                                                                      Dec 22 2015, 8:49 am




ATTORNEY FOR APPELLANT                                    ATTORNEYS FOR APPELLEES
Dustin D. Huddleston                                      JOHNSON COUNTY AUDITOR &
Huddleston & Huddleston                                   JOHNSON COUNTY TREASURER
Franklin, Indiana                                         Kathleen A. Hash
                                                          Shena T. Wheeler
                                                          Franklin, Indiana
                                                          APPELLEE PRO SE
                                                          Patrick W. Black
                                                          Edinburgh, Indiana



                                           IN THE
    COURT OF APPEALS OF INDIANA

In re the 2014 Johnson County                            December 22, 2015
Tax Sale,                                                Court of Appeals Case No.
                                                         41A01-1505-MI-445
Town of Edinburgh,
                                                         Appeal from the Johnson Superior
Appellant,                                               Court
        v.                                               The Honorable Kevin M. Barton,
                                                         Judge
Patrick Black, Johnson County                            Trial Court Cause No.
Auditor, and Johnson County                              41D01-1408-MI-143
Treasurer,
Appellees.




Brown, Judge.




Court of Appeals of Indiana | Opinion 41A01-1505-MI-445| December 22, 2015                   Page 1 of 14
[1]   The Town of Edinburgh (the “Town”) appeals from the trial court’s Order

      Denying Issuance of Tax Deed. The Town raises four issues which we

      consolidate and restate as whether the court’s order is clearly erroneous. We

      affirm.


                                           Facts and Procedural History

[2]   Patrick Black owns a parcel of real property in Edinburgh, Johnson County,

      Indiana. The parcel was listed for sale at Johnson County’s September 12, 2014

      tax sale, but the parcel was not sold. As a result, the Johnson County Auditor

      (the “Auditor”) issued a tax sale certificate to the Johnson County Board of

      Commissioners (the “Commissioners”) on September 13, 2014, 1 and the

      Commissioners assigned the sale certificate to the Town on October 28, 2014.2




      1
          Ind. Code § 6-1.1-24-6 provided in part at the time:
                 (a) When a tract or an item of real property is offered for sale under this chapter and an
                 amount is not received equal to or in excess of the minimum sale price prescribed in
                 section 5 of this chapter, the county executive acquires a lien in the amount of the
                 minimum sale price. This lien attaches on the day after the last date on which the tract or
                 item was offered for sale.
                 (b) When a county executive acquires a lien under this section, the county auditor shall
                 issue a tax sale certificate to the county executive in the manner provided in section 9 of
                 this chapter. The county auditor shall date the certificate the day that the county
                 executive acquires the lien. When a county executive acquires a certificate under this
                 section, the county executive has the same rights as a purchaser.
      (Subsequently amended by Pub. L. No. 251-2015, § 9 (eff. July 1, 2015)).

      2
          Ind. Code § 6-1.1-24-9(d) provided at the time:
                 Subject to IC 36-1-11-8, the county executive may assign a certificate of sale held in the
                 name of the county executive to any political subdivision during the life of the certificate.
                 If an assignment is made under this subsection, the period of redemption of the real
                 property under IC 6-1.1-25 is one hundred twenty (120) days after the date of the
                 assignment.
      (Subsequently amended by Pub. L. No. 251-2015, § 17 (eff. July 1, 2015)).

      Court of Appeals of Indiana | Opinion 41A01-1505-MI-445| December 22, 2015                               Page 2 of 14
[3]   A Notice of Sale and Redemption Period was sent to Black which stated that

      the date of expiration of the period of redemption was February 25, 2015, and

      that the Town intended to petition for a tax deed on or after February 26, 2015.

      The notice also stated that “the components of the amount required to redeem

      the Real Property are as follows: . . . $21,213.21; plus . . . $1,365.00;” plus

      “$2,257.82, if the Real Property is redeemed not more than six (6) months after

      the date of sale or [] $3,386.73, if the Real Property is redeemed more than six

      (6) months but not more than one (1) year after the date of sale;” plus “[t]axes,

      special assessments, interest, penalties and fees on the Real Property that

      accrued after the date of sale.” Appellant’s Appendix at 30.


[4]   On February 24, 2015, Black went to the Auditor’s office to determine the

      amount he needed to pay to redeem his property from the tax sale. An

      employee of the Auditor contacted its vendor, SRI, Inc., to determine the

      amount due to redeem the property from the tax sale. SRI indicated that the

      total amount required for redemption was $26,557.85, and Black paid that

      amount to the Auditor. On February 25, 2015, the Auditor sent a letter to the

      Town which stated that the property which had been assigned to the Town on

      October 28, 2014 was redeemed on February 24, 2015.




      The tax sale certificate stated that the amount of the minimum bid was $22,578.21 and that “[t]o the
      judgment was added the real estate taxes of $1,365.00 that are due and payable in 2014, but not delinquent as
      of 9/12/14. (Judgment $21,213.21 + Fall 2014 installment of $1,365.00 = $22,578.21).” Appellant’s
      Appendix at 20.

      Court of Appeals of Indiana | Opinion 41A01-1505-MI-445| December 22, 2015                       Page 3 of 14
[5]   On February 26, 2015, the Town filed a petition for the issuance of a tax deed

      with the Johnson County Superior Court stating that the property had not been

      redeemed before the expiration of the period of redemption.3 On March 4,

      2015, the Town sent a letter to the Auditor which stated that, “[a]ccording to

      information obtained from the Auditor’s office and the Treasurer’s office, the

      total amount required for redemption regarding the . . . parcel has not been

      paid” and that “[t]axes and/or penalties in the amount of $1,575.56 are still due

      and unpaid.” Id. at 55. The Town attached a tax bill reflecting this amount.

      On March 10, 2015, the Commissioners sent a letter to Black stating that, in

      processing the redemption, it had discovered that taxes and/or penalties that

      accrued after the tax sale of $1,575.56 were still due and unpaid and requested

      that Black bring the funds to the Johnson County Treasurer (the “Treasurer”)

      no later than March 17, 2015, to complete the redemption.4 Black paid

      $1,575.76 to the Auditor.


[6]   On March 27, 2015, the Town filed a Notice of Payments arguing that the

      property was not redeemed from the sale before the expiration of the

      redemption period as required by statute and requesting an order directing the




      3
       The petition was not served upon the Auditor and Treasurer and was not entered in the court’s
      chronological case summary.
      4
        At the April 22, 2015 hearing, counsel for the Auditor stated that, after the Auditor learned from the Town’s
      letter that there were penalties that accrued since the tax sale, the Auditor decided that the equitable thing to
      do would be to give Black a chance to pay the remaining dollars as he had already paid over $26,000.

      Court of Appeals of Indiana | Opinion 41A01-1505-MI-445| December 22, 2015                          Page 4 of 14
      Auditor to issue a tax deed to the Town.5 On March 30, 2015, the Auditor

      requested a hearing.


[7]   On April 22, 2015, the court held a hearing at which Black was present and the

      Town as well as the Auditor and Treasurer appeared by counsel. At the

      hearing, Brad Engler, the chief operating officer of SRI, testified that SRI

      conducted the Johnson County tax sale in September 2014, that SRI had

      received a call in February and asked for a redemption figure, and that it had

      provided “the amount based upon what was in the system at that particular

      point in time which did not include the penalties that were applied in, during

      the November tax collection.” Transcript at 42. He testified that, on a normal

      tax sale where money is exchanged, there would be no penalties in November

      because the amounts would have been paid the day of the tax sale. Engler

      testified that he believed SRI had worked with Johnson County since 1995 and

      that it was a consultant for eighty-three of Indiana’s ninety-two counties. He

      testified that, in its role as a consultant, SRI performed work for tax sales

      including verifying the lists of properties with the offices of the county auditors

      and treasurers, providing statutory notices on behalf of the auditors, preparing

      pre-sale publications, providing draft court documents for the county attorneys

      to review, and then conducting the auctions and post-sale functions.




      5
       The Town attached a 2014 tax sale record to its Notice of Payments showing that the assessed value of the
      property was $91,000.

      Court of Appeals of Indiana | Opinion 41A01-1505-MI-445| December 22, 2015                     Page 5 of 14
[8]   Engler testified that this was the first time that the Auditor “ever did a

      Commissioner’s Certificate Redemption” and that this redemption was

      different than a regular tax sale because no money had exchanged hands. Id. at

      46. He testified that SRI’s information is “updated throughout the tax sale

      process . . . up until this, right at the conclusion of the sale.” Id. at 47. He

      testified that another vendor, Thomson Reuters, maintains Johnson County’s

      tax billing software, that “the County’s tax system and our tax sale system do

      not talk to each other,” and that Thomson Reuters “isn’t interested in

      exchanging data.” Id. at 44. The court asked “basically, the only time that

      we’re going to get into a . . . penalty provision for the second installment is

      when there’s an assignment by the Commissioners,” and Engler answered

      “Correct.” Id. at 49. Engler further indicated that this was the first redemption

      in Johnson County where there had been an assignment. When asked if it had

      happened in the other eighty-two counties, Engler testified “Very, very few . . . I

      can’t even tell you that any of these have ever redeemed where . . . the counties

      have assigned a certificate to another political subdivision” and that “it may be

      the first time ever.” Id. Engler testified that an administrative staff person of

      SRI provided the figure to the Auditor that was then passed on to Black, that

      the additional penalty did not show up on the staff person’s computer program,

      and that the staff person did not know to add any penalties that accrued after

      the sale in the event of an assignment. He also testified that, if tax and special

      assessment payments are not made in November, then the system will add a ten

      percent penalty on the amounts not paid at that point in time and that is what

      occurred in this case. At the end of the hearing, the court asked whether, if
      Court of Appeals of Indiana | Opinion 41A01-1505-MI-445| December 22, 2015   Page 6 of 14
      there was an issuance of the tax deed, would the back taxes essentially be

      forfeited, and counsel for the Auditor and Treasurer stated she was not sure and

      counsel for the Town stated the Town would not have to pay those taxes.


[9]   On April 28, 2015, the trial court entered an Order Denying Issuance of Tax

      Deed with detailed findings, including:


                                                    *****

              26. The Court begins by noting that it is unable to determine
              how the figure of $1,575.56 was determined to be the amount
              owed. The Johnson County Auditor’s Office reports that the
              figure includes “$1,365.00 in Last Year 2nd Installment Tax”.
              The Tax Sale Certificate provides that “To the judgment was
              added the real estate taxes of $1,365.00 that are due and payable
              in 2014, but not delinquent as of 9/12/14. (Judgment $21,213.21
              + Fall 2014 Installment $1,365.00 + $22,578.21”. The Auditor
              reports that the redemption amount paid by Mr. Black included
              the $1,365.00 amount.

              27. The Court is therefore only able to determine that penalties
              were unpaid in the amount of Two Hundred Ten Dollars and
              Fifty-Six Cents ($210.56). The error in not including penalties
              would be consistent with the testi[m]ony of Mr. Engler. Taxes
              assessed for 2014 are not yet payable in 2015.

                                                    *****

              36. The Town of Edinburgh asserts that the case of M. Jewell,
              LLC v. Powell may be differentiated in that the property owner
              in that case filed an objection to issuance of a tax deed. The
              Court does not find that an objection is a prerequisite for the
              court to exercise it’s [sic] equitable jurisdiction. Indiana Code 6-



      Court of Appeals of Indiana | Opinion 41A01-1505-MI-445| December 22, 2015     Page 7 of 14
           1.1-25-4.6[6] provides that upon the filing of an objection, the
           court is required to conduct a hearing. The statute does not
           preclude the court from otherwise conducting a hearing. Indiana
           Code 6-l.l-25-4.6(b)[7] requires that the Court make a finding that
           the Parcel has not been redeemed before expiration of the period
           of redemption. The filing of a timely objection is not a statutory
           prerequisite to the findings required by the court prior to issuance
           of a order to the auditor to issue a tax deed.

                                                     *****

           39. Town of Edinburgh’s Verified Petition For Issuance Of Tax
           Deed is denied. Parcel is found to be redeemed. . . .

Appellant’s Appendix at 7, 9-14.




6
  Ind. Code § 6-1.1-25-4.6 provided in part at the time that “[a]ny person owning or having an interest in the
tract or real property may file a written objection to the petition with the court not later than thirty (30) days
after the date the petition was filed” and that, “[i]f a written objection is timely filed, the court shall conduct a
hearing on the objection.” (Subsequently amended by Pub. L. No. 251-2015, § 22 (eff. July 1, 2015)).
7
    Ind. Code § 6-1.1-25-4.6(b) (2014) provided in part at the time:
           Not later than sixty-one (61) days after the petition is filed under subsection (a), the court
           shall enter an order directing the county auditor (on the production of the certificate of
           sale and a copy of the order) to issue to the petitioner a tax deed if the court finds that the
           following conditions exist:
                    (1) The time of redemption has expired.
                    (2) The tract or real property has not been redeemed from the sale before the
                    expiration of the period of redemption specified in section 4 of this chapter.
                    (3) Except with respect to a petition for the issuance of a tax deed under a sale
                    of the certificate of sale on the property under IC 6-1.1-24-6.1 or IC 6-1.1-24-6.8,
                    or with respect to penalties described in section 4(k) of this chapter, all taxes and
                    special assessments, penalties, and costs have been paid.
                    (4) The notices required by this section and section 4.5 of this chapter have been
                    given.
           (5) The petitioner has complied with all the provisions of law entitling the petitioner to a
           deed.
(Subsequently amended by Pub. L. No. 251-2015, § 22 (eff. July 1, 2015)).

Court of Appeals of Indiana | Opinion 41A01-1505-MI-445| December 22, 2015                               Page 8 of 14
                                                    Discussion

[10]   The issue is whether the trial court’s judgment is clearly erroneous. The trial

       court’s findings of fact control as to the issues they cover and a general

       judgment will control as to the issues upon which there are no findings. M

       Jewell, LLC v. Powell, 954 N.E.2d 1053, 1055 (Ind. Ct. App. 2011). We review

       findings for clear error and we review conclusions of law de novo. Id. A

       judgment is clearly erroneous if no evidence supports the findings, the findings

       do not support the judgment, or the trial court applied the wrong legal standard.

       Id. We consider only the evidence favorable to the judgment and all reasonable

       inferences flowing therefrom, and we will neither reweigh the evidence nor

       assess witness credibility. Trust No. 6011, Lake Cty. Trust Co. v. Heil’s Haven

       Condominiums Homeowners Ass’n, 967 N.E.2d 6, 14 (Ind. Ct. App. 2012), trans.

       denied.


[11]   The Town asserts that the trial court erred in failing to issue a tax deed to it for

       Black’s property because Black did not redeem the property within the statutory

       timeframe. It further argues that the court erred in finding that the unpaid

       penalties were $210.56 and that Black was not entitled to equitable relief

       because he did not file an objection to the Town’s petition for a tax deed.


[12]   Black contends that he properly followed the notice provided to him when he

       inquired at the Auditor’s office about the amount needed to redeem his

       property in a timely manner following the tax sale, that after realizing the error

       the Auditor fashioned a solution that allowed him to quickly pay the remaining

       costs, and that he acted promptly to do so. He also argues that the Town did
       Court of Appeals of Indiana | Opinion 41A01-1505-MI-445| December 22, 2015   Page 9 of 14
       not object to the hearing or his appearance and testimony at the hearing. The

       Auditor and Treasurer maintain that the court properly exercised its equitable

       powers as Black was prejudicially misled by the amount provided to him by the

       Auditor’s office. They argue that the facts in this case are very similar to those

       in M Jewell where the court affirmed the trial court’s determination that the

       party wishing to redeem his property was prejudicially misled by information

       given to him by a county office. They also argue that the court was able to

       enter equitable relief even if Black did not file a written objection, that if Black

       had filed an objection the court would have scheduled a hearing which is

       exactly what occurred, that the Town did not object to the scheduled hearing,

       and that Black properly relied on the Auditor’s calculation of the redemption

       amount.


[13]   Ind. Code § 6-1.1-24-9(d) provided at the relevant time that, if an assignment

       was made under the subsection, the period of redemption was 120 days after the

       date of the assignment. Ind. Code § 6-1.1-25-2 provided in part:


               (a) The total amount of money required for the redemption of
               real property equals:
                        (1) the sum of the amounts prescribed in subsections (b)
                        through (f); or
                        (2) the amount prescribed in subsection (g);
               reduced by any amounts held in the name of the taxpayer or the
               purchaser in the tax sale surplus fund.
                                                     *****
               (f) The total amount required for redemption includes, in
               addition to the amounts required under subsections (b) and (e),

       Court of Appeals of Indiana | Opinion 41A01-1505-MI-445| December 22, 2015   Page 10 of 14
               all taxes, special assessments, interest, penalties, and fees on the
               property that accrued after the sale.

       (Subsequently amended by Pub. L. No. 251-2015, § 20 (eff. July 1, 2015)).


[14]   We first observe that the trial court’s findings that Black went to the Auditor’s

       office to determine the amount due to redeem the property and paid the amount

       he was provided, that he did not have unclean hands, and that he relied upon

       the information provided by the Auditor are supported by the evidence. The

       trial court found that Black went to the Auditor on or about February 24, 2015,

       for the purpose of determining the amount due to redeem the property from tax

       sale, that he was provided with the figure of $26,557.85 by the Auditor, who

       had obtained the figure from SRI, as representing the total amount required for

       redemption, and that he paid that amount. The court also found that Black

       later paid the Auditor the remaining amount requested of $1,575.56. The trial

       court’s findings are supported by the testimony and documents admitted at the

       April 22, 2015 hearing as set forth above and in the record, and the court’s

       findings are not clearly erroneous.


[15]   As to the trial court’s decision to deny the Town’s petition for a tax deed, we

       observe that, as a general proposition, the trial court “has full discretion to

       fashion equitable remedies that are complete and fair to all parties involved”

       and “[e]quity has power, where necessary, to pierce rigid statutory rules to

       prevent injustice.” Tajuddin v. Sandhu Petroleum Corp. No. 3, 921 N.E.2d 891,

       895 (Ind. Ct. App. 2010) (citing Swami, Inc. v. Lee, 841 N.E.2d 1173, 1178 (Ind.

       Ct. App. 2006), trans. denied).

       Court of Appeals of Indiana | Opinion 41A01-1505-MI-445| December 22, 2015   Page 11 of 14
[16]   In M Jewell, Max Powell’s property was sold at a tax sale to M Jewell, LLC

       (Jewell) and he later went to the county treasurer’s office, when he should have

       gone to the auditor’s office, with the intention of redeeming his property. 954

       N.E.2d at 1054. The treasurer’s office assured Powell he needed to pay

       approximately $280 to redeem his property, and Powell wrote a check for that

       amount. Id. Later, after Jewell posted notice that Powell’s property had been

       sold at a tax sale, Powell again went to the treasurer’s office and attempted to

       redeem his property but an employee informed him that he would have to wait

       until after a hearing. Id. The redemption period later expired. Id. Jewell

       petitioned for a tax deed for Powell’s property, Powell filed an objection, and

       after a hearing the trial court denied Jewell’s petition and provided Powell

       thirty days to redeem his property by paying the outstanding balance to the

       auditor’s office. Id. at 1054-1055.


[17]   Jewell appealed and argued the trial court erred in failing to issue a tax deed to

       it because Powell did not redeem his property within the statutory timeframe.

       Id. at 1055. We noted that the trial court found that Powell came to the court of

       equity with clean hands, that he personally appeared at the county treasurer’s

       office with his checkbook in hand to redeem the property, and that he was

       given incorrect information by an employee of the treasurer’s office on two

       occasions. Id. We also noted that the trial court found it would be unjust in

       light of Powell’s good faith efforts to redeem his property to award his house to

       a company that had paid $5,000 toward its purchase. Id. In addressing Jewell’s




       Court of Appeals of Indiana | Opinion 41A01-1505-MI-445| December 22, 2015   Page 12 of 14
       argument that the trial court’s order erroneously gave Powell an extra thirty

       days to redeem his property, we held:


               However, “[e]quity has power, where necessary, to pierce rigid
               statutory rules to prevent injustice.” Swami, 841 N.E.2d at 1178.
               The trial court determined Powell was prejudicially misled by the
               incomplete information given to him by the Grant County
               Treasurer’s Office, and that determination supports piercing the
               statutory rules to prevent injustice. See Tajuddin v. Sandhu
               Petroleum Corp. No. 3, 921 N.E.2d 891, 895 (Ind. Ct. App. 2010)
               (holding trial court properly denied a petition for a tax deed
               when the property owners thought they were paying property
               taxes on an improved parcel of land, but actually were paying
               taxes on a different, unimproved parcel because of an assessment
               irregularity).

       Id. at 1056.


[18]   In this case, the trial court found that Black paid the Auditor $26,557.85 on

       February 24, 2015, that neither SRI nor the Auditor realized that the figure did

       not include penalties accruing after the tax sale, and that Black did not have

       unclean hands as would preclude equitable relief. The court further found that

       Black relied upon the information provided by the Auditor as to the amount

       owed for redemption, that the Auditor represented to all parties that the

       property had been redeemed, and that the loss to Black of property assessed at

       $91,000 for failure to pay penalties of $210.56 is a situation in which equity may

       act to pierce rigid statutory rules to prevent injustice.8 The facts favorable to the



       8
        According to the court, the unpaid penalty was $210.56, whereas the Commissioners informed Black that
       he needed to pay an additional $1,575.56 to redeem the property. Whichever amount should have been

       Court of Appeals of Indiana | Opinion 41A01-1505-MI-445| December 22, 2015                 Page 13 of 14
       judgment and the reasonable inferences to be drawn therefrom support the trial

       court’s judgment. We also note that neither the Commission nor the Town

       paid any amount at the tax sale toward the purchase of Black’s property.9

       Similar to in M Jewell, there is ample evidence in the record of Black’s

       affirmative and good faith efforts to protect his ownership in his property prior

       to the expiration of the redemption period. Additionally, we agree with the

       court’s conclusion that, while Ind. Code § 6-1.1-25-4.6 provides that a party

       may obtain a hearing by filing an objection, the court here did hold a hearing

       and was not prevented from exercising its equitable power where an objection

       was not filed.


[19]   Based upon the record, we conclude the trial court did not err in entering its

       April 28, 2015 Order Denying Issuance of Tax Deed and granting Black

       equitable relief.


                                                         Conclusion

[20]   For the foregoing reasons, we affirm the judgment of the trial court.


[21]   Affirmed.


       Kirsch, J., and Mathias, J., concur.




       included in the figure provided by the Auditor on February 24, 2015, Black paid the higher amount requested
       in the Commissioners’ March 10, 2015 letter and the amount was not included in the redemption figure
       provided to Black by the Auditor and SRI on February 24, 2015.
       9
           In M Jewell, the county sold Powell’s property to Jewell for $5,000.

       Court of Appeals of Indiana | Opinion 41A01-1505-MI-445| December 22, 2015                    Page 14 of 14
