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Proof of Mailing Not Very Taxing

The Supreme Court of Pennsylvania clarified the interpretation of the statutory notice requirements for tax sales in the matter of Horton v. Washington County, 81 A.3d 883 (2013). The underlying claim involved Plaintiffs’ not having paid real estate taxes for the Property for the years 2007 and 2008 to Washington County’s Tax Claim Bureau (“Bureau”). Due to the delinquent taxes, the Bureau pursued and perfected a tax sale of the Property.

Specifically, the Court analyzed 72 P.S. Section 5860.602(e) and the statutory phrase “proof of mailing” in order to provide guidance as to how notice of a tax sale is to be provided to the interested parties.

The Plaintiffs in the matter owned real estate in Pennsylvania (“Property”) from which they operated an insurance business while they resided in Florida. Plaintiffs did not use the Property as a mailing address. Furthermore, the deed to the Property contained errors, namely the Plaintiffs’ names were misspelled and it indicated that the Property was a residence as opposed to a business. Significantly, the Bureau was never provided with correct information about Plaintiffs’ actual residence.

Before conducting the above-mentioned tax sale, the Bureau made a variety of efforts to locate and notify the Plaintiffs of the tax sale. The Bureau’s efforts included: mailing a courtesy letter to the Property in April 2008 (which was returned by the United States Postal Service (“USPS”) as “no such number”); mailing a pre-sale warning letter to the Property in May 2009 (returned by the USPS as “return to sender – attempted – not known – unable to forward”); mailing a certified letter with restricted delivery to the Property (returned by the USPS as “not deliverable as addressed – unable to forward”) in July 2009; posting the Property later in July 2009 (personal service was not perfected and there was no answer at the Property); in August 2009 placing a notice in three (3) local newspapers for the tax sale; and, later in August 2009, sending an additional final notice of the sale to the Property (returned as “not deliverable as addressed – unable to forward”). The sale took place in September 2009 and by October 2009 the Bureau mailed several post-sale notices to Plaintiffs at the Property via certified mail (all were returned as not deliverable).

Based on the above, a tax sale of the Property occurred and was perfected; Plaintiffs subsequently filed a petition to set aside the tax sale. At the trial of this matter, Plaintiffs testified that they never received any tax bill, any notice of tax delinquency, or any notice of the tax sale; they also admitted that the Bureau was not responsible for any of the errors on the Deed to the Property and conceded that the errors would make it difficult for the Bureau to locate them. Plaintiffs also argued that the Bureau did not exercise reasonable efforts to investigate their whereabouts. The trial court granted Plaintiffs’ petition to set aside the tax sale. Specifically, the trial court ruled that Bureau did not provide a “proof of mailing” of notice of the sale to Plaintiffs. The Bureau appealed to the Commonwealth Court which upheld the decision of the trial court, ruling that a “proof of mailing” can only be satisfied with a USPS Certificate of Mailing (Form 3817). The Bureau then appealed to the Pennsylvania Supreme Court.

On appeal to the Pennsylvania Supreme Court, the only issue to be decided was whether Plaintiffs were provided sufficient notice under the applicable statute. The Court noted that Pennsylvania precedent requires the Bureau to strictly comply with the statute’s notice provisions in order to ensure Plaintiffs received due process of law before being deprived of Property. The case turned on an interpretation of 72 P.S. Section 5860.602(2)’s language requiring a “proof of mailing.”

When determining how to interpret the term “proof of mailing” the Court looked to legislative intent and other parts of the same statute. The Court found it significant that multiple official USPS mailing terms are used in the relevant statute, but the term “proof of mailing” is not a USPS term for a specific service. As a result, the Court could not conclude that the term “proof of mailing” referred to a specific USPS service or form.

The Court noted that, as described above, the Bureau did send correspondence and other notices to the Property and provided USPS documents as proof that those mailings did, indeed, occur (albeit they were returned); therefore, the Court ruled, the Bureau did provide the proof of mailing as required by the statute. As a result, the Court remanded the matter back to the trial court for consideration of the other issues raised by Plaintiffs in view of the Court’s ruling that they received adequate notice.

In ruling as it did, as described above, the Court overruled prior cases and specifically confirmed that, as far as notice for tax sales are concerned, “proof of mailing” merely means providing documentary proof of mailed correspondence and does not refer to a specific USPS service or form.

Originally published in Upon Further Review on August 18, 2014 and can be seen here.

Statute of Limitations When a Defendant Dies

One the most basic legal principles is that statutes of limitations establish the time frames in which a civil suit can be brought in a given case and any attempt to bring suit outside of that time frame will inevitably result in the case being dismissed. For example, the statute of limitations for a personal injury matter is two years from the date the injury is, or should be, discovered (see: 42 Pa.C.S.A. §5524(1), (2), and (3)) and, for the most part, bringing a personal injury matter beyond that two year deadline will be cause to dismiss the claim.

One of the possible exceptions to the application of statutes of limitations is if the defendant dies during the pendency of the limitations period. As with any complaint, it is the duty of a plaintiff “to use all reasonable diligence to properly inform himself of the facts and circumstances upon which the right of recovery is based and then institute suit within the prescribed period,” and that includes determining whether the defendant is living or dead at the time of suit. Lange v. Burd, 800 A2d 336 (Pa.Super. 2002).

Generally speaking, a dead person cannot be sued or be a party to an action Montanya v. McGonegal, 757 A.2d 947 (Pa.Super.2000); Lange v. Burd, 800 A2d 336 (Pa.Super. 2002). However, 20 Pa.C.S.A. §3383 carves out an exception to this general rule permitting a dead person to be sued within one year after his death. §3383 goes on to say that its terms ought not be construed to shorten a two year statute of limitations period. Therefore, hypothetically speaking based on the above, if someone died on the day a plaintiff discovered his injury, then the plaintiff would have two years to bring suit against the deceased. At the other end of the spectrum, if someone died on the last day of the two year statute of limitations, then the plaintiff would have an additional year to bring suit against that defendant (for a total of three years). Finally, if someone died during the statutory two year period, the last date a plaintiff could bring suit against the deceased could be either the last day of the two year statutory period or the last day of the one year period stated in §3383 above, whichever came later. Longo v. Longo v. Estep, 289 Pa.Super. 19 (1981); Rylee et ux. v. Nicoll’s Administrator, 74 Pa.D.&C. 269 (1950); Telford Coal Company v. Prothero et al., 24 Pa.D.&.C. 183 (1935).

After considering the above, the obvious question arises as to whether one can substitute another party (e.g.: an estate) for the deceased defendant in order to pursue a plaintiff’s claims. According to applicable case law, one may bring suit against a decedent’s estate in order to pursue claims that would have otherwise been against the decedent himself if he were alive. If a complaint is filed against a deceased person, it must be withdrawn and refiled against his estate instead. Montanya v. McGonegal, 757 A.2d 947 (Pa.Super.2000). The refiled complaint against the estate is subject to the same applicable statutes of limitations stated above for the decedent. See Montanya. The filing of a complaint against the deceased, instead of his estate, does not serve to toll the running of statutes of limitations described above in order to permit an action against the decedent’s estate after the expiration of statutes of limitations described above. See Lange.

The only way around the above statutes of limitations is to argue that there was some sort of fraud or intentional concealment of the death of the defendant which served to unfairly prejudice plaintiff in his attempt to bring suit. See Lange. The plaintiff does not have to prove that fraud or concealment was intentional, just simply that the opposing party’s conduct served to conceal the death of the defendant. See Montanya. When arguing that the opposing party committed fraud and/or concealed the death of the defendant, it should be noted that silence on the part of the opposing party is insufficient to constitute fraud or concealment. As a result, an insurance company or party failing to volunteer the information that the defendant is dead at any time – or even accepting service for the deceased at his residence – during the life of the claim and/or suit will not constitute fraud or concealment. See Montanya. The fraud or concealment must be the result of an affirmative action; consequently a passive action (e.g.: taking no action at all) is not an affirmative action. See Montanya. Moreover, the plaintiff has the burden of proving the fraud and/or concealment with clear and convincing evidence.

Although Pennsylvania law may provide a case with a little more life after the death of a defendant, ultimately statutes of limitations will apply to kill a case even if the death of a defendant did not do it already.

Originally published on June 24, 2014 in The Legal Intelligencer Blog and can be seen here.

Defendant Not at Fault in Default Judgment

If a default judgment is entered against a party and months, or perhaps years, go by before the judgment holder attempts to execute upon it, can the party subject to the judgment strike it after so much time had passed? The Commonwealth Court of Pennsylvania, in the recent case of City of Philadelphia v. David J. Lane Advertising, 33 A.3d 674, indicates that a default judgment, even as long as ten (10) years later, can be stricken from the record under the right circumstances.

In the Lane matter, in approximately May 1999, a complaint was filed by the City against David J. Lane Advertising (“Lane”) for alleged unpaid taxes dating from 1988 and 1989. Lane was promptly served but failed to file an answer to the aforesaid complaint. Accordingly, about six (6) months later, in or about November 1999, the City secured a default judgment against Lane after having issued Lane a 10-Day Notice per Pa.R.C.P. No.: 237.1. Ten (10) years later, in approximately July 2009, the City attempted to execute the judgment from November 1999, after which Lane, through his attorney, filed a motion to strike the default judgment.

The Court observed that default judgments are generally not favored and that the Court’s analysis of a motion to strike a default judgment is limited to the facts in the record at the time the judgment is entered and that it will not review the case on its merits. The focus of the Court is on potential defects in the judgment that affect the validity of the judgment; with this in mind, the Court’s inquiry was directed to the content and form of the 10-Day Notice per Pa.R.C.P. No.: 237.1 described above. The Court ruled that failure to comply with Pa.R.C.P. No.: 237.1 could create a defective record which, if it rises to the level of a “fatal” defect, could result in the default judgment being stricken, no matter how old it is.

In the Lane matter, the form for the 10-Day Notice per Pa.R.C.P. No.: 237.1 used by the City was very similar to the suggested form as laid out in the Rules of Civil Procedure, but it was not precisely the same. The form used by the City stated, inter alia, “[y]ou are in default because you have failed to take action required of you in this case.” The form suggested by the Rules of Civil Procedure is as follows: “[Y]OU ARE IN DEFAULT BECAUSE YOU HAVE FAILED TO ENTER A WRITTEN APPEARANCE PERSONALLY OR BY ATTORNEY AND FILE IN WRITING WITH THE COURT YOUR DEFENSES OR OBJECTIONS TO THE CLAIMS SET FORTH AGAINST YOU.”

The Court noted that the language used by the City was the suggested language in the Rules of Civil Procedure prior to 1994; however, in 1994, the Supreme Court of Pennsylvania changed the language, as described above, which is about five (5) years prior to the entrance of the default judgment. The Court further pointed out, after an analysis of the language itself and the explanatory comment for the new rule, that the precise purpose of the change in language from 1994 was to notify a defendant as to specifically what he failed to do and the specific reasons why the defendant is in default. To that end, the Court found that the form used by the City, though similar, lacked the new language in the 1994 updated rule which the Supreme Court purposefully added to ensure specificity in the notices issued.

Based on the above, the Court decided that it was not ruling as to whether Lane was deserving of having the judgment stricken, but whether he is entitled to it as a matter of law. The Court, citing prior decisions, noted both that default judgments are disfavored and that strict compliance with the Rules of Civil Procedure is required or else the default judgment is voided. As a result, the Court ruled that the language in the 10-Day Notice per Pa.R.C.P. No.: 237.1 used by the City is lacking so much critical language per the 1994 Rule revision, that it was fatally defective, and it ordered the ten (10) year old default judgment stricken, which served to reopen the underlying case.

The practical effect of the Lane decision is abundantly clear: when seeking a default judgment against an adverse party, follow the Rules of Civil Procedure precisely and simply use the language suggested in the Rules for the 10-Day Notice per Pa.R.C.P. No.: 237.1 exactly as written in the Rule.

Originally published on December 17, 2013 in Upon Further Review and can be viewed here.

Looking to make a year-end donation? Please keep the Christian Legal Clinics of Philadelphia in mind!

If you are looking for a place to give or make a year end donation, especially in the spirit of the Christmas Season, please remember the Christian Legal Clinics of Philadelphia. You can learn more about us here.

We need the support to open a new location in Kensington as well as secure an attorney employed by the Clinic itself to attend hearings and other similar services. Any amount helps us continue our efforts to bring justice to the underprivileged. Contributions can be directly through our website or mailed to the address on the website. Thanks a lot and Merry Christmas.

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