D D & D Family Properties, LLC v. R. David Wright ( 2020 )

FIRST DIVISION
BARNES, P. J.,
GOBEIL and PIPKIN, JJ.
NOTICE: Motions for reconsideration must be
physically received in our clerk’s office within ten
days of the date of decision to be deemed timely filed.
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November 3, 2020
In the Court of Appeals of Georgia
A20A1339. DD&D FAMILY PROPERTIES, LLC v. WRIGHT.
BARNES, Presiding Judge.
This lawsuit concerns title to certain real property sold at a tax sale. On cross-
motions for summary judgment by the disputing parties, the trial court ruled in favor
of R. David Wright and against DD&D Family Properties, LLC. For the reasons that
follow, we vacate the judgment and remand the case.
Summary judgment is properly granted “if the pleadings, depositions, answers
to interrogatories, and admissions on file, together with the affidavits, if any, show
that there is no genuine issue as to any material fact and that the moving party is
entitled to a judgment as a matter of law.” OCGA § 9-11-56 (c). “In our de novo
review of the grant or denial of a motion for summary judgment, we must view the
evidence, and all reasonable inferences drawn therefrom, in the light most favorable
to the nonmovant.” (Citations and punctuation omitted.) AgSouth FarmCredit, ACA
v. West, 352 Ga. App. 751, 752 (835 SE2d 730) (2019).
On July 5, 2017, the underlying tax sale was conducted against MHD
Communities LLC and Kaila Fisher. DD&D Family Properties thereby acquired for
the purchase price of $6,000 a tax deed to the Carroll County property known as 109
Holly Creek Drive within the Regal Oaks Subdivision (the “Property”).
On July 5, 2018, Wright tendered a $7,608 check to DD&D Family Properties
to redeem the property. Rejecting such tender, DD&D Family Properties mailed the
check back to Wright’s counsel on July 17, 2018, stating that “[i]n Georgia, only
certain persons are authorized to redeem property from a tax sale. OCGA § 48-4-
40.[1] Your client is not one of those persons.” On July 20, 2018, Wright’s counsel
wrote DD&D Family Properties a letter acknowledging the return of Wright’s tender.
1
OCGA § 48-4-40 sets out:
Whenever any real property is sold under or by virtue of an execution
issued for the collection of state, county, municipal, or school taxes or
for special assessments, the defendant in fi. fa. or any person having any
right, title, or interest in or lien upon such property may redeem the
property from the sale by the payment of the amount required for
redemption, as fixed and provided in Code Section 48-4-42: (1) At any
time within 12 months from the date of the sale; and (2) At any time
after the sale until the right to redeem is foreclosed by the giving of the
notice provided for in Code Section 48-4-45.
2
Wright’s counsel pointed out that he had already emailed to DD&D Family Properties
a copy of the quitclaim deed by which Wright was claiming an interest in the
Property, but was additionally attaching to the letter a copy of that quitclaim deed.
Wright’s counsel ended the letter with:
I do not understand what game you . . . appear to be playing concerning
this matter. I have attempted in good faith to contact you and obtain the
information necessary to make the purchaser at the tax sale whole in
accordance with the state statutes. The response has appeared to be
avoidance and denial. If DD&D properties does not accept the tender of
the funds to redeem the [P]roperty back to . . . Wright as the holder from
the Defendant in Fi.Fa., then the appropriate action will be taken to
recover the same through legal means and to pursue any and all claims
for fees and bad faith damages.
On October 23, 2018, Wright filed the instant lawsuit, alleging that on June 20,
2018, he had obtained title to the Property through a quitclaim deed from a defendant
in fi. fa. Wright attached a copy of the quit claim deed to his complaint; the quit claim
deed identified the grantor, however, as “MHD Acceptance, LLC.”2 Wright sought,
among other things, a declaratory judgment that he was a person authorized under
2
It is undisputed that the grantor on the quitclaim deed was “MHD Acceptance,
LLC,” whereas the tax deed showed the defendants in fi. fa. as MHD Communities
LLC and Kaila Fisher.
3
OCGA § 48-4-40 to redeem the Property from the tax sale purchaser by the payment
of the amount required for redemption.
DD&D Family Properties denied that Wright was entitled to any relief, then
filed a motion for summary judgment. Among the arguments advanced, DD&D
Family Properties contended that Wright was not within any category of persons
authorized to redeem the Property under OCGA § 48-4-40, asserting that the grantor
on the quit claim deed was “someone that did not own the property at the time the
[tax] deed was delivered.” DD&D Family Properties also argued that the amount
proffered by Wright for redemption was insufficient under OCGA § 48-4-42.3
According to DD&D Family Properties, the required amount as of the date tendered
was not $7,608; it was $7,800, which it calculated as $6,000 (amount paid at tax sale)
+ $1,200 (20 percent of amount for the first year) + $600 (10 percent for each
3
OCGA § 48-4-42 (a) provides in relevant part here:
The amount required to be paid for redemption of property from any sale
for taxes as provided in this chapter shall with respect to any sale made
after July 1, 2002, be the amount paid for the property at the tax sale . .
. plus: . . . (3) A premium of 20 percent of the amount for the first year
or fraction of a year which has elapsed between the date of the sale and
the date on which the redemption payment is made and 10 percent for
each year or fraction of a year thereafter.
(Emphasis supplied.)
4
subsequent year or portion thereof). Furthermore, DD&D Family Properties asserted
that the right to redeem the Property was foreclosed on August 28, 2018 with proper
notice having been provided to MHD Communities LLC and Kaila Fisher;4 DD&D
Family Properties went on to assert that Wright, “having a deed that was not
recorded[,] was not required to be noticed.”5
Thereafter, in July 2019, Wright tendered into the court’s registry $7,800, as
“the sum [DD&D Family Properties] claims was necessary to redeem the [P]roperty.”
He also filed a motion for summary judgment, arguing that he had demonstrated
entitlement to redeem the Property.
4
Wright has not disputed that the right to redeem was foreclosed on August 28,
2018.
5
See generally GE Capital Mtg. Svcs. v. Clack, 271 Ga. 82, 85 (2) (a) (515
SE2d 619) (1999) (concluding that the failure to serve a defendant in fi. fa. under
OCGA § 48-4-45 (a) (1) (A) did not affect the validity of the foreclosure of the right
of redemption because “his interest did not appear of record in [the county in which
the land was located] when the foreclosure of the right of redemption was begun”).
5
After a hearing on the parties’ cross-motions for summary judgment,6 the trial
court rejected the arguments advanced by DD&D Family Properties.7 Granting
Wright’s summary judgment motion, the trial court thereby ordered DD&D Family
Properties to convey the Property to Wright pursuant to OCGA § 48-4-44.8 DD&D
Family Properties now appeals.
1. As an initial matter, we note that the Supreme Court of Georgia outlined in
Ga. Land USA, LLC v. Ga. Power Co., 297 Ga. 237 (773 SE2d 236) (2015):
[W]hen property is sold for unpaid taxes, the tax sale purchaser
obtains a deed to the property. This deed, however, does not provide the
tax sale purchaser with absolute title to the property, but rather gives the
purchaser a defeasible fee interest therein with the title remaining
6
The trial court conducted a hearing on the parties’ summary judgment
motions, but no transcript of that hearing has been included in the appellate record.
7
The trial court found it “undisputed that both Wright and MHD Communities,
LLC intended for the Property to be the subject of the quitclaim deed. Thus, the
failure to have MHD Communities, LLC instead of MHD Acceptance, LLC convey
the tract to Wright constituted a mutual mistake that was relievable in equity.”
(Punctuation omitted.) In so ruling, the trial court relied on OCGA § 23-2-25 (“If the
form of conveyance is, by accident or mistake, contrary to the intention of the parties
in their contract, equity shall interfere to make it conform thereto.”). Given our
holdings below, we do not reach the propriety of this ruling. See Division 3, infra.
8
OCGA § 48-4-44 (a) (providing, among other things, that “where property is
redeemed, the purchaser at the tax sale shall make a quitclaim deed to the defendant
in fi. fa.”).
6
subject to encumbrance for at least one year after purchase due to other
interested parties’ statutory rights of redemption. . . . [A]fter the tax sale,
the delinquent taxpayer[s] or any other party holding an interest in or
lien on the property may redeem the property by paying to the tax sale
purchaser the purchase price plus any taxes paid and interest. If the
property is redeemed, the tax sale is essentially rescinded and a
quitclaim deed is executed by the tax sale purchaser back to the owner
of the property at the time of levy and sale. This right of redemption,
however, may be terminated by the tax sale purchaser anytime after one
year following the tax sale. After that year has run, the tax sale
purchaser may “terminate, foreclose, divest, and forever bar” all rights
to redeem the property by giving notice under OCGA § 48-4-40 et seq.
(“the barment statutes”) to all parties with redemption rights. The
barment statutes apply to all persons having any right, title or interest in,
or lien upon the subject property.
(Citations and punctuation omitted.) Id. at 239-240 (1).
2. DD&D Family Properties maintains that it was entitled to summary
judgment. Among the grounds argued, it claims that Wright failed to tender timely
the statutory redemption amount. More specifically, DD&D Family Properties asserts
that Wright’s $7,608 check (tendered on July 5, 2018, which was prior to the
foreclosure of the right of redemption) failed to include sufficient premium. Pursuant
to OCGA § 48-4-42 (a) (3), premium accrues as follows: “A premium of 20 percent
7
of the amount for the first year or fraction of a year which has elapsed between the
date of the sale and the date on which the redemption payment is made and 10 percent
for each year or fraction of a year thereafter.” (Emphasis supplied.)
The record shows that the trial court essentially concluded that the statutory
premium had accrued only “for the first year or fraction of a year” – that is, no
(additional) premium had accrued “for each year or fraction of a year thereafter.” In
reaching that conclusion, the trial court expressly discerned that “[DD&D Family
Properties’] calculations did not account for OCGA § 1-3-1 (d) (3).” In full, that
provision states:
Computation of Time. Except as otherwise provided by time period
computations specifically applying to other laws, when a period of time
measured in days, weeks, months, years, or other measurements of time
except hours is prescribed for the exercise of any privilege or the
discharge of any duty, the first day shall not be counted but the last day
shall be counted; and, if the last day falls on Saturday or Sunday, the
party having such privilege or duty shall have through the following
Monday to exercise the privilege or to discharge the duty. When the last
day prescribed for such action falls on a public and legal holiday as set
forth in Code Section 1-4-1, the party having the privilege or duty shall
have through the next business day to exercise the privilege or to
discharge the duty. When the period of time prescribed is less than seven
8
days, intermediate Saturdays, Sundays, and legal holidays shall be
excluded in the computation.
(Emphasis supplied.) As the trial court further reasoned in the contested summary
judgment order,
July 4, 2018 (Independence Day) was a legal holiday set forth in OCGA
§ 1-4-1[9] such that Wright’s privilege to redeem the [P]roperty extended
to the next business day, that of July 5, 2018. Therefore, the amount due
to redeem the [P]roperty would have been $6,000 (purchase price) +
$1,200 (20% of $6000) or $7,600, which was the amount tendered by
Wright.[10]
DD&D Family Properties takes issue with the trial court’s rationale, urging
that:
The 10 percent premium is due after the first year of the sale. It is not a
computation of time it is a due date. A promissory note due on July 4,
2018 is in default on July 5, 2018. It is not a measurement of time; it is
computation of an amount due to redeem. It is not a privilege or a
9
OCGA § 1-4-1 (a) (explaining which days the “State of Georgia shall
recognize and observe as public and legal holidays”).
10
The trial court’s mathematical calculation is erroneous; but for reasons
explained below, the amount of $7,600, as well as the actual amount of the check
($7,608) tendered on July 5, 2018, failed to include sufficient premium.
9
discharge of a duty. The 10 percent premium after the first year is also
due for a fraction of a year.
We agree with DD&D Family Properties that nothing in OCGA § 1-3-1 (d) (3)
authorized the trial court to treat July 5, 2018 as falling within the first year of the
redemption period for purposes of calculating the premium due. As OCGA § 1-3-1
(d) (3) states at its outset, it governs “[e]xcept as otherwise provided by time period
computations specifically applying to other laws.” For purposes of calculating the
premium component of the required redemption amount, OCGA § 48-4-4211
specifically provides for its own time period computations.
In Southerland v. Bradshaw, 255 Ga. 455 (339 SE2d 579) (1986), the Supreme
Court of Georgia ascertained,
[B]y establishing the reference points of OCGA § 48-4-42 as “each year
or fraction of a year which has elapsed between the date of the sale and
the date on which the redemption payment is made,” the General
Assembly has demonstrated its intention to compute the time period for
which a ten percent premium is due as a twelve-month year running
from the date of sale.
11
See note 3, supra.
10
(Emphasis omitted.) Id. at 456 (2).12 As a readily apparent example of a “year,”
Southerland pointed to the period of time “running from the first day of January
through the thirty-first day of December.” Id. Further, Southerland critically held that
the “premium of OCGA § 48-4-42 . . . begins to run at the date of the tax sale.” Id. at
456 (2). Hence, Southerland explained that the first year in that case – for purposes
of calculating premium under OCGA 48-4-42 – ran from the date of the tax sale,
December 2, 1980, through December 1, 1981. Id. at 455-456 (2).
In accordance with Southerland, the “first year” in this case – for purposes of
calculating accrued premium pursuant to OCGA § 48-4-42 – ran from the date of the
tax sale, July 5, 2017, through July 4, 2018. It follows then that because the first year
ended on July 4, 2018, July 5, 2018 fell within a “fraction of a year thereafter,”
thereby requiring an additional 10 percent be included as premium. And we see
nothing in OCGA § 48-4-42 barring premium from accruing on Independence Day
or any other day, whether contemplated as a holiday by OCGA § 1-4-1, or not.
Indeed, “[t]he intent and purpose of this payment under OCGA § 48-4-42 is to fully
12
While Southerland reviewed a former version of OCGA § 48-4-42, the
subsequent statutory modifications do not render Southerland inapposite for purposes
here.
11
compensate the owner for what he paid plus [the premium].” (Emphasis supplied.)
Southerland, 255 Ga. at 456 (2).
The trial court thus erred in its determination that “the amount due to redeem
the [P]roperty would have been $6,000 (purchase price) + $1,200 (20% of $6000) or
$7,600.” Contrary to the trial court’s rationale, OCGA§ 1-3-1 (d) (3) was not
applicable to the proper calculation of the amount of premium that had accrued under
OCGA § 48-4-42 (a) (3).13 The trial court’s conclusion that Wright timely tendered
the required redemption amount was thus erroneous.14
13
Also faulty with the trial court’s rationale is the premise that the last day to
redeem the Property was July 4, 2018. See generally OCGA § 1-3-1 (d) (3) (providing
that “[w]hen the last day prescribed” to exercise a privilege falls on a holiday, the
party having the privilege has through the next business day to exercise such
privilege). As noted above, OCGA § 48-4-40 allows property sold at a tax sale to be
redeemed: “(1) At any time within 12 months from the date of the sale; and (2) At any
time after the sale until the right to redeem is foreclosed by the giving of the notice
provided for in Code Section 48-4-45.” (Emphasis supplied.) Here, there was neither
evidence, nor any assertion that the last day to redeem the Property was July 4, 2018.
14
Wright makes no contention that the payment into the court’s registry was
made prior to the foreclosure of the right of redemption; nor does he contend that
such payment was otherwise timely under OCGA § 48-4-40. See generally Saffo v.
Foxworthy, Inc., 286 Ga. 284, 286 (2) (687 SE2d 463) (2009) (“Service of the notice
of foreclosure of the right of redemption bars the filing or continuance of any action
to set aside, cancel, or in any way invalidate the tax deed referred to in the notice or
the title conveyed by the tax deed, unless the plaintiff first pays or tenders the full
redemption amount.”) (emphasis supplied); Natl. Tax Funding v. Harpagon Co., 277
Ga. 41, 43 (2) (586 SE2d 235) (2003) (“The effect of expiration of the redemption
12
Citing Mark Turner Properties v. Evans, 274 Ga. 547 (554 SE2d 492)
(2001),Wright alternatively argues,
Even if the tender occurred on a date which required application of the
[additional 10 percent] premium, the letter set by Wright’s Counsel on
or about July 20, 2018, [DD &D Family Properties’] conduct thereafter,
and Wright’s payment into the registry, dispensed with the formality of
Wright tendering the full amount until the matter was resolved.
In Mark Turner Properties, the Supreme Court held, “Where . . . an offer is made to
pay whatever amount is due, and the person to whom tender is due refuses by her
conduct to accept any amount, the refusal dispenses with the formality of making a
legal tender.” Id. at 550 (3).15 Because the trial court did not reach this argument, we
period and bar of the right of redemption is to vest the purchaser with an absolute and
unconditional title to the land, provided such title was owned by the original owner,
and the tax sale was valid.”) (citation and punctuation omitted); Machen v. Wolande
Mgmt. Group, 271 Ga. 163, 166 (1) (517 SE2d 58) (1999) (“Appellants failed to
exercise their right of redemption in a timely manner. Any tender after the time
allowed by law for redemption under a tax sale is without effect.”).
15
See also Strong v. JWM Holdings, 341 Ga. App. 309, 313-314 (1) (800 SE2d
380) (2017) (reciting that “tender of the amount required for redemption is waived
when the party entitled to payment, by declaration or by conduct, proclaims that, if
tender of the amount due is made, an acceptance of it will be refused,” that “for an
actual tender to be waived by the word or conduct of the party entitled to payment,
it is still necessary for the party seeking redemption to make an actual, present bona
fide offer to pay that which is due before filing the redemption action”; and that
“[e]xpressing a general willingness or desire to redeem the property is not sufficient;
13
do not consider it here; we vacate the summary judgment rulings and remand this case
for further proceedings not inconsistent with this opinion. See Amin v. Guruom, Inc.,
280 Ga. 873, 875 (635 SE2d 105) (2006) (vacating summary judgment ruling that
was based on an erroneous legal theory, and remanding case for further proceedings
consistent with opinion).
3. In light of Division 2, we do not reach at this time the remainder of DD&D
Family Properties’ claims of errors.
Judgment vacated and case remanded. Gobeil and Pipkin, JJ., concur.
there must be an actual offer to pay the required redemption price”) (citations,
punctuation, and emphasis omitted).
14