Surcouf v. Darling

• Decision Date: 21 October 2015
• Docket Number: 2015–CA–0279.,Nos. 2015–CA–0278,s. 2015–CA–0278
• Citation: 177 So.3d 1085
• Parties: Heather SURCOUF v. Rex DARLING, Jr. Rex Darling, Jr. v. Heather Surcouf, American Thrift & Finance Plan LLC d/b/a State Farm Acceptance, et al.
• Court: Court of Appeal of Louisiana — District of US

177 So.3d 1085

Heather SURCOUF

v.Rex DARLING, Jr.

Rex Darling, Jr.

v.Heather Surcouf, American Thrift & Finance Plan LLC d/b/a State Farm Acceptance, et al.

Nos. 2015–CA–0278

2015–CA–0279.

Court of Appeal of Louisiana, Fourth Circuit.

Oct. 21, 2015.

Wesley M. Plaisance, Breazeale, Sachse & Wilson, L.L.P., New Orleans, LA, for Defendant/Appellee.

Stephen D. Morel, Jessica C. Seale, Morel Yorsch, L.L.C., Metairie, LA for Plaintiff/Appellant.

(Court composed of Judge TERRI F. LOVE, Judge PAUL A. BONIN, Judge SANDRA CABRINA JENKINS ).

PAUL A. BONIN, Judge.

Rex Darling Jr. failed to pay the 2008 ad valorem taxes due on immovable property owned by him. Heather Surcouf acquired the property at a tax sale and confirmed a default judgment against Mr. Darling by which judgment she sought to quiet title to the property. Some months later, however, Mr. Darling filed suit against Ms. Surcouf to annul the tax sale transfer.

Mr. Darling's primary ground for his nullity action was that the tax collector for the City of New Orleans, having been notified that notice of the tax sale had not been delivered to Mr. Darling, failed to take additional reasonable steps to provide him notice before proceeding to the tax sale. Ms. Surcouf responded that the tax collector had taken such steps, primarily by virtue of hiring a privately contracted company, which, according to her, made several endeavors to locate all interested parties.

Mr. Darling filed a motion for partial summary judgment, seeking to have the tax sale adjudged an absolute nullity. Ms. Surcouf, arguing that there remained genuine issues of material fact about any additional steps taken by the tax collector to notify Mr. Darling of the tax sale, opposed the motion. The trial judge granted partial summary judgment, decreeing the tax sale a nullity, and also, under La. C.C.P. art. 1915 B(1), designated the judgment as final and appealable. Ms. Surcouf now appeals.

On our de novo review of the partial summary judgment, we conclude that the trial judge was legally correct in finding that there was no genuine issue of material fact that the tax collector had failed to take additional reasonable steps to provide Mr. Darling with notice before the tax sale and, accordingly, the tax sale was an absolute nullity. Accordingly, we affirm the partial summary judgment and remand the matter for further proceedings.

We explain our decision in more detail below.

I

At the outset, we emphasize that the parties and the trial judge correctly and importantly recognized that the judgment here declaring the tax sale a nullity is not a final and appealable judgment in the absence of a proper designation as a final judgment by the trial judge "after an express determination that there is no just reason for delay." La. C.C.P. art. 1915 B(1). The procedure necessarily follows the substance of the judgment. And substantively, unless the tax sale was annulled because the taxes were paid before the date of the tax sale, "[n]o judgment annulling a tax sale shall have effect until the price and all taxes and costs are paid, and until ten percent per annum interest on the amount of the prices and taxes paid from date of respective payments are paid to the purchaser ..." La. Const. art. VII, § 25 (C). See also Mooring Tax Asset Grp., L.L.C. v. James, 14–0109, p. 7 (La.12/9/14), 156 So.3d 1143, 1148 ("This constitutional provision specifically dictates that the judgment of nullity cannot be effective until the tax purchaser is reimbursed taxes, costs, and interest.").

Thus, because the basis of Mr. Darling's claim that the tax sale was a nullity was not that he had paid the property taxes before the tax sale, the declaration of absolute nullity of a tax sale here is merely the rendition of a partial summary judgment which is dispositive of a particular issue in the case but does not by any means dispose of the entire case as to these parties. See La. C.C.P. art. 966 E. A declaration of absolute nullity of a tax sale does not entitle the delinquent taxpayer to the immediate cancellation of the tax sale deed (or its equivalent). See Mooring Tax Asset Grp., L.L.C., 14–0109, p. 10, 156 So.3d at 1148–50. In order for the nullity to be effected through a cancellation of the tax sale deed, the tax sale purchaser must be restored to the situation that existed before the tax sale. Id. See also La. Civil Code art. 2033 ("An absolutely null contract ... is deemed never to have existed. The parties must be restored to the situation that existed before the contract was made.").

Here, the trial judge satisfied the requirements of La. C.C.P. art. 1915 B(1) by designating the judgment as final, thereby allowing us to exercise our appellate jurisdiction in this matter. See La. Const. art. V, § 10 (A); R.J. Messinger, Inc. v. Rosenblum, 04–1664 (La.3/2/05), 894 So.2d 1113. Cf. Favrot v. Favrot, 10–0986, p. 4 (La.App. 4 Cir. 2/9/11), 68 So.3d 1099, 1103 ; La. C.C.P. art. 1915 B(2) ("In the absence of such determination and designation, any such order or decision shall not constitute a final judgment for the purpose of an immediate appeal....").

II

Keeping in mind that we are considering the ruling on a partial summary judgment, in this Part we turn to describe only those facts which are contained in the "field of evidence" introduced at the hearing on the motion for partial summary judgment.

A

By affidavit, Mr. Darling stated that he had acquired the property located at 1472 Constance Street in New Orleans on February 16, 2000. A certified copy of that acquisition was attached; the notarial act of sale showed his "mailing address" as 738 Milan Street, New Orleans, Louisiana 70115. A certified copy of a mortgage in favor of American Thrift & Finance Plan LLC d/b/a State Farm Acceptance was also enclosed. The mortgage was recorded in the mortgage office records on November 28, 2001. The mortgagee's address in the notarial act is shown as 4344 Earhart Blvd., New Orleans, Louisiana 70125.

Mr. Darling further stated under oath that he moved in February 2008 to Marina del Rey in California and supplied his forwarding address, 4101 Via Marina Unit N–307, Marina del Rey, California 90292, to State Farm Acceptance, which maintained the new address in its files and issued his 2009 IRS Mortgage Interest Statement Form 1098 to that address. All of these statements were substantiated by attached documentary evidence.

Another affidavit, this one by attorney Daniel Oppenheim, who was comanager of State Farm Acceptance, was filed by Mr. Darling. Mr. Oppenheim stated that despite the recordation of State Farm Acceptance's mortgage, the tax collector did not give the mortgagee notice of the tax delinquency or the impending tax sale. Mr. Oppenheim verified that Mr. Darling had furnished his California address to the mortgage holder and that State Farm Acceptance would have shared the address with the tax collector. Mr. Oppenheim also declared that State Farm Acceptance would likely have advanced the sums necessary to pay any delinquent taxes had notice been given to it. The mortgage instrument itself secured Mr. Darling's obligation to repay State Farm Acceptance in the event that it paid taxes on the property.

The affidavits of Walter O'Brien Jr., the City's finance operations manager in the Bureau of the Treasury, and of Margaret Beyer were introduced. Mr. O'Brien declared that two notices were sent to Mr. Darling before the tax sale. Both notices, mailed to 1472 Constance Street, were returned and notated "Attempted—Not Known—Unable to Forward." A third pre-tax sale notice was sent by certified mail to the Constance Street address. It was returned and notated "Vacant—Unable to Forward." Because the delinquent taxes remained unpaid after twenty days, legal advertisements were published in The Times–Picayune on November 21, 2009 and November 28, 2009. Ms. Beyer verified these dates from her own research.

The tax sale occurred December 2–3, 2009. Mr. O'Brien reports that two post-sale notices were sent by first class mail to Mr. Darling at the Constance Street address and both were returned and notated "attempted—not known—unable to forward."

In opposition to these affidavits, Ms. Surcouf introduced the affidavit of Bryan Barrios. Mr. Barrios is the chief executive officer of Archon Information Systems, which was subcontracted to administer aspects of the City's tax sales. Mr. Barrios generally describes in his affidavit the kind of services Archon performed in connection with the December 2009 tax sales, which was when this tax sale occurred. He declared that an automated skip tracing was performed to locate addresses of interested parties, a search of bankruptcy records of interested persons were performed, a telephone call notice campaign was conducted to attempt to reach the tax debtor, and public records interested party research was conducted. His affidavit, however, does not specify that any of these general activities were undertaken with respect to Mr. Darling's property and does not specify the results, if any, related to this particular property and its owner. Mr. Barrios' affidavit also verifies information provided by Mr. O'Brien about the notices sent to Mr. Darling at the Constance Street address and returned to the tax collector.

B

Based upon these affidavits and the certified documentary evidence, we find that the tax collector was aware before the tax sale that Mr. Darling had not received the notice of the delinquency and impending tax sale at any time before the tax sale. We also find, as undisputed facts, that the tax collector did not give notice of the tax sale to State Farm Acceptance, the mortgagee, before the tax sale and that the mortgagee was actually in possession of the then-current address for Mr. Darling. Finally, we conclude from the affidavits that there were no facts before the trial judge as to additional efforts or steps, if any, of the tax collector to give Mr. Darling notice before selling his property at a tax sale.

Keeping...