In Re Matter of Ackah
2017 N.C. App. LEXIS 750
| N.C. Ct. App. | 2017Background
- Ackah owned a home subject to an HOA lien under the Planned Community Act and moved abroad in 2012, forwarding mail to family in South Carolina but not notifying the HOA of her move.
- She fell delinquent on HOA dues in 2014; the HOA mailed notices (some by certified mail that were returned "unclaimed"), posted notice on the Property door, but did not email her despite having an email address.
- The HOA sought enforcement of its lien before the Clerk; the Clerk held a hearing without Ackah's participation and entered an order authorizing sale; the Jones Family bought the Property at the judicial sale and received a deed.
- Ackah later learned of the sale and moved in superior court under Rule 60 to set aside the Clerk's order; the superior court granted relief and restored title to Ackah.
- On appeal, the Court of Appeals held that the HOA failed to satisfy Rule 4's "due diligence" requirement (entitling Ackah to Rule 60 relief), but that N.C. Gen. Stat. § 1-108 limits relief so as not to affect title of a good-faith purchaser when the notice is constitutionally sufficient.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether HOA's notice satisfied Rule 4 due diligence | HOA did not use due diligence (should have used email) | HOA asserted its certified mail and posting complied | Court: HOA failed Rule 4 due diligence; Ackah entitled to Rule 60 relief |
| Whether Ackah is entitled to have the sale set aside affecting purchaser's title | Ackah argued sale should be set aside due to defective Rule 4 service | Jones Family argued § 1-108 bars disturbing title of good-faith purchaser | Court: § 1-108 bars relief that alters purchaser's title when notice is constitutionally sufficient |
| Whether HOA's notice met constitutional due process | Ackah argued notice was constitutionally insufficient (no actual notice) | Jones Family: certified mail + posting satisfied due process | Court: Notice constitutionally sufficient under Jones v. Flowers (reasonably calculated to notify) despite failing Rule 4 |
| Proper remedy available to Ackah after Rule 60 relief | Ackah sought restoration of title and possession | Jones Family sought protection as good-faith purchaser; HOA liable for defective process | Court: Ackah may obtain restitution from HOA under § 1-108; title to purchaser remains protected; superior court's order restoring title reversed in part |
Key Cases Cited
- Jones v. Flowers, 547 U.S. 220 (2006) (constitutional notice must be reasonably calculated to inform owner; posting may suffice after returned certified mail)
- Henderson County v. Osteen, 292 N.C. 692 (1977) (statutory sale without constitutionally sufficient notice unconstitutional as applied)
- White v. White, 179 N.C. 592 (1920) (purchaser at execution sale protected; title not disturbed where notice was constitutionally sufficient)
- Foster v. Allison Corp., 191 N.C. 166 (1926) (statutory predecessor protects purchaser's title when sale made under judgment)
- Harrison v. Hargrove, 120 N.C. 96 (1897) (judgment regular on its face protects purchaser; later irregularity does not void purchaser's title)
- Town of Cary v. Stallings, 97 N.C. App. 484 (1990) (court may in the interest of justice affect title when setting aside judgment — cited by dissent but distinguished by majority)