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Brentwood Borough School District v. HSBC Bank USA, N.A.

Commonwealth Court of Pennsylvania

March 24, 2015

Brentwood Borough School District, Heather Held
v.
HSBC Bank USA, N.A., Grove Properties, Inc.; Appeal of: HSBC Bank USA, N.A

Argued November 10, 2014.

Appealed from No. GD 09-004808. Common Pleas Court of the County of Allegheny. O'Reilly, J.

Brett L. Messinger, Philadelphia, for appellant.

Emmanuel S. Anthou, Canonsburg, for appellee Grove Properties, Inc.

BEFORE: HONORABLE BERNARD L. McGINLEY, Judge, HONORABLE ANNE E. COVEY, Judge, HONORABLE ROCHELLE S. FRIEDMAN, Senior Judge. OPINION BY JUDGE McGINLEY. Judge Leadbetter did not participate in the decision in this case.

OPINION

Page 808

BERNARD L. McGINLEY, Judge

HSBC Bank, N.A. (HSBC) appeals the December 11, 2013, Order of the Court of Common Pleas of Allegheny County (trial court) that denied HSBC's Petition for Redemption of Real Property (Redemption Petition) pursuant to Section 32 of the act commonly known as the Municipal Claims and Tax Liens Act (Act), Act of May 16, 1923, P.L. 207, as amended, 53 P.S. § 7293.

HSBC is the holder of a mortgage on property located at 3408 Willet Road, Pittsburgh, Pennsylvania (Property), which secured a Note signed by the former owner of the Property, Heather Held (Held). On June 6, 2011, the Property was sold to a third-party purchaser, Grove Properties, Inc. (Grove Properties), pursuant to a tax sale initiated by the Brentwood Borough School District and Brentwood Borough under the Act for delinquent real estate and/or school taxes for the years 2006 and 2007.

On November 11, 2011, HSBC, as mortgagee, filed a Redemption Petition pursuant to Section 32(a) of the Act, 53 P.S. § 7293(a). Section 32 of the Act provides as follows:

(a) The owner of any property sold under a tax or municipal claim, or his assignees, or any party whose lien or estate has been discharged thereby,

Page 809

may, except as provided in subsection (c) of this section, redeem the same at any time within nine months from the date of the acknowledgment of the sheriff's deed therefor, upon payment of the amount bid at such sale; the cost of drawing, acknowledging, and recording the sheriff's deed; the amount of all taxes and municipal claims, whether not entered as liens, if actually paid; the principal and interest of estates and encumbrances, not discharged by the sale and actually paid; the insurance upon the property, and other charges and necessary expenses of the property, actually paid, less rents or other income therefrom, and a sum equal to interest at the rate of ten per centum per annum thereon, from the time of each of such payments. If both owner and creditor desire to redeem, the owner shall have the right so to do only in case he pays the creditor's claim in full. If more than one creditor desires to redeem, the one who was lowest in lien at the time of sale shall have the prior right, upon payment in full of the claim of the one higher in lien. Within nine months, one who was lower in lien may redeem from one higher in lien who has already redeemed, and the owner may redeem from him; and so on throughout, in each case by paying the claim of the one whose right was higher; and one higher in lien may redeem from one lower in lien, unless his claim is paid; but in each case the right must be exercised within nine months.

53 P.S. § 7293(a).

HSBC asserted that it had the statutory right to redeem the Property from Grove Properties within nine months from the date of the acknowledgement of the Sheriff's Deed conveying the Property to Grove Properties. It is undisputed that the Sheriff's Deed was acknowledged on June 17, 2011.

In response, Grove Properties claimed that HSBC had no right to redeem after the acknowledgement of the sheriff's deed because the Property was " vacant property" under Section 32(c) of the Act, 53 P.S. § 7293(c). Section 32(c) of the Act, 53 P.S. § 7293(c), provides that " there shall be no right of redemption of vacant property by any person after the date of the acknowledgement of the sheriff's deed therefor." (Emphasis added.) Section 32(c) of the Act, 53 P.S. § 7293(c), further provides:

[P]roperty shall be deemed to be 'vacant property' unless it was continuously occupied by the same individual or basic family unit as a residence for at least ninety days prior to the date of the sale and continues to be so occupied on the date of the acknowledgment of the sheriff's deed therefore.

Grove Properties argued that if HSBC wished to redeem this " vacant property" it was required to do so before the Sheriff's Deed was acknowledged on June 17, 2011, which it did not do.

A hearing on the Redemption Petition was held before the trial court on December 11, 2013. Held did not appear at the hearing. In support of its position that the property was " vacant property" Grove Properties presented Held's notarized Affidavit in which she stated that she did not reside in the Property during the ninety days prior to the sale:

1. I am the prior owner of real property commonly known as 3408 Willet Road, Pittsburgh, PA 15227.
2. The property was sold at a sheriff's sale on June 6, 2011.
3. During the 90 days prior to the sheriff's sale, I did not continually occupy the ...

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