Wood v. La Rose, 39 N.Y.2d 266 (1976)

A county treasurer is not obligated to subdivide delinquent tax properties for sale, but may allow bidding on less than the full interest; however, a tax deed may be invalidated if the property owner was incorrectly informed about redemption procedures by the county treasurer.

Summary

This case concerns the validity of a tax deed. The Court of Appeals addressed whether the county treasurer had a duty to subdivide the property for sale and whether the plaintiff was given incorrect information regarding the proper procedure for redemption. The Court held that the treasurer did not abuse his discretion by permitting bidding on the entire parcel. However, the Court also found evidence suggesting the plaintiff was misinformed by the treasurer about redemption procedures, specifically being told to contact the purchaser instead of the treasurer to redeem the property. The Court reversed the Appellate Division order and remitted the case to the Supreme Court for a new trial to determine if the defendants should be estopped from asserting the validity of the tax deed.

Facts

The plaintiff, Wood, owned property subject to delinquent taxes. The County Treasurer conducted a tax sale where La Rose purchased the property. Wood attempted to pay his delinquent taxes prior to the issuance of the tax deed. Wood claimed the County Treasurer incorrectly informed him that he needed to contact La Rose, the purchaser, to redeem the property.

Procedural History

The Supreme Court declared the tax deed valid. The Appellate Division affirmed. The plaintiff appealed to the Court of Appeals.

Issue(s)

1. Whether the county treasurer is required to subdivide delinquent tax properties and sell only so much as is necessary to cover the delinquent taxes?

2. Whether the defendants should be estopped from asserting the validity of the tax deed because the county treasurer gave the plaintiff incorrect information about how to redeem the property?

Holding

1. No, because the Real Property Tax Law § 1006(1) authorizes, but does not mandate, bidding for less than a full interest in the entire parcel.

2. Undetermined; the case is remitted to the Supreme Court for a new trial on this issue because there is evidence that the County Treasurer gave the plaintiff incorrect information about redemption procedures.

Court’s Reasoning

Regarding the first issue, the Court interpreted Real Property Tax Law § 1006(1), which states that the treasurer shall continue the sale until so much of each parcel shall be sold as will be sufficient to pay the amount due, as permissive rather than mandatory. The court stated that this provision “does not put the county treasurer to the costly burden of subdividing delinquent tax properties, but merely authorizes, without mandating, bidding for less than a full interest in the entire parcel.” The Court cited prior case law, including Matter of Countrywide Realty Co. v. Bruen, to support this interpretation.

Regarding the second issue, the Court found evidence that the plaintiff attempted to pay his taxes but was allegedly misled by the treasurer. The court noted that “payment for the purpose of the redemption of property sold for delinquent taxes should be made to the county treasurer. (Real Property Tax Law, § 1010, subd 1.)” Because there was a factual question of whether the Treasurer’s office provided incorrect information, the Court could not determine if the defendants should be estopped from asserting the validity of the tax deed. The Court remitted the case to the Supreme Court for a new trial on the estoppel issue.