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UPSET SALE PROPERTIES AGAINST WHICH DELINQUENT 1981 TAXES WERE RETURNED TO TAX CLAIM UNION ON OR ABOUT FIRST MONDAY MAY (11/09/87)

decided: November 9, 1987.

RE: THE UPSET SALE OF PROPERTIES AGAINST WHICH DELINQUENT 1981 TAXES WERE RETURNED TO THE TAX CLAIM UNION ON OR ABOUT THE FIRST MONDAY OF MAY, 1982 (SKIBO PROPERTY). TAX CLAIM UNIT OF NORTHAMPTON COUNTY, PENNSYLVANIA, APPELLANT


Appeal from the order of the Court of Common Pleas of Northampton County, in case of Re: The Upset Sale of properties against which delinquent 1981 taxes were returned to the Tax Claim Unit on or about the First Monday of May, 1982 (Skibo Property), No. 1983-CM-6737.

COUNSEL

Jill F. Fackenthal, with her, Leo V. DeVito, Jr., and John J. Bartos, for appellant.

Erv McLain, with him, Thomas J. Maloney, for appellee.

Judge Craig, and Senior Judges Barbieri and Kalish, sitting as a panel of three. Opinion by Senior Judge Barbieri.

Author: Barbieri

[ 111 Pa. Commw. Page 34]

This is an appeal by the Tax Claim Unit of Northampton County (TCU) from an order of the Court of Common Pleas of Northampton County dismissing TCU's exceptions and entering judgment in favor of Windrift Real Estate Associates (Windrift) in the amount of $901.25. Windrift's claim against TCU arose out of a tax claim sale held on November 17, 1983, whereat Windrift purchased a property which sale was later voided by the common pleas court on the basis of a defective notice sent to the property owner by TCU. The common pleas court held that Windrift was damaged

[ 111 Pa. Commw. Page 35]

    by TCU's negligence and entitled to recover its costs of borrowing the funds used to purchase the property at the voided sale. We will affirm.

The material facts were stipulated by the parties and are as follows. In 1983, the TCU notified Alyce Skibo that claims for delinquent taxes had become absolute and that the property would be sold to satisfy those delinquent taxes. The TCU held an auction on November 17, 1983, at which auction Windrift was the successful bidder on Skibo's property for $25,200.00. The tax sale was made subject to certain publicized terms.*fn1 In January,

[ 111 Pa. Commw. Page 361984]

, Skibo filed objections to the sale based in part on the TCU's failure to adequately inform her of her redemption rights, specifically her right to apply for a one-year extension of the redemption period granted under Northampton County Ordinance No. 72. On October 2, 1984, the common pleas court sustained Skibo's exceptions and set aside the sale of her property at the November 17, 1983, auction. Subsequently, the TCU refunded to Windrift the $25,200.00 purchase price as well as $1,999.62 in interest that the TCU had earned on the purchase price while it was held in escrow. Windrift sought from the TCU reimbursement for its entire interest expense of $2,900.87, as well as counsel fees in the amount of $1,992.50 that it expended in defending its interest in the sale property during Skibo's challenge to the sale. The common pleas court held that the TCU negligently failed to provide Skibo with the proper notice as required by law and that Windrift's additional interest expense incurred in borrowing the funds to purchase Skibo's property at the tax sale was reasonably foreseeable, making the TCU liable to Windrift for the entire amount of its interest expense incurred, $2,900.87, less the interest TCU earned on the escrow funds that were already paid to Windrift, $1,999.62, leaving a liability of $901.25, upon which the common pleas court entered judgment in favor of Windrift against the TCU. The court denied Windrift's claim for attorney's fees.

The sole issue presented in this appeal is whether a tax collection unit of a municipality is liable to a disappointed purchaser ...


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