News: Brokerage

Supreme Court calls real property tax foreclosure into question - by Gabriella Botticelli

Gabriella Botticelli

A recent United States Supreme Court opinion has significant impact on New York’s Real Property Tax Law. Tyler v. Hennepin County, Minnesota, decided on May 25, 2023, ruled it unconstitutional for a taxing authority to foreclose upon and sell property based upon a failure to pay taxes without a procedure for the property owner to recover any surplus from the sale. In Tyler, the county took possession of a condo based on a $15,000 tax delinquency. The county sold the condo for $40,000, keeping the $25,000 surplus. The court ruled that the county’s retention of the surplus violated the Constitution’s Takings Clause.

New York’s Real Property Tax Law (“RPTL”) § 1136 raises similar concerns. Per RPTL § 1136, when a taxing authority seeks judgment to foreclose a tax lien and no answer has been interposed, or the court has determined the answer is not meritorious, the court shall award judgment to the tax district which “shall contain a direction to the enforcing officer” to “execute and cause to be recorded a deed conveying to such tax district full and complete title to such parcel.” See RPTL § 1136(3); see also RPTL § 1136(2)(a). Some New York counties take advantage of this statute to take possession of delinquent properties, sell them for more than the sums owed for taxes, and keep the surplus. In response to Tyler, there is legislation pending to change the RPTL to impose a moratorium on tax foreclosure until the state can amend its laws to comply with Tyler and allow property owners to recover any surplus that may result from a tax lien sale.

If you are at risk of losing your property through a tax lien foreclosure, contact an attorney to ensure your rights are protected.

Gabriella Botticelli is an attorney and a member of the firm’s litigation practice group at Forchelli Deegan Terrana LLP, Uniondale, N.Y. 

READ ON THE GO
DIGITAL EDITIONS
Subscribe
Columns and Thought Leadership
AI comes to public relations, but be cautious, experts say - by Harry Zlokower

AI comes to public relations, but be cautious, experts say - by Harry Zlokower

Last month Bisnow scheduled the New York AI & Technology cocktail event on commercial real estate, moderated by Tal Kerret, president, Silverstein Properties, and including tech officers from Rudin Management, Silverstein Properties, structural engineering company Thornton Tomasetti and the founder of Overlay Capital Build,
Lasting effects of eminent domain on commercial development - by Sebastian Jablonski

Lasting effects of eminent domain on commercial development - by Sebastian Jablonski

The state has the authority to seize all or part of privately owned commercial real estate for public use by the power of eminent domain. Although the state is constitutionally required to provide just compensation to the property owner, it frequently fails to account
Strategic pause - by Shallini Mehra and Chirag Doshi

Strategic pause - by Shallini Mehra and Chirag Doshi

Many investors are in a period of strategic pause as New York City’s mayoral race approaches. A major inflection point came with the Democratic primary victory of Zohran Mamdani, a staunch tenant advocate, with a progressive housing platform which supports rent freezes for rent
Behind the post: Why reels, stories, and shorts work for CRE (and how to use them) - by Kimberly Zar Bloorian

Behind the post: Why reels, stories, and shorts work for CRE (and how to use them) - by Kimberly Zar Bloorian

Let’s be real: if you’re still only posting photos of properties, you’re missing out. Reels, Stories, and Shorts are where attention lives, and in commercial real estate, attention is currency.