Moore v. Brighton, No. 78-3-14 Casc (Teachout, J., June 17, 2014)

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                                                      STATE OF VERMONT

SUPERIOR COURT                                                                                         CIVIL DIVISION
Caledonia Unit                                                                                         Docket No. 78-3-14 Casc


DONALD MOORE
    Plaintiff

v.

TOWN OF BRIGHTON and
LUCILLE STEVENS
     Defendants


                                                                 DECISION

        This matter was filed in the Small Claims Court by Plaintiff Donald Moore against
Defendants Town of Brighton and Tax Collector Lucille Stevens. The events giving rise to
Plaintiff’s claim commenced with the tax sale of a parcel of real property by the Town of
Brighton to Plaintiff, pursuant to 32 V.S.A. §§ 5251, et seq., for the purposes of satisfying the
property owner’s delinquent taxes. At the time of the tax sale, on March 14, 2013, the owner
owed the town $11,865.56 in taxes. Plaintiff purchased the property at the tax sale for $33,000.

        When an owner’s property is sold at a tax sale, the statute provides that the owner may
exercise a right of redemption within one year of the day of sale. See 32 V.S.A. § 5260. To
redeem, the owner must pay to the town “the sum for which the land was sold with interest
thereon calculated at a rate of one percent per month or fraction thereof from the day of sale to
the day of payment.” Id. If the owner timely exercises his right of redemption, the town shall
not issue a deed of the land to the purchaser but remits to the purchaser any money paid by the
owner. See id.

        There is no dispute that the property owner attempted to exercise his right of redemption
and that in January 2014, Plaintiff received two checks from the Town totaling $34,314.10. In
this case, Plaintiff claims that he did not receive the proper amount and seeks judgment for a
shortfall. Specifically, Plaintiff cites to 32 V.S.A. § 5260 and claims he was not paid the
statutorily prescribed interest of one percent per month on the sum for which the land was sold,
and alleges that if he was properly paid, he should have at least received an additional $2,315.60.

        A hearing was held on June 11, 2014. Plaintiff represented himself. Defendants were
both represented by Attorney William Boyd Davies. Defendants admitted that Plaintiff was not
paid interest of 1% per month on the purchase price of the property but argued that for
redemption the owner was only required to pay interest on the property owner’s tax obligations
to the Town.
                                        Conclusions of Law

        “When the language of a statute is clear and unambiguous, [the court] must apply the
plain meaning of the language used.” Reed v. Glynn, 168 Vt. 504, 506 (1998). Here, the
language of 32 V.S.A. § 5260 is clear and unambiguous, and its plain meaning requires the
property owner to pay the purchase price with interest thereon at a rate of one percent per month.
The wording of the statute leaves no room for an interpretation that the property owner must only
pay interest on taxes owed. Thus, to redeem the property, the owner was obliged to pay $33,000
plus 1 % monthly interest on $33,000, and not, as Defendants claim, $33,000 plus 1% monthly
interest on $11,865.56. This makes sense in that a delinquent property owner is required to make
the purchaser, whose funds preserved the opportunity for redemption for the benefit of the
owner, whole.

        In their answer to the complaint, Defendants argue that Plaintiff “fails to consider that the
statute must be considered in the context of various court cases dealing with tax sales.”
However, Defendants do not cite to any cases supporting their position and, indeed, applicable
case law actually supports the plain meaning of the statute set forth above. See Hogaboom v.
Jenkins, 2014 VT 11, ¶ 25 (“The tax sale itself increases the base against which interest is
assessed.”); Wilson v. Alexander, 139 Vt. 279, 280 (1981) (at the end of the one year redemption
period, property owners “redeemed the property by paying the amount the plaintiff had paid for
the property at the tax sale plus 12% interest, as required by the statute.”); see also Ran-Mar, Inc.
v. Town of Berlin, 2006 VT 117, ¶ 14, 181 Vt. 26 (“it is undisputed that if the taxpayer wants to
redeem, it will have to pay the purchaser the purchase price plus statutory interest to make the
purchaser whole.”) (Dooley, J., concurring). Furthermore, the statute provides “no discretion to
[Defendants] as to whether to accept less than full payment.” Westine v. Whitcomb, Clark &
Moeser, 150 Vt. 9, 12-13 (1988). In addition, the right to collect an outstanding balance of the
requisite interest is not extinguished by an acceptance of partial payment of that interest. Id.

        Accordingly, had Defendants received a redemption amount from the property owner that
included the appropriate amount of interest on the property’s purchase price, Defendants would
be required under 32 V.S.A. § 5260 to remit that payment to Plaintiff. The evidence presented at
the hearing demonstrates that Defendants have yet to receive a full redemption payment. In
cases such as this, however, neither the Town nor the Tax Collector have a direct financial
obligation to the purchaser. Rather, they are merely a “clearing house” for money the owner
owes to the purchaser. See Westine, 150 Vt. at 12-13. The owner is not a named defendant in
this action. In this case, Plaintiff seeks the shortfall amount not from the owner, but from the
Town and Tax Collector, who are only the “clearing house” with no independent obligation to
Plaintiff. Plaintiff is not entitled to collect any shortfall amount from these Defendants.

         This is not to say that Plaintiff is without a remedy. Plaintiff may seek a money judgment
against the property owner in a separate case. Alternatively, Plaintiff may seek non-monetary
relief from Defendants, but not in Small Claims court. See 32 V.S.A. § 5261; see also Westine,
150 Vt. at 12-13 (“The Town did … owe a duty to [the purchaser] to issue him a tax deed upon
[the owner’s] failure to properly redeem the property pursuant to § 5260.”). Small Claims Court
is only for money judgments (Rule 2 of the Vermont Rules of Small Claims Procedure), and
Plaintiff has no claim for a money judgment from Defendants.



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        Judgment is therefore entered for Defendants on the grounds that they do not have an
obligation to Plaintiff for his claim. Plaintiff is not precluded from filing a civil action against
Defendants for a tax deed, or filing a separate claim in Small Claims Court against the property
owner for the shortfall in interest, but is not entitled to a judgment against Defendants in this
case.



                                          JUDGMENT

       For the foregoing reasons, judgment is entered for the Defendants. The complaint is
dismissed without prejudice to file other claims as described above, and without costs .

       Dated at St. Johnsbury this 17th day of June, 2014.


                                                                     __________________
                                                                     Mary Miles Teachout
                                                                     Superior Court Judge




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