MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC. et al. v. Verissimo DePINA et al.
No. 2011-324-Appeal.
Supreme Court of Rhode Island.
April 12, 2013.
63 A.3d 871
Each appellant filed her claim and reasons for the appeal in the Superior Court, yet failed to file any part of the record and instead moved for an extension of time to file the record. In Griggs I, 845 A.2d at 1010, we foresaw just such a situation and addressed it, saying “[s]ection
We discern no error in the trial justice‘s dismissal of the appellants’ appeals. Although we harbor considerable concerns about the authority of the Probate Court to continue to preside over a guardianship proceeding for a long-dead ward, as well as the magnitude of the sanctions imposed without the benefit of a jury trial, we are unable to conduct any meaningful review due to the lack of a record before us.6 Nor can we address whether the Superior Court properly issued the execution while this matter was on appeal, as that issue is not properly before us.
IV
Conclusion
For the reasons stated herein, we affirm the judgments of the Superior Court. The record of this case shall be returned to the Superior Court.
Patrick T. Conley, Esq., for Defendant Amy Realty.
Present: SUTTELL, C.J., GOLDBERG, FLAHERTY, ROBINSON, and INDEGLIA, JJ.
OPINION
Chief Justice SUTTELL, for the Court.
The defendant, Amy Realty,1 appeals from the Superior Court‘s grant of partial
I
Facts and Procedural History
In January 2008, the Pawtucket Water Supply Board (PWSB) mailed a notice to Verissimo DePina informing him that the water bill on his property located at 18 Perry Street in Central Falls was past due, and that the PWSB would move forward with a water lien sale unless payment was received or an alternative arrangement was negotiated.3 In April 2008 (apparently having received no response to the first notice), the PWSB sent DePina a second notice of the sale informing him that his property at 18 Perry Street would be advertised for a tax sale on May 6, 2008 and that it would be sold at public auction on May 29, 2008.4 Both notices listed the property to be sold as 18 Perry Street, Assessor‘s Plat No. 5, lot No. 486 (Lot 486), even though DePina‘s property was in fact Assessor‘s Plat No. 5, lot No. 456 (Lot 456). The PWSB also publicly advertised the sale of Lot 486 pursuant to
At the time these notices were sent, MERS (as nominee for lenders Citigroup Global Markets Realty and Regions Bank) held first and second mortgages on the property, which were appropriately recorded in the land evidence records. It is undisputed that, notwithstanding the requirement of
On May 29, 2008, the PWSB auctioned the lot advertised in the newspaper as “Plat 5, Lot 486, taxed to Verissimo DePina,” for $2,027.81. Subsequently, the PWSB issued a deed purportedly conveying “all of the right, title and interest of the said Raquel Valdez, Bank of America, N.A., and Verissimo DePina * * * in and to that certain tract or parcel of land * * * designated as Plat 5, Lot 486” to Amy Realty. The parties do not dispute that the tax deed was recorded within sixty days of the sale, as is required by
Additionally, Amy Realty prepared a redemption deed for Valdez, reconveying Lot 486 to her so that there would be no cloud on her title. It is undisputed that neither Raquel Valdez nor Bank of America ever held an interest in Lot 456.
Amy Realty‘s representative gave deposition testimony that, at the time of the tax sale, he was under the impression that he had bid on and purchased Lot 486, not Lot 456, and that until Valdez contacted him, he was not aware of the discrepancy as to the lot numbers. Additionally, he acknowledged that, aside from DePina, the parties with actual interests in Lot 456 (namely, plaintiffs) did not receive notice of the sale.
Thereafter, Amy Realty filed an amended petition to foreclose, this time on Lot 456, and sent notice to each of the parties with an interest in Lot 456, including plaintiffs.5 However, plaintiffs did not respond; and, in December 2009, a final decree was entered foreclosing plaintiffs’ rights of redemption in Lot 456.
In April 2010, plaintiffs filed a complaint seeking injunctive and declaratory relief under
II
Standard of Review
“The grant of a motion for summary judgment is reviewed by this Court de novo, ‘employing the same standards and rules used by the hearing justice.‘” Great American E & S Insurance Co. v. End Zone Pub & Grill of Narragansett, Inc., 45 A.3d 571, 574 (R.I.2012) (quoting Generation Realty, LLC v. Catanzaro, 21 A.3d 253, 258 (R.I.2011)). Thus, we will affirm a grant of summary judgment if, in “reviewing the admissible evidence in the light most favorable to the nonmoving party, we conclude that no genuine issue of material fact exists and that the moving party is entitled to judgment as a matter of law.” Id. (quoting Generation Realty, LLC, 21 A.3d at 258).
This Court also reviews questions of statutory construction de novo. Mendes v. Factor, 41 A.3d 994, 1002 (R.I. 2012). “As a general matter, the authority for the sale of real estate for delinquent taxes ‘must be found in the statutes and such statutes will not be enlarged by judicial construction but will be strictly construed in favor of the owner.‘” Reservoir Avenue Associates v. Sepe Investments, LLC, 941 A.2d 805, 810 (R.I. 2007) (quoting First Bank & Trust Co. v. City of Providence, 827 A.2d 606, 610 (R.I.2003)).
III
Discussion
Amy Realty argues that the Superior Court erred in vacating the foreclosure decree because, once the foreclosure decree was entered, plaintiffs were “forever barred” from seeking redemption or challenging the validity of the proceeding under the provisions of
The procedure for tax sales, redemptions, and foreclosures in Rhode Island is set forth in a series of statutory provisions. See
To resolve the issues raised in this appeal we must examine several intertwined provisions of Rhode Island‘s tax sale statutes. First,
A final foreclosure decree carries with it significant consequences for any party who had an interest in the property prior to the tax sale:
“inadequacy of notice of the petition amounting to a denial of due process or for the invalidity of the tax sale because
the taxes for which the property was sold had been paid or were not due and owing because the property was exempt from the payment of such taxes.” Id.
Moreover,
“If a person claiming an interest desires to raise any question concerning the validity of a tax title, the person shall do so by answer filed in the proceeding on or before the return day, or within that further time as may on motion be allowed by the court or else be forever barred from contesting or raising the question in any other proceeding.”
Finally,
This Court has recognized the finality that Rhode Island‘s tax foreclosure procedure provides to purchasers, and we have consistently upheld the strict bar to tax sale challenges erected by
“the explicit language of [
§§ 44-9-30 and44-9-31 is] controlling in this case; and any subsequent claims by [the owner] were forever barred. Any previous defects in the notice procedure of the tax sale were negated by [the owner‘s] subsequent failure to answer or appear upon notice of the petition to foreclose its rights of redemption. We deem [the owner‘s] failure to answer on or before the return day to be fatal to its appeal.” Kildeer Realty, 826 A.2d at 966-67.
Our case law has consistently prevented those who previously held an interest in property sold at a tax sale from attacking a final decree of foreclosure when they have been properly noticed of the foreclosure proceedings but have failed to take action prior to the return day to protect their redemption rights. See Medeiros v. Bankers Trust Co., 38 A.3d 1112, 1113-14, 1119 (R.I.2012) (holding that, when a property owner who had received notice of the tax sale and foreclosure petition failed to answer the foreclosure petition, he was barred from subsequently claiming an interest in the property); ABAR Associates, 870 A.2d at 991, 992, 996, 997 (concluding that the holder of an unrecorded interest who was not entitled to receive notice of the tax sale or foreclosure petition could not intervene in a subsequent challenge to the final decree barring his right to redeem).
The plaintiffs urge us to apply our holding in Sycamore Properties, LLC v. Tabriz Realty, LLC, 870 A.2d 424 (R.I.2005), to the issues at bar. There we held that, under an earlier version of
Although the General Assembly‘s post-Sycamore amendments may have significantly narrowed the notice-based “safety valve” of
Amy Realty maintains that the corrective deed changing the lot number from 486 to 456 obviates this deficiency because it relates back to the date of the tax sale, such that the law deems Lot 456 to have been the property sold at the tax sale. Thus, Amy Realty‘s title to Lot 456 hinges on the validity of the corrective deed purporting to alter the lot number of the property auctioned at the tax sale. Amy Realty seeks to minimize the error as a “typo,” perhaps similar to a misspelling in the grantee‘s name, a slight mistake in a deed‘s expression of metes and bounds, or any other clerical error that may be rectified simply by obtaining a corrective deed. However, we are of the opinion that to describe this discrepancy in lot numbers as a mere “typo” grossly mischaracterizes the nature and import of the error; not only did this mistake cause the PWSB to notice incorrect parties, but it also caused the wrong lot to be sold at auction.
It does not appear that we have previously been called upon to determine which types of errors may be rectified through a corrective tax sale deed, but the weight of authority suggests that corrective deeds may not be used to fix such fundamental errors as selling the incorrect lot at a tax sale. We find the Texas Supreme Court‘s
“Preserving the narrow circumstances for acceptable use of a correction deed is important because a proper correction deed may relate back to the date of the deed it corrects. * * * To allow correction deeds to convey additional, separate properties not described in the original deed would introduce unwarranted and unnecessary confusion, distrust, and expense into the Texas real property records system. For example, it could require those who must rely on such records to look beyond the deed and research the circumstances of ownership to make sure that no conveyance mistake such as that before us in this case was made, undermining the entire purpose of record notice.” Id. at 750-51.
Thus, the court held the corrective deed purporting to convey both lots when only one was sold at the foreclosure sale to be void. Id. at 751.
Other persuasive authority also supports the conclusion that a corrective deed may not be used to correct an error as fundamental as conveying the wrong lot. For example, Corpus Juris Secundum recognizes the validity of corrective deeds when used to rectify minor irregularities, but cautions that corrective deeds may not be employed when doing so would prejudice the rights of third parties:
“Where there is no fraud and the rights of third persons have not intervened, and equity could have reformed the deed, it may be amended by a subsequent instrument so as to effectuate the intention of the parties. This rule applies to a mistake in the description of the property, or to omission of conditions by mutual mistake, or to a deed executed and antedated to replace a destroyed instrument, even though done without the grantee‘s knowledge.
* * * *
“Ordinarily, a correction deed relates back to the date of the document that it purports to express more accurately, as long as no new rights are thereby affected. However, as against third persons, an alleged defective deed can be cured only by a bill in equity, and not by a confirmation assuming to relate back to
the original deed.” 26A C.J.S. Deeds § 40 at 66-67, 68 (2011).
Here, the mistake at the tax auction and in the resulting deed was far more fundamental than a simple misspelling of a party‘s name or a slightly incorrect property description: the initial tax deed here purported to convey an entirely different property than the property for which a water bill was due and owing. In the original deed, the property conveyed was described only as “Plat 5, Lot 486,” and the parties whose interests were being transferred included Raquel Valdez and Bank of America, as well as Verissimo DePina.9 The weight of authority indicates that a corrective deed is insufficient to correct an error of this magnitude. We agree with the hearing justice that the original tax deed purported to convey Lot 486, and that the corrective deed, relating to an entirely different parcel of land, Lot 456, was null and void because it was not recorded within sixty days of the tax sale as required by
Additionally, given the policies underlying the tax sale statute, we find Amy Realty‘s argument that the corrective deed cured all deficiencies to be untenable under the facts of this case. As we have previously noted:
“Historically, * * * our law has strongly disfavored forfeitures of real property.
* * * *
“Legislatures and courts have acted to ameliorate the severity of tax forfeitures. Although tax-sale statutes furnish a strong arm with which to enforce the government‘s right to its revenues, the statutes also protect the right of property owners to their real estate. * * * Because the right of redemption is a valuable property right, * * * and the potential loss to the owner is grave, the courts have as a matter of general policy interpreted tax statutes liberally in favor of redemption.” Albertson, 447 A.2d at 388.
We also observe that
Finally, Amy Realty argues that the errors in the tax sale notices listing the property as Lot 486 rather than Lot 456 were cured by
For the foregoing reasons, we are of the opinion that the plaintiffs were entitled to avail themselves of the “safety valve” of
IV
Conclusion
For the reasons set forth in this opinion, we affirm the judgment of the Superior Court. The record may be returned to the Superior Court.
William Lamont THOMAS v. Omar PROCTOR et al.
No. 2011-309-Appeal.
Supreme Court of Rhode Island.
April 17, 2013.