In re Consolidated return of Real Estate Tax Sale Held September 10

859 A.2d 15, 2004 Pa. Commw. LEXIS 711
CourtCommonwealth Court of Pennsylvania
DecidedSeptember 29, 2004
StatusPublished
Cited by12 cases

This text of 859 A.2d 15 (In re Consolidated return of Real Estate Tax Sale Held September 10) is published on Counsel Stack Legal Research, covering Commonwealth Court of Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re Consolidated return of Real Estate Tax Sale Held September 10, 859 A.2d 15, 2004 Pa. Commw. LEXIS 711 (Pa. Ct. App. 2004).

Opinion

OPINION BY

Judge LEAVITT.

James A. Sposito, Esq. (Sposito) appeals from an order of the Lackawanna Court of Common Pleas (trial court) setting aside a tax sale for the reason that the sale should have been stayed by reason of the record owner’s bankruptcy filing. Because Sposi-to was not a party in the proceeding before the trial court on the petition to set aside the tax sale, we quash the appeal.

Denise A. Huston and William A. Huston are the fee simple owners of unimproved property in the Township of Greenfield, Lackawanna County (Property). On July 21, 2003, Denise A. Huston (Huston) filed a petition with the United States Bankruptcy Court, Middle District of [16]*16Pennsylvania for relief under Chapter 18 of the Bankruptcy Code. On September 10, 2003, the Lackawanna County Tax Claim Bureau (Tax Claim Bureau) sold the property to the Sposito Realty Co.1 at a tax upset sale. Huston’s bankruptcy petition was dismissed on October 15, 2003, but it was still pending on the day of the Property’s sale.

On October 22, 2003, the trial court, upon consideration of the Tax Claim Bureau’s consolidated tax sale return, which included the sale of the Property, entered a confirmation nisi pursuant to Section 607(a) of the Real Estate Tax Sale Law, Act of July 7,1947, P.L. 1368, as amended, 72 P.S. 5860.607(a).2 Unless objections are filed within thirty days of the confirmation nisi, a decree of absolute confirmation is entered. Section 607(c), 72 P.S. § 5860.607(c).3 On November 20, 2003, two days before the objection period expired, Huston filed a petition to set aside the tax sale of the Property, asserting the sale had been barred by the automatic stay provisions of the Bankruptcy Code.4 She served the petition on the Tax Claim Bureau and mailed a copy to Sposito. In response, the trial court issued a rule to show cause, rule returnable by December 19, 2003. Huston served the rule on both Sposito and the Tax Claim Bureau.

On December 19, 2003, the Tax Claim Bureau filed an answer to Huston’s petition. On the same day, Sposito filed preliminary objections to the petition, asserting that the trial court did not have jurisdiction to set aside the tax sale based on the automatic stay of the bankruptcy proceeding and that Huston could not invoke the automatic stay because she had failed to serve a copy of her bankruptcy petition on the County.5 [17]*17Further, Sposito asserted that it was for the bankruptcy court, not the trial court, to decide whether the tax sale of the Property should be set aside.

On December 30, 2003, the trial court conducted a hearing on the petition to set aside the tax sale of the Property. The parties stipulated to the facts, and presented argument in support of their respective positions. Huston argued that because Sposito had not petitioned to intervene, he was not a proper party. She also argued that Sposito’s preliminary objections, that were not timely filed, did not identify an interest separate from that of the Tax Claim Bureau and, thus, he lacked standing. Sposito countered that he was a party to the proceeding because he had been served with the rule to show cause.6 Huston rejoined that the service was done as a courtesy and noted that Sposito’s name did not appear in the caption, as required in order for him to be a party.

The trial court determined that the filing of Huston’s bankruptcy petition automatically stayed all legal proceedings against Huston, with or without notice to the County, and granted her petition to set aside the tax sale. It also noted that,

[T]he record will reflect that although [Sposito] filed an answer in the form of a preliminary objection, he did so without seeking leave of Court as require (sic) by the applicable Rules of Civil Procedure. Pa. R.C.P. 2329.7

Trial Court Opinion at 3.

Sposito filed an appeal8 with this Court, presenting sixteen questions for our review. The salient question raised by Sposito is whether the trial court erred in deciding the impact of Huston’s bankruptcy petition upon the tax sale of the Property, a question that Sposito contends was exclusively for the bankruptcy court to decide. The Tax Claim Bureau did not appeal the trial court’s order, but it filed a brief in support of Sposito by its “pro bono” counsel, not its solicitor. Huston argues that the automatic stay triggered by the filing of Huston’s petition was operative regardless of whether the County was given notice, and, therefore, the trial court’s order was correct as a matter of law. She also argues that because Sposito never petitioned to intervene, he was not a party and lacks standing to appeal to this Court.

We consider, first, the question of Spositos ability to appeal the trial courts holding. Section 607(d) of the Real Estate [18]*18Tax Sale Law provides, “[i]n case any objections or exceptions are filed they shall be disposed of according to the practice of the court.” 72 P.S. 5860.607(d) (emphasis added). In this case, it appears that it was the practice of the trial court to require a successful bidder at an upset sale, such as Sposito, to intervene in order to become a party to a hearing on objections to an upset sale. Indeed, this appears to be the practice of our courts of common pleas when considering objections to a tax sale. See, e.g., In re Sale of Real Estate By Montgomery Tax Claim Bureau for 1997 Delinquent Taxes, 836 A.2d 1037 (Pa.Cmwlth.2003).

An individual not named in a proceeding may become a party, with all the rights and liabilities of a party, by filing a petition to intervene and obtaining leave of court to intervene. Pennsylvania Rule of Civil Procedure No. 2328(a) provides that a person seeking to intervene must file an “[ajpplication for leave to intervene by a petition in the form of and verified in the manner of a plaintiffs initial pleading in a civil action, setting forth the ground on which intervention is sought.” Pa. R.C.P. No. 2328(a). Pa. R.C.P. No. 2327 denotes four categories of persons who may intervene, including one who may “be adversely affected by a distribution or other disposition of property in the custody of the court.” Pa. R.C.P. No. 2327(2). Upon the filing of the petition and after hearing, the court is required to enter an order allowing or refusing intervention. Pa. R.C.P. No. 2329. A grant of intervention entitles the litigant to the rights and liabilities of a party. Pa. R.C.P. No. 2330.

Sposito was not a “named” party, and he did not petition to intervene.9 At no point in the objection proceeding did the trial court enter an order granting Sposito party status. When Huston raised the question of Spositos status at the December 30, 2003 hearing, Sposito responded as follows:

I think the tax claim bureau would have an obligation to give me notice or file a petition to add me as an additional party because I am the purchaser.

Reproduced Record at 65a (R.R. -). Counsel for the Tax Claim Bureau asserted it did not, as a practice, join successful bidders when served with a petition to set aside an upset sale and disagreed that it had any such duty. Sposito declined to intervene.

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Bluebook (online)
859 A.2d 15, 2004 Pa. Commw. LEXIS 711, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-consolidated-return-of-real-estate-tax-sale-held-september-10-pacommwct-2004.