362 P.3d 61
Mont.2015Background
- Mary Barbara Evans Stewart recorded a homestead declaration for property in Lakeside, Montana, and later defaulted on property taxes beginning in 2006.
- Flathead County held a tax-lien sale in July 2008; the county became purchaser when no third party bought the lien.
- RN & DB paid the delinquent taxes (first assignment in 2011, additional payments later) and ultimately obtained a tax deed after statutory notice and redemption procedures were satisfied in 2013.
- Stewart initially contested a defective 2011 tax deed; that deed was held void and the action dismissed without prejudice. RN & DB later complied with statutory requirements and obtained a corrected tax deed in December 2013.
- RN & DB filed a quiet-title action; default was entered then set aside. Stewart asserted Montana’s homestead exemption and challenged assessment procedures; the district court granted RN & DB summary judgment and quieted title.
- Stewart appealed, arguing (1) the homestead exemption protects her property from tax-lien foreclosure; (2) the county assessor failed to investigate her assessment complaints; and (3) she was denied a hearing. The Supreme Court affirmed.
Issues
| Issue | Plaintiff's Argument (Stewart) | Defendant's Argument (RN & DB) | Held |
|---|---|---|---|
| Whether Montana homestead exemption prevents loss of property at a tax-lien/tax-deed sale | Homestead exemption bars execution or forced sale for tax collection; tax deed is equivalent to execution and thus homestead protects property | A tax deed (after statutory process) is a sovereign grant creating new title; tax-lien/deed process is statutory and not an execution subject to homestead exemption | Homestead exemption does not apply to property tax-lien/tax-deed sales; tax deed creates new title extinguishing prior claims, including homestead |
| Whether alleged irregular assessments by county assessor required withholding of tax deed | Stewart alleged assessor ignored her May 2013 complaints and county should have paused the tax-deed process | RN & DB: Stewart failed to pursue required statutory appraisal/appeal procedures and did not timely object prior to tax-lien sale; assessor affidavits show assessments lawful | Court held Stewart failed to follow statutory challenge procedures and produced no timely evidence; her assessment complaint did not create a material fact to avoid judgment |
| Whether denial of a summary-judgment hearing deprived Stewart of due process | Stewart requested a hearing to subpoena assessor testimony to rebut RN & DB’s affidavit and show disputed facts | RN & DB: request was untimely/defective and any assessor testimony would not create a genuine issue of material fact | Court found no abuse of discretion in denying a hearing because the proffered testimony would not have created a material factual dispute |
| Effect of statutory procedural defects in earlier (2011) tax deed on later valid tax deed | Stewart pointed to prior defects as prejudicial to later proceedings | RN & DB: later proceedings complied with strict statutory requirements; prior defective deed was set aside and did not bar later valid deed | Court held prior void deed was addressed; RN & DB’s subsequent strict compliance produced a valid tax deed and quiet title |
Key Cases Cited
- Collier v. Kincheloe, 342 Mont. 314, 180 P.3d 1157 (2008) (tax deed creates a new sovereign title, extinguishing prior interests)
- Showell v. Brosten, 345 Mont. 108, 189 P.3d 1210 (2008) (tax-deed statutes require strict technical compliance)
- Hansen Trust v. Ward, 379 Mont. 161, 349 P.3d 500 (2015) (recognizing seriousness of tax-deed process and owner risks when purchaser strictly follows statutes)
- McDonald v. Grassle, 228 Mont. 25, 740 P.2d 1122 (1987) (tax deed is an independent grant extinguishing former titles)
- Isern v. Summerfield, 287 Mont. 461, 956 P.2d 28 (1998) (observing disproportion between delinquency and property value in tax-deed context)