THEATTORNEY GENERAL
OF TEXAS
AUSTIN 11.-~BCKAS
PRICE DANIEL
ATTORNEY GENERAL
April 7, 1950
Hon. B. F. McKee Opinion No. V-1040
County Auditor
Hidalgo County Re: The disposition to be made
Edinburg, Texas of funds received in delin-
quent tax cases from prop-
erty / purchased by a taxing
unit, as trustee for all tax-
ing units, and sold prior to
expiration of redemption
period, and related ques-
Dear Mr. McKee: tion.
You request the opinion of this office upon two questions,
both of which deal with sales of property purchased by a taxing
unit, as trustee for the benefit of all taxing units,parties to the
suit, and subsequently sold by the taxing unit, prior to the expira-
tion of the period of redemption.
Your questions may be stated as follows: (1) How should
the proceeds of the second sale by the purchasing taxing unit be
disposed of if the sale is made prior to the expiration of the re-
demption period; (2) if the property is sold for an amount in ex-
cess of the judgment, costs and expenses at a second sale, is
the owner required to pay statutory penalty upon such excess in
order to redeem.
The answer to both your questions is found in Sections
9,12, and 12-a of Article 7345b, V.C.S.
These statutes are rather lengthy, and we do not deem
it necessary to set them out in full, but only the pertinent parts.
Briefly, Section 9 of the statute provides the method and manner
for a second sale by the purchasing taxing unit. After thus pro-
viding, the statute directs that the purchase price be disposed
of as follows:
“When such property is so sold at Public or pri-
vate sale, the proceeds thereof shall be received by or
Hon. B. P, McKee, Page 2, V-1040.
paid over to the taxing unit which purchased said prop-
erty at the tax foreclosure sale, for the account of it-
self and all other taxing units adjudged to have a tax
lien against such property, and all taxing units so re-
ceiving said proceeds shall first pay out of the same
all costs and expenses of Court and of sale, and dis-
tribute the remainder among all taxing units for which
purchasing taxing unit purchased and held said prop-
erty, pro rata and in proportion to the amounts of
their tax liens against said property as established in
said judgment. ”
Thus it is quite apparent that the purchasing taxing unit
should distribute the proceeds of the second sale, after first pay-
ing all costs and expenses of the sale, to the respective taxing
units, parties to the suit, upon a pro rata basis in proportion to
the amounts of their tax liens adjudged against the property as
established by the judgment. This, of course, is true regardless
of whether the second sale is a private or public sale. This an-
swers your first question.
In answer to your second question, said Section 9 of the
statute further specifically provides as follows:
1. . . . provided, if the period for the redemption
of said property from said tax foreclosure sale has
not expired at the time of said sale, said conveyance
shall be made expressly subject to the right of redemp-
tion provided in Section 12 of said Act.”
In this connection it is only necessary to say that the
amount received by the purchasing taxing unit at a second sale
has nothing to do with the amount required to be paid by the own-
er to redeem. This is governed by the amount bid at the first
sale, which must conform to the terms and conditions provided
for in Section 9.
The amount required to be paid by the owner or others
entitled to redeem under the proviiioas of Section 12 of said
Article is governed exclusivaly bye the provisions of said section,
and this regardless of whether the first sale is to a taxing unit
or to a private purchaser; and no greater amount is required to
redeem than that provided for by this section of the statute, and
Hon. B. F. McKee, Page 3, V-1040.
the addition of any further penalty is wholly unauthorized.
From the foregoing it is clear that when a second sale
is made by a purchasing taxing unit, either at private or public
sale, before the redemption period has expired, the entire pro-
ceeds after the payment of costs and expenses of the sale, shall
be distributed pro rata among all the participating taxing units
in proportion to the amount of taxes, penalties and interest ad-
judged in favo.r of each. The amount received by the selling
taxing unit at the second sale has nothing to do with the amount
required to redeem, This is governed by the bid at the first sale,
and no greater amount may be exacted than that provided in Sec-
tion 12 of Article 734%. ,V.C.S,.
SUMMA.RY
Under the provisions of Section 9 of Article 7345b,
V.C.S., the purchasing taxing unit should distribute the
proceeds of the second sale whether made before or
after the expiration of the period of redemption, after
paying the costs and expenses of the sale, among all
taxing units pro rata and in proportion to the amounts
of their tax liens as established by the judgment. Sec-
tion 12 of said Article specifies the amount required
to redeem and refers to the first sale and not the sec-
ond, No greater amount may be exacted to redeem than
that specified.
Yours very truly,
PRICE DANIEL
APPROVED: Attorney General
W. V. Geppert
Taxation Division
Charles D. Mathews By $?L?iz--
. .
Executive Assistant Assistant
LPL/mwb/f