Judicial In Rem Tax Sales

Recently, we have seen more judicial tax sales in Georgia. This type of sale is much different than a non-judicial tax sale. OCGA § 48-4-75. Both the procedures and the deadlines differ.

When a taxpayer fails to property taxes, a county may file a judicial-in-rem tax sale. OCGA § 48-4-78. When the county employs this type of tax sale, it files a “Petition” in the superior court. The Petition is against the property itself and anyone with an interest in the property, including the owner.

Once the county files the Petition, the county gives notice to the interested parties. OCGA § 48-4-78. The county posts the property with copies of the summons and Petition, notice to interested parties, and notice of hearing. The county also sends the documents by regular and certified mail to all interested parties. Lastly, the county publishes a legal notice in the county newspaper alerting the public. The notice runs for two weeks).

Following notice, the court holds a hearing. Any interested party has the right to be heard and to contest the allegations in the Petition at the hearing. If the superior court determines that the information in the Petition is accurate and that the county gave proper notice, the court will order the county to sell the property at an auction. OCGA § 48-4-79.

The county then advertises the sale of the property in the county’s legal newspaper for four weeks. The advertisement will show the owner’s name, a description of the property to be sold, and the amount of the tax due OCGA §§ 9-13-140-142.

Before judicial tax sale auction, an interested party may redeem the property by paying the redemption amount to the county tax commissioner. If an interested party pays the redemption amount, the county dismisses the Petition. OCGA § 48-4-80.

One of the main differences between judicial and non-judicial tax sales is that a judicial tax sale allows only 60 days to redeem (buy back the property). In a non-judicial tax sale, the owner has at least one year to redeem. OCGA § 48-4-81.

The other major difference is judicial tax sales vest title absolutely into the purchaser. In theory, this eliminates the need for post-sale barment procedures and quiet title actions. There is little case law to provide guidance, but we expect the courts to consider these issues in the future.

Surplus Foreclosure Funds

In Georgia, most foreclosures are non-judicial. Meaning that the lender does not need court approval or supervision to foreclose. Thus, most foreclosures in Georgia happen “privately.” This blog post addresses the lender’s obligations to disburse surplus foreclosure funds.

A lender who forecloses on real estate assumes the obligation of properly distributing the proceeds from the foreclosure sale. Holland v. Sterling, 214 Ga. 583, 585 (1958). The lender is entitled to apply the fund from the sale first to the costs of the sale, attorney’s fees, and the interest and principal of the secured indebtedness. OCGA § 13-4-42. If there are any surplus or excess funds, the lender must pay the surplus funds to lienholders and then to the borrower.

The lender’s interest in property exists only to the extent of the amount they are owed. Thus, the lender must account to the borrower for any surplus foreclosure funds. Palmer v. Mitchell County Federal Sav. & Loan Ass’n, 189 Ga. App. 646 (1988).

If there is a legitimate dispute to the surplus foreclosure funds, the lender can file an interpleader. An interpleader is a legal action where the lender gives the money to the court. And the court decides who is entitled to the money.

If there is no legitimate dispute regarding the surplus funds, and the lender fails to timely disburse the funds, the creditor may be liable for prejudgment interest to the party entitled to such funds. OCGA § 7-4-15. Such liability will largely depend on whether the amount of such surplus is a liquidated amount. Walton Motor Sales, Inc. v. Ross, 736 F.2d 1449 (11th Cir. 1984).

Quiet Title

At Gomez & Golomb, we regularly file quiet title actions. Whether you’re trying to get marketable title following a tax sale or trying to clear up a clouded title, the following is a quick overview of the requirement to file a quiet title in Georgia:

(1) The filing party must own/hold title.

(2) There must be a cloud against the filing party’s title.

(3) For conventional quiet titles, the action must be filed in the Superior Court in the county where the adverse party lives. OCGA § 23-3-40.

(4) For quiet titles against all the world, the action must be filed in the Superior Court in the county where the land is located. OCGA § 23-3-60.

(5) The quiet title must be verified (signed under oath) by the filing party.

(6) The quiet title must include a description of the property, a description of the filing party’s interest in the property, any adverse claims on the property, a plat of survey, and a lis pendens.

(7) In a quiet title against all the world, the petition must be submitted to a special master, who examines the title, determines the interested parties, ensures the interested parties are served, holds a hearing, and issues recommendations to the court.

(8) All adverse parties who are known and whose residences are ascertainable by the sheriff or his deputy must be served; the filing party must make a diligent effort to identify and serve the adverse parties.

(9) Service by publication is permitted when the adverse party resides out of the state or if the residence is unknown.

If you have any questions, please call us at 404-392-9994.

Tax Deed Redemption: Tricks of the Trade

Redemption Process

A new Georgia appellate case, Moxie Capital v. Delmont 21 (2021), has been released that every tax deed purchaser, investor, and property owner should know about. The case involves how to redeem a property following a tax sale.

OCGA § 48-4-40 says the property owner or an interest holder in the property may redeem a property following a tax sale. Redemption must occur within a twelve-month window and after a notice of right to redeem has been provided. OCGA § 48-4-42 states how much a redeeming party must pay to redeem. Importantly, the funds required to redeem “shall be paid in lawful money of the United States.”

Redemption Dispute

In Moxie Capital, an investor attempted to redeem a property. For various reasons, the attempted redemption occurred on the last day of the redemption period. The investor contacted the tax deed holder for a payoff. There were conflicting versions of what happened from there. The investor said the tax deed holder did not cooperate; while the tax deed holder argued he had no obligation to cooperate.

What the parties don’t dispute is that the investor timely delivered a personal check to the tax deed holder. The investor claimed that certified funds were not available because the banks had closed by the time he found out the details of where to deliver the redemption amount. On the next day, the tax deed holder returned the personal check to the investor. And claimed that the investor’s right to redeem had expired.

Naturally, this went to court. While somewhat complicated, ultimately, the investor lost. And the tax deed purchaser got the property. The Georgia Court of Appeals ruled that to redeem, funds must be in the form of cash or certified check. The Court cited OCGA § 48-4-42, which says funds must be “paid in lawful money of the United States.” Although no Georgia court has clearly defined “lawful money,” the Georgia Court of Appeals reasoned that a personal check is a promise to pay. Thus, the Court of Appeals did not consider the investor’s personal check to be a payment.

The Court of Appeals also suggested that a tax deed purchaser has no obligation to act in “good faith” when responding to a party trying to redeem.

Don’t Wait Until the Last Minute – Call Us

Moxie Capital is consistent with other Georgia cases that apply redemption statutes strictly. Some would say harshly. Whether you agree or disagree with the outcome will depend on which side of the ledger you’re on.

Regardless of if you are a tax deed purchaser or a homeowner, we will be glad to represent you to get you through the process safely.

Call Us at 404-382-9991 to speak with an attorney regarding your options!

Valuing the Wrongful Death of a Child?

The death of a child is considered the single worst trauma a person can go through. The stress is so great that loved ones often suffer broken-heart syndrome, which presents like a heart attack. The wrongful death of a child makes coping (and healing) that much more unimaginable.

Gomez & Golomb counsels grieving families concerning their legal rights regarding wrongful death claims. We are compassionate, honest, and genuinely care about our clients’ well-being. We are not just here to get paid, but want to make a positive difference in people’s lives.

This post addresses how the Georgia court system values the wrongful death of a child. Of course, this is not something the family wants to think about. But, in the years that follow the child’s death, recovering enough money to help the family makes ends meet is essential.

In Georgia, the person or entity who caused the child’s death must compensate the deceased child’s family for “the full value of the life.” OCGA § 51-4-2(a). Importantly, the “full value of the life” is determined from the perspective of the child who died. Placing a monetary value on such pain, suffering, and loss is difficult, but Georgia has guidelines to help a jury assign a monetary value.  

The family is entitled to recover the full value of the deceased child without deducting for any of the deceased’s personal expenses had she lived. OCGA §§ 51-4-1(1), 51-4-4, 19-7-1(c). “[U]nder Georgia’s wrongful death statute, damages are measured from the decedent’s point of view.” Brock v. Wedincamp, 253 Ga. App. 275, 280 (2002).

The full value of a wrongful death of a child is comprised of two categories of damages:

(1) those items having a proven monetary value, such as lost potential lifetime earnings, income, or services, reduced to present cash value, and

(2) lost intangible items whose value cannot be precisely quantified, such as a parent’s society, advice, example and counsel as determined by the enlightened conscience of the jury.

Concerning the wrongful death of a child, the value of a child’s life is established by the enlightened conscience of an impartial jury as applied to the evidence in the case. This includes testimony as to such child’s age, life expectancy, precocity, health, mental and physical development, family circumstances, and from the experience and knowledge of human affairs on the part of the jury. Dep’t of Human Res. v. Johnson, 264 Ga. App. 730, 738 (2003).

We are here to help with any questions regarding the wrongful death of a child. Please call us at 404-382-9994.