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Missouri Supreme Court Upholds tax sale by City of St Louis

Not providing a current mailing address to the Assessors office can cost you your home

Mohammad Bhatti learned this the hard way.  Bhatti, a resident of the City of St. Louis, purchased a property at 3243 Pennsylvania in 2005 to rehab and resell.  From court records I reviewed it appears that the city had the property address as Mr. Bhatti’s mailing address rather than where he was actually living.  This is something that would ultimately cost Mr. Bhatti to lose his property at 3243 Pennsylvania, which he claims to be worth $169,900, over $1,452.06 in delinquent property taxes

According to the court records, Mr. Bhatti did not receive the property tax bills from the city of St. Louis on his property at 3243 Pennsylvania because they were being mailed to the vacant dwelling that was undergoing rehab.  Apparently it is the practice of the post office not to leave mail at a vacant property but instead to return it to the sender as “undeliverable”.  For the same reason, an incorrect mailing address, Mr. Bhatti alleges his property “was sold at a tax delinquency sale, later confirmed by the Circuit Court of the City of St. Louis, without ever receiving notice of the tax delinquency, the tax sale, or the subsequent confirmation action initiated by the purchaser, Lewis Mitchell Company.

Mr. Bhatti claims that the city of St. Louis could have easily assured he received the notice of the tax sale as he (Bhatti) is a city resident, pays city earnings tax, had applied for numerous building permits on the property in question each time listing his current mailing address and that he had “for sale” signs on the property that clearly showed his address.

After losing his property, Mr. Bhatti appealed the courts confirmation of the sale by the city to Lewis Mitchell Company for $7,600.00 (all tax sales of property must be “confirmed” by a court afterward) challenging the constitutional adequacy of the notice of the foreclosure sale.  The case went to the Missouri Supreme Court who handed down its decision yesterday which was a 4-3 decision in favor of the City of St. Louis and the purchaser of the property and against Mr. Bhatti.  In the courts decision, written by Judge Mary R. Russell, the trial court’s judgment confirming the tax sale was affirmed.  In the decision it was stated that “United States Supreme Court precedent requires that notice be reasonably calculated to inform such an owner that an action is pending and give the owner an opportunity to object; it does not require the government to take additional steps to provide notice when the government does not know or have reason to know that the notice provided is insufficient. Here, the sheriff sent notice to the address the man listed with city officials for real estate taxes, and although the man testified he did not live at the property, he never changed his address with city officials. As such, there was no reason for the sheriff to take additional steps to provide a different form of notice.”

In a dissenting opinion, Judge Michael A. Wolff said he would have reversed the judgment and sent the case back to the court for further proceedings to allow the man (Bhatti) an opportunity to be restored to ownership of his property upon payment of his taxes and other authorized expenses properly chargeable to him. He would find that the notice used by the city here did not meet the United States Supreme Court’s precedential requirements that notice be the “best practicable,” especially given that the postal service does not deliver to vacant properties such as the one here and that there was no one except the man to represent his interests as the property owner. He also would require the city, as the only party with knowledge of whether notices sent by first-class mail were “returned to sender,” to keep records of such returns to satisfy additional United States Supreme Court precedent.

On a personal note, even though I have purchased property at tax sales, I have thought the process was flawed at best, particularly in the City of St. Louis, and is structured in such a manner that it is ripe for abuse as well as for situations like Mr. Bhatti’s.  I’m not saying that there is anything wrong about the City selling off a property that is five years delinquent on property taxes, I just feel if you are going to sell off someones property(especially for “pennies on the dollar of the value”) that there should be every effort possible made to assure the property owner is aware of the pending action.

Oh yeah, if you own property, you may want to make sure the Assessor’s office has your current mailing address…

Click here for the address change form for the City of St. Louis

Click here for the address change form for St. Louis County

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