WMAC 2013, LLC v. Dennie R. Gladney ( 2020 )

In the Missouri Court of Appeals
Eastern District
DIVISION TWO
WMAC 2013, LLC, ) No. ED107204
)
Respondent, ) Appeal from the Circuit Court
) of St. Louis County
vs. )
) Honorable Thea A. Sherry
DENNIE R. GLADNEY, et al., )
)
Appellants. ) FILED: January 14, 2020
Introduction
Dennie R., Sharon, and Diana Gladney (collectively “the Gladneys”) appeal from the trial
court’s grant of summary judgment to WMAC 2013, LLC (“WMAC13”) in a quiet title and
ejectment action. In their sole point on appeal, the Gladneys challenge the trial court’s entry of
summary judgment. The Gladneys contend a genuine issue of material fact exists as to whether
the tax lien certificate on their property was sold to a prohibited purchaser under Section
140.190.2.1 Because the sale of the tax-deficient property to a statutorily prohibited purchaser
does not address a material fact given the circumstances of this case, we deny the Gladneys’
point on appeal and affirm the judgment of the trial court.
1
All Section references are to RSMo (2016).
Factual and Procedural History
Dennie R. and Sharon Gladney acquired the real property at 3815 Brown Road in St.
Louis, Missouri (“the Property”) in 2010. Subsequently, Dennie R. and Sharon Gladney failed to
pay property taxes on the Property. In August 2015, WMAC 2014, LLC (“WMAC14”)
purchased a tax lien certificate for the Property at a public tax sale auction. In 2016, Dennie R.
and Sharon Gladney transferred the Property to their daughter, Diana Gladney.
The Gladneys did not redeem the Property within the year following the tax sale.
Consequently, in September 2016, the St. Louis County Collector of Revenue issued a
Collector’s Deed for Taxes for the Property (“the Deed”) to WMAC14, which later conveyed the
Deed to WMAC13. WMAC13 filed a petition to quiet title pursuant to the Deed and to eject
Dennie R. and Sharon Gladney from the Property. Subsequently, Diana Gladney was granted
leave to intervene.
WMAC13 moved for summary judgment against the Gladneys on its petition to quiet
title. In an attempt to defeat summary judgment, the Gladneys argued that they raised a genuine
issue of fact regarding the validity of the Deed. Specifically, the Gladneys offered evidence that
WMAC14 was a successor company of WMAC13. The Gladneys maintained that WMAC14’s
successor liability rendered it a prohibited purchaser at the tax sale under Section 140.190.2
because WMAC13 had failed to pay property taxes on other St. Louis County properties at the
time WMAC14 acquired the Property. The Gladneys reasoned that since WMAC14 was a
successor company of WMAC13 and WMAC13 was a prohibited purchaser, then WMAC14 was
a prohibited purchaser as well. Accordingly, the Gladneys argued that WMAC13 was not
entitled to summary judgment on its petition because WMAC14 obtained the Deed through an
invalid sale.
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The trial court found that WMAC13 presented a prima facie case for summary judgment
and that no credible evidence was presented to successfully challenge the Deed under Section
140.610. Accordingly, the trial court granted summary judgment. The Gladneys now appeal.
Point on Appeal
In their sole point on appeal, the Gladneys contend that the trial court erred in granting
summary judgment. The Gladneys maintain that they raised a genuine issue of fact regarding
WMAC14’s status as a prohibited purchaser in the tax sale, which, if shown, would render
WMAC13’s title invalid and, as a matter of law, defeat its right to judgment on the petition to
quiet title.
Standard of Review
We review an appeal from summary judgment de novo. Farrow v. Saint Francis Med.
Ctr., 407 S.W.3d 579, 587 (Mo. banc 2013) (citing ITT Commercial Fin. Corp. v. Mid-Am.
Marine Supply Corp., 854 S.W.2d 371, 376 (Mo. banc 1993)). “[We review] the record in the
light most favorable to the party against whom judgment was entered and afford[] that party the
benefit of all reasonable inferences.” Id. (citing Lewis v. Gilmore, 366 S.W.3d 522, 524 (Mo.
banc 2012)). We also review questions of statutory interpretation de novo. Newsome v. Kan.
City, Mo. Sch. Dist., 520 S.W.3d 769, 780 (Mo. banc 2017) (internal citation omitted).
Discussion
Trial courts are required to enter summary judgment where “there is no genuine issue as
to any material fact” and where “the moving party is entitled to judgment as a matter of law.”
Rule 74.04(c)(6).2 “[A] ‘genuine issue’ exists where the record contains competent materials
that evidence two plausible, but contradictory, accounts of the essential facts[.]” ITT
2
All Rule references are to Mo. R. Civ. P. (2018).
3
Commercial Fin. Corp., 854 S.W.2d at 382. “A material fact in the context of summary
judgment is one from which the right to judgment flows.” Goerlitz v. City of Maryville, 333
S.W.3d 450, 453 (Mo. banc 2011) (internal citation omitted). More specifically, “material facts
are those ultimate facts that constitute the elements of a cause of action or affirmative defense[.]”
Custer v. Wal-Mart Stores E. I, LP, 492 S.W.3d 212, 215 (Mo. App. S.D. 2016) (citing ITT
Commercial Fin. Corp., 854 S.W.2d at 379–81).
On appeal, the Gladneys acknowledge that WMAC13 has made a prima facie case for
summary judgment. See Section 140.460.2 (providing that a collector’s deed is “prima facie
evidence of a good and valid title in fee simple in the grantee of said deed”). However, the
Gladneys posit that they sufficiently rebutted the prima facie case by introducing a genuine issue
of fact regarding WMAC14’s status as a prohibited purchaser in the tax sale as the successor of
WMAC13. See Edwards v. Black Twig Mktg. & Commc’ns LLC, 418 S.W.3d 512, 520 (Mo.
App. E.D. 2013) (internal citations omitted) (providing a successor may be liable for the
liabilities of its predecessor where a transaction is entered into fraudulently to escape liability).
The Gladneys then reason that WMAC14’s status as a prohibited purchaser under Section
140.190.2 raises a material fact challenging WMAC13’s right to judgment.
The Gladneys’ argument fails because, under the summary judgment facts presented,
whether WMAC14 was a prohibited purchaser under the statute is immaterial to WMAC13’s
rights in the Property, and its corresponding right to judgment. Therefore, even if the Gladneys
could establish at trial that WMAC14 was a prohibited purchaser, that fact is not material to their
challenge of WMAC13’s title in the Property.
Section 140.610 governs “all suits and controversies involving the title of land claimed
and held by virtue of the deed executed by the county collector for nonpayment of taxes
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thereon[.]” “[I]n order to defeat the title conveyed by such deed,” the person claiming adverse
title “shall be required to prove” one of the following:
[1] [T]hat the land described therein was not subject to taxation at the date of
assessment of the tax for which it was sold, or [2] that the taxes for the nonpayment
of which the land was sold were paid to the proper officer within the time limited
by law therefor, or [3] that the same had not been assessed for the taxes for the
nonpayment of which it was sold, or [4] that the same had been redeemed pursuant
to law, or [5] that a certificate in proper form had been given by the proper officer,
within the time limited by law for paying taxes or for redeeming from sales made
for the nonpayment thereof, stating no taxes were due at the time such sale was
made, or [6] that at the date of the deed the redemption period had not expired.
Section 140.610. Section 140.610’s usage of the words “shall” and “required” makes clear that a
party must prove one of the six statutory grounds to defeat the title conveyed by a collector’s
deed. See State v. Teer, 275 S.W.3d 258, 261 (Mo. banc 2009) (internal citation omitted) (“The
word ‘shall’ generally prescribes a mandatory duty.”); see also State ex rel. Jackson v. Dolan,
398 S.W.3d 472, 479 (Mo. banc 2013) (quoting State v. Moore, 303 S.W.3d 515, 520 (Mo. banc
2010)) (“When interpreting a statute, [Missouri courts] must give meaning to every word or
phrase of the legislative enactment.”). The Gladneys’s argument that WMAC14’s status as a
prohibited purchaser voids the Deed is simply not listed in the statute as one of the express
grounds upon which the Gladneys may seek to set aside the Deed as invalid. See Section
140.610.
Despite the mandate of Section 140.610, the Gladneys direct this Court to Section
140.190.2 to argue that WMAC13’s Deed was void as the result of an invalid sale. Section
140.190.2 provides that “no sale shall be made to any person or designated agent who is
currently delinquent on any tax payments on any property, other than . . . on the property being
offered for sale, and who does not sign an affidavit stating such at the time of sale.” (Emphasis
added). The Gladneys argue that the Deed was transferred to WMAC14 in an invalid sale
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because WMAC13 was delinquent on its property taxes at the time of the tax sale, and
WMAC14, the purchaser at the tax sale, is WMAC13’s successor. See Edwards, 418 S.W.3d at
520 (internal citations omitted). The Gladneys essentially argue that they need not seek to void
the Deed under Section 140.610 to defeat the quiet title action because the Deed was inherently
invalid under Section 140.190.2. This argument fails because even if the sale was made to a
prohibited purchaser as defined under Section 140.190.2, that fact alone does not render the
Deed invalid.
Notably, Section 140.190.2 states that “[f]ailure to sign such affidavit [attesting to non-
delinquent tax status] as well as signing a false affidavit may invalidate such sale.” (Emphasis
added). Thus, a sale to a prohibited purchaser is not automatically invalid once the sale has
occurred. See Section 140.190.2. But, while Section 140.610 does not allow a third party to
judicially invalidate such a collector’s deed, the statute is not without an enforcement
mechanism. Section 140.540.1 provides that, “[w]henever the county collector shall discover,
prior to the conveyance of any lands sold for taxes, that the sale was for any cause whatever,
invalid, he shall not convey such lands[.]” (Emphasis added). First, the statute specifically
empowers the county collector to refuse any sale or transfer to a party who is delinquent on its
payment of county taxes. And should a delinquent taxpayer somehow succeed in making a
purchase of a collector’s deed at a tax sale, the county collector may possess the legal right to
have the deed invalidated; however, any such right resides exclusively with the county collector
under a plain reading of the statute.
We see no language in the statute authorizing delinquent taxpayers any right to assert a
county collector’s rights under Section 140.190.2. While this statutory scheme does not provide
a judicial remedy to tax-delinquent title-holders such as the Gladneys for sales made to a
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prohibited purchaser, the statute does provide for other remedies. Should the tax-delinquent
title-holder discover the collector’s deed was sold to a prohibited purchaser before the county
collector conveys the land, the tax-delinquent title-holder can notify the county collector, who
presumably would then not convey the land. See Section 140.540.1. Second, and more
fundamental to the statutory scheme, the tax-delinquent title-holder has one full year to redeem
the property following the tax sale. See Section 140.340.1. The statutory provisions addressing
the subsequent sale of the collector’s deed for tax-delinquent properties were enacted to protect
the county collector, not the tax-delinquent property owner. Additionally, it bears noting that
title-holders will only find themselves in this situation if they fail to pay their property taxes. See
Section 140.010; Section 140.150.
After reviewing the record, we find that the Gladneys failed to raise a genuine issue of
material fact that, if proven, would void the Deed and thereby defeat the entry of summary
judgment. Even if WMAC14 were both a prohibited purchaser and a successor of WMAC13,
WMAC13 nevertheless is entitled to summary judgment under the facts of this case.
Accordingly, we affirm the trial court’s entry of summary judgment. Point One is denied.
Conclusion
The judgment of the trial court is affirmed.
_____________________________________
KURT S. ODENWALD, Judge
Philip M. Hess, P.J., concurs.
Lisa P. Page, J., concurs.
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