order granting summary judgment and setting aside the tax deed as void.

I. FACTUAL AND PROCEDURAL HISTORY

In November 1996, Subcarrier Communications, Inc., Plaintiff below and Appellee (hereinafter referred to as "Subcarrier"), purchased a 9.23-acre tract of real estate from Skyline Communications, Ltd.¹ The deed commemorating the sale was duly recorded in the office of the Preston County Clerk and correctly identified Subcarrier's corporate address as 101 Eisenhower Parkway, Roseland, New Jersey.

In September of 1997, Subcarrier relocated its office to 139 White Oak Lane, Old Bridge, New Jersey. By correspondence dated November 25, 1997, Subcarrier notified the Preston County Clerk of its change in address and current phone number. Nevertheless, in May 1998, when the 1997 property tax for the realty had not been paid,² the Sheriff of Preston County mailed a notice of delinquency to Subcarrier at its former, Roseland, New Jersey, address. A postal forwarding order was in effect at that time, so Subcarrier received the notice at its new address. Subcarrier responded to the notice by tendering a check in the proper amount and enclosing a letter with the check again advising the sheriff of Subcarrier's new address. Additionally, the check tendered in payment of the delinquent taxes bore Subcarrier's new address.

Nevertheless, when property tax statements were issued for the 1998 tax year, the sheriff once again mailed Subcarrier's statement to its old Roseland, New Jersey, address. Thereafter, in September 1998, the sheriff mailed a notice of delinquency due to Subcarrier's failure to pay the 1998 property tax. As before, the sheriff mailed the notice to Subcarrier's old Roseland, New Jersey, address. By this time the postal forwarding order had expired and the statement was returned to the sheriff's office with a stamp stating "[u]ndeliverable, [f]orwarding order expired."

On November 15, 1999, a tax lien sale was conducted by the Preston County Sheriff. Mr. Patrick Nield, Sheriff of Mineral County, West Virginia, a Defendant below and one of the Appellants (hereinafter referred to as "Sheriff Nield"), purchased the tax lien for the property for the amount of $436.38.³ Thereafter, in late 2000, Sheriff Nield engaged attorney Neil Reed, a third-party defendant below, to research the title to the property and to otherwise assist Sheriff Nield in obtaining a tax deed to the property. One of the requirements for obtaining a tax deed is to provide notice of the right to redeem pursuant to W. Va.Code §§ 11A-3-19 (1998) (Repl.Vol.2005), 11A-3-21 (1998) (Repl.Vol.2005), and 11A-3-22 (1995) (Repl.Vol.2005). To facilitate proper notice to Subcarrier, Sheriff Nield contacted the West Virginia Secretary of State's office to obtain Subcarrier's current mailing address. The only address on record for Subcarrier was the old, Roseland, New Jersey, address. Therefore, the county clerk mailed the notice to Subcarrier's old, Roseland, New Jersey, address.⁴ As expected, the notice of the right to redeem sent to Subcarrier was returned stamped "[u]ndeliverable, [f]orwarding order expired." Thereafter, in January 2001, the notice of right to redeem was published in the Preston County News and the Preston County Journal, pursuant to W. Va.Code § 11A-3-22, the statute that provides, inter alia, for serving notice on an out-of-state landowner whose address "cannot be discovered by due diligence."

On or about April 12, 2001, Sheriff Nield assigned his tax lien to himself, his son Ronald Nield, and John B. Lusk, defendants below and appellants. On the same date, the county clerk issued a tax deed for the subject property naming Sheriff Nield, Ronald Nield and John Lusk as the grantees. Also on that day, Sheriff Nield went to the property and observed a sign attached to a fence surrounding the telecommunications tower which displayed Subcarrier's name, current address and phone number. The circuit court found that it was undisputed that this sign had been present on the property since at least August 1999. Sheriff Nield then called Subcarrier and informed it that he possessed a tax deed to the property.

In July 2001, Sheriff Nield, Ronald Nield and John Lusk conveyed the property to LN & N Investments, LLC. Sheriff Nield, Ronald Nield and John Lusk are the sole principals of LN & N (hereinafter collectively referred to as "the defendants").

Then, on September 3, 2002, Subcarrier filed suit to set aside the tax deed.⁵ The defendants filed an answer and counterclaim seeking recovery of damages equal to the amount of income Subcarrier had received from contracts involving the use of the telecommunications tower.⁶

Subcarrier filed a motion for summary judgment on June 26, 2003, claiming that there was no question of fact that the defendants had failed to exercise due diligence in obtaining Subcarrier's correct address for providing notice of the right to redeem, and further asserting that the tax deed was voidable as a matter of law pursuant to W. Va.Code § 11A-3-6(a) (1994) (Repl.Vol.2005), which prohibits sheriffs from purchasing tax liens. The circuit court denied the motion by order entered October 15, 2003, finding there was a genuine question of material fact on the issue of whether the defendants had exercised due diligence. The circuit court additionally found that the issue of whether Sheriff Nield was prohibited from purchasing the tax lien was a question of first impression in West Virginia, and held "in abeyance its ruling regarding whether the tax lien purchased by Defendant Patrick Nield, and the tax deed issued to Defendants pursuant thereto, are voidable pursuant to West Virginia Code § 11A-3-6(a)."

The case was further developed over the next year and Subcarrier renewed its motion for summary judgment on July 26, 2004. By order entered October 25, 2004, the Circuit Court of Preston County granted summary judgment to Subcarrier based upon its finding that there was no question that defendants had failed to make a reasonable inquiry that could and would have revealed the correct mailing address for the notice requirements set forth in W. Va.Code § 11A-3-22.⁷ It is from this order that the defendants now appeal.

II. STANDARD OF REVIEW

This case is before us on appeal from an order granting summary judgment. "A circuit court's entry of summary judgment is reviewed de novo." Syl. pt. 1, Painter v. Peavy, 192 W.Va. 189, 451 S.E.2d 755 (1994). When undertaking our plenary review, we apply the same standard for granting summary judgment as would be applied by a circuit court. Specifically,

"`[a] motion for summary judgment should be granted only when it is clear that there is no genuine issue of fact to be tried and inquiry concerning the facts is not desirable to clarify the application of the law.' Syllabus Point 3, Aetna Casualty & Surety Co. v. Federal Insurance Co. of New York, 148 W.Va. 160, 133 S.E.2d 770 (1963)." Syllabus Point 1, Andrick v. Town of Buckhannon, 187 W.Va. 706, 421 S.E.2d 247 (1992).

Syl. pt. 2, Painter. We further observe that "[t]he circuit...