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IMPORTANT Redemption Decision from Alabama Court of Civil Appeals

Posted by 15789465 on

On Friday, September 12, 2014, the Alabama Court of Civil Appeals spelled out the procedure for attacking a redemption when the tax sale investor has not been paid for insurance premiums and the value of preservation improvements. The Court might change its mind if there is a motion to reconsider. The decision might be overturned by the Alabama Supreme Court after a petition for certiorari (an appeal, basically.) But, for now it provides much needed guidance on this topic. Please continue following this blog for any further developments. In Wall to Wall Properties v. Cadence Bank, Cadence paid the Probate Judge of Madison County slightly less than $900 to redeem property from a tax sale. This was the amount of the taxes due, plus 12% interest. The investor claimed he was also owed insurance premiums and the value of preservation improvements. He asked the Probate Judge to vacate the redemption certificate and conduct a hearing on the additional sums claimed by the investor. The Probate Judge refused, so the investor filed a mandamus petition in the Circuit Court. A mandamus petition is a request to a higher court that it order a lower court to do its job.  The Circuit Court dismissed the mandamus petition, without giving a reason.  The investor appealed to the Alabama Court of Civil Appeals. This is what the Court of Civil Appeals said: The Probate Judge has a duty to determine if ALL monies have been paid (including sums due to an investor) BEFORE it issues a redemption certificate. If it fails to do that, and issues the redemption certificate, then the investor can file a request with the Probate Court to vacate the redemption. The Probate Court must then immediately vacate the redemption certificate and schedule a hearing to consider the evidence regarding sums due to the investor. If the Probate Court  refuses to vacate the redemption certificate, then the investor should file a mandamus petition with the Circuit Court. Thank you, Howard Ross, of Wall to Wall Properties, for pursuing this case and getting some guidance from the appellate courts.  To read the entire decision, click HERE.

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7 comments

  • Denise, what would be the effect of filing a mechanic’s lien on a tax property to cover the necessarypreservation repairs, such as repairing a leaking roof?

    Greg Stanley on
  • not to bore everyone

    the situation here is that Ex parte Jim Walter Resources (Ala 2012) appears to rule that a circuit court lacks jurisdiction to hear appeals or petitions for mandamus to a probate court unless it is of one of the listed types of cases – which does not include tax sale redemption – yet Ross v. Rosen-Rager (Ala. 2010) appears to hold that a tax sale purchaser can challenge a certificate of redemption by filing a petition for mandamus to the probate court

    in rosen-rager the supreme court said that a circuit court “has general superintendence” over a probate court – while in Ex parte Jim Walter the court said that a circuit court “has ONLY general superintendence” over a probate court, but never said that it was overruling rosen-rager

    the two cases appear to be in conflict for tax sale redemptions

    howie on
  • Thanks, Howie. While I agree that Friday’s decision is a logical extension of Ross v Rosen Rager and Ex parte Foundation Bank, the courts are blazing new ground here. While Motions to Reconsider are rarely granted, the courts do reverse themselves from time to time. Also, Rule 39 of the Alabama Rules of Appellate Procedure allow certiorari to the Alabama Supreme Court on more grounds than just a request to overturn a prior Supreme Court decision.

    For you non-lawyers out there, an “appeal” is a method of asking a higher court to overrule a lower court’s decision. If you file an appeal, and the lower court did in fact rule improperly, the higher court has to consider your request and issue a decision saying what the law is in the situation. A Petition for Writ of Certiorari is slightly different. It is a request to a higher court to take notice of a lower court’s decision, which has incorrectly decided an IMPORTANT point of law. The higher court usually does not grant the request. It might be because they think the lower court made the correct decision. It might be because they don’t think the legal point is important enough, generally speaking, to spend their time on it. It might be incredibly important to the parties, but not to the state at large, or the body of law in general.

    In Howie’s case, the only way his decision can be overturned is if the Alabama Supreme Court grants certiorari so it can consider whether the Court of Civil Appeals ruled improperly. That is a possibility, although I do agree with Howie that it is a very remote possibility.

    Denise L. Evans on
  • this appeal was transferred from the supreme court to the court of appeals – therefore i don’t think it will be reversed on rehearing – as you seem to have noticed, the appeals court held that a circuit court ordinarily would not have jurisdiction to hear an appeal (or issue a writ of mandamus) from a probate court of a case type not enumerated in ala 12-22-21 (which excludes tax sale redemption) as ruled by supreme court in ex parte jim walter resouces (2012) – the exception for tax sale is due to the ruling in ross v rosen-rager (2010) in which the supreme court recognized circuit court jurisdiction of circuit courts to entertain petitions for writ of mandamus to a probate court to challenge issuance of a certificate of redemption – since the supreme court did not rule that rosen-rager was overruled, it is still controlling precedence for the court of civil appeals – therefore, the only way i see this opinion reversed is on a petition for certiorari to the supreme court, pursuant to arap 39 on the grounds of a prior decision of the supreme court that should be overruled,

    howie on
  • Hi Chuck, I don’t recall a decision with that holding, but I’ll check to see. Perhaps the decision referenced liability insurance. I can buy liability only insurance for tax sale properties, and I can’t get reimbursed for that. Thanks for bringing this up. I’ll see what I can find.

    Denise L. Evans on

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