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U.S. Supreme Court

Mennonite Bd. of Missions v. Adams, 462 U.S. 791 (1983)

Mennonite Board of Missions v. Adams

No. 82-11

Argued March 30, 1983

Decided June 22, 1983

462 U.S. 791


An Indiana statute requires the county auditor to post notice in the county courthouse of the sale of real property for nonpayment of property taxes and to publish notice once each week for three consecutive weeks. Notice by certified mail must be given to the property owner, but at the time in question in this case, there was no provision for notice by mail or personal service to mortgagees of the property. The purchaser at a tax sale acquires a certificate of sale that constitutes a lien against the property for the amount paid and is superior to all prior liens. The tax sale is followed by a 2-year period during which the owner or mortgagee may redeem the property. If no one redeems the property during this period, the tax sale purchaser may apply for a deed to the property, but before the deed is executed, the county auditor must notify the former owner that he is entitled to redeem the property. If the property is not redeemed within 30 days, the county auditor may then execute a deed to the purchaser who then acquires an estate in fee simple, free and clear of all liens, and may bring an action to quiet title. Property on which appellant held a mortgage was sold to appellee for nonpayment of taxes. Appellant was not notified of the pending sale and did not learn of the sale until more than two years later, by which time the redemption period had run and the mortgagor still owed appellant money on the mortgage. Appellee then filed suit in state court seeking to quiet title to the property. The court upheld the tax sale statute against appellant's contention that it had not received constitutionally adequate notice of the pending tax sale and of its opportunity to redeem the property after the sale. The Indiana Court of Appeals affirmed.

Held: The manner of notice provided to appellant did not meet the requirements of the Due Process Clause of the Fourteenth Amendment. Pp. 462 U. S. 795-800.

(a) 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 the circumstances, to apprise interested parties of the pendency of the action and afford them an opportunity to present their objections."

Mullane v. Central Hanover Bank & Trust Co., 339 U. S. 306, 339 U. S. 314. 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. Pp. 462 U. S. 795-797.

Page 462 U. S. 792

(b) Since a mortgagee clearly has a legally protected property interest, he is entitled to notice reasonably calculated to apprise him of a pending tax sale. Constructive notice to a mortgagee who is identified in the public record does not satisfy the due process requirement of Mullane. Neither notice by publication and posting nor mailed notice to the property owner are means "such as one desirous of actually informing the [mortgagee] might reasonably adopt to accomplish it." Mullane, supra, at 339 U. S. 315. Personal service or notice by mail is required even though sophisticated creditors have means at their disposal to discover whether property taxes have not been paid and whether tax sale proceedings are therefore likely to be initiated. Pp. 462 U. S. 798-800.

427 N.E.2d 686, reversed and remanded.

MARSHALL, J., delivered the opinion of the Court, in which BURGER C.J.,and BRENNAN, WHITE, BLACKMUN, and STEVENS, JJ., joined. O'CONNOR, J., filed a dissenting opinion, in which POWELL and REHNQUIST, JJ., joined, post, p. 462 U. S. 800.

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