Norma Anderson, Tunica County Tax Collector, and Rechelle Siggers, Tunica County Chancery Clerk v. S & S Properties, LLC

Jackson, MS – Tax Sale lawyer represented appellee with filing a complaint against the County to set aside and void tax sales.

On January 22, 2019, S&S filed a complaint against the County to set aside and void

tax sales involving real property purchased through an August 31, 2015 tax sale. S&S

contended that the County failed to comply with the tax-sale notice statutes, and the parties

subsequently agreed by stipulation that "[n]o sheriff's notice was issued or served for any of

the subject tax sales . . . as required by [Mississippi] Code [Annotated section] 27-43-3

[(Rev. 2017)].” Following the chancellor's recusal, the Mississippi Supreme Court appointed

a special judge to preside over the matter. After discovery, the parties signed an agreed order

to grant S&S leave to amend its complaint and to join the assessed property owners. The

County moved to dismiss the complaint, and S&S filed an amended motion for summary

judgment. Following a hearing on the parties' motions, the chancellor denied the County's

motion to dismiss and granted S&S's amended motion for summary judgment.

¶4. The chancellor entered his final judgment on December 9, 2020. Consistent with his

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prior opinion entered on October 14, 2020, the chancellor found that S&S had standing to

challenge the validity of the August 31, 2015 tax sales. Because the County failed to provide

proper notice of the tax sales to the assessed property owners as required by statute, the

chancellor ordered that the subject tax sales be set aside as void. The chancellor further

required the County to refund the $35,467.32 that S&S paid to purchase the properties.

Aggrieved, the County appeals.

STANDARD OF REVIEW

¶5. Where substantial evidence supports a chancellor's findings of fact, this Court will

not reverse unless "the findings are manifestly wrong, [are] clearly erroneous, or amount to

an abuse of discretion.” Panola Cnty. Tax Assessor v. Oak Inv. Co., 297 So. 3d 1122, 1126

(¶19) (Miss. Ct. App. 2020) (quoting Cleveland v. Deutche Bank Nat'l Tr. Co., 207 So. 3d

710, 714 (¶17) (Miss. Ct. App. 2016)). For questions of law, however, we "employ[] a de

novo standard of review and will only reverse for an erroneous interpretation or application

of the law.” Id. at 1126-27 (¶19) (quoting Rebuild Am. Inc. v. Norris, 64 So. 3d 499, 501

(¶7) (Miss. Ct. App. 2010)). This Court reviews a chancellor's grant of summary judgment

de novo. Yoakum v. Smith (In re Est. of Yoakum), 311 So. 3d 686, 689 (¶9) (Miss. Ct. App.

2021). We may only affirm a summary judgment ruling where the record "show[s] 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.” M.R.C.P. 56(c).

DISCUSSION

¶6. Because the chancellor had not yet entered his final judgment when the Legislature

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amended section 27-45-27, the County contends that the amended version of the statute

applies to S&S's claims. Under the amended version of section 27-45-27(2), the County

argues that S&S lacks standing to challenge the tax-sale purchases. As a result, the County

asserts that the chancellor erred by granting S&S's amended motion for summary judgment.

¶7. When S&S filed its complaint in January 2019, the supreme court's holding in SASS

Muni-V LLC v. DeSoto County, 170 So. 3d 441, 449 (¶21) (Miss. 2015), applied and afforded

tax-sale purchasers standing to challenge the validity of a tax sale. Specifically, the SASS

court stated:

Under Mississippi's liberal standing requirements, we find that a tax-sale

purchaser has standing to challenge the validity of the sale under the notice

provisions of the tax-sale statutes. A tax-sale purchaser undeniably holds an

interest in the property, both prior to and after expiration of the redemption

period, regardless of the validity of the sale. Upon the expiration of the

redemption period, assuming all prerequisites for a valid tax sale were met,

perfect legal title vests in the purchaser by operation of the tax sale, and the

owner is divested of any interest in the property.

Id.

¶8. Effective July 1, 2019, the Legislature superseded the standing rule from SASS by

amending Mississippi Code Annotated section 27-45-27 (Rev. 2017) to include subsection

(2). See Miss. Code Ann. § 27-45-27(2) (Supp. 2019). As amended, section 27-45-27(2)

states: "No purchaser of land at any tax sale, nor holder of the legal title under him by

descent or distribution, shall have any right of action to challenge the validity of the tax sale.”

Id.

¶9. In two recent cases, this Court determined that the amended version of section 27-45-

27(2) failed to apply retroactively. Bennett Tax Co. Inc. v. Newton County, 298 So. 3d 440,

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445 (¶¶10-11) (Miss. Ct. App. 2020); Panola Cnty. Tax Assessor, 297 So. 3d at 1129 (¶29).

The County argues on appeal, however, that Bennett Tax Co. and Panola County Tax

Assessor are distinguishable from the instant case because the final judgments in those

matters had already been entered when the Legislature amended section 27-45-27. By

contrast, the chancellor here had not yet entered his final judgment when the statutory

amendment took effect. As a result, the County maintains that the amended version of

section 27-45-27(2) applies to S&S's claims. Thus, even though the County has agreed that

it failed to comply with statutory tax-sale notice requirements, it still asserts that S&S lost

its standing under SASS to challenge the validity of the 2015 tax-sale purchases once the

amended version of section 27-45-27(2) took effect. The County therefore argues that the

chancellor erroneously granted S&S's amended motion for summary judgment.

¶10. In Durrant Inc. v. Lee County, No. 2019-CA-01826-COA, 2021 WL 5896268 (Miss.

Ct. App. Dec. 14, 2021) (motion for rehearing pending), which issued just last year, this

Court considered the same argument that the County raises in the present matter. In Durrant,

two companies "bought the same property at tax sales in 2016 and 2017, respectively, and

later sued to set aside their purchases and obtain refunds . . . .” Id. at *1 (¶1). With regard

to the 2016 tax sale, the companies alleged that the chancery clerk failed to send proper

notice to the assessed property owner. Id. at (¶3). After finding that both companies lacked

standing to assert their claims, the chancellor dismissed their complaint. Id. at (¶1).

Similarly to the present case, the two companies had filed their complaint prior to the

Legislature's amendment of section 27-45-27, but the chancellor had not yet entered a final

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judgment when the amendment took effect. Id. at *4-5 (¶¶19-20). In her final judgment,

"the chancellor found that the amended version of section 27-45-27(2) applies retroactively

because it precludes a tax-sale purchaser's ability to raise a cause of action, rather than a

vested contractual or property right.” Id. at *4 (¶19). On appeal, this Court disagreed and

found that one of the companies had standing to challenge the 2016 tax-sale purchase. Id.

at *5 (¶22).

¶11. In reaching our determination in Durrant, we acknowledged the following:

Every right or remedy created solely by the repealed or modified statute

disappears or falls with the repealed or modified statute, unless carried to final

judgment before the repeal or modification, save that no such repeal or

modification shall be permitted to impair the obligation of a contract or to

abrogate a vested right.

Id. at (¶21) (quoting Cellular S. Inc. v. BellSouth Telecomms. LLC, 214 So. 3d 208, 214 (¶16)

(Miss. 2017)). Because—as here—the amendment to section 27-45-27 took effect prior to

the entry of the chancellor's judgment in Durrant, we specifically noted that "the amendment

must be applied unless it impairs the obligation of a contract or abrogates Durrant's vested

right.” Id. (emphasis omitted).

¶12. "[T]o become vested, the right must be a contract right, a property right, or a right

arising from a transaction in the nature of a contract which has become perfected to the

degree that it is not dependent on the continued existence of the statute.” Bennett Tax Co.,

298 So. 3d at 444-45 (¶9) (quoting State ex rel. Pittman v. Ladner, 512 So. 2d 1271, 1275-76

(Miss. 1987)). As we explained in Bennett Tax Co.,

the court in Price v. Harley, 142 Miss. 584, 107 So. 673, 674 (Miss. 1926),

held that an amended statute could not be applied if the application would

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impair the obligation of an existing contract. In a remarkable on-point ruling,

the United States Supreme Court stated in Wood v. Lovett, 313 U.S. 362, 369

(1941), "The federal and state courts have held, with practical unanimity, that

any substantial alteration by subsequent legislation of the rights of a purchaser

at tax sale, accruing to him under laws in force at the time of his purchase, is

void as impairing the obligation of contract.”

Bennett Tax Co., 298 So. 3d at 445 (¶9).

¶13. Acknowledging our prior holding in Bennett Tax Co., we stated in Durrant that "this

[C]ourt has already held that retroactively applying section 27-45-27(2) 'would impair the

obligations of contract and retroactively apply a statute that does not meet the statutory

retroactivity test.'” Durrant, 2021 WL 5896268, at *5 (¶22) (quoting Bennett Tax Co., 298

So. 3d at 445 (¶10)). In light of our prior caselaw, especially our recent holding in Durrant,

we must reach the same conclusion here. We therefore find that the amended version of

section 27-45-27(2) fails to apply to and prevent S&S's challenge to the 2015 tax-sale

purchases. As a result, we affirm the chancellor's grant of summary judgment to S&S.

Because we find no error in the chancellor’s grant of summary judgment to S&S, we

affirm.