New Hope for Outlaws (Tax Buyers)

by Chris on May 16, 2016

In ancient England, an undesirable could be declared an “outlaw” which meant they were outside the protection of the law.

Recent court decisions essentially deny tax buyers the protection of the courts, declaring even final, non-appealable judgments as meaningless. For example, a judgment confirming a tax title, under certain circumstances can be “vacated,” even if properly served and compliant with law.

Before the enactment of the tax sale revisions of 2009, there was no mechanism for recovering the taxes paid by the tax buyer and no provision for reimbursement of attorney’s fees and court costs. The 2009 revision to Title 47 enacted a series of after-the-tax-sale notices specifically designed to comply with due process as interpreted by the United States Supreme Court.

This was the Louisiana legislature’s effort to remedy any lack of notice in connection with the tax sale. The Fourth Circuit in the Surcouf opinion held the legislature cannot cure a defect in notice of a tax sale, so any defect in the pre-sale notice doomed the validity of the sale.

However, the Second Circuit recently addressed the validity of notice under La. Rev. Stat. § 47:2156 in Adair Asset Management v. Turney. In that case, the court held the process of notice, relying on post sale notice, was valid, since any interested party had notice and an opportunity to defeat the sale.

Stay tuned. The Louisiana Supreme Court has avoided applying the 2009 statute retroactively, so one of these decisions may yet land on Royal Street

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