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Department of Finance of Sussex County v. Clarke

Superior Court of Delaware

September 30, 2019

KEITH D. CLARKE, Defendant. 1995 PROPERTY MANAGEMENT, INC., Plaintiff,
KEITH D. CLARKE, Defendant.

          Submitted: July 11, 2019

         Upon Objections to Commissioner's Report (Pursuant to Superior Court Civil Rule 132)

         Motion to Set Aside Sheriffs Sale GRANTED

         Motion for Writ of Ejectment DENIED

          Dean A. Campbell, Esquire, Georgetown Professional Park, Attorney for Defendant

          Ryan T. Adams, Esquire, Moore & Rutt, P.A., Attorney for Plaintiff Department of Finance of Sussex County

          Paul G. Enterline, Attorney for Plaintiff 1995 Property Management, Inc.



         KARSNITZ, J.


         The two Motions pending before the Court relate to Monition proceedings resulting in a Sheriffs sale (the "Sheriffs Sale") by the Sheriff of Sussex County, Delaware (the "County") of the premises located at Hickman Village, Lot .11, Laurel, Sussex County, Delaware 19973, Tax Map Parcel 3-32-1.00-126.00 (the "Property"). The Property, owned by Keith D. Clarke ("Owner"), was sold at the Sheriffs Sale to 1995 Property Management, Inc. ("Purchaser") on June 19, 2018. This Court entered an Order confirming the sale on January 17, 2019. On January 30, 2019, Owner filed a Motion to Set Aside Sheriffs Sale (the "Motion to Set Aside"). On March 4, 2019, Purchaser filed a Motion for a Rule to Show Cause why Purchaser should not be entitled to an immediate Writ of Ejectment to place Purchaser in exclusive possession of the Property (the "Motion to Eject"). The Commissioner held a hearing on these two Motions on April 15, 2019. The parties submitted oral and written arguments. On April 22, 2019, the Commissioner issued Orders denying the Motion to Set Aside, granting the Motion to Eject, and ordering Owner to pay Purchaser $3, 405.00 in attorneys' fees and court costs incurred in filing the Motion to Eject. On May 6, 2019, Owner timely filed Objections to Commissioner's Report. Both the Department and Purchaser timely responded to Owner's Objections. On July 11, 2019, I heard oral argument on both Motions from counsel for both parties.

         My ruling on the Motion to Eject follows a fortiori from my ruling on the Motion to Set Aside.


         Owner and his ex-wife, Brinda Clarke, jointly owned the Property from September 9, 1998, until November 23, 2015. On November 23, 2015, Owner and his ex-wife conveyed the Property to Owner alone. The Property has three addresses: Hickman Village, Lot 11, Laurel, Delaware 19956 (the address on the original Deed to Owner and his ex-wife); 11 Commercial Lane, Laurel, Delaware 19956; and, 11 Hickman Drive, Laurel, Delaware 19956 (the address on the second Deed from Owner and his ex-wife to Owner). However, Owner never used any of these three addresses for receiving notices of property taxes from the County or for any other reason. Rather, the "Return To" section of the second Deed provided the following address: 9005 Executive Club Drive, Delmar, Maryland 21875 (the "Executive Club Drive Address").

         From 2007-2017, no property taxes were paid on the Property. As of December 7, 2017, Owner owed $32, 013.66 in property taxes on the Property. The County Department of Finance (the "Department") filed a Praecipe for Monition, Complaint for Entry of Judgment on Monition, and Writ of Monition in the office of the Prothonotary on January 11, 2018. The Prothonotary recorded the Praecipe in the special judgment docket and issued a Monition to the Sheriff. The Monition was posted by the Sheriff on the Property and the Sheriff made return of his proceedings under the Monition to the Prothonotary within ten (10) days after posting the Monition. After the expiration of twenty (20) days following the return of the Sheriff upon the Monition, the Department filed a Praecipe for Writ of Venditioni Exponas in the office of the Prothonotary. The Prothonotary issued a Writ of Venditioni Exponas directing the Sheriff to sell the Property. On June 19, 2018, the Sheriff sold the Property to Purchaser for $60, 000.00. The Department filed an Affidavit of Non-Redemption stating that Owner had not exercised his statutory right of redemption, and Purchaser filed a Petition for Deed of Conveyance. On January 17, 2019, this Court entered an Order confirming the sale because Owner had not redeemed, and directed the Sheriff to execute and deliver a Deed to Purchaser. The Sheriff did so, and the Deed was recorded with the County Recorder of Deeds.

         A detailed chronology of all pertinent facts relating to these matters is attached hereto as Appendix A.


         Although Owner did not seek to set aside this Court's Order confirming the Sheriffs Sale under Superior Court Civil Rule 60(b), the Commissioner considered the Motion to Set Aside to have been filed pursuant to that Rule, specifically Superior Court Civil Rule 60(b)(1) ("excusable neglect"). Because I do not address the issue of excusable neglect (see below), I will consider the Motion to Set Aside to have been filed pursuant to Superior Court Civil Rules 60(b)(4) and (6).[1]

         Owner's Objections to Commissioner's Report were made pursuant to Superior Court Civil Rule 132(a)(3)(ii) and 132(a)(4)(ii). Pursuant to Superior Court Civil Rule 132, Commissioners are empowered to conduct non case-dispositive hearings and to hear and determine any non case-dispositive matter pending before the Court.[2]Commissioners are also empowered to conduct case-dispositive hearings and to submit to a judge of this Court proposed findings of fact and recommendations for the disposition, by a judge, of any such case-dispositive manner."[3] The standard of review of a Commissioner's decision depends on whether the matter heard was case-dispositive or non case-dispositive.[4] If the matter is non case-dispositive, Rule 132 provides that I may reconsider any hearing or pretrial matter of the Commissioner "only where the movant demonstrates that the Commissioner's order is based upon findings of fact that are clearly erroneous, or is contrary to law, or is an abuse of discretion."[5] If the matter is case dispositive, Rule 132 requires me to "make a de novo determination of those portions of the report or specified proposed findings of fact or recommendations to which objection is made."[6] In making such a determination, I may accept, reject, or modify, in whole or in part, the findings or recommendations made by the Commissioner, and I may receive further evidence or recommit the matter to the Commissioner with instructions.[7]

         In New Castle County v. Kostyshyn, 2014 WL 1347745 (Del. Super. Apr. 4, 2014), defendants engaged in an acrimonious and protracted dispute with the City of Wilmington (the "City") over unpaid property taxes. The City filed Writs of Monition against the defendants' properties with the Court and subsequently the City issued a Writ of Venditioni Exponas Monition ordering the Sheriff to put the properties up for public sale. In response, defendants filed a motion to stay the Sheriffs sale. The matter was referred to a Superior Court Commissioner who denied the motion, and the Commissioner also denied defendants' motion for reargument. Defendants then filed a motion for reconsideration of the Commissioner's decision with the Superior Court.

         Although Kostyshyn involved a motion to stay a pending Sheriffs sale, and this case involves a motion to set aside a completed Sheriffs sale, the standard of review used by the Court is the same. The Court held:

"In this instance, the Commissioner's denial of Defendants' Motion to Stay the Sheriffs Sale and requests to dismiss the monition actions affects a substantial legal right and under these circumstances should be considered case-dispositive. In turn, the Court must and has reviewed the Commissioner's disposition thereof de novo"[8]

         In this case, the Commissioner's Orders to set aside the Sherriff's Sale and grant a Writ of Ejectment affect a substantial legal right of Owner. As such, they are case-dispositive, and I have made a de novo determination of those portions of the Commissioner's Orders to which Owner has objected. After de novo review, I agree in part and disagree in part with the Commissioner's findings, as discussed below. I grant the Motion to Set Aside the Sheriffs Sale. It follows, therefore, that I deny the Motion to Eject.

         IV. ANALYSTS

         A. Failure to Meet Notice Requirements

         With respect to notice before a Sheriffs sale, Superior Court Civil Procedure Rule 69(g) provides in pertinent part:

"No sheriffs sale of real estate shall be held unless at least seven (7) days before the sale the plaintiff or his counsel of record shall send by certified mail, return receipt requested to ... (3) to record owners acquiring title to such real estate (terre tenants) at least thirty (30) days prior to the sheriffs sale ... a notice consisting of a Notice to Lien Holders, Tenants, Record Owners and Persons Having an Interest of Sheriffs Sale of Real Estate ... and a copy of the advertisement of the sale posted ... The notice shall be addressed to terre tenants at the last known available or reasonably ascertainable address of such terre tenants. No sheriffs sale shall be held in such action unless the plaintiff or his counsel of record or a representative of the plaintiff or his counsel of record shall file with the Court and deliver to the sheriff conducting the sale a copy of proof of the mailing and posting of such notice which shall consist of the usual receipt given by the post office of mailing to the person mailing the certified article and a copy of the Notice to Lien Holders, Tenants, Record Owners and Persons Having an Interest mailed with such notice together with an affidavit made by plaintiff or his counsel of record specifying:
(i) The dates upon which the notice was mailed by certified mail;
(ii) That the copy of the Notice to ... Record Owners ... attached to the affidavit is a true and correct copy of the notice mailed by certified mail;
(iii) That the notice was posted on the common entrance door or in a common area of any building or buildings on the real estate which is the subject of the action and the date of such posting;
(iv) That the receipt obtained at the time of mailing by the person mailing the envelope containing the notice is the receipt filed with the affidavit; and
(v) If the identity or address of any ... terre tenants ... cannot be reasonably ascertained, a description of the reasonably diligent efforts that were made to ascertain such identity or address." [Emphasis supplied][9]

         In this case, the County never sent the required Rule 69(g) Notice to Owner before the Sheriffs Sale at the last known available or reasonably ascertainable address of Owner. I agree with the Commissioner's findings that the efforts in sending Owner the Rule 69(g) Notice of the Sheriffs Sale were not reasonable. Owner provided the Executive Club Drive Address to the County as his tax billing address. It is clear the County received notification of the Executive Club Drive Address as Owner's tax billing address; the May 2017 Notice of Sheriffs Sale was sent to Owner at the Executive Club Drive Address after the Property was conveyed to him alone.[10] Owner did not notify the County of any other address. The County inexplicably switched between sending notices to the Executive Club Drive Address, then to postal address 30948 Old Landing Road, then back to the Executive Club Drive Address, and then once again back to the Old Landing Road address. Furthermore, the mailings sent to each of the addresses the County used for notice of the Monition proceedings were returned as incorrect.[11] At the time of the filing, the County had the Executive Club Drive Address, as was evidenced by the federal tax lien that was included in the Rule 69(g) Affidavit. While the County understandably attempted to locate Owner at other addresses when he failed to respond to any of its notices, the Notice of Sheriffs Sale also should have been sent to the Executive Club Drive Address. By failing to send the Notice to the Executive Club Drive Address, the County did not provide notice reasonably likely to reach Owner. Thus, Owner had neither actual nor constructive notice of the Sheriffs Sale before it occurred.

         With respect to notice after a Sheriffs sale, 9 Del. C. §8729 provides in pertinent part:

"The owner of any such real estate sold under this subchapter ... may redeem the same at any time within 60 days from the day the sale is approved by the Court ..." [Emphasis supplied]

         It does not appear that Owner received notice at any address of either the County's Affidavit of Redemption or Purchaser's Motion to approve the Sheriffs Sale and authorize the Sheriff to execute the Deed. Thus, Owner was effectively denied notice of his right to redeem, the Court's approval of the sale, or the execution and recordation of the Sheriffs Deed.

         In his Objections to Commissioner's Report, Owner raises seven (7) objections. I need only consider Objection I, Denial of Due Process of Law in a Taking of Land, in order to reach my decision in this case.

         As the Commissioner notes in her Orders, Sheriffs Sales are judicial processes, and consequently this Court has broad discretion to control such sales and to correct abuses or protect the affected parties from injury or injustice.[12]Because there is a public policy in Delaware requiring that a good faith purchaser at a tax sale reach a point where he becomes assured of absolute title and the peace attendant thereto, as a general rule a deed acquired through a tax sale will not be questioned once confirmation and approval by this Court has taken place, and minor procedural defects will be deemed cured by confirmation.[13]

         However, this public policy must give way where there was no jurisdiction to conduct the Sheriffs Sale due to failure to meet notice requirements. Sales without jurisdiction, or authority, are absolutely void and any resulting title is a nullity.[14] In Ward v. Gray, 374 A.2d 15 (Del. Super. 1977), plaintiffs brought an action in ejectment against parties who had purchased land at a tax sale. The names of three persons were listed as "taxable" on the Sussex County list of property owners, and the deed to the property contained the addresses for all three property owners. The notice of tax sale was sent to only one of the owners. This Court held that notice was inadequate, and that there could be no valid tax sale of the property. Moreover, the Court stated that actual or constructive knowledge on the part of the possessor of property of a tax sale which is void for lack of jurisdiction cannot cure this fatal defect. The Court granted summary judgment to the plaintiffs.

         The United States Supreme Court has held a tax sale void, even two years after the sale, where notice is not reasonably calculated to notify the owner:

"Prior to an action that will affect an interest in life, liberty or property protected by the Due Process Clause, a State must provide notice reasonably calculated, under all circumstances, to apprise interested parties of the pendency of the action and afford them an opportunity to present their objections. Notice by publication is not reasonably calculated to inform interested parties who can be notified by more effective means such as personal service or mailed notice."[15] [Emphasis supplied]

         B. ...

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