Apellate court affirms forfeiture of 504 tax sale certificates purchased by ineligible buyer

The Indiana Court of Appeals did not buy a Lake County man’s argument that state statute allows ineligible buyers at tax sales to avoid forfeiture by paying delinquent property taxes, finding the man had time to clear his debt but never did so.

Thomas Wisniewski acknowledged he established Broadway Logistics Complex LLC to serve as his agent in the March 2019 tax sale by the Lake County auditor. At the time, he owed delinquent taxes, penalties and interest on Lake County property, which, under Indiana Code § 6-1.1-24-5.3, made him ineligible to participate in the tax sale. However, through BLC, he purchased 544 tax sale certificates.

In August 2019, the county auditor discovered Wisniewski’s connection to BLC and, after an investigation, concluded BLC was “improperly and fraudulently acting as agent for Tom Wisniewski an ineligible tax sale bidder.” The auditor then sought forfeiture of the tax sale certificates.

Subsequently, the treasurer notified Wisniewski in September 2019 of the auditor’s request. The treasurer’s letter listed 41 parcels with delinquent taxes, six of which were in Wisniewski’s name and 35 of which were in the name of individuals or entities connected with him.

Wisniewski had the option to avoid forfeiture if he brought all the delinquencies current within 30 days. Although he appeared in the treasurer’s office “on multiple occasions to pay various delinquent taxes,” he refused to pay all that the county maintained he owed.

At the end of September 2019, Wisniewski filed an “Emergency Motion to Toll Statutory Time Limit, Enjoin Forfeiture of Tax Certificates, And To Set An Emergency Hearing.” He wanted an order tolling the 30-day period established by I.C. 6-1.1-24-5.3(d) and stopping the county from forfeiting the 504 non-redeemed tax sale certificates until he could meet with the auditor and treasurer about the “erroneous tax bills.”

The Lake Superior Court entering an order granting the “Agreed Motion for Continuance of Emergency Hearing,” which the parties had filed in October 2019. After the case was transferred to Lake Circuit Court, the treasurer moved forward with its petition for declaratory judgment.

A bench trial was held and, in April 2021, the court lifted the stay and authorized the treasurer to act on the forfeiture of the tax sale certificates.

Wisniewski and BLC appealed but the Court of Appeals affirmed in Broadway Logistics Complex, LLC, and Thomas Wisniewski v. Peggy Holinga Katona, as Lake County Treasurer, and John Petalas, as Lake County Auditor, 21A-PL-738. The unanimous panel ruled the trial court did not err in allowing the forfeiture to commence.

On appeal, Wisniewski and Broadway Logistics acknowledged that BLC acted as an agent of Wisniewski in the tax sale and that Wisniewski was ineligible. Nevertheless, they contend a plain reading of I.C. 6-1.1-24-5.3 gives an ineligible person the right to cure and avoid forfeiture by paying the delinquent property taxes within 30 days.

The appellate court noted that the trial court issued an order in October 2019 prohibiting the treasurer from forfeiting the tax sale certificates and that the parties then agreed to stay any forfeiture deadline while the litigation was ongoing. That stay was not lifted until April 2021, and neither Wisniewski nor Broadway Logistics presented evidence that they made any payments after the circuit court issued its order.

“The record establishes that neither Wisniewski nor BLC paid the full amounts due on the parcels identified in the Treasurer’s September 11, 2019, forfeiture letter,” Judge Elaine Brown wrote for the court. “Under these circumstances we cannot say the circuit court erred by lifting the stay and authorizing the Treasurer to act on the forfeiture of the 504 ineligibly obtained tax sale certificates.”