THIS OPINION HAS
NO PRECEDENTIAL VALUE. IT SHOULD NOT BE CITED OR RELIED ON AS PRECEDENT
IN ANY PROCEEDING EXCEPT AS PROVIDED BY RULE 268(d)(2), SCACR.
THE
STATE OF SOUTH CAROLINA
In The
Court of Appeals
James F. Meyer and Virginia P. Meyer, Plaintiffs,
v.
Charleston County and Charleston County Delinquent Tax Department, Morris Brooke, Larry Goodwin, Frances Goodwin, and Joseph Keating, Defendants.
________________________
Larry Goodwin and FrancesGoodwin, Appellants,
James F. Meyer and Virginia P. Meyer, Respondents,
and Charleston County, Morris Brooke, Joseph Keating, Linda M. Bond, Edward Wiseman, III, Jane Doe and John Doe, fictitious names
representing unknown heirs and distributees or devisees of any of the Defendants who may be deceased, and also representing any unknown persons claiming any rights, title or
interest in or lien upon the real estate the subject hereof, Richard Roe and Sarah Roe, fictitious names representing unknown persons who may claim an interest therein as may be infants, incompetents, in the military service and persons entitled to protection under the Soldiers and Sailors Civil Relief Act of 1940, or others who may be under any other disability, Cross-Defendants,
of whom Charleston County, Charleston County Delinquent Tax Department, Morris
Brooke, Joseph Keating, Linda M.
Bond, and Edward Wiseman, III, are Respondents.
Appeal
From Charleston County
Mikell
R. Scarborough, Master-in-Equity
Unpublished
Opinion No. 2011-UP-179
Heard
February 9, 2011 Filed April 19, 2011
AFFIRMED
Jeffrey
T. Spell, of North Charleston, for Appellants.
Anthony
D. Hoefer, of Sumter; Bernard E. Ferrara, Jr., of North Charleston; Charles H.
Gibbs, Jr. and Thomas P. Lowndes, Jr., both of Charleston; Edward Wiseman, III,
of Summerville; Joseph Keating and Linda M. Bond, both of John's Island; and G.
Thomas Hill, of Ravenel, for Respondents.
PER CURIAM: Respondents, James
and Virginia Meyer (collectively "Taxpayers"), brought this quiet
title action to recover their John's Island home after Appellants, Larry and
Frances Goodwin ("Purchasers"), purchased the home at a tax sale.
The Master-in-Equity granted the requested relief, and Purchasers appealed.
Purchasers argue that the master erred in concluding the Charleston County Tax
Collector ("the County") failed to comply with the notice
requirements of sections 12-51-40 & -120 of the South Carolina Code (Supp.
2010) in collecting taxes on the John's Island home.[1]
We affirm.
FACTS/PROCEDURAL
HISTORY
Morris Brooke
(Mortgagee) hired Virginia Meyer to provide caregiving services to his wife,
Peg Brooke, after she suffered from a brain aneurism that left her physically
and cognitively handicapped. Mortgagee determined that to best meet his
family's needs, he would assist Taxpayers in building a house large enough so
that he, Mrs. Brooke, and Taxpayers could live together. Mortgagee loaned
Taxpayers the funds necessary to buy a lot on John's Island and to build a
house on it. Mortgagee also agreed to pay the expenses for an elevator and a
handicapped bathroom in the house.
On April 7,
2003, Taxpayers purchased the lot at 1367 River Road on John's Island from developer
Macarena Keating for $140,000.[2]
Taxpayers were under the mistaken impression that the 2004 taxes on the lot
were paid out of the proceeds from the closing of the sale. On April 9, 2003, Taxpayers
granted a first mortgage on the property to Mortgagee in the amount of $165,000.
As construction expenses increased, Mortgagee loaned an additional $235,000 to
Taxpayers in return for a second mortgage on the premises.
In March of
2004, Taxpayers conveyed back to Mrs. Keating a portion of their lot, 0.412 of
an acre, for the sum of $35,000. Taxpayers used this sum to fund ongoing
construction on their remaining property, and Mrs. Keating sold the new
.412-acre lot to Linda Bond, a cross-defendant in this action.[3]
On April 15,
2005, Taxpayers sold their residence at 1 South Held Circle on James Island in
anticipation of moving into their new home on John's Island. During the
completion of construction on the new home, Taxpayers lived in an apartment on
James Island until August 1, 2005, when the apartment lease expired. They then
stayed with various friends and relatives until they received a certificate of
occupancy for the John's Island home on November 22, 2005.
In the meantime,
the County began the process of collecting the delinquent 2004 taxes on
Taxpayers' lot by mailing an Execution Notice dated April 11, 2005, to
Taxpayers at the South Held Circle address.[4]
The exact date that the notice was actually mailed is unknown. Notably, all
envelopes used by the County had the notation "Return Service
Requested," which required the postal service to return undeliverable mail
sent by the County back to the County rather than forwarding the mail. Due to
the Taxpayers' April 15th move date, and due to the delay between dates on
County letters and their actual mailing dates, the master found credible Taxpayers'
assertion that they did not receive the Execution Notice.
In a continued
attempt to collect the 2004 taxes, the County sent a Notice of Levy to
Taxpayers at the South Held Circle address by certified mail, return receipt
requested, restricted delivery. The letter was returned to the County on June
20, 2005, stamped "Unclaimed." Virginia Meyer had signed the return
receipt; however, the signature of both Taxpayers was required before the
postal service would release the letter. James Meyer went to the post office
to sign for the letter, but he was informed that the letter had already been
returned to the County.
The County later
attempted to post a notice on the property at 1367 River Road informing
Taxpayers that the property was officially "seized" and would be sold
on October 3, 2005, to satisfy delinquent taxes. However, Taxpayers testified
that they never saw such a notice. A tax sale was conducted on October 3, 2005,
and Purchasers submitted a successful bid.
Still unaware of
the delinquency for the 2004 tax year, Taxpayers filed with the County
Assessor's Office an application for an adjustment of the 2005 taxes for the 4%
qualified residential rate. On July 24, 2006, Mr. Meyer spoke with various
County employees by telephone concerning the 2005 taxes. He was informed that
the application for the 4% rate had been approved, and he was directed to the Delinquent
Tax Department to obtain the exact amount due. Martine McPherson, an
Accounting Technician in the Delinquent Tax Department, informed Mr. Meyer that
the property had been sold at a tax sale in 2005. Mrs. McPherson noted that
Mr. Meyer seemed "shocked."
On September 12,
2006, the County mailed correspondence to Taxpayers advising them that the one-year
period in which they were allowed to redeem the property would expire on
October 4, 2006.[5]
The County sent a similar notice to Mortgagee. All of the notices were
returned to the County as undelivered. Mortgagee was out of the state for his
son's wedding in Pennsylvania when the notice of redemption was mailed to him,
and he did not return to South Carolina until October 2, 2006. He never found
the notice of redemption in his mailbox or in the mail he retrieved from the
post office.
On October 27,
2006, Taxpayers filed an action to quiet title to their John's Island property.[6]
The parties signed a Consent Order prohibiting the County from issuing a tax
deed to Purchasers. Therefore, Taxpayers continued to live in their John's
Island home and to complete the construction of their home.
At the hearing
before the master, Taxpayers testified and presented the testimony of Mortgagee
and Joseph Keating. The County presented the testimony of Dionne Brown, a
Revenue Specialist in the County's Delinquent Tax Department, and Martine
McPherson, the Accounting Technician in the Delinquent Tax Department. Mrs.
Brown testified that she mailed the Execution Notice and the Notice of Levy to
Taxpayers and that she later posted a delinquent tax notice to their home. However,
Mr. Keating, who owned the adjacent lot, testified that during the summer of
2005, he saw the notice of tax sale for Taxpayers' home posted on the stairway
entrance to his own home. He stated that he did not say anything to Taxpayers
about the notice and threw it away because he thought that Taxpayers would also
receive notice of the delinquent taxes in the mail and he did not want to
embarrass them. He further testified about other mistaken postings in his
neighborhood due to confusion over addresses.
The master issued an order
quieting title in the names of Taxpayers. In his order, he found that at no
time prior to the tax sale did the County notify Mortgagee of the tax
delinquency. He also found that Taxpayers would have moved out of the house at
1 South Held Circle by the time that any Execution Notice would have arrived
and that Mrs. Brown posted the tax sale notice on the wrong house. The master
further found that Taxpayers did not receive any of the mailed notices of
delinquent taxes or the tax sale notice posted on Mr. Keating's house.
Finally, the master found that neither Taxpayers nor Mortgagee received any of
the notices of redemption mailed by the County. The master concluded that the
County failed to meet the requirements of S.C. Code Ann. §§ 12-51-40 & -120
(Supp. 2010). The master denied Purchasers' motion to alter or amend. This
appeal followed.
ISSUES ON APPEAL
1. Did
the master err in concluding that the County violated section 12-51-40(c) of
the South Carolina Code (Supp. 2010) when it posted the notice of tax sale on
the wrong house?
2. Did
the master err in concluding that the County violated section 12-51-40(b) of
the South Carolina Code (Supp. 2010) by failing to send notice of delinquent
taxes to Mortgagee prior to the tax sale?
3. Did
the master err in concluding that the County violated section 12-51-120 of the
South Carolina Code (Supp. 2010) by not following up on the notices of
redemption?
STANDARD
OF REVIEW
"An
action to quiet title resides in equity." Osterneck
v. Osterneck, 374 S.C. 573, 577, 649 S.E.2d 127, 129 (Ct. App. 2007). "When
reviewing an equitable action heard first by a master-in-equity and appealed
directly to an appellate court, the court should review the facts in accordance
with its own view of the preponderance of evidence in the record." Id.
However, "[t]his broad scope of review does not require the appellate
court to ignore the fact that the master was in a better position to
assess the credibility of witnesses and assign weight to their testimony."
Id.
LAW/ANALYSIS
Introduction
"In
South Carolina, 'all requirements of the law leading up to tax sales [that] are
intended for the protection of the taxpayer against surprise or the sacrifice
of his property are to be regarded mandatory and are to be strictly enforced.'" Smith v. Barr, 375 S.C. 157, 164, 650 S.E.2d 486, 490 (Ct. App. 2007)
(quoting Donohue
v. Ward, 298 S.C. 75,
83, 378 S.E.2d 261, 265 (Ct. App. 1989)). "Additionally,
the failure to give the required statutory notice renders the tax sale invalid." Smith, 375 S.C. at 164, 650 S.E.2d at 490. "Even
actual notice is insufficient to uphold a tax sale absent strict compliance
with statutory requirements." In re Ryan Inv. Co., 335 S.C. 392,
395, 517 S.E.2d 692, 693 (1999).
Section 12-51-40
of the South Carolina Code (Supp. 2010) sets forth the alternate procedure for
notifying a taxpayer of delinquent taxes prior to conducting a tax sale.[7] Section
12-51-40(a) requires counties to send a notice of delinquent
property taxes to "the defaulting taxpayer and to a grantee of record of
the property, whose value generated all or part of the tax." The notice
must be mailed to the best address available. § 12-51-40(a).
Subsection
(b) of section 12-51-40 provides that if the taxes remain unpaid after thirty
days from the date of mailing of the delinquent notice, a county must mail a
notice of delinquent property taxes to the defaulting taxpayer and "any
grantee of record of the property" by certified mail, return receipt
requested, with delivery restricted to the addressee. § 12-51-40(b). If
this notice is returned, a
county must then take exclusive physical possession of the taxpayer's property by
posting a notice of
an impending tax sale "at one or more conspicuous places on the premises" pursuant to
subsection (c) of the statute. § 12-51-40(c).
After
the tax sale, the defaulting taxpayer, a grantee, a mortgagee, or judgment
creditor may redeem the real property within the following twelve months. S.C.
Code Ann. §
12-51-90 (Supp. 2010). A county must send to these persons a notice of the approaching end
of the redemption period pursuant to section 12-51-120. If the property is not
redeemed within the allotted time, a county must deliver a tax title to the
purchaser. S.C. Code Ann. § 12-51-130 (Supp. 2010).
Posting
Purchasers assert
that the master erred in concluding
the County violated section 12-51-40(c) because the evidence shows that the
County posted the notice of tax sale on the correct house. Purchasers request
the court to find facts in accordance with the testimony of Dionne Brown, the
County employee who attempted to post the property. They argue that her
testimony regarding the location of the posting was more credible than the
testimony of the Taxpayers' neighbor, Joseph Keating, who indicated that the
posting was on his own house rather than Taxpayers' house. We disagree.
Although this
court may find facts in accordance with its own view of the preponderance of
the evidence, prudence dictates that we defer to the trier of fact on matters of
witness credibility. See, e.g., Tiger,
Inc. v. Fisher Agro, Inc., 301 S.C. 229, 237, 391 S.E.2d 538, 543 (1989)
(holding that while the court could review the evidence to determine facts in
accordance with its own view of the preponderance of the evidence, it would not
disregard the findings of the master, who saw and heard the witnesses and was
in a better position to evaluate their credibility); Bishop v. Tolbert,
249 S.C. 289, 298, 153 S.E.2d 912, 917 (1967) ("The issues in the
trial of this case were essentially factual and since the testimony was in
sharp conflict, the credibility of the witnesses and the resolution of the
testimony was a matter peculiarly within the province of the Master."); Osterneck,
374 S.C. at 577, 649 S.E.2d at 129 ("This broad scope of
review does not require the appellate court to ignore the fact that the master
was in a better position to assess the credibility of witnesses and assign
weight to their testimony.").
We
see no compelling reason to deviate from the master's credibility assessment
in the present case. Therefore, we affirm his
finding that the County failed to post the Taxpayers' property as required by
section 12-51-40(c). In view of our disposition of this issue, we need not address Purchasers'
remaining issues. See Futch v. McAllister
Towing of Georgetown, Inc., 335 S.C. 598, 613, 518 S.E.2d 591, 598 (1999) (stating that the appellate court need not review
remaining issues when its determination of a prior issue is dispositive of the
appeal).
CONCLUSION
Accordingly,
the master's voiding of the tax sale is AFFIRMED.
WILLIAMS,
GEATHERS, and LOCKEMY, JJ., concur.
[1] The relevant
language in both section 12-51-40 and section 12-51-120 has remained the same since
January 1, 2001. The tax year in dispute in this case is 2004. Section
12-51-40 sets forth the requirements for sending notice of delinquent taxes to
taxpayers and posting a tax sale notice on the property. Section 12-51-120
sets forth the requirements for sending the notice of redemption to taxpayers
and other interested persons, such as mortgagees. The requirements of section
12-51-40(a)-(c) and section 12-51-120 are discussed in greater detail in the
analysis section of this opinion.
[2] Mrs. Keating
and her husband, Joseph Keating, owned the adjacent lot, and Mr. Keating
performed the grading on Taxpayers' lot. Mr. Keating is a cross-defendant in
this action due to his filing of a mechanics lien on Taxpayers' lot on October
25, 2006, just days before Taxpayers filed this quiet title action.
[3] Taxpayers granted an easement across their property to Linda Bond. Purchasers
filed a counterclaim and cross-claim seeking judgment quieting title to the
John's Island property in their name and also extinguishing Linda Bond's
easement.
[4] The 2004 taxes
were assessed on the lot before Taxpayers made any improvements to the lot.
[5] The
County mailed two notices to Mrs. Meyer individuallyone at the South Held
Circle address and the other to the John's Island address. The notice mailed
to the John's Island address bore an incorrect zip code. In a similar fashion,
the County mailed two notices to Mr. Meyer. The County also mailed a notice
to the Taxpayers jointly at the John's Island address with the correct zip
code.
[6] Taxpayers
later amended their complaint to add a cause of action for unjust enrichment
and a cause of action under the South Carolina Betterment Statute, S.C. Code
Ann. § 27-27-10 to -100 (2007).
[7] The primary
procedure for counties to follow in enforcing the payment of property taxes is
set forth in Title 12, Chapter 49 of the South Carolina Code. See S.C.
Code Ann. §§ 12-49-10 to
-1290 (2000 & Supp. 2010). The provisions in Chapter 51 set forth an
alternate procedure for counties to use for enforcing the payment of property
taxes. See S.C. Code Ann. §§ 12-51-40 to -170 (2000 &
Supp. 2010).