Untitled Texas Attorney General Opinion

THE A~JTORNEY GENERAL OF TEXAS GERALD C. MANN AUSTIN u.TE- -ON AlTORNEY GENERAI. Honorable T. M. Trimble, First Assistant State Superintendent of Public Instructlon Austin, Texas Dear Sir: Opinion No. o-5072 Re: Whether property purchased by taxing unit is taxable and whether such property may be sold at private sale. ,~ We have received your letter of January 27, 1943, in which you enclose a letter from Mr- R. 0. Larkin, Superlnt~end- ent of Schools of the Three Rivers Independent School Dis- trict. You request our opinion on two questions asked in Hr. Larkln's letter. Such questions read as follows: "The Three Rivers School board employed a delinquent tax collector, who sued and receiv- ed judgment on some real estate. At the adver- tised sale, no one would bid the property in for as much aa the taxes and court costs were, there- fore, the school bid them in, and wish to sell them. We have several buyers that will take the property off our hands. Can we sell as a private body and sale giving a quit claim deed or do we have to go back to court and resell at public sale - even though the public sale has been held once. "Question No. 2. Where the school bids in said property, are the taxes, State, County and School automatically stopped or do we render the property and file for exemption?" Though neither Mr. Larkin's letter nor your letter states so, we assume that the property wasppurchased under the terms of Article 7345b, Vernon's Annotated Civil Statutes, by the school district for the use and benefit of itself and the other taxing units which were parties to the foreclosure suit and which were in said suit adjudged to have tax liens against such property. This opinion is expressly written on such assumption, and is limited accordingly. Section 12 of Article 7345b fixes a period of two Honorable T.M. Thimble, Page 2 years after property is sold at foreclosure sale under judg- ment of a tax suit, In which the owner of such property or anyone having an interest therein may redeem the property, under the conditions named In said section. Section 9 of Article 7345b provides, in part, as fol- lows: "Sec. 9. If the property be sold to any tax- ing unit which is a'party to the judgment under decree of court in said suit, the title to said property shall be bid in and held by the taxing unit purchasing same for the use'and benefit of Itself and all other taxing units which are par- ties to the suit and which have been adjud,gedin said suit to have tax liens against such proper- ty, pro rata and in proportion to the amount of the tax liens in favor of said respective taxing units as established by the judgment in said suit, and costs and expenses shall not be payable until sale by such taxing unit so purchasing same, and such property shall not be sold by the taxing unit purchasing same for less than the adjudged value thereof or the amount of the judgments against the property in said ault, whichever is lower, without the written consent of all taxing units which in said judgment have been found to have tax liens against such property; and when such wroperty is sold by the taxing unit purchasing same, the pro- ceeds thereof shall be received by it for account of itself and all other said taxing units adjudg- ed in said suit to have a tax lien against such property, and after paying all costs and expenses, shall be distributed among such taxing units pro rata and in proportion to the amount of their tax liens against such property as established in _., said judgment. Consent In behalf of the State of Texas under this Section of this Act may be given by the County Tax Collector of the county in which the property is located. "Provided that if sale has not been made by such.purchasing taxing unit before six months after the redemption period provided in Section 12 hereof has expired, it shall thereafter be the duty of the Sheriff upon written request from any taxing unit who has obtained a judg- ment in said suit, to sell said propertyat public outcry to the highest bidder for cash at the principal entrance of the courthouse In the Honorable T. M. Trimble, page 3 0 -5072 county wherein the land lies, after giving notice of sale in the manner now prescribed for sale of real estate under execution." It is established in this State that a purchaser of land at a tax sale acquires no title to the land until the period of redemption has expired and that any right acquired at such sale is subject and subordinate to the right of the owner to redeem the land at any time within the redemption period. Rogers v. Moore, lOO.Tex. 220; Bente v. Sullivan, 115 S.W. 350; McGraw v. Potts, 27 S.W. (26) 550. However, It has been held that the purchaser of land at a tax sale may sell the land before the expiration of the redemption period, subject to the right of redemption. In other words, the purchaser at a tax sale (here, the school district) may, before the period of redemption has expired, sell or convey or assign its right to receive the redemption money from the owner together with the title which will vest upon failure to redeem the property within the statutory erlod. See Turner v. Smtth, 119 S.W. 922 (error refusedP ; Opinion No. O-950. Section 9 of Article 7345b authorizes both private and public sales, and a private sale may be made either be- fore or after the redemption period. However, the taxing unit which purchased the property may not sell the aame for less than the adjudged value thereof or the amount of the judgments against the property in the suit, whichever is low- er, without the written consent of all the other taxing units which in the judgment have been found to have tax liens against such property. Opinions No. O-1939, No. O-3977. In answer to your first question, it la our opinion that the school district may, before the period of redemption has expired, sell, convey, or assl~gnat private sale it3 right to receive the redemption money from the owner, to- gether with the title which will vest upon failure to redeem within the statutory period, subject to the conditions set forth in the preceding paragraph. If the period for redemp- tion has expired and full title to the property has, there- fore, passed to the school district, it may convey the prop- erty subject to the same conditions. In Opinion No. O-950 we said the following: "It is our opinion that the right to re- ceive the redemption money should be conveyed by a quitclaim deed to the land containing an assignment clause by which the grantee is spe- cifically assigned the right to collect the money from the owner and to issue to him a re- Honorable T. M. Trimble, page 4 O-5072 ceipt for the same. The statute does not pro- vide that the purchaser shall execute such a receipt but the owner would have the right to demand and receive some evidence in writing that he had redeemed his land within the time and manner provided by law." In your second question you ask whether the land pur- chased by the school district at the tax sale 1s~taxable. We have answered this question InOpinion No. O-3624. In conformity with that opinion you are advised that until the two yearperiod of redemption has expired, title to the prop- erty remains In the owner; and that, therefore, the property should be carried on the current tax rolls and assessed for taxes during the two year period against said owner and not the school district. If the property is not redeemed within' the two year perlod,,then the rights that the purchasing tax- ing unit acquired at the foreclosure sale blossom Into full title, and the property should not thereafter be continued to be assessed upon the current tax rolls of the various tax- ing units in the suit. Very truly yours ATTORNRYGENERAL OF TEXAS By s/George W. Sparks George W. Sparks Assistant GWS/s/wc APPROVED PEB 15, 1943 s/Gerald C. Mann ATTORREYGENWAL OF TEXAS Approved Opinion Committee By s/NE Chairman