Bert Dickey IV and Lulynne Hicky v. Gary Lillard, Brenda Lillard, and Tommy Land, Commissioner of State Lands

2020 Ark. App. 447, 607 S.W.3d 531

• Court: Court of Appeals of Arkansas
• Decided: September 30, 2020
• Status: Published

Opinion

Cite as 2020 Ark. App. 447 Reason: I attest to the accuracy and integrity of this document ARKANSAS COURT OF APPEALS Date: 2021-07-12 14:04:14 Foxit PhantomPDF Version: 9.7.5 DIVISION I No. CV-19-804

Opinion Delivered September 30, 2020 BERT DICKEY IV AND LULYNNE HICKY APPEAL FROM THE CLEBURNE COUNTY CIRCUIT COURT APPELLANTS [NO. 12CV-18-3]

V. HONORABLE HOLLY L. MEYER, JUDGE GARY LILLARD, BRENDA LILLARD, AND TOMMY LAND, COMMISSIONER OF STATE LANDS AFFIRMED APPELLEES

N. MARK KLAPPENBACH, Judge

Gary and Brenda Lillard purchased a lot in Heber Springs in a delinquent-tax sale

conducted by the Commissioner of State Lands and subsequently filed a lawsuit to confirm

title in themselves. Bert Dickey and LuLynne Hicky resisted, contending that they did not

receive notices prior to the sale and that the attempts to notify them were insufficient. The

circuit court ultimately entered a summary-judgment order in favor of the Lillards rejecting

the contention that notice was legally inadequate. This appeal followed. The issue on

appeal is whether the notice provided by the Commissioner of State Lands to the tax-

delinquent property owners prior to the sale complied with Arkansas statutory notice

requirements and with the dictates of constitutional due process. We hold that there were

no issues of material fact in dispute and that the notice provided in this case complied with Arkansas Code Annotated section 26-37-301 (Supp. 2019) and with the Due Process Clause

of the Fourteenth Amendment to the United States Constitution. We affirm.

The following undisputed chronology places the arguments in context. Baer C.

Wood purchased this lot in 1986 and died in 2002. After Wood died, Dickey and Hicky

became interest holders in the lot as Wood’s heirs; Wood’s estate was never probated.1 After

Wood’s death, the tax bills were sent to Baer C. Wood, c/o Richard Stichter, 925 Ferguson

Road, Heber Springs. The real property taxes were paid from the 2002 through 2011 tax

years. In April 2013, Richard Stichter went in person to the county collector’s office and

changed the tax-bill address to Baer C. Wood c/o Bert Dickey at 701 Hobson Avenue in

Hot Springs. The tax bill mailed in July 2013 to Dickey at the Hobson Avenue address was

returned to the Cleburne County Collector’s Office. No property taxes were paid from

and after the 2012 tax year.

In 2016, the Commissioner of State Lands commenced the process to recover the

delinquent and unpaid real property taxes. In February 2016, a notice of tax sale was sent

by certified mail to Dickey at the Hot Springs address on Hobson Avenue, but the notice

was returned to sender, “no such number, unable to forward.” The Commissioner

undertook a search that included “skip tracing,” which revealed several addresses, but the

two most current associated addresses were in Hot Springs, one on Central Avenue and one

on Lindale Circle. The Cleburne County property records and a title company’s search

provided no helpful leads.

Appellant, Bert Dickey IV, is the son of Bert Dickey III (deceased), and 1

consequently, Wood’s grandson. Appellant LuLynne Hicky is Wood’s daughter. 2 In May 2017, the Commissioner resent the notice by certified mail to (1) Bert Dickey

at 105 Lindale Lane Circle in Hot Springs and (2) Baer C. Wood at 5000 Central Avenue

#20 in Hot Springs. These certified letters were also returned to sender and unable to

forward. After the letters were returned, they were resent by regular mail, as indicated by

the Commissioner’s in-office stamp on the envelope.

In August 2017, the Commissioner published a notice of public sale in The Sun

Times, the local Cleburne County newspaper. On September 7, 2017, the Commissioner

sent notices of the tax sale, which included the time within which to redeem the property,

to Baer C. Wood and/or Bert Dickey at the Hobson Avenue, the Central Avenue, and the

Lindale Circle addresses. The Lillards purchased the lot for $46,000 at the tax-delinquency

sale and received a limited warranty deed for this forfeited property. No one lodged an

objection or an attempt to redeem the property.

In the subsequent lawsuit filed in January 2018 by appellees to confirm the validity

of the tax sale, appellants responded and resisted the confirmation, contending that they

were deprived of statutory notice and notice required by due process. A motion for

summary judgment was filed, appellants responded, and the circuit court was presented with

documentary evidence, affidavits, and arguments of counsel to consider, after which the

circuit court entered summary judgment.2

2 The summonses for this lawsuit were addressed to Dickey at 14515 Jerome Drive, Little Rock, Arkansas, and to Hicky at 2336 North Washington Street, Forrest City, Arkansas. Each summons was sent by certified mail; both were received. However, in Hicky’s affidavit in response to the motion for summary judgment, she stated that she had lived at 405 Fleurland, Forrest City, Arkansas, for over forty years. 3 The issues before us on appeal are whether the circuit court erred in entering

summary judgment on compliance with (1) Arkansas statutory notice requirements and (2)

notice required by due process. Summary judgment should be granted only when it is clear

that there are no genuine issues of material fact to be litigated and the moving party is

entitled to judgment as a matter of law. Jarsew, LLC v. Green Tree Servicing, LLC, 2009 Ark.

App. 324, 308 S.W.3d 161. We determine if summary judgment was appropriate by

considering whether the evidence presented by the moving party in support of its motion

leaves a material fact unanswered, viewing the evidence in the light most favorable to the

nonmoving party and resolving all doubts and inferences against the moving party. Id.

We first consider whether the circuit court erred in granting summary judgment on

the statutory-compliance issue. An issue involving notice given to a party with an interest

in tax-delinquent land is a matter of statutory interpretation, which the appellate court will

review de novo on the record. Pulaski Choice, L.L.C. v. 2735 Villa Creek, L.P., 2010 Ark.

91, 362 S.W.3d 882. When we construe a statute, we will first examine the plain language

of the statute and give the words their plain and ordinary meaning. Id.

Arkansas Code Annotated section 26-37-301 (Supp. 2019) provides in relevant part:

(a)(1) After receiving tax-delinquent land, the Commissioner of State Lands shall notify the owner, at the owner’s last known address as certified by the county, by certified mail, of the owner’s right to redeem by paying all taxes, penalties, interest, and costs, including the cost of the notice.

(2) All interested parties, as identified by the Commissioner of State Lands, shall be sent notice of the sale from the Commissioner of State Lands by certified mail.

(3) If the notice by certified mail is returned unclaimed or refused, the Commissioner of State Lands shall mail the notice to the owner or interested party by regular mail.

4 (4) If the notice by certified mail is returned undelivered for any other reason, the Commissioner of State Lands shall send a second notice to the owner or interested party at any additional address reasonably identifiable through the examination of the real property records properly filed and recorded in the office of the county recorder where the tax-delinquent land is located as follows:

(A) The address shown on the deed to the owner; (B) The address shown on the deed, mortgage, assignment, or other filed and recorded document to the interested party; or (C) Any other corrected or forwarding address on file with the county collector or county assessor.

....

(c) As used in this section, “owner” and “interested party” mean any person, firm, corporation, or partnership holding title to or an interest in the tax-delinquent land by virtue of a bona fide recorded instrument at the time of certification to the Commissioner of State Lands.

(f) The validity of a notice under this section may be challenged only by an owner or interested party of tax-delinquent land that did not receive notice in substantial compliance with this section.3

(Emphasis added.) “In the event that the mailing address or electronic address information

of the taxpayer changes, the taxpayer has an obligation to furnish the correct mailing address

or electronic address information.” Ark. Code Ann. § 26-35-705(c) (Supp. 2019).

Appellants argue that there remains a material question of fact regarding whether the

Commissioner actually resent the notices by regular mail after the certified mailings were

returned to sender. We disagree. The motion for summary judgment included copies of the

certified mailings, the stamps on those mailings from the post office showing that they were

3 The current version of section 26-37-301 is slightly different than the version in effect at the time of these proceedings, but the changes are immaterial to the question we are presented in this appeal.

5 returned as undeliverable, and the Commissioner’s in-office stamps on the envelopes

indicating the date they were resent by regular mail. The Commissioner used the name and

address provided by Mr. Stichter to the county officials in 2013, showing the information

changed to Baer C. Wood c/o Bert Dickey at 701 Hobson Avenue in Hot Springs. The

Commissioner additionally utilized alternative search methods, found the two most recently

associated addresses, and attempted notification at those addresses.4 These steps clearly

satisfied Ark. Code Ann. § 26-37-301(a)(4)(C). There were no remaining issues of material

fact on whether the Commissioner complied with the Arkansas statutory notice mandates,

and appellees were entitled to judgment as a matter of law on this aspect of their motion.

We next consider whether the circuit court erred in determining that appellees were

entitled to judgment on the due-process aspect of their motion. We hold that the

Commissioner made additional reasonable efforts to notify appellants, that there remained

no issues of material fact on this issue, and that the circuit court correctly ruled in favor of

appellees.

Before a State may take property and sell it for unpaid taxes, the Due Process Clause

of the Fourteenth Amendment requires the government to provide the owner notice and

an opportunity for hearing appropriate to the nature of the case. Jones v. Flowers, 547 U.S.

220 (2006). Notice is constitutionally sufficient if, at the time it was sent, it was reasonably

4 While appellants argue that the Commissioner’s search revealed telephone numbers as potential contacts that the Commissioner should have used, the statute does not require the Commissioner to attempt contact by telephone. Appellants further contend that the Commissioner should have used the addresses on the 1986 deed, but this is only one of three statutorily approved methods. Appellants additionally suggest alternative means of notice (sending a letter to the property addressed to “occupant” or posting a written notice on the land itself), but section 26-37-301 does not require such measures. 6 calculated to reach the intended recipient. Id. Due process does not require that a property

owner receive actual notice. Metro Empire Land Ass’n, LLC v. Arlands, LLC, 2012 Ark.

App. 350, 415 S.W.3d 594. Any sale of tax-delinquent land without proper notice is void.

Rylwell, LLC v. Men Holdings 2, LLC, 2014 Ark. 522, 452 S.W.3d 96. If the State has

reason to believe that a party or parties have an interest in real estate, it is incumbent upon

the State to take reasonable steps to give notice to those interested parties. Id. When the

Commissioner sends notice to an owner or interested party by certified mail that is returned

undelivered, additional reasonable efforts to provide notice are required by the Due Process

Clause of the Fourteenth Amendment to the United States Constitution. See Jones, supra.

It is undisputed that the Commissioner sent certified letters in an attempt to provide

notice to the landowner and interested parties, but all those attempts were sent back to the

Commissioner by the post office as “return to sender” or undeliverable. The documentary

evidence establishes that the Commissioner resent notices by regular mail after the certified

mailings were unsuccessful.

In 2006, the Supreme Court in Jones v. Flowers considered what due process requires

for purposes of notifying interested parties when property in Arkansas is to be sold to recoup

delinquent taxes. The Supreme Court offered up suggested additional reasonable steps such

as following up an undelivered certified mailing with a resent notice by regular mail (which

was done here) or perhaps posting a notice on the front door of the property addressed to

“occupant.” The Court rejected the notion that the Commissioner was required to conduct

open-ended searches such as searching the local phone book or other government records

because that would impose burdens on the State significantly greater than the relatively easy

7 options it outlined. The Court declined to prescribe the form of service that should be

adopted, instead leaving it to Arkansas to determine how best to proceed.

In the legislative session that followed the Jones decision, our legislature added the

provisions in section 26-37-301(a)(3) and (a)(4) enumerating additional reasonable steps

designed to provide notice to owners and interested parties. See Act 706 of 2007, § 4. The

Commissioner here complied with the statutorily suggested alternative methods to notify

the owner and interested parties by using the forwarded address given to the county office,

and the Commissioner also utilized two additional addresses found pursuant to other search

methods. While more extensive efforts could have been undertaken, our decision is limited

to determining whether the circuit court erred in declaring that due process was satisfied on

these facts. We hold that the circuit court did not err because due process was satisfied.

The Commissioner’s acts herein complied with the statutory requirements and with

constitutional due process. The circuit court did not err in entering summary judgment on

the undisputed material facts presented.

Affirmed.

HARRISON and HIXSON, JJ., agree.

Blair & Stroud, by: H. David Butler and Barrett S. Moore, for appellants.

Tilley, Prince & O’Neill, by: Christopher J. O’Neill, for separate appellees Gary Lillard

and Brenda Lillard.