Brentwood Borough School District v. HSBC Bank USA, N.A.
111 A.3d 807
| Pa. Commw. Ct. | 2015Background
- HSBC held a mortgage on 3408 Willet Road, Brentwood Borough; the property was sold at sheriff's tax sale on June 6, 2011, for unpaid 2006–2007 taxes and conveyed by sheriff's deed acknowledged June 17, 2011.
- Grove Properties purchased the property at the tax sale; HSBC filed a Redemption Petition under Section 32(a) of the Municipal Claims and Tax Liens Act on November 11, 2011.
- Grove Properties asserted the property was “vacant property” under § 32(c), which eliminates any right to redeem after acknowledgement of the sheriff’s deed unless the owner can show continuous residential occupancy for 90 days before sale and on the acknowledgement date.
- Former owner Heather Held submitted a notarized affidavit stating she did not reside at the property during the 90 days before the sale, had gas service terminated, and was living with a friend and using the property mainly for storage.
- The trial court denied HSBC’s petition on two grounds: (1) HSBC’s petition was not filed within a 90‑day period (erroneously applied), and (2) the property was vacant under § 32(c), so HSBC’s petition (filed after acknowledgment) was untimely as to a vacant property.
- On appeal the Commonwealth Court held the trial court erred as to the 90‑day general redemption deadline (§ 32(a) provides nine months), but affirmed that the property was vacant under § 32(c) and thus HSBC’s redemption (filed after acknowledgment) was untimely.
Issues
| Issue | Plaintiff's Argument (HSBC) | Defendant's Argument (Grove) | Held |
|---|---|---|---|
| Timeliness of petition under § 32(a) | Petition filed Nov 11, 2011 — within nine months of deed acknowledgement (June 17, 2011) | Trial court said 90‑day deadline applied | Court: HSBC was within the nine‑month statutory period; trial court erred applying a 90‑day deadline |
| Whether property is “vacant” under § 32(c) | Held was only temporarily absent; leaving belongings/occasional returns shows occupancy and intent to return | Held did not continuously occupy for 90 days before sale or on acknowledgement date; utilities disconnected; used mainly for storage | Court: Evidence showed no habitual physical residence, utilities shut off, and Held residing elsewhere — property was vacant under § 32(c) |
| Effect of vacancy on right to redeem | As mortgagee, substantial interest and should be allowed equitable relief; lack of notice of owner’s claim of non‑residence is unfair | § 32(c) limits redemption for vacant property to pre‑acknowledgement period; mortgagee had statutory notice of the tax sale and opportunity to protect its lien | Court: Equity does not override § 32(c); mortgagee had notice and opportunity; affirm denial of redemption |
Key Cases Cited
- City of Philadelphia v. Novick, 400 Pa. Super. 101 (1990) (tax sale purpose is returning property to tax rolls and productive use)
- City of Philadelphia v. F.A. Realty Investors Corp., 95 A.3d 377 (Pa. Cmwlth. 2014) (distinguishing vacant‑property redemption timing)
- City of Allentown v. Kauth, 874 A.2d 164 (Pa. Cmwlth. 2005) (scope of appellate review in tax sale cases)
- Mennonite Bd. of Missions v. Adams, 462 U.S. 791 (1983) (notice principles in property‑interest contexts)
- Collins v. London Assur. Corp., 165 Pa. 298 (1895) (sheriff's sale completion tied to court confirmation and deed acknowledgement)
- City of Philadelphia v. Taylor, 465 A.2d 33 (Pa. Super. 1983) (statutory construction and liberal interpretation of redemption statutes)