United Asset Mgmt. Trust Co. v. Clark

• Decision Date: 30 November 2010
• Docket Number: No. WD 71589.,WD 71589.
• Citation: 332 S.W.3d 159
• Parties: UNITED ASSET MANAGEMENT TRUST COMPANY, Trustee for Coast to Coast Holding Trust, Appellant,v.Keith A. CLARK, et al., Respondents.
• Court: Missouri Court of Appeals

332 S.W.3d 159

UNITED ASSET MANAGEMENT TRUST COMPANY, Trustee for Coast to Coast Holding Trust, Appellant,

v.Keith A. CLARK, et al., Respondents.

No. WD 71589.

Missouri Court of Appeals, Western District.

Nov. 30, 2010.As Modified on Denial of Rehearing

Feb. 1, 2011.

Application for Transfer Denied

March 29, 2011.

Eric D. Roby, for Appellant.Alan B. Gallas, for Respondent Clark.Betsy A. Blake, for Respondent Shipley.Before Division Two: JOSEPH M. ELLIS, Presiding Judge, ALOK AHUJA, Judge and GARY D. WITT, Judge.JOSEPH M. ELLIS, Judge.

United Asset Management Trust Company, trustee for the Coast to Coast Holding Trust (“the Trust”), appeals from a judgment entered in the Circuit Court of Cass County concluding that a piece of property formerly held by the Trust had been properly transferred by the tax collector for Cass County to Keith and Crystal Clark by means of a tax sale and collector's deed.

Prior to July 20, 1992, the property at issue was owned by Norma and Clinton Tracy. On that date, the Tracys conveyed the property to the Trust. The address provided to the county for the Trust was a post office box in Grandview, Missouri. No information regarding the identity of the trustee or beneficiaries of the trust was recorded with the county.

At some point, the Trust stopped maintaining the post office box. After the Trust failed to pay property taxes on the property in 2003 and 2004, the county tax collector mailed the Trust multiple delinquency notices to the post office box address. Subsequently, in April and July 2005, the tax collector mailed to the Trust, at the post office box address, notices that the property would be sold at a tax sale on August 22, 2005, if the delinquent property taxes were not paid. The postal service returned all these letters to the tax collector as undeliverable with no forwarding address. The tax collector published notice of the tax sale of the property in the Star Herald on July 21, July 28, and August 4, 2005.

On August 22, 2005, the Clarks purchased the tax lien on the property from the tax collector for $2,600.00 in its first offering at auction. On August 24, 2005, the tax collector sent notice to the Trust at the post office box address that the property had been sold at the tax sale. The postal service returned that letter as undeliverable with no forwarding address.

On June 14, 2006, Mr. Clark sent a certified letter to the Grandview post office box address notifying the Trust that the Clarks had purchased the County's tax lien on the property at the tax sale and that they were preparing to file for a collector's deed. The letter stated, “YOU NEED TO CONTACT THE CASS COUNTY COLLECTORS OFFICE WITHIN THE 90 (NINETY) DAYS FROM THE DATE OF THIS LETTER TO REDEEM THIS PROPERTY OTHERWISE I WILL FILE FOR THE COLLECTOR'S DEED.” That letter was returned to the Clarks by the postal service as undeliverable with no forwarding address. Prior to sending the notice, the Clarks had searched directory assistance and the internet trying to find a better or more recent address for Appellant, all to no avail. After the notice was returned undeliverable, the Clarks continued to try to locate Appellant's address. Keith Clark found the company that maintained the Grandview post office box address and requested Appellant's new or forwarding address. He was told that the information could not be given to him. On September 12, 2006, Mr. Clark filed an affidavit with the tax collector stating that he and Mrs. Clark had complied with the notification requirements of § 140.405 ¹ and requested a collector's deed be issued. That same day, the tax collector issued a collector's deed for taxes to the Clarks, and the deed was recorded at the county recorder's office by them.

Subsequently, Mr. Tracy's son noticed Mr. Clark mowing the property one day and was informed by Mr. Clark that the Clarks had purchased the property at the August 22, 2005 tax sale and owned the property. Mr. Tracy's son provided this information to Mr. Tracy, a trust manager for the Coast to Coast Holding Trust, who in turn informed the Trustee of the tax sale.

On October 6, 2006, United Asset Management Trust Company, acting in its capacity as trustee for the Coast–To–Coast Holding Trust, filed a petition against the tax collector and the Clarks seeking to set aside the tax deed and quiet title to the property in favor of the Trust. The Trustee claimed that notice by the tax collector was insufficient because the tax bill notices of the sale were returned as undeliverable by the postal service, the notice of sale was only published for one week, and a notice of tax sale was not posted on the property. The Trustee also claimed that the notice provided by the Clarks was deficient because the notice was returned as undeliverable and the Clarks took no additional steps to provide the notice to the Trust. On November 11, 2006, the Clarks filed a counterclaim to quiet title in the property.

The case was tried to the court on August 11, 2009. Subsequently, the trial court entered its judgment in favor of Respondents and quieted title in favor of the Clarks. The court found that both the tax collector and the Clarks had properly mailed notice to the Trust at its last known mailing address and that no other reasonable means were available to them to provide additional notice. The Trustee brings two points on appeal from that judgment.

In its first point, the Trustee claims the trial court erred in entering judgment in favor of the Clarks because the Clarks' notice failed to comply with the mandatory notice requirements of § 140.405 ² in that it incorrectly stated the amount of time the Trustee had to redeem the property and failed to notify the Trustee that it would be forever barred from redeeming the property if it did not do so by that date. In Point II, the Trustee asserts the trial court erred in entering judgment for the Clarks because the Collector and the Clarks denied the Trust's due process right to notice under the Fourteenth Amendment to the United States Constitution in that they failed to take additional reasonable steps to notify the Trust that its real property was going to be taken and sold for delinquent taxes when the Collector and the Clarks knew that the tax sale notices and the redemption notice mailed by the Clarks to the Trust were returned as undeliverable.

Standard of Review

“In a judge-tried case, we will affirm the trial court's judgment unless no substantial evidence supports it, it is against the weight of the evidence, or it erroneously applies the law.” CedarBridge, LLC v. Eason, 293 S.W.3d 462, 466 (Mo.App. E.D.2009). In making that determination, “[w]e must view the evidence and the inferences therefrom in the light most favorable to the judgment and disregard all contrary evidence.” Id. Our review related to questions of law, however, is de novo, and no deference is afforded to the trial court's legal conclusions. Amond v. Ron York & Sons Towing, 302 S.W.3d 708, 711 (Mo.App. E.D.2009).

Historical Background

To fully understand Appellant's claim that the Clarks' notice did not comply with the requirements of § 140.405 and that the Clarks, therefore, lost all interest in the property, some background is in order.

Chapter 140 of the Revised Statutes of Missouri is commonly known as the Jones–Munger Act. M & P Enters., Inc. v. Transamerica Fin. Servs., 944 S.W.2d 154, 156 (Mo. banc 1997). It provides for the annual sale of real property on which taxes are delinquent and unpaid. § 140.150.1. In advance of the sale, which occurs on the fourth Monday in August, § 140.150.1, the collector must publish a list of the property to be sold once a week for three consecutive weeks, the last publication date being at least fifteen days prior to the date of sale. § 140.170.1. The statutory scheme of the Jones–Munger Act contemplates the possibility that the property might not sell at the tax sale. Accordingly, if a tract does not sell in the year it is first offered, a second offering is made the next year. § 140.240.1. At a first or second offering tax sale, the property may only be sold if an adequate bid is received, that being “a sum equal to the delinquent taxes thereon with interest, penalty and costs.” § 140.240.1. If an adequate bid is not received in the second year, it is offered again in the third year and sold to the highest bidder. § 140.250.1. At the third offering, counties are permitted to bid and buy to prevent tax losses resulting from inadequate bids. § 140.260.1.

The purchaser at a first or second offering tax sale is not given a deed directly, but rather receives a certificate of purchase. § 140.290.1. During the one year immediately following the tax sale, § 140.340.1 provides that “[t]he owner or occupant ... or any other persons having an interest therein, may redeem the [property] at any time” by paying the collector the purchase price plus the costs of sale and interest as provided therein. From the date of the sale until expiration of the statutory one year period of redemption, the purchaser “ ‘is vested with an inchoate or inceptive interest in the land subject to the absolute right of redemption in the record owner in whom the title remains vested.’ ” M & P Enters., Inc., 944 S.W.2d at 157 (quoting State ex rel. Baumann v. Marburger, 353 Mo. 187, 182 S.W.2d 163, 165 (1944)). Thereafter, “[i]f no person shall redeem the lands sold for taxes within one year from the sale, at the expiration thereof, and on production of certificate of purchase, the collector ... shall execute to the purchaser ... a conveyance of the real estate so sold, which shall vest in the grantee an absolute estate in fee simple....” § 140.420. Pursuant to § 140.410, the purchaser must cause the deed to be executed and placed of record within two years of the date of sale. Read in conjunction with § 140.420, this effectively means the purchaser must obtain the collectors deed and record it during...