IN THE COMMONWEALTH COURT OF PENNSYLVANIA
In Re: :
: No. 1302 C.D. 2015
Upset Tax Sale Conducted : Argued: February 8, 2016
on September 11, 2014 by the :
Delaware County Tax Claim :
Bureau :
Folio No. 34-00-02509-35 :
:
Appeal Of: Gabriele Adiarte :
BEFORE: HONORABLE ROBERT SIMPSON, Judge
HONORABLE P. KEVIN BROBSON, Judge
HONORABLE MICHAEL H. WOJCIK, Judge
OPINION NOT REPORTED
MEMORANDUM OPINION
BY JUDGE WOJCIK FILED: March 8, 2016
Gabriele Adiarte (Owner) appeals from an order of the Court of
Common Pleas of Delaware County (trial court) denying her petition to set aside a
tax upset sale. Owner argues the trial court erred because the Delaware County
Tax Claim Bureau (Bureau) did not strictly comply with the notice provisions or
exhaust additional notification efforts under the Real Estate Tax Sale Law1 (Tax
Sale Law). Upon review, we reverse.
I. Background
On September 11, 2014, the Bureau held an upset tax sale for a
condominium unit owned by Owner located at 314-B Saybrook Lane, Wallingford,
Delaware County, Pennsylvania (Property) as a result of delinquent property taxes.
1
Act of July 7, 1947, P.L. 1368, as amended, 72 P.S. §§5860.101-5860-803.
Steve Fitzgerald, LLC (Bidder) successfully bid on the Property. After the sale,
the Bureau petitioned for confirmation of the sale, which the trial court entered
absolute.
In November 2014, Owner filed a petition to set aside the sale of the
Property. Owner asserted the Bureau denied her due process by not providing the
requisite statutory notice of the sale in accordance with the Tax Sale Law. She
also claimed the Bureau made no efforts to locate her prior to the sale to effectuate
mail notice. Bidder filed a motion to intervene, which the trial court granted. The
trial court then held a hearing in March 2015.2
At the hearing, Bidder presented the testimony of Lori Schreiber, the
Bureau’s upset sales coordinator (Coordinator) to prove the Bureau complied with
the mail notice provisions of the Tax Sale Law. Coordinator testified the Bureau
sent notice of the sale to the address provided by Owner to the Delaware County
tax assessment office (assessor’s office) – “Peter Gabriele, P.O. Box 694,
Hockessin, Delaware 19707 c/o Egar [sic] F. Adiarte.” Reproduced Record (R.R.)
at 17a-18a, 43a; see id. at 62a. The Bureau sent the notice by certified mail, return
receipt requested. Id. at 12a. The United States Postal Service (USPS) returned
the notice marked “Unclaimed Unable to Forward.” Id. at 12a-13a. A copy of the
return was admitted into evidence as Exhibit TCB-5. Id. at 13a, 62a. On cross-
2
In Pennsylvania, a valid tax sale requires strict compliance with three statutorily
prescribed notice provisions: published notice, mail notice and posted notice. Section 602 of the
Tax Sale Law, 72 P.S. §5860.602. At the hearing, the parties stipulated the Bureau properly
advertised notice of the sale thereby satisfying the publication notice requirements. Reproduced
Record (R.R.) at 9a. Although Owner initially challenged the posted notice before the trial court,
she did not pursue this on appeal. Therefore, the focus of our inquiry is limited to whether the
Bureau satisfied the mail notice requirements and whether the Bureau undertook reasonable
efforts to locate Owner.
2
examination, Coordinator could not attest to whether the certified mail notice was
marked or endorsed for “restricted delivery.” Id. at 18a, 20a-21a.
Coordinator also testified regarding the Bureau’s additional
notification efforts. When notice is returned unclaimed, Coordinator explained the
Bureau usually searches online databases “to find another address . . . .” R.R. at
13a-14a. Coordinator testified that, according to the file note for the Property, the
Bureau searched two internet databases -- Cole’s and Zabasearch -- but the search
was unsuccessful in locating another address or phone number for Owner. Id. at
13a-14a, 23a, 32a. On cross-examination, Coordinator admitted she did not
personally perform the search. Id. at 23a-25a, 33a. Coordinator further admitted
her office did not search any records of the Prothonotary or recorder of deeds. Id.
at 33a-34a, 38a.
In opposition, Owner testified she owned the property since 1997,
when she was then known as “Gabriele Peter.” R.R. at 49a. Since July 2010,
Owner rented the Property to tenants. From the time the Property was first rented,
Owner’s husband Edgar F. Adiarte (Husband) handled all financial matters related
to the Property, including payment of real estate taxes. Id. at 52a. To facilitate his
handling of the Property’s financial matters, Husband established a post office box
in Hockessin, Delaware, over which he retained exclusive control. Id. at 52a.
Owner confirmed the Hockessin P.O. Box was the same address on file with
assessor’s office, to which it would send tax bills for the Property. Id. at 54a.
Although she used the P.O. Box address for the Property, Owner testified she
resided with Husband and her children at 333 Woodcrest Road, West Grove,
Chester County, Pennsylvania for the last nine years. Id. at 50a.
3
Owner was not aware the 2012 real estate taxes were delinquent. R.R.
at 51a. On October 1, 2014, she discovered an open letter from the Bureau, on a
table in her home, stating the Property was sold on September 11, 2014 at the tax
sale. Id. at 55a-56a. Prior to discovering the letter, Owner was unaware the
Property was listed for the tax sale. Id. at 51a. Owner retained counsel to
investigate the legality of the sale. Id. at 50a. She learned the Bureau sent notice
of the sale by certified mail to the Hockessin P.O. Box, but the mail was returned
unclaimed. Id. at 56a-57a. The parties did not dispute that Owner did not have
actual notice of the sale prior to the sale date.
Based on the evidence presented, the trial court denied Owner’s
petition to set aside. Owner appealed to this Court. At the direction of the trial
court, she filed a statement of errors complained of on appeal pursuant to
Pa. R.A.P. 1925(b). Pertinent to this appeal, Owner asserted the Bureau did not
send notice by “restricted delivery” or undertake reasonable efforts to locate her.
In support of its order, the trial court filed an 11-page opinion. The
trial court credited the testimony of Coordinator, and it determined the Bureau
complied with the mail notice requirements. The trial court explained the Bureau
sent notice by certified mail, return receipt requested to the P.O. Box provided by
Owner to the assessor’s office. USPS returned the notice to the Bureau marked
“Unclaimed Unable to Forward.” Trial Court Opinion, 9/28/15, at 4. The trial
court explained the “use of a P.O. Box address guarantees that the mail is delivered
only to the addressee provided as only that individual would have access to the
P.O. Box.” Id. at 9. Husband failed to retrieve the certified mail notice from the
P.O. Box before it was returned as unclaimed.
4
With regard to the reasonable efforts to locate Owner, the trial court
found the Bureau utilized two internet databases in an effort to locate her
whereabouts. The trial court concluded that the Bureau “used ordinary common
business practices to ascertain proper addresses where notice of the tax sale may be
given and documented the same in the property file.” Id. at 11.
II. Issues
On appeal,3 Owner asserts the Bureau failed to strictly comply with
Section 602(e)(1) of the Tax Sale Law, 72 P.S. §5860.602(e)(1), because it did not
provide any evidence that it sent the notice to Owner by “restricted delivery.” She
claims the trial court’s conclusion that the “use of a P.O. Box address guarantees
that the mail is delivered only to the addressee provided as only that individual
would have access to the P.O. Box” renders the Tax Sale Law’s “restricted
delivery” requirement meaningless.
In addition, Owner argues the trial court erred when it concluded the
Bureau exercised reasonable efforts to locate her. The returned unclaimed notice
triggered the Bureau’s mandatory duties under Section 607.1 of the Tax Sale Law4
to locate her. Section 607.1 details the minimum search required, including a
search of the county telephone directory, records of the assessor’s office, the
Prothonotary’s office and recorder of deeds office. However, the Bureau did not
undertake any of these searches.
3
In tax sale cases, this Court’s review is limited to determining whether the trial court
abused its discretion, erred as a matter of law or rendered a decision without supporting
evidence. Maya v. County of Erie Tax Claim Bureau, 59 A.3d 50, 54 n.2 (Pa. Cmwlth. 2013).
4
Added by Section 30 of the Act of July 3, 1986, P.L. 351, 72 P.S. §5860.607a.
5
III. Discussion
A. Restricted Delivery
The primary purpose of the Tax Sale Law is to ensure the collection
of taxes, not to strip away a citizen’s property rights. Rice v. Compro Distributing,
Inc., 901 A.2d 570, 575 (Pa. Cmwlth. 2006). Therefore, adequate notice is a
prerequisite before the execution of any tax sale. Id. “The statutory notice
provisions in the Tax Sale Law must be strictly construed lest a person be deprived
of property without due process.” Maya v. County of Erie Tax Claim Bureau,
59 A.3d 50, 55 (Pa. Cmwlth. 2013) (citations omitted); accord Smith v. Tax Claim
Bureau of Pike County, 834 A.2d 1247, 1252 (Pa. Cmwlth. 2003). “[T]he focus is
not on the alleged neglect of the owner, which is often present in some degree, but
on whether the activities of the Bureau comply with the requirements of the
statute.” Smith, 834 A.2d at 1251.
The Tax Sale Law provisions governing upset sales require the tax
claim bureau to provide three types of notice: published notice, mail notice and
posted notice. Section 602 of the Tax Sale Law, 72 P.S. §5860.602. The tax claim
bureau bears the burden of proving compliance with the notice provisions. Maya.
Of relevance here is the provision relating to mail notice, which provides:
(e) In addition to such publications, similar notice of the
sale shall also be given by the bureau as follows:
(1) At least thirty (30) days before the date of the
sale, by United States certified mail, restricted delivery,
return receipt requested, postage prepaid, to each owner
as defined by this act.
72 P.S. §5860.602(e)(1) (emphasis added).
The types of mailings expressly delineated in Section 602(e) are
USPS terms identifying USPS services, which are explained and defined by USPS.
6
Horton v. Washington County Tax Claim Bureau, 81 A.3d 883, 890 (Pa. 2013).
The General Assembly “intended these terms to be interpreted pursuant to USPS
definitions.” Id. at 891.
According to section 503.3.1 of USPS’s Domestic Mail Manual
(“DMM”),5 incorporated by reference in 39 C.F.R. §111.1, “certified mail”
provides proof of mailing by showing that “an article was delivered or that a
delivery attempt was made.” Accord Horton, 81 A.3d at 890. Certified mail, when
combined with return receipt requested, provides the signature of the person who
accepted the package. Section 6.0 of DMM; accord Horton, 81 A.3d at 890.
“Restricted delivery” allows the sender to specify the person who can
sign for and receive the item. Section 503.2.2 of the DMM; accord Horton, 81
A.3d at 890; Kemler v. Lackawanna County Tax Claim Bureau (Pa. Cmwlth., No.
944 C.D. 2014, filed March 9, 2015).6 When mail is marked “restricted delivery,”
it “is delivered only to the addressee or to the person authorized in writing as the
addressee’s agent (the USPS may require proof of identification from the addressee
(or agent)[)] to receive the mail ....” Section 508.1.1.8 of the DMM; accord Dwyer
v. Luzerne County Tax Claim Bureau, 110 A.3d 223, 226 (Pa. Cmwlth. 2015).
Even where a return receipt is signed, the signature must belong to someone
authorized by the owner to accept certified mail. Husak v. Fayette County Tax
Claim Bureau, 61 A.3d 302 (Pa. Cmwlth. 2013) (mailed notice to Fannie Mae
5
The DMM is available on USPS’s portal:
http://pe.usps.com/cpim/ftp/manuals/dmm300/mailingStandards.pdf (last visited February 18,
2016).
6
Section 414 of this Court’s Internal Operating Procedures authorizes the citation of
unreported panel decisions issued after January 15, 2008, for their persuasive value, but not as
binding precedent. 210 Pa. Code §69.414.
7
signed by “Pierce,” whose identity and authority were unknown, required
additional notification efforts). USPS charges additional fees for these extra
services.7
Failure to strictly comply with the mail notice requirements of Section
602(e)(1) is grounds to set aside the sale. Husak; Sabarese v. Tax Claim Bureau of
Monroe County, 451 A.2d 793 (Pa. Cmwlth. 1982); Kemler. In Sabarese, a
common pleas court invalidated a tax sale on the grounds that the tax sale notices
were not marked “personal addressee only.” 451 A.2d at 793. The version of
Section 602(e)(1), in effect at that time, required notice “[a]t least thirty (30) days
before the date of the sale, by United States certified mail, personal addressee
only, return receipt requested, postage prepaid, to each owner as defined by this
act.” Former 72 P.S. §5860.602(e)(1) (emphasis added).8 On appeal, this Court
affirmed upon concluding the taxing bureau did not strictly comply with the
statute. Sabarese, 451 A.2d at 795. We rejected the bureau’s argument that the
omission made no difference because the owner would not have received the
notice anyway even if it was addressed to the “personal addressee only.” Id. at
794; see also In re Return of Tax Claim Bureau of Chester County, 222 A.2d 602,
604 (Pa. Super. 1966) (tax sale invalidated where tax records did not show notice
was “sent by registered mail, return receipt requested, deliver to addressee only.”).
Although Section 602(e)’s terminology changed from “personal
addressee only” to “restricted delivery,” USPS’s meanings have not. See In re
7
According to the DMM’s “Domestic – Extra Services and Fees,” “certified mail” costs
$3.45, whereas “certified mail restricted delivery” costs $8.60; “return receipt” in conjunction
with another extra service costs $2.80 (received by mail) or $1.40 (received electronically).
8
This section was amended by the Act of July 3, 1986, P.L. 351, to its current version.
8
Consolidated Return, Beaver County Tax Claim Bureau, 19 Pa. D. & C.3d 555,
563-64 (C.P. Beaver 1981). Both services restrict who may sign for receipt of a
mailing and are synonymous. Id.
Recently, in Kemler, this Court set aside a tax sale upon concluding
the taxing bureau did not meet its burden of proving that it sent notice via certified
mail, restricted delivery to one of the property’s owners. There, the bureau did not
offer a copy of the notice endorsed restricted delivery or offer any testimony to
indicate the delivery was restricted.
Here, Coordinator testified the Bureau mailed the notice to Owner via
certified mail, return receipt requested. R.R. at 12a. She testified the address used
was the address Owner provided to the assessor’s office for the Property. Id. at
17a, 43a. On cross-examination, however, Coordinator could not confirm that the
notice was sent by restricted delivery. In fact, Coordinator did not know what
restricted mail was and could only attest that she sent the notice by certified mail.
Id. at 20a-21a.
In addition, the Bureau offered a copy of the returned mail notice into
evidence (Exhibit TCB-5), which Coordinator authenticated. R.R. at 10a, 62a.
The exhibit showed the notice was mailed by certified mail, return receipt
requested, to:
PETER GABRIELE
PO BOX 694
HOCKESSIN DE 19707
c/o Egar [sic] F. Adiarte
Id. at 62a. USPS made three attempts on July 12, July 15, and July 27, 2015. Id.
USPS returned the notice to the Bureau marked “UNCLAIMED UNABLE TO
9
FORWARD.” Id. However, the exhibit does not bear a restricted delivery
endorsement or any indication it was mailed by restricted delivery. See id.
The trial court found the Bureau complied with the mail notice
requirements because it sent the notice via certified mail to a post office box. The
trial court reasoned “[t]he use of P.O. Box address guarantees that the mail is
delivered only to the addressee provided as only that individual would have access
to the P.O. Box.” Trial Court Opinion at 9.
However, the Tax Sale Law clearly requires notice sent by “restricted
delivery,” without exception. Section 602(e)(1) of the Tax Sale Law. The trial
court’s post office box exception is not supported by the Tax Sale Law or case law.
We decline to create such an exception.
Furthermore, although it does not appear that notice sent by restricted
delivery would have made any difference in this case, case law clearly provides
that tax sale notice provisions are strictly construed even where such efforts prove
futile. Steinbacher v. Northumberland County Tax Claim Bureau, 996 A.2d 1095,
1099 (Pa. Cmwlth. 2010) (en banc); Smith, 834 A.2d at 1252. As the Bureau did
not prove strict compliance with Section 602(e), the mail notice was defective. See
Husak; Sabarese; see also Kemler. To conclude otherwise would render the Tax
Sale Law’s “restricted delivery” requirement meaningless. On this basis, we
conclude the tax sale of the Property was invalid.9
9
In light of this disposition, we need not address whether the Bureau exercised
reasonable efforts under Section 607.1(a) of the Tax Sale Law to locate Owner.
10
IV. Conclusion
In sum, because the Bureau did not strictly comply with the mail
notice requirements of Section 602(e)(1) of the Tax Sale Law, the tax sale of the
Property was invalid. Accordingly, we reverse the order of the trial court and set
aside the September 11, 2014, tax sale of Owner's Property.
MICHAEL H. WOJCIK, Judge
11
IN THE COMMONWEALTH COURT OF PENNSYLVANIA
In Re: :
: No. 1302 C.D. 2015
Upset Tax Sale Conducted :
on September 11, 2014 by the :
Delaware County Tax Claim :
Bureau :
Folio No. 34-00-02509-35 :
:
Appeal Of: Gabriele Adiarte :
ORDER
AND NOW, this 8th day of March, 2016, the order of the Court of
Common Pleas of Delaware County, dated July 1, 2015, is hereby REVERSED
and the September 11, 2014, tax sale of Appellant Gabriele Adiarte’s property is
set aside.
__________________________________
MICHAEL H. WOJCIK, Judge