City of Jackson v. Rebuild America, Inc.

77 So. 3d 1105, 2011 Miss. App. LEXIS 195, 2011 WL 1252173
CourtCourt of Appeals of Mississippi
DecidedApril 5, 2011
DocketNo. 2008-CA-02121-COA
StatusPublished
Cited by2 cases

This text of 77 So. 3d 1105 (City of Jackson v. Rebuild America, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals of Mississippi primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
City of Jackson v. Rebuild America, Inc., 77 So. 3d 1105, 2011 Miss. App. LEXIS 195, 2011 WL 1252173 (Mich. Ct. App. 2011).

Opinion

BARNES, J.,

for the Court:

¶ 1. The City of Jackson (also referred to hereafter as “the City”) conveyed the property at issue in this appeal to Greater Mount Calvary Community Development Corporation (GMCCDC) on June 24, 2003. In accordance with Mississippi Code Annotated section 21-17-l(3)(a) (Rev.2001 & Supp.2003), the deed contained a reverter clause. When GMCCDC failed to pay property taxes, the property was sold by tax sale to Wachovia Bank and subsequently conveyed to Rebuild America, Inc. (Rebuild America). After filing a complaint to quiet title, Rebuild America filed a motion for summary judgment. The City filed a cross-motion for summary judgment, asserting that the property reverted to it by operation of law and that the tax sale was void. The Chancery Court of Hinds County awarded summary [1107]*1107judgment to Rebuild America which the City of Jackson now appeals. We find that there are genuine issues of fact as to whether statutory notice of the expiration of redemption period was properly given to GMCCDC and whether the City of Jackson waived this argument by not raising it until the hearing for summary judgment. However, as we find that the City’s reversionary interest in the property was sufficient to require statutory notice of the right of redemption to the City, we reverse the chancery court’s grant of summary judgment for Rebuild America and render judgment in favor of the City of Jackson.

SUMMARY OF FACTS AND PROCEDURAL HISTORY

¶ 2. On June 24, 2003, the City of Jackson conveyed the subject property at issue in this appeal via quitclaim deed to GMCCDC. The “QUITCLAIM DEED WITH POSSIBILITY OF REVERTER” conveyed all the City’s interest in the property:

Provided that the Grantee begins construction of housing for persons of low and moderate income within 1 year of the date of this conveyance, substantially completes construction of the housing for persons of low and moderate income within 2 years of the date of this conveyance and, thereafter, any housing constructed on the property hereby conveyed is sold by Grantee to persons of low and moderate income, otherwise the interest conveyed by this deed shall re-veri to the Grantor without the Grantor taking any further action in law or equity to reenter the property.

(Emphasis added). A reversion clause was required by Mississippi Code Annotated section 21 — 17—l(3)(a) (Rev.2001 & Supp. 2003), which stated as follows:

Any deed or conveyance executed pursuant hereto shall contain a clause of reverter providing that the bona fide not-for-profit corporation or public school district may hold title to such lands only so long as they are continued to be used for the civic, social, educational, cultural, moral, economic or industrial welfare of the community, and that title shall revert to the municipality in the event of the cessation of such use for a period of two (2) years.

(Emphasis added).1

¶ 3. The quitclaim deed was filed with the Chancery Clerk of Hinds County. However, GMCCDC failed to meet the conditions set forth in the quitclaim deed. Further, GMCCDC failed to pay 2004 taxes, and the property was sold in a tax sale on August 29, 2005. The tax sale remained on file in the chancery clerk’s office for the two-year statutory redemption period. The record reflects that notice of the right of redemption was given to GMCCDC by publication and service by deputy sheriff (posted on the door of the business office).2 Compare Miss.Code Ann. § 27-43-3 (Rev.2006). The City of Jackson was not given notice.

[1108]*1108¶ 4. Meanwhile, on July 14, 2006, the Jackson City Council proposed an order to rescind GMCCDC’s interest in the property based upon its failure to begin construction. In January 2007, the City mailed two separate letters to GMCCDC’s counsel, advising him that the property had reverted to the City for the failure to meet conditions outlined in the quitclaim deed. The first letter, dated January 16, 2007, simply stated that “the property has reverted back to the city.” The second letter, dated January 31, 2007, reiterated that the property had reverted to the City and further requested that a construction lien and the delinquent taxes attributable to GMCCDC be remedied. The second letter also noted that the City had contacted the tax assessor’s office regarding the delinquent taxes and “because the property reverted to the City before the end of 2005,” the 2006 taxes were not owed by GMCCDC.

¶ 5. On September 10, 2007, a tax deed was issued to Wachovia Bank and was later filed with the chancery clerk’s office. Wachovia Bank then conveyed the subject property via quitclaim deed to Rebuild America on October 31, 2007. This deed was recorded with the chancery clerk. Rebuild America filed a complaint to quiet and confirm tax title on December 11, 2007, naming as defendants, GMCCDC and the City of Jackson.3 The City filed a response to the complaint on January 10, 2008, which merely asserted that there was no money owed for judgment liens and/or lis pendens. GMCCDC failed to respond to the complaint, and an entry of default judgment was entered against GMCCDC on August 11, 2008.

¶ 6. On March 17, 2008, Rebuild America filed a motion for summary judgment on the basis that the City had failed to reenter the subject property and, thus, had waived any legal possessory rights pursuant to the possibility of reverter. On April 21, 2008, Rebuild America also requested a temporary restraining order as the City was currently conducting construction activities on the property.4 In the “Defendant City of Jackson’s Response to Motion for Summary Judgment and Motion for Leave to File Amended Answer,” the City claimed that the property, by operation of law, had reverted to the City or, in the alternative, that the City had continually manifested its determination to take advantage of the breach by virtue of its letters to GMCCDC. Then, on May 7, 2008, the City filed a supplemental response/cross-motion for summary judgment which claimed that: (1) the subject property reverted to the City of Jackson by operation of law; (2) the tax sale was void as the City was a beneficiary pursuant to Mississippi Code Annotated section 27-43-5 (Rev.2006) and did not receive notice of the right of redemption; (3) Rebuild America took title subject to the reverter clause; and (4) alternatively, in the interest of public policy, the City should retain its interest in the subject property.

¶ 7. A hearing on the motions was held on July 23, 2008. At the hearing, in addition to the above-stated claims in its motion pleadings, the City also argued that [1109]*1109notice to GMCCDC of the right to redeem the property was deficient pursuant to Mississippi Code Annotated section 27-43-3. Rebuild America contended that the City lacked standing to bring this claim for deficient notice. In his November 19, 2008 order, the chancellor held that the property did not automatically revert by operation of law; therefore, the City had no interest in the property that would entitle it to receive notice. He also stated that notice to GMCCDC “was properly made” and granted summary judgment in favor of Rebuild America.

¶ 8.

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Cite This Page — Counsel Stack

Bluebook (online)
77 So. 3d 1105, 2011 Miss. App. LEXIS 195, 2011 WL 1252173, Counsel Stack Legal Research, https://law.counselstack.com/opinion/city-of-jackson-v-rebuild-america-inc-missctapp-2011.