Government Must Take Additional Reasonable Steps to Notify of Tax Sale

Jones v. Flowers
Jones v. Flowers
No. 04-1477
Wednesday, April 26, 2006

“[W]hen mailed notice of a tax sale is returned unclaimed, the [government] must take additional reasonable steps to attempt to provide notice to the property owner before selling his property, if it is practicable to do so.” This U.S. Supreme Court opinion involves the taking of property for unpaid taxes in Arkansas, but its analysis of due process rights under the U.S. Constitution applies to the actions of local government in every state, including New Hampshire.

The facts in this case are familiar. A residential property owner allowed his taxes to go unpaid for several years. The government (in this case, an Arkansas state commission) certified the property as “delinquent” and attempted to notify the property owner. Under Arkansas law, a certified letter, return receipt requested, was the required method of notice. Nobody was at home to sign for the letter, and nobody appeared at the post office to retrieve the letter within the next 15 days. The post office returned the unopened packet to the commissioner marked “unclaimed.” Two years later, the commissioner prepared to sell the property for the unpaid taxes. As required by statute, notice of the sale was published in the newspaper, and once a purchase offer was received the commissioner once again attempted to notify the owner by certified mail of the delinquency and his opportunity to redeem the property. The second letter was also returned as unclaimed. After the sale was completed, the new owner had a notice to vacate the premises delivered to the property; this notice was served on the former owner’s daughter, who contacted the former owner and notified him of the tax sale.

(As a comparison, the notice requirements before a tax deed and subsequent sale under New Hampshire law are similar to those under the Arkansas tax sale law, although there are some procedural differences. Notification of the owner is required by certified mail both before a tax deed is executed and before the municipality subsequently sells the property. RSA 80:77 and 80:89.)

Before any state, municipality, or other governmental entity may take property and sell it for unpaid taxes, the Due Process Clause of the Fourteenth Amendment to the U.S. Constitution requires the government to provide the owner “notice and opportunity for hearing appropriate to the nature of the case.” In this case, the Court considered whether the Due Process Clause requires the government to take additional steps to notify a property owner when notice of a tax sale is returned undelivered. The Court found that when such additional steps can reasonably be taken, the answer is “yes.”

Due process does not require that the property owner receive actual notice before the government may take his property. Rather, it requires the government to provide “notice reasonably calculated, under all the circumstances, to apprise interested parties of the pendency of the action and afford them an opportunity to present their objections.” Notice is constitutionally sufficient if it was reasonably calculated to reach the intended recipient when it was sent. The exact kind of notice required will vary with the circumstances and conditions of each case. In this case, it was clear that the government knew before the tax sale that notice to the owner had failed. The Court found that it would have been reasonable for the government, with that knowledge, to take some further steps to try to notify the owner.

Of course, if there were no reasonable additional steps the government could have taken upon the return of the unclaimed letter, it cannot be faulted for doing nothing. However, the Court found that there were several possible steps the government could have (and thus should have) taken. One would have been to resend the notice by regular mail so that a signature was not required. There are many reasons that people do not claim a certified letter (no one is there to sign for it, recipient does not want to sign for it, recipient no longer lives there, etc.) and regular mail might avoid those problems. The Court also suggested that the letter be addressed to “occupant” to increase the chances that someone would open it and read it. Finally, the Court suggested posting a notice on the front door. In contrast, the Court found that the government was not required to go so far as to search for a new address in the telephone book or other government records. However, it is important to note that the determination of what additional steps are “reasonable” in response to new information (such as an unclaimed letter) will depend upon what that new information reveals, and upon all the circumstances of that case. Therefore, depending upon the facts, a government may be required to do more or less than the Court required in this particular case.