Lance R. Pomerantz
Attorney at Law

Land     Title     Law

“Constructive Notice”  The  Newsletter

Excerpted from the March 6, 2014 mailing of "Constructive Notice":

Church Building Lost to Tax Foreclosure

A religious corporation has lost its church building despite being exempt from local real estate taxation. Matter of City of Hudson, 2014 NY Slip Op 01361, (3rd Dept., February 27, 2014).

The building had been transferred from the corporation to its minister in 1985, without petitioning for, or obtaining the leave of court required by RCL §12 (1). The minister and his wife obtained mortgages on the property and paid the taxes until 2008. After the tax lien foreclosure was commenced, the invalid sale was discovered in 2011. The Church sued to overturn the tax sale, arguing that, as the actual owner, it was not given the required statutory notice. The Third Department rejected this claim.

The Court found that the City took all the steps required of it by statute, and was not required to make a more exhaustive search. “A taxing authority's enforcing officer is not required to be a lawyer, title searcher or have special expertise in ferreting out errors in recorded deeds, nor have courts imposed unreasonable obligations on taxing authorities to perform burdensome research to discover potential interested parties.”


The Court noted that the record “does not disclose whether [the minister’s] mortgages have been paid or remain liens on the property.” Nor is there any indication if those lenders received notice of the tax lien foreclosure. Query whether they would be entitled to notice, given the invalidity of the mortgagor’s title?