130 N.E.3d 630
Ind. Ct. App.2019Background
- Trust 4340 (beneficiary Midwest Investment/Dellaportas) owned an undeveloped ~30-acre parcel in LaPorte County; tax bills were directed to Midwest Investment in Chicago but the owner did not update the Auditor after later address moves.
- Taxes were paid through 2008 but unpaid 2009–2015; LaPorte County held a 2015 tax sale and SRI, Inc. (a contractor) handled mailing notices for the Auditor.
- SRI sent a certified-mail tax-sale notice to Trust 4340 that was stamped “Return to Sender, Not Deliverable as Addressed, Unable to Forward” (with a handwritten “refused”); a contemporaneous first-class mailing was not returned.
- The Auditor did not search its internal records for a better address after the certified mail was returned, despite the Work Plan Agreement with SRI requiring such searches; the Auditor also published notice in the local paper.
- XL Investment bought the certificate at a live sale, obtained a tax deed, and later filed a quiet-title action; Trust 4340 first received actual notice on December 9, 2016 and moved to set aside the deed on March 9, 2017.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Timeliness of motion to set aside tax deed | Motion filed ~3 months after receipt of actual notice was timely as a “reasonable time” under due process | Motion was untimely given long tax delinquency, owner’s failure to update address, and publication by purchaser | Court held the 3-month delay (6 months after deed issuance, 3 months after actual notice) was reasonable; trial court erred in deeming it untimely |
| Sufficiency of notice under statute and due process | Certified-mail return as “not deliverable” required Auditor to search its own records for a better address; first-class mailing + publication insufficient | Auditor relied on amended statute and SRI’s outside searches; first-class mail and publication satisfied notice | Court held Auditor constitutionally required to search its own records after certified mail returned; first-class re-mailing and publication were insufficient; tax deed set-aside required |
| Effect of statutory amendment to I.C. §6-1.1-24-4 | Constitutional duties cannot be abrogated by statute; Auditor’s record-search obligation remains | Statutory change relieved Auditor of duty to search internal records after returned certified mail | Court held legislative language cannot eliminate constitutional duties; Auditor remains obligated to search its records |
| Adequacy of mailed notice content | Notice lacked street address or common description; content was questionable for due process | Auditor/SRI produced pin/legal description; vacant land had no street address | Court expressed concerns about substantive notice content and noted possible noncompliance with statutory content requirements |
Key Cases Cited
- Jones v. Flowers, 547 U.S. 220 (2006) (when mailed notice is returned unclaimed, state must take additional reasonable steps)
- Marion County Auditor v. Sawmill Creek, LLC, 964 N.E.2d 213 (Ind. 2012) (when certified mail is "not deliverable as addressed," re-mailing by first-class is unreasonable)
- City of Elkhart v. SFS, LLC, 968 N.E.2d 812 (Ind. Ct. App. 2012) (auditor must search records it maintains for updated owner information)
- Reeder Associates II v. Chicago Belle, Ltd., 778 N.E.2d 828 (Ind. Ct. App. 2002) (auditor may not substitute outside searches for a search of its own records)
- Edwards v. Neace, 898 N.E.2d 343 (Ind. Ct. App. 2008) (reasonable-time exception to 60-day statute depends on circumstances)
- Hullett v. LaFevre, 926 N.E.2d 524 (Ind. Ct. App. 2010) (auditor required to search internal records for notice purposes)
- Farmer Mutual Ins. Co. v. M Jewell, LLC, 992 N.E.2d 751 (Ind. Ct. App. 2013) (statute must be interpreted to preserve due process protections; auditor’s duties include reasonable record searches)
- M & M Investment Group, LLC v. Ahlemeyer Farms, Inc., 994 N.E.2d 1108 (Ind. Ct. App. 2013) (affirming standards regarding returned mail and notice sufficiency)