In re RYAN INVESTMENT CO., INC., Debtor. Charles P. Summerall, IV, Trustee for Ryan Investment Co., Inc., Plaintiff/Appellee, v. Richland County, a political subdivision of the State of South Carolina, and Jeremiah Davis, Defendants, Of whom Jeremiah Davis is Defendant/Appellant

Supreme Court of South Carolina1999-06-28No. No. 24960

335 S.C. 392517 S.E.2d 692

Summary · law.co

Holding. Postal regulations do not excuse compliance with the statutory requirement to mail tax redemption notices by certified mail with restricted delivery to the addressee, and the county treasurer's failure to demonstrate an attempted compliance with the restricted delivery requirement cannot be excused; the Bankruptcy Court's invalidation of the tax sale is affirmed.

A debtor corporation's real property was sold at a tax sale for unpaid taxes, and the buyer assigned the bid to Davis. After the corporation filed for bankruptcy, the trustee challenged the tax sale, claiming the county treasurer failed to follow statutory requirements for mailing the redemption notice. State law required the notice be sent by certified mail with restricted delivery to the addressee only. The treasurer mailed the notice by certified mail but did not use restricted delivery, addressing it to the corporation in care of an individual. Davis argued that postal regulations prohibit restricted delivery when the addressee is a corporation rather than a natural person, and therefore the statutory requirement should be excused.

The court rejected this argument, holding that tax sales must comply strictly with all statutory requirements and that postal regulations alone cannot excuse noncompliance. The court ruled that before any excuse for noncompliance can be considered, the party seeking the excuse must demonstrate an actual attempt to comply with the statute. Because the county treasurer presented no evidence of attempting to use restricted delivery, the noncompliance could not be excused, and the tax sale was properly invalidated.

Summary generated by law.co from the public-domain opinion. The opinion text itself is public domain.

Key issues

Whether postal service regulations excuse statutory mailing requirements for tax sale notices
Whether strict compliance with tax sale statutes is required even when actual notice is received
Whether noncompliance with mailing requirements can be excused without showing attempted compliance

Procedural posture

The case was certified from the District Court to the state supreme court to answer two specific legal questions regarding the mailing requirements for tax redemption notices.

Authorities cited

No cited authorities resolved to law.co cases yet.

Opinion · public domain

majority opinion

MOORE, Justice:

Ryan Investment Co. (Debtor Corporation) owned real property in Richland County that was sold at a tax sale for failure to pay 1992 taxes. The successful bidder assigned its bid to defendant/appellant Davis (Buyer). Debtor Corporation subsequently filed for relief in Bankruptcy Court. Plaintiff/appellee (Trustee) moved to set aside the tax sale on the ground the Richland County Treasurer had failed to comply with statutory mailing requirements for the notice of redemption. The Bankruptcy Court invalidated the tax sale and Buyer appealed to the District Court. This case is now before us on certification to answer the following questions:

1. Do the postal regulations excuse compliance with the restricted delivery requirements of § 12-51-120 of the South Carolina Code of Laws, where the owner of record is a corporation?

2. If the above question is answered in the affirmative, must there be compliance with the restricted delivery requirements where the owner of record is a corporation but where a natural person has been designated as the recipient of tax notices for the corporation?

DISCUSSION

At the time the redemption notice was mailed in this case, S.C.Code Ann. § 12-51-120 provided that such notice must be sent to the owner of record by “certified mail, return receipt requested-deliver to addressee only.” The Richland County Treasurer mailed the redemption notice by certified mail, but did not restrict delivery to the addressee. The notice was addressed:

Ryan Investment Co., Inc. c/o H.H. Bresky 200 Boyleston Street, # 325 Chestnut Hill, MA 02167

Buyer contends postal regulations do not allow restricted delivery when the addressee is a corporation. He cites United States Postal Services Domestic Mail Manual, § S916.1.1, which provides: “Restricted delivery service permits a mailer to deliver only to the addressee or addressee’s authorized agent. The addressee must be an individual (or natural person) specified by name.” Accordingly, Buyer argues noncompliance with the restricted delivery requirement of § 12-51-120 should be excused as a matter of law. We disagree.

Tax sales must be conducted in strict compliance with statutory requirements. Dibble v. Bryant, 274 S.C. 481, 265 S.E.2d 673 (1980). Even actual notice is insufficient to uphold a tax sale absent strict compliance with statutory requirements. South Carolina Fed. Sav. Bank v. Atlantic Land Title Co., 314 S.C. 292, 442 S.E.2d 630 (Ct.App.1994) (citing Aldridge v. Rutledge, 269 S.C. 475, 238 S.E.2d 165 (1977)). The failure to mail a redemption notice by restricted delivery mail is ground to invalidate a tax sale. Manji v. Blackwell, 323 S.C. 91, 473 S.E.2d 837 (Ct.App.1996).

In light of this strict compliance rule, we find postal regulations in and of themselves cannot excuse the failure to comply with statutory mailing requirements. We hold attempted compliance with statutory mailing requirements is required before non-compliance can be excused. The party seeking to excuse non-compliance must demonstrate facts indicating attempted compliance before the Court will consider the adequacy of the mailing actually accomplished. Cf. Hawkins v. Greenwood Dev. Corp., 328 S.C. 585, 493 S.E.2d 875 (Ct.App.1997) (party asserting impossibility of performance as defense to contract has burden of showing that the thing to be done cannot by any means be accomplished).

Here, there are no facts showing an attempt to have the Post Office deliver the redemption notice by restricted delivery to Debtor Corporation and therefore non-compliance with § 12-51-120 is not excused. In light of this conclusion, we decline to address the second certified question. Since no attempted compliance has been shown, we need not consider what alternative mailing would otherwise be adequate.

CERTIFIED QUESTION ANSWERED.

FINNEY, C.J., TOAL, WALLER, and BURNETT, JJ., concur.

. This section was amended in 1996 to substitute the phrase restricted delivery” for deliver to addressee only.” The meaning is the same.

. The certified facts in this case, however, indicate two instances where the Post Office apparently delivered notices by restricted delivery to corporations.