Red Flower, Inc. v. McKown ( 2016 )

COLORADO COURT OF APPEALS 2016COA160
Court of Appeals No. 14CA2409
Baca County District Court No. 11CV14
Honorable Douglas Tallman, Judge
Red Flower, Inc., a Kansas corporation,
Plaintiff-Appellant and Cross-Appellee,
v.
Kevin R. McKown,
Defendant-Appellee and Cross-Appellant.
JUDGMENT AFFIRMED IN PART, REVERSED IN PART,
AND CASE REMANDED WITH DIRECTIONS
Division IV
Opinion by JUDGE HARRIS
Hawthorne and Román, JJ., concur
Announced November 3, 2016
Shinn, Steerman & Shinn, Donald L. Steerman, Lamar, Colorado, for Plaintiff-
Appellant and Cross-Appellee
Brett R. Lilly, LLC, Brett R. Lilly, Wheat Ridge, Colorado, for Defendant-
Appellee and Cross-Appellant
¶1 If a property owner fails to pay his or her property taxes, the
county may sell a tax lien on the property to a third party.
§§ 39-11-101 to -109, C.R.S. 2016. After three years, and upon
notice to the owner, occupant, and other interested parties, the
holder of an unredeemed lien may obtain a treasurer’s deed for the
property. § 39-11-120(1), C.R.S. 2016.
¶2 Plaintiff, Red Flower, Inc., bought tax liens on farmland owned
by defendant, Kevin R. McKown. After the redemption period
expired, the Baca County Treasurer issued the tax deeds to Red
Flower. McKown subsequently challenged the validity of the deeds
on the ground that the Treasurer had failed to provide notice to a
tenant farmer who grew crops on the property.
¶3 The district court ruled that unlike owners and other
interested parties — who are subject to a “diligent inquiry” standard
of notification — the occupant is entitled to actual notice of the
issuance of the treasurer’s deed. Because the tenant farmer had
not received actual notice, the court voided the deeds.
¶4 We disagree with the district court’s interpretation of the
relevant statute, but we affirm, in part, on the alternative ground
that, with respect to one of the deeds, Red Flower’s publication
1
notice was deficient. With respect to the other deed, we remand to
the district court to determine whether the Treasurer used diligent
efforts to notify the tenant farmer of the issuance of the deed.
I. Background
¶5 McKown owned 320 acres of farmland in rural Baca County.
There were no structures, fencing, corner posts, or other
improvements on the property. Access to the property is by “field
roads”; the nearest county road is two miles away.
¶6 From 2004 until 2011, Don Lohrey farmed the property
pursuant to an oral sharecrop agreement. He received the value
from two-thirds of the harvest and McKown, as the owner, received
the remaining one-third.
¶7 Lohrey lived approximately ten miles away from McKown’s
property, in Walsh, Colorado. During the winter months, Lohrey
was present at McKown’s farm about once every two weeks. During
the growing season, he was on the property more frequently —
about once a week. Lohrey had similar oral agreements with six
other property owners, and he farmed a total of 5000 acres in the
general vicinity.
2
¶8 Though McKown’s agreement with Lohrey was not recorded
with the county clerk and recorder’s office, it was documented in a
form required by the United States Department of Agriculture and
kept on file at the Baca County Farm Service Agency.
¶9 After McKown failed to pay his county property taxes, the
Treasurer sold tax liens for the real property and the mineral rights.
Red Flower bought the tax lien certificates on November 15, 2007.
In August 2010, a few months before the expiration of the
redemption period, Red Flower applied for treasurer’s deeds. The
Treasurer attempted to notify McKown, but her efforts were
unsuccessful. She published a series of notices in the newspaper
in September 2010 and, in December 2010, she issued the deeds to
Red Flower.
¶ 10 The following year, Red Flower filed a C.R.C.P. 105 action to
quiet title in the property. McKown appeared and defended on the
ground that the tax deeds were invalid, based on insufficient notice
to McKown and also to Lohrey, whom the parties stipulated had
been in actual possession or occupancy of the property but had not
received notice.
3
¶ 11 The district court found that the Treasurer had made a
“diligent inquiry” to find the owner, McKown, as required by the
statute, and it entered judgment for Red Flower. A division of this
court affirmed that ruling, Red Flower, Inc. v. McKown, (Colo. App.
No. 12CA2128, July 11, 2013) (not published pursuant to C.A.R.
35(f)) (Red Flower I), but remanded for a determination of whether
the Treasurer had complied with the separate requirement to notify
the occupant.
¶ 12 On remand, the district court considered the plain language of
the statute, which requires that, prior to issuance of a tax deed, the
county treasurer serve, by personal service or mail, notice “on [1]
every person in actual possession or occupancy” of the property,
“and also on [2] the person in whose name [the property] was taxed”
if, “upon diligent inquiry, such person can be found in the county
or if his residence outside the county is known,” and on [3] “all
persons having an interest or title of record in” the property if,
“upon diligent inquiry, the residence of such persons can be
determined.” § 39-11-128(1)(a), C.R.S. 2016.
¶ 13 The court determined that the Treasurer’s obligation to make
“diligent inquiry” applied only to notification of owners and other
4
interested parties, but not to actual occupants. It reasoned that the
absence of the qualifier “if, upon diligent inquiry,” in the clause
referring to occupants meant that the Treasurer was obligated to
make all efforts necessary to notify the occupant. Indeed, according
to the district court, there was no limit on the efforts required of the
Treasurer to provide the occupant with notice of the issuance of the
deed.
¶ 14 The court determined — presumably based on the parties’
stipulation — that Lohrey qualified as a person in possession of the
property. From there, it concluded that because the Treasurer had
not complied with her statutory obligation to provide Lohrey with
actual notice, the tax deeds were void.
¶ 15 On appeal, Red Flower argues that the district court’s
construction cannot be squared with the language or intent of the
statutory scheme. McKown contends that the district court could
have granted summary judgment in his favor for the additional
reason that the Treasurer’s publication notice was deficient and
therefore the deeds were void.
¶ 16 Though we do not fully adopt Red Flower’s reasoning, we agree
that the district court’s interpretation is incorrect. However, we
5
agree with McKown that, at least with respect to the real property
deed, publication notice was deficient.
II. The Notice Requirement
¶ 17 Red Flower contends that the district court’s interpretation of
the notification requirement in section 39-11-128(1)(a) places an
illogically high burden on the Treasurer to notify persons in “actual
possession or occupancy” of the property. It urges a reading of the
statute that essentially adds a “diligent inquiry” element to the
clause referring to actual possessors or occupants. Though we
disagree with Red Flower’s reasoning, we conclude that section
39-11-128 does not require actual notice to any of the listed
persons.
A. Standard of Review
¶ 18 We review de novo the district court’s interpretation of a
statute as well as its decision granting summary judgment. Klinger
v. Adams Cty. Sch. Dist. No. 50, 130 P.3d 1027, 1031 (Colo. 2006);
Collard v. Vista Paving Corp., 2012 COA 208, ¶ 16.
¶ 19 Red Flower asks us to temper our de novo review by deferring
to the Treasurer’s interpretation of the statute. We acknowledge the
general principle on which Red Flower relies — that courts
6
traditionally defer to an agency’s interpretation of a statute it is
entrusted to administer, Hertz Corp. v. Indus. Claim Appeals Office,
2012 COA 155, ¶ 12 — but we conclude that it is inapplicable here.
Under this general principle, courts ordinarily defer to the state
property tax administrator’s interpretation of property tax statutes
and the rules promulgated to implement those statutes. See
Aberdeen Inv’rs, Inc. v. Adams Cty. Bd. of Cty. Comm’rs, 240 P.3d
398, 403 (Colo. App. 2009) (courts generally defer to the Board of
Assessment Appeals’ and the Property Tax Administrator’s
interpretations of tax statutes because “they are charged with
administering the tax code”). But county treasurers are not the
“agency” charged with administering the state tax code, and so we
will not defer to the Treasurer’s interpretation of her own
obligations under section 39-11-128(1)(a). Moreover, because
statutory construction is a question of law, we would not be bound
by the agency’s interpretation of the statute in any event. Bd. of
Cty. Comm’rs v. Colo. Pub. Utils. Comm’n, 157 P.3d 1083, 1088
(Colo. 2007).
7
B. Interpretation of Section 39-11-128(1)(a)
¶ 20 Our efforts to interpret a statute must always begin with the
language of the statute itself. People v. Cooper, 27 P.3d 348, 354
(Colo. 2001). If the statutory language is unambiguous, we look no
further and apply the words as written. People v. Summers, 208
P.3d 251, 254 (Colo. 2009). The plainness or ambiguity of statutory
language is determined by reference to the language itself, the
specific context in which that language is used, and the broader
context of the statute as a whole. Robinson v. Shell Oil Co., 519
U.S. 337, 341 (1997). The statutory scheme is read as a whole to
give consistent, harmonious, and sensible effect to all of its parts, in
accordance with the presumption that the legislature intended the
entire statute to be effective. Bryant v. Cmty. Choice Credit Union,
160 P.3d 266, 274 (Colo. App. 2007). We avoid constructions that
are at odds with the legislative scheme or that lead to illogical or
absurd results. Id.
¶ 21 The supreme court has construed section 39-11-128(1)(a)’s
notice requirement in this way:
With regard to notice, the General Assembly
requires that several steps be taken. Prior to
the issuance of a tax deed, the county
8
treasurer must serve, by personal service or
mail, notice “on every person in actual
possession or occupancy” of the property. The
treasurer must also serve notice “on the
person in whose name [the property] was
taxed,” and on “all persons having an interest
or title of record in” the property, if they can be
located through “diligent inquiry.”
Lake Canal Reservoir Co. v. Beethe, 227 P.3d 882, 889 (Colo. 2010)
(alteration in original) (citations omitted).
¶ 22 There is no serious dispute that, as a matter of plain language,
the “diligent inquiry” qualifier does not apply to notification of the
actual possessor or occupant. Red Flower suggests that “and”
might mean “or” in the provision, and that the “diligent inquiry”
term modifies each clause of the provision, but neither argument is
developed or persuasive.
¶ 23 We agree with the district court that the “diligent inquiry”
standard does not apply to notice to actual possessors or
occupants. The provision lists three categories of persons entitled
to notice. The “diligent inquiry” qualifier is connected, spatially and
grammatically, to only two of those categories. Generally, qualifying
or modifying words and phrases refer to the word, phrase, or clause
with which they are grammatically connected. Moreover, where
9
qualifying words are in the middle of a sentence, and apply to a
particular branch of it, they are not to be extended to that which
precedes or follows. See 73 Am. Jur. 2d, Statutes § 128 (2d ed.
2015). In addition, the provision uses the singular “person” to
signify that the qualifier applies only to the preceding category or
persons: “The treasurer shall serve . . . a notice . . . on every person
in actual possession or occupancy of [the property] . . . and also on
the person in whose name [the property] was taxed . . . if, upon
diligent inquiry, such person can be found in the county . . . .”
§ 39-11-128(1)(a) (emphasis added). If the “diligent inquiry”
qualifier covered the preceding reference to an actual occupant, the
next clause would refer to “persons” — both the occupant and the
person in whose name the property was taxed.
¶ 24 The harder issue though, and where the views diverge, is in
discerning the effect of the omission of the “diligent inquiry”
qualifier with respect to actual possessors or occupants. The
district court concluded, though it questioned the rationale, that
the effect was a requirement that the Treasurer use whatever
inquiry is necessary — potentially beyond diligent and into
extraordinary — to notify the actual occupant of the issuance of the
10
deed. Red Flower counters that this effect is so illogical that it
would be better to ignore the plain language and to imply the
addition of the “diligent inquiry” qualifier to all actual possessors
and occupiers.
¶ 25 We find both alternatives unsupportable. Red Flower’s
proposal requires us to rewrite the statute, treating the omission of
the “diligent inquiry” qualifier as a legislative error that we can
remedy through judicial interpretation. But in interpreting a
statute, we must “accept the General Assembly’s choice of language
and not add or imply words that simply are not there.” People v.
Benavidez, 222 P.3d 391, 393-94 (Colo. App. 2009); see also Dep’t
of Labor & Emp’t v. Esser, 30 P.3d 189, 196 (Colo. 2001) (“We do
not presume that the General Assembly used language idly; rather,
we give effect to the statute’s words and terms.”).
¶ 26 On the other hand, we decline to adopt the district court’s
construction because it is inconsistent with the overall statutory
scheme and leads to absurd results. We start by noting that “the
notice requirement has long been understood to primarily protect
the interests of owners of record.” Lake Canal, 227 P.3d at 890; see
also Mitchell v. Espinosa, 125 Colo. 267, 272, 243 P.2d 412, 414
11
(1952) (“The only purpose of the law in requiring the publication of
notice . . . is to protect the interest of the fee-title owner and afford
him an opportunity for redemption . . . .”). It is indeed
incongruous, as Red Flower points out, that the occupant of the
property would be entitled to demand that the county treasurer
make extraordinary efforts to notify him or her when the owner is
entitled only to reasonable efforts. We do not mean to suggest that
service on the occupant is a mere “technicality,” as Red Flower
insists, see Meyer v. Haskett, 251 P.3d 1287, 1291 (Colo. App.
2010) (in the absence of “full compliance” with notification
requirements, treasurer’s deed is subject to invalidation), but, if the
legislature had intended to require a heightened notification
standard for one category of people under section 39-11-128(1)(a), it
is unlikely that it would have chosen occupants over owners.
¶ 27 We are confident, though, that the legislature did not intend to
create a heightened standard for any category of persons entitled to
notice under the statute. A division of this court has previously
noted the “unbroken line of Colorado cases” interpreting section
39-11-128 to require no more than those efforts that comport with
minimum due process standards. Schmidt v. Langel, 874 P.2d 447,
12
451 (Colo. App. 1993). Indeed, as the court observed in Schmidt,
the adoption of more expansive standards of diligence would
“provide little guidance as to when the inquiry must cease and little
assurance that the efforts required would be fruitful or within the
limits of practicality.” Id. These concerns are highlighted here: the
district court’s construction of the statute requires a potentially
never-ending inquiry that could easily exceed the limits of
practicality for county treasurers.
¶ 28 McKown contends that the district court’s interpretation is
compelled by Taylor v. Lutin, 106 Colo. 170, 102 P.2d 484 (1940),
but we are not convinced. In Taylor, the issue presented was
whether the lessee of the property owner qualified as an occupant
entitled to notice. When the treasurer’s sole attempt to serve the
lessee failed, she argued he was not an occupant under the statute.
But at a trial to determine the validity of the deed, the treasurer
conceded that the lessee “had the occupancy of the land,” a
concession the court deemed generally dispositive of the issue. Id.
at 173, 102 P.2d at 485. Taylor did not address the efforts required
of a treasurer in notifying an occupant of a tax sale or issuance of a
13
deed, and we therefore do not read the case to establish a
requirement of actual notice.
¶ 29 Accordingly, we must reject the district court’s interpretation
of the statute to require nothing short of actual notice — no matter
the efforts necessary — to the actual possessor or occupant.
¶ 30 Instead, in our view a harmonious reading of the provision’s
language establishes that the “diligent inquiry” qualifier was
omitted from the occupant clause because the statute contemplates
that a person “in actual possession or occupancy” of the property
will be found on the property, obviating the need for any inquiry as
to the person’s whereabouts.
¶ 31 The statute does not define the term “actual possession or
occupancy.” § 39-11-128(1)(a). The addition of the word “actual”
suggests that the legislature intended a narrower meaning than the
word “possession” or “occupancy” would have on its own. Vigil v.
Franklin, 103 P.3d 322, 327 (Colo. 2004) (in construing statutes,
courts must give effect to every word). In the absence of a statutory
definition, we may refer to a dictionary definition to determine the
meaning of a word or phrase. City of Arvada v. Colo.
Intergovernmental Risk Sharing Agency, 988 P.2d 184, 187 (Colo.
14
Ohio App. 1999) (ruling that it was appropriate for district court to look
to Black’s Law Dictionary to determine definition of legal term),
aff’d, 19 P.3d 10 (Colo. 2001).
¶ 32 Black’s Law Dictionary defines “actual possession” as
“[p]hysical occupancy or control over property,” as distinguished
from “constructive” possession, meaning “[c]ontrol or dominion over
a property without actual possession,” or possession that is
“[l]egally imputed; existing by virtue of legal fiction though not
existing in fact.” Black’s Law Dictionary 380, 1351 (10th ed. 2014).
The term “occupancy” is defined as “[t]he act, state, or condition of
holding, possessing, or residing in or on something; actual
possession, residence, or tenancy, esp. of a dwelling or land.” Id. at
1247.
¶ 33 Brown v. Davis, 103 Colo. 110, 83 P.2d 326 (1938), is
instructive on this point. In Brown, the purchaser of the tax deed
failed to notify the occupant of the property, but argued that,
because the owner had been served and the owner was legally in
possession of the property, notice to the actual occupant was
unnecessary. The supreme court disagreed, explaining that “the
status of the property as to its actual physical occupancy, as
15
distinguished from the constructive possession thereof, to a major
degree controls the procedure with reference to the required notice.”
Id. at 113, 83 P.2d at 327. Where the property is “actually
occupied,” the court instructed,
the statute clearly contemplates . . . that
service of notice not only must be made upon
the [owner], if he can be found in the county,
and upon those having an interest in or title of
record to the premises when their residence
can be learned, but also upon the person in
the actual possession or occupancy of the
premises.
Id. at 113, 83 P.2d at 327-28.
¶ 34 It makes sense, then, that the statute would not require the
county treasurer to make a “diligent inquiry” to find a person who is
physically possessing or occupying the premises. “No such
provision [the “diligent inquiry” requirement] is made with respect
to occupants of the property [because they] presumably may be
found at the property.” In re Application for Tax Deed, 675 N.E.2d
285, 286 (Ill. App. Ct. 1997).1
1 The Colorado and Illinois statutes are identical in all relevant
respects, the Colorado statute having originally been adopted from
the Illinois law. Brown v. Davis, 103 Colo. 110, 114, 83 P.2d 326,
328 (1938). Under 35 Ill. Comp. Stat. 200/22-15 (2016), notice
shall be served “upon owners who reside on any part of the property
16
¶ 35 The district court was therefore correct in concluding that the
“diligent inquiry” standard does not apply to notification of actual
possessors or occupants, but it erred in determining that some
limitless duty to find and notify the occupants applied instead.
Rather, when the premises are actually occupied, the county
treasurer may serve notice on the occupants at the property.
¶ 36 The wrinkle in this case is that the parties appear to have
stipulated, and the district court found, that Lohrey — who neither
lives on the property nor can be found there on more than an
occasional basis — was an actual occupant.2 It is undisputed that
sold by leaving a copy of the notice with those owners personally,”
and “upon all other owners and parties interested in the property, if
upon diligent inquiry they can be found in the county, and upon
the occupants of the property.”
2 The district court referred to Lohrey as a “tenant,” and the parties
sometimes refer to him as a “tenant farmer.” The record, however,
is not clear as to Lohrey’s precise legal status. Lohrey testified that
he had a verbal sharecrop arrangement with McKown that began in
2004 and continued without formal renewal until about the time
Lohrey retired from farming in 2012. Under the terms of the
arrangement, Lohrey farmed the land, paid two-thirds of the
expenses and took two-thirds of the crops, while McKown paid one-
third of the expenses and took one-third of the crops. A tenant
typically has a right of exclusive possession of the property
whereas, in a sharecropper arrangement, the owner retains the
right to enter and occupy the land subject only to the rights of the
sharecropper with respect to the crops. Hampton v. Struve, 70
N.W.2d 74, 79 (Neb. 1955); see also Burton v. Miller, 86 Colo. 166,
17
Lohrey lived nearly ten miles away from the property, he visited
McKown’s field somewhere between once every two weeks and once
a week for the limited purpose of checking on his crops, and his
right to enter on the property derived exclusively from a verbal
sharecropper arrangement with McKown.
¶ 37 Still, we will assume, though we decline to decide that the
statute readily contemplates it, that there could be a category of
occupants who do not in fact occupy the premises; in other words,
persons, like Lohrey and like many owners and others with an
interest in the property, who must be found before they can be
served with notice.
¶ 38 But whenever the person entitled to notification is not on the
premises, section 39-11-128(1)(a) requires the county treasurer to
make only a “diligent inquiry” to determine the person’s
whereabouts and then to notify him of the sale. See Milroy v.
McFerran, 270 P.2d 329, 331 (Okla. 1954) (holding that statute did
168, 279 P. 51 (1929) (sharecropper is not a tenant); Warner v.
Hoisington, 42 Vt. 94, 96-97 (1869) (sharecropper arrangement
“does not amount to a lease of the land”). The distinction might be
relevant as to whether Lohrey qualifies as an actual possessor or
occupant of the property, but we need not decide that issue
because, as we have noted, the parties stipulated that Lohrey was
an occupant for purposes of section 39-11-128(1)(a), C.R.S. 2016.
18
not include “diligent inquiry” qualifier for notice to occupant but,
where occupant was tenant farmer who lived on adjoining property,
“diligent inquiry” standard applied); cf. Dohrn v. Mooring Tax Asset
Grp., L.L.C., 743 N.W.2d 857, 861 (Iowa 2008) (stating that statute
did not include “diligent inquiry” standard but, where occupant was
not on premises and had to be located to be served, a reasonable
efforts standard might apply).
¶ 39 The statute contemplates three categories of persons entitled
to notice, who fall into two broad classifications: (1) persons who
can be found on the property (ordinarily, actual possessors and
occupants and, often, owners) and (2) persons likely to be found off
the property (sometimes owners and, often, other persons with an
interest in the property). Those are the classifications that matter
for purposes of determining the county treasurer’s burden. If the
person is on the property, the statute presumes no real burden on
the treasurer to locate the person. If the person is off the property,
the statute requires the treasurer to make a “diligent inquiry” to
find the person.
¶ 40 But under no circumstances is the treasurer held to a higher
standard than the use of efforts reasonably calculated to effectuate
19
notice. See Jones v. Flowers, 547 U.S. 220, 229 (2006); see also
Schmidt, 874 P.2d at 451 (“[E]xtraordinary efforts at locating an
address are not demanded by principles of due process.”); cf.
Klingsheim v. Cordell, 2016 CO 18, ¶ 20 (“[T]he purpose of section
39-11-128(1) is to forbid the issuance of a treasurer’s deed absent
reasonably diligent efforts to notify persons with an interest in the
property, especially those with a right to redeem.”).
¶ 41 Here, the parties tell us that Lohrey was an occupant who was
found off the property — a curious designation, but one we accept
for purposes of our decision. In that case, he was entitled to have
the Treasurer make “diligent inquiry” to locate and serve him with
notice of the issuance of the deed.
¶ 42 Our conclusion is supported by another provision of the
statute. See People v. Yoder, 2016 COA 50, ¶ 17 (We “look at the
statute as a whole in order to interpret the meaning and purpose of
its language.”). Under subsection 128(1)(b), when the value of the
property exceeds $500, the Treasurer is required to publish notice
of the issuance of the tax deed. A copy of such notice must be sent
to “each person not found to be served whose address is known or
can be determined upon diligent inquiry.” § 39-11-128(1)(b).
20
¶ 43 This provision confirms that any person who must be “found”
off the property in order to be notified by mail of the issuance of the
deed is entitled to have the Treasurer make a “diligent inquiry” to
determine his or her whereabouts. At the same time, the provision
makes clear that there is no category of persons who must be
“found” for notification purposes entitled to actual notice.
¶ 44 The district court determined that McKown was entitled to
demand that the Treasurer go to any lengths necessary to locate
and serve Lohrey. Using that standard, the district court
determined that Lohrey did not have actual notice of the transfer of
the deeds and entered summary judgment for McKown. We
conclude that the court applied the wrong standard.
¶ 45 Red Flower opposes a remand, arguing that, as a matter of
law, the Treasurer made a “diligent inquiry” to determine Lohrey’s
whereabouts. In our view, whether efforts amount to a “diligent
inquiry” and were reasonably calculated to effectuate notice
depends on the circumstances of each case. Cf. Sandstrom v. Solen,
2016 COA 29, ¶ 22 (“‘Diligent’ means a ‘steady, earnest, attentive,
and energetic application and effort in a pursuit’ . . . .” (quoting
21
Schmidt, 874 P.2d at 450)). Therefore, we determine that a remand
is necessary.
¶ 46 However, we need not remand with respect to both deeds. The
real property deed, unlike the mineral deed, could not be issued
until the Treasurer published notice of its impending issuance.
McKown contends that the publication notice was deficient and, for
the reasons discussed below, we agree. Therefore, we affirm the
district court’s entry of summary judgment in favor of McKown on
the real property deed on this alternative basis. See Colo. Pool Sys.,
Inc. v. Scottsdale Ins. Co., 2012 COA 178, ¶ 71 (we may affirm
summary judgment for any reason supported by the record, even
reasons not decided by the trial court) (cert. granted in part Sept. 3,
2013). We remand, therefore, only with respect to the mineral deed.
C. Interpretation of Section 39-11-128(1)(b)
¶ 47 In all cases where the assessed value of the property is $500
or more, the Treasurer must publish notice of the issuance of the
deed in the following manner: “three times, at intervals of one
week, . . . not more than five months nor less than three months
before the time at which the tax deed may issue.”
§ 39-11-128(1)(b).
22
¶ 48 According to the Treasurer’s testimony, she published the first
notice in the newspaper on September 2, 2010, and the third and
final notice on September 16, 2010. (She did not provide the date
of the second notice.) The tax deed issued to Red Flower on
December 8, 2010 — less than three months after the last notice.
¶ 49 Red Flower reads the provision to require that only the first
notice be published three months before issuance of the deed. But
we cannot square that construction with the plain language of the
statute.
¶ 50 In our view, the provision creates a window within which the
notices must be published: sometime between five and three
months before the deed is issued, the Treasurer must publish three
notices, once each week. Our reading gives full effect to all of the
words in the provision, see Bd. of Cty. Comm’rs v. Vail Assocs., Inc.,
19 P.3d 1263, 1273 (Colo. 2001) (we construe statutory provision as
a whole, giving effect to every word and term, whenever possible),
while Red Flower’s interpretation disregards the “three times”
language.
23
¶ 51 Accordingly, we conclude that the Treasurer’s publication
notice was statutorily deficient.3
¶ 52 McKown argues that the deficient notice renders the deed void.
Though we disagree that the deed is void, we determine that it is
voidable and, therefore, the court properly set it aside.
¶ 53 A deed is void when the taxing entity had no jurisdiction or
authority to issue it. Lake Canal, 227 P.3d at 886. By contrast, a
deed is voidable when the county treasurer’s notice is statutorily
insufficient. Id. at 887. As the supreme court explained,
3 Red Flower contends that the sufficiency of the publication notice
was resolved in its favor in Red Flower I and that we are bound by
the prior division’s determination under the law of the case
doctrine. True enough, the prior division concluded, “the
undisputed facts show that the county treasurer fulfilled
[subsection (1)(b)’s] requirements by publishing the notice for three
weeks in a Baca County newspaper in September 2010, four
months before the deed to the real property was issued in
December.” No. 12CA2128, slip op. at 5 (footnote omitted). But as
the division had just noted, the issue was not raised by McKown;
rather, he argued that the Treasurer failed to comply with
subsection (1)(a) by not making a diligent effort to discover his
address. Consequently, the division’s observations about the
Treasurer’s compliance with subsection (1)(b) were not necessary to
its ruling and were dicta. In general, dictum does not become law
of the case. Hardesty v. Pino, 222 P.3d 336, 340 (Colo. App. 2009).
But even if we construe the prior division’s determination as law of
the case, we may decline to apply the doctrine if we discern a
factual error. Here, Red Flower itself concedes that notice was not
published four months before the deeds issued.
24
inadequate notice does not implicate jurisdiction or authority, but
rather “the manner in which the authority was exercised.” Id. at
889.
¶ 54 We are not persuaded by McKown’s argument that Gomer v.
Chaffee, 6 Colo. 314 (1882), compels a different conclusion. In
Gomer, the treasurer sold the tax lien on April 17th, in violation of
the statute that authorized the sale of tax liens only after April 20th
of each year. Id. at 316. Because the treasurer’s authority to sell
tax liens is purely statutory, he had no power to sell the liens prior
to the date authorized by statute. Id. at 315.
¶ 55 Here, if the Treasurer had issued the deeds before the
expiration of the redemption period, we would be presented with an
analogous issue. But the statutory redemption period ended on
November 15, 2010, and the Treasurer had the power to issue the
deed at any time thereafter. The defect in this case was procedural,
not jurisdictional. See Sandstrom, ¶ 24 (insufficient notice is a
procedural defect that renders tax deed voidable, not void).
¶ 56 Still, the point of publication notice is to encourage
redemption and protect the owner’s interest in his or her property,
see Lake Canal, 227 P.3d at 890, and, as we noted earlier, it is no
25
mere technicality. The taxpayer is entitled to redeem until the end
of the redemption period or three months after the last publication
notice, whichever comes later. See § 39-11-128(1)(a) (Notice must
state “when the time of redemption will expire or when the tax deed
shall be issued.”). The Treasurer did not publish the last notice
until September 16, 2010; thus, McKown should have had until
December 16, 2010, to redeem the lien.
¶ 57 A voidable deed may be set aside so long as the claim to
recover property is brought within five years after the issuance of
the deed. Sandstrom, ¶ 30. Here, McKown’s counterclaim was filed
well within the statute of limitations.
¶ 58 The district court voided the tax deed for a different reason,
but we may affirm its decision on an alternative ground supported
by the record. Id. Because the Treasurer failed to comply with
section 39-11-128(1)(b), the district court properly set aside the real
property deed.
III. Conclusion
¶ 59 The district court’s entry of summary judgment in favor of
McKown is affirmed in part, reversed in part, and remanded for
further proceedings. On remand, the district court should
26
determine, with respect to the mineral deed only, whether the
Treasurer used diligent efforts to notify Lohrey of the issuance of
the deed.
JUDGE HAWTHORNE and JUDGE ROMÁN concur.
27