N.O. Brown v. City of Philadelphia and Sheriff of Philadelphia County
359 C.D. 2016
| Pa. Commw. Ct. | Oct 26, 2016Background
- Brown was the high bidder at a 2011 Philadelphia sheriff tax sale and paid $360,000 (initial $60,000 then $300,000 balance plus fees); he requested the sheriff’s deed but it was not recorded within the statutory period.
- Tax sale decree (May 11, 2010) authorized sheriff sale; sale arose from tax-lien foreclosure initiated by U.S. Bank (trustee); City and Sheriff were not parties to the foreclosure.
- Section 31.2 of the Tax Liens Law requires the sheriff to execute, acknowledge, and deliver the deed within 30–120 days; the sheriff failed to record the deed within that period and recorded it roughly nine months late.
- Brown filed suit in May 2012 seeking rescission and restitution for breach of contract; the sheriff contended no contract existed and that tax-lien statutory procedures govern remedies (petition to set aside sale).
- The trial court treated the complaint as a petition to set aside the sale, declined to set aside the sale (insufficient equitable harm), but awarded Brown $7,200 for delay damages (nine months × $800/month interest on a commercial loan).
- On appeal Brown argued he could rescind under a breach-of-contract theory; the Commonwealth Court affirmed, holding no contract existed between purchaser and sheriff because the sheriff’s duties were ministerial/statutory.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Can Brown sue the Sheriff for breach of contract and rescind the sheriff-sale purchase for late deed delivery? | Brown: Sheriff breached duty to deliver deed timely; that breach created a contractual claim entitling rescission and restitution. | Sheriff: No contract—sheriff performs ministerial, statutory duties; Tax Liens Law provides exclusive remedies (petition to set aside). | Held: No contract exists; claim construed as tax-sale petition; rescission/contract action unavailable against sheriff. |
| Was the sale subject to being set aside for the sheriff’s 12-month delay in deeding? | Brown: Delay harmed him (financing costs, lost investment opportunity), supporting setting aside sale. | Sheriff: Delay insufficient to justify equitable relief; plaintiff’s harm was vague and not enough to rescind sale. | Held: Trial court did not abuse discretion; sale not set aside—equitable harm not proven. |
| Are delay damages available for failure to acknowledge deed within statutory period? | Brown: N/A as he sought rescission, but sought damages for loss. | Sheriff: Remedies governed by Tax Liens Law; but court can award appropriate relief for statutory violation. | Held: Court awarded delay damages of $7,200 for nine months’ interest; statutory duty violated (deed acknowledged late). |
| Is the proper procedural vehicle a breach of contract claim or a petition to set aside under tax-lien statutes and Pa. R.C.P.? | Brown: Framed as breach of contract; sought contractual remedies. | Sheriff: Challenges to sheriff sales regulated by Tax Liens Law and Rules (petition to set aside; time limits). | Held: Petition to set aside / tax-lien procedures govern; court correctly treated action as such. |
Key Cases Cited
- Petticord v. Joyce, 578 A.2d 632 (Pa. Cmwlth.) (statutory duty negates bargained-for exchange; no contract when party already legally obligated)
- Department of Transportation v. First Pennsylvania Bank, 466 A.2d 753 (Pa. Cmwlth.) (no contract where one party is already legally bound to perform)
- Chatham Communications, Inc. v. General Press Corp., 344 A.2d 837 (Pa.) (contract formation requires bargained-for exchange)
- Cohen v. Sabin, 307 A.2d 845 (Pa.) (same principle regarding bargained-for exchange)
- McElvenny v. Bucks County Tax Claim Bureau, 804 A.2d 719 (Pa. Cmwlth.) (standard of review for denial of petition to set aside tax sale)
- Allegheny County v. Golf Resort, Inc., 974 A.2d 1242 (Pa. Cmwlth.) (setting aside sheriff sale is equitable; appellate review limited to abuse of discretion)
- Mortgage Electronic Registration Sys., Inc. v. Ralich, 982 A.2d 77 (Pa. Super.) (procedural timing for challenging sheriff sales under Pa. R.C.P.)