JH Jordan v. Jensen, 2017 UT 1

Background

In 2000 Uintah County sold land at a tax sale for unpaid taxes; the county did not provide constitutionally adequate notice to the recorded mineral-interest owners (the Jordans).
The tax deed to purchaser Quality Remediation Services (QRS) and subsequent deed to the Jensens contained no reservation for the severed mineral interest; purchasers later asserted mineral ownership.
The Jordans (and later lessee Axia) discovered the defect years later and filed a quiet-title action in 2013 challenging the tax-sale conveyance of the mineral estate.
The Jensens invoked Utah Code § 78B-2-206, arguing the four-year special limitations period for challenging tax titles barred the suit (more than four years had passed since the 2000 sale).
The district court granted summary judgment to the Jordans/Axia, concluding the county’s failure to provide constitutionally adequate notice (a due-process violation) prevented § 78B-2-206 from operating and deprived the county of jurisdiction to sell the mineral interest.
The Utah Supreme Court affirmed: because the statute of limitations was triggered by unconstitutional state action (the tax sale without proper notice), § 78B-2-206 could not be applied to bar the challenge, and the tax deed was void as to the mineral interest.

Issues

Issue	Plaintiff's Argument (Jordans/Axia)	Defendant's Argument (Jensens)	Held
Whether § 78B-2-206 bars a challenge to the tax deed that followed a tax sale conducted without constitutionally adequate notice	§ 78B-2-206 was triggered by unconstitutional state action, so it cannot run to bar their due-process claim	Prior Utah precedent permits § 78B-2-206 to validate tax deeds even if statutory/due-process steps were defective; limitations period should bar suit	Court held § 78B-2-206 does not apply because it was triggered by state action that violated due process; plaintiffs may challenge the tax title
Whether constructive or record notice after the sale suffices to allow § 78B-2-206 to run	Constructive/record notice after an unconstitutional tax sale is insufficient when the owner’s name/address were reasonably ascertainable	Constructive notice (e.g., recorded tax deed) put owners on inquiry notice and should allow the statute to run	Court held constructive or subsequent record notice is insufficient where actual mailed notice was constitutionally required and the owner was reasonably ascertainable
Whether failure to give required notice deprives the county of jurisdiction to sell the property	Lack of constitutionally adequate notice prevents the county from obtaining jurisdiction over the interested party’s property, so the sale cannot convey that interest	The defect might render the tax deed voidable but § 78B-2-206 can still validate it after the limitations period	Court held the county lacked jurisdiction to sell the Jordans’ mineral interest, so the tax deed is void as to that interest
Validity of Hansen v. Morris as controlling on due-process/limitations interaction	Hansen is inconsistent with later U.S. Supreme Court due-process jurisprudence and should not control	Hansen stands for applying the limitations statute to validate tax titles even where statutory notice was defective	Court overruled Hansen to the extent it held § 78B-2-206 could apply despite a due-process notice failure

Key Cases Cited

Mennonite Bd. of Missions v. Adams, 462 U.S. 791 (1983) (when mortgagee is reasonably ascertainable, state must provide actual notice of tax sale; failure to give adequate notice is a due-process violation)
Schroeder v. City of New York, 371 U.S. 208 (1962) (limitations period for damages triggered by government action is inapplicable when the government condemned property without constitutionally adequate notice)
Tulsa Prof’l Collection Servs., Inc. v. Pope, 485 U.S. 478 (1988) (state involvement that activates a time bar can constitute state action such that applying the bar without adequate notice violates due process)
Texaco, Inc. v. Short, 454 U.S. 516 (1982) (distinguishes state-triggered forfeiture statutes from privately caused lapses; limitations running from owner inactivity do not implicate due process)
Hansen v. Morris, 283 P.2d 884 (Utah 1955) (earlier Utah decision holding predecessor to § 78B-2-206 could validate tax deeds despite notice defects; overruled here to the extent inconsistent with later due-process precedents)
Frederiksen v. LaFleur, 632 P.2d 827 (Utah 1981) (prior Utah recognition of § 78B-2-206’s stabilizing purpose; court reserved question whether statute could apply to conduct repugnant to fundamental fairness)