760 S.E.2d 875
W. Va.2014Background
- On July 1, 2008, the subject properties were owned by CRW Real Estate, So Park, and Knollwood, private entities.
- In August–September 2008 the WV Department of Administration (WVDOA) purchased the properties from private owners, after the 2009 assessment date.
- The 2009 real estate taxes were not timely paid, and on November 16, 2010 the tax liens were sold to EB Dorev Holdings, Inc.
- A March 2012 petition and related litigation sought to prevent tax deeds; EB Dorev and the Clerk, Sheriff, and Assessor answered and cross-claimed.
- The circuit court granted WVDOA summary judgment, voided the tax lien sale, and held that (i) the 2009 taxes were rendered moot by WVDOA’s acquisition and (ii) the liens were extinguished by merger or were inchoate.
- EB Dorev appeals, challenging (a) exemption timing, (b) merger of liens, and (c) lapse of maturity of liens.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether WVDOA’s purchase rendered 2009 taxes moot due to exemption. | Dorev argues 2009 taxes remained due from private owners on assessment date. | WVDOA concedes exemption timing was incorrect but argues merger/inchoate issues control. | Exemption timing was misapplied; issues proceed to merger/inchoate analysis. |
| Whether the tax liens were extinguished by the doctrine of merger. | Dorev asserts Armstrong-type merger applies only to state purchases at tax sales. | WVDOA contends Locke-based merger applies and extinguishes liens upon state acquisition. | Court affirms merger doctrine application; liens extinguished. |
| Whether the tax liens were inchoate and never matured into saleable liens. | If merged, no saleable lien remained. | Liens could be extinguished by merger or otherwise; inchoate analysis unnecessary. | Alternative inchoate claim deemed unnecessary after merger finding. |
| Whether EB Dorev is entitled to a refund of purchase money. | Sale void requires return of lien purchase price. | Liens extinguished; no purchase money to refund. | Court declines to decide on refund issue on appeal, grants leave to raise later. |
Key Cases Cited
- Armstrong Products Corp. v. Martin, 119 W.Va. 50 (1937) (recognizes merger where state purchases land at tax sale)
- Turk v. Skiles, 45 W.Va. 82, 30 S.E. 234 (1898) (recognizes principle of merger in the abstract)
- Sullivan v. Saunders, 66 S.E. 497 (1909) (discusses merger exception to the general rule)