Tax Sale of Family-Owned Property is Set Aside by Appellate Court in Pennsylvania
When our clients, the owners/operators of a family-run auto parts and repair shop in South Philadelphia, were notified by the city government that they were delinquent on the real estate taxes they were understandably confused and concerned. Due to the delinquency on account of the property, a sheriff’s sale was scheduled for the property unless the tax arrearage was appropriately dealt with.
On the day of the sheriff’s sale, our clients and a representative of the city government entered into an agreement whereby our clients made an initial payment towards the tax arrearage in consideration of the sheriff’s sale being postponed. Per this agreement, the sheriff’s sale for the property was not subject to the bidding process at the sheriff’s sale scheduled for that day and our clients believed things were close to rectification.
Needless to say, our clients were quite surprised to learn that, unbeknownst to them, the property was sold at the sheriff’s sale scheduled for the following month. What our clients did not know at the time is that the day prior to the sheriff’s sale a letter had been faxed, after business hours, from the city government to our clients’ attorney at the time, who had already left his office for the night, informing him that the sheriff’s sale would take place the following morning and that the property would be for sale. Our client’s attorney at the time did not arrive back to his office until the following day after the property was already sold at the sheriff’s sale for a significant sum. Looking for answers and attorneys that could help with this extremely fraught situation, our clients retained our services to attempt to set aside the sheriff’s sale of the property.
Without haste, we immediately filed a petition to set aside the sheriff’s sale with the Philadelphia County Court of Common Pleas. At the subsequent hearing, we presented the testimony of our clients and their former attorney in support of the arguments we made in the petition to set aside the sheriff’s sale. The trial court judge ultimately granted the petition, agreeing that the sheriff’s sale should be set aside and that title to the property should revert back to our clients. In its ruling, the trial court judge relied upon an opinion issued by an appellate court in Pennsylvania in which we represented another client in setting aside a sheriff’s sale initiated by the city government in Philadelphia.
The third-party purchasers of our client’s property then filed an appeal of the trial court’s ruling to the Commonwealth Court of Pennsylvania. Complicating matters, the third-party purchasers were represented by a large law firm in Philadelphia and one of the attorneys who wrote the brief in support of their appeal was the former president judge of the Commonwealth of Pennsylvania.
The Commonwealth Court elected to have the appeal heard en banc which is a session in which a case is heard before all the judges of a court (before the entire bench) rather than by a panel of judges selected from them. En banc review is often used for unusually complex cases or cases considered to be of greater importance. After appearing before all of the judges of the Commonwealth Court during oral argument, the Commonwealth Court affirmed the trial court’s ruling which set aside the sheriff’s sale of the property and ordered that a deed transferring title to the property back to our clients.
Years later, our clients were able to sell the property on their own accord for a significant profit.
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