HB190 Alabama 2023 Session

Summary

Primary Sponsor

Tim Wadsworth Representative

Republican

Session

Regular Session 2023

Title

Relating to rights and remedies of a purchaser of real estate sold at a tax sale; to amend Section 40-10-82 of the Code of Alabama 1975, to provide limitations of actions that may be brought in circuit court to resolve certain issues related to real estate sold for the payment of taxes and to limit the period of time for a land owner to file a motion to redeem real estate sold for the payment of taxes, to challenge the validity of a tax sale, or to pay a court ordered judgment and costs.

Description

Existing law for county and ad valorem tax sales conducted under Alabama Code Sections 40-10-1 through 40-10-143, recognizes two distinct redemption periods.

The first period, commonly referred to as the "administrative" or "statutory" redemption period, begins on the date a property is sold by the county, and continues for at least three years.

This bill does not modify or affect this initial redemption period. This bill relates to the second redemption period, referred to as the "judicial" redemption period, which begins at the conclusion of the administrative redemption period.

This bill provides that, following the statutory redemption period, anyone with an interest in the property (i.e. purchasers, owners, mortgagees, and lienholders) may bring suit to determine and establish all rights and interests in the property sold so that clear title to the property can be obtained. This bill would clarify that a tax sale purchaser may, following the administrative redemption period, bring suit to establish the purchaser's title to the property without having first maintained possession of the property.

Anyone having a right to redeem or challenge the tax sale may file suit, or counterclaim, to resolve such HB190 INTRODUCED claims.

This bill would establish, with certain exceptions, an absolute six-year deadline for an owner, mortgagee, or lienholder to redeem.

This bill would eliminate the time limit identified in Rioprop Holdings, LLC v. Compass Bank, 256 So.3d 674 (Ala. Civ. App. 2018) for a tax purchaser to obtain possession or file suit for possession of the property to avoid forfeiture of the purchaser's interest in the property.

This bill would also affirm the existing right of holders of mortgages and liens recorded at the time of the tax sale to redeem within one year of written notice of the tax sale given by the purchaser; the right of an owner who remains in actual possession of the property to redeem notwithstanding the six year deadline; the right of minors and incompetent persons to redeem; and that the six-year deadline to redeem does not apply to the state or to owners of property where taxes had been paid at the time of sale or were not subject to taxation.

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Subjects

Real estate tax sales, redemption periods, deadlines, rights of parties to bring certain actions in circuit court .