Marlton Recovery Partners, LLC v. County of Los Angeles
195 Cal. Rptr. 3d 156
Cal. Ct. App.2015Background
- Marlton Recovery Partners acquired title to 26–27 parcels in 2011 that had property taxes delinquent beginning in the 2005–2006 tax year; total delinquent taxes ~ $2.4M and penalties ~ $1.59M.
- On June 5, 2012 Marlton requested cancellation of penalties under Revenue & Taxation Code § 4985.2(a) for tax years 2008–09 through 2011–12, asserting investor fraud and other equitable grounds.
- Treasurer-Tax Collector Saladino denied the request (July 16, 2012), explaining § 4985.2(a) permits cancellation only if the principal tax is paid no later than June 30 of the fourth fiscal year following the delinquent fiscal year.
- Marlton paid some delinquent taxes (parcels sold to Kaiser) on July 31, 2012, i.e., after its June 5, 2012 request; other parcels remained unpaid as of June 2013.
- Marlton filed a verified petition for writ of mandate challenging the denial; the county moved for summary judgment arguing Marlton failed to make timely principal payments as required by § 4985.2(a).
- The trial court granted summary judgment for Respondents; the Court of Appeal affirmed, holding § 4985.2(a) requires timely payment within the statutory four‑year period and that Marlton’s late or missing payments foreclosed relief.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether § 4985.2(a) allows cancellation of penalties when principal tax payment was not made within the statute's four‑year deadline | Marlton: statute does not require payment before filing a cancellation request; cancellation is mandatory when criteria satisfied and tolling applies to earlier years | County: § 4985.2(a) conditions cancellation on payment of the principal no later than June 30 of the fourth fiscal year following delinquency; Marlton failed that condition | Held: § 4985.2(a) unambiguously requires timely principal payment; Marlton’s payments were too late (or absent), so denial was proper, appeal affirmed |
| Whether the trial court could rely on a ground not expressly raised in the county’s summary judgment motion (lack of payment) | Marlton: trial court abused discretion and denied due process by deciding on an unpled ground | County: record shows Marlton could not have raised a triable issue on the payment timing, so consideration of the ground was proper | Held: trial court’s reliance was permissible because Marlton conceded it paid after its request and could not show a triable fact; no procedural error |
Key Cases Cited
- People ex rel. Strumpfer v. Westoaks Investment #27, 139 Cal.App.4th 1038 (discusses legislative purpose and limits of predecessor to § 4985.2)
- Klajic v. Castaic Lake Water Agency, 90 Cal.App.4th 987 (standard of review for writ of mandate challenging administrative action)
- Farahani v. San Diego Community College Dist., 175 Cal.App.4th 1486 (statutory interpretation reviewed de novo)
- Juge v. County of Sacramento, 12 Cal.App.4th 59 (when court may grant summary judgment on an unraised ground if no triable issue could be shown)
- Ross v. Roberts, 222 Cal.App.4th 677 (discussion applying Juge and related procedural principles)