TN Underwriting References

Tax Deeds

Tennessee

• Judicial Sale process § 67-5-2501
  • Judicial Notice Requirements
  • Notice by publication is common – so questions about efforts made by assessor & counsel to locate.
  • In fact, many title companies will not write title insurance policies on tax sale property for 10-20 years after sale.
  • Case law: Failure of notice, void judgement. No Statute of limitati

Where court in delinquent tax suit has jurisdiction over subject matter by actual or constructive notice to taxpayer, all questions must be settled in that cause, but notice is essential, and in absence of notice decree is void, and three-year statute of limitations does not apply to a void decree.  Code 1932 §§ 1591, 1609, 1610.  West v. Jackson, 1944, 186 S.W.2d 915, 28 Tenn.App. 102.Taxation   2930Taxation   2936Taxation   3162(2)

• Notice of sale published and to Defs per rules of civ pro.
• Order confirming sale transfers right of possession.
• Decree of confirmation required.
• 1 year right of redemption after sale and confirmation.
• Screwy statute of limitations language. In 67-5-2504

(d)(1) A suit to invalidate any tax title to land shall be commenced within one (1) year from the date the cause of action accrued, which is the date of the entry of the order confirming the tax sale.
(2) The statute of limitations to invalidate the sale of any tax title shall be one (1) year as set forth in subdivision (d)(1), except that it may be extended to one (1) year after the plaintiff discovered or with the exercise of reasonable due diligence should have discovered the existence of such cause of action.
(3) In no event shall any action to invalidate any tax sale title be brought more than three (3) years after the entry of the order confirming the tax sale.

• Odd interpretation – this statute prevents filing Q.T. action for 3 years. And impliedly grants the prior owner a 3 year challenge period. Inman v. Raymer Court of Appeals of Tennessee.May 4, 2004 Not Reported in S.W.3d2004 WL 948386

• So can’t insure for 3 full years after. ??

• • A tax deed is void, where the law authorizing the tax sale, pursuant to which the deed was made, was not strictly followed.  Sheafer v. Mitchell, 1902, 71 S.W. 86, 109 Tenn. 181.Taxation 3072(1)
  • Tax deeds are void where several tracts of land are sold as a whole and not separately;  where the law authorizing such sales is not strictly followed, the proceeding being purely statutory, and where the record offered to support the deed varies materially from its recitals.  Sheafer v. Mitchell, 1902, 71 S.W. 86, 109 Tenn. 181.Taxation 3070Taxation 3072(5)
  • A tax deed is insufficient to support ejectment where it does not recite that the land was “duly reported” as required by the statute under which the tax sale was made.  Marley v. Foster, 1899, 52 S.W. 166, 102 Tenn. 241, 18 Pickle 241.Ejectment 9(3)Taxation 3104
  • Tax title can be invalidated due to procedural irregularities in connection with tax sale.  West's Tenn.Code, § 67-5-2504.  Morrow v. Bobbitt, 1996, 943 S.W.2d 384, rehearing denied, appeal denied.Taxation 3072(1)

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