Volume 6 - Opinions of Counsel SBEA No. 68
Taxes (cancellation) (tax sale - Suffolk County) - Real Property Tax Law, § 995; Suffolk County Tax Act, § 40-c:
Where Suffolk County acquires tax liens on property later discovered to be town property exempt from taxation, the county treasurer has authority to cancel the tax sale (Suffolk County Tax Act, §40-c).
We have received an inquiry as to what should be done where Suffolk County acquires tax liens at tax sales of property later discovered to be town property exempt from taxation (see, Real Property Tax Law, §406). Apparently, a town in Suffolk County acquired title to some properties on February 20, 1973 but failed to record its deeds. The assessor, unaware of the town’s acquisition, continued to list the property as taxable. When taxes were not paid, tax liens on the property were acquired by Suffolk County, in compliance with the procedure set forth in the Suffolk County Tax Act. The town has since notified the county of its ownership of these parcels.
Section 40-c of the Suffolk County Tax Act gives the county treasurer broad authority to cancel any tax sale which might be invalid, ineffectual or void. The first paragraph of this section provides as follows:
The county treasurer shall not convey any lands sold for taxes if he shall discover before the conveyance that the sale was for any cause invalid or ineffectual to give title to the lands sold, but he shall cancel the sale .... If the error originated with the town officers, the sum paid shall be a charge against the town from which the tax was returned and the county legislature shall cause the same to be assessed, levied and collected and paid to the county treasurer.
A purported sale for unpaid taxes of municipally owned property otherwise entitled to exemption from taxation is void (see, Budd v. Franco, 194 App. Div. 803, 185 N.Y.S. 797). Even if the property of the town were subject to taxation, section 995 of the Real Property Tax Law would bar the sale of such property for unpaid taxes, unless the town consented thereto after a finding that the value of the parcel did not justify payment of the tax. (By virtue of section 32 of the Suffolk County Tax Act, provisions of the Real Property Tax Law (formerly the Tax Law) apply in that county unless inconsistent with the County Tax Act. Section 995 of the Real Property Tax Law is not inconsistent with the Suffolk County Tax Act and the limitations of section 995 therefore apply in Suffolk County.)
The sale of the tax liens against town property in this case was void and therefore “invalid or ineffectual” to give title to the lands sold within the meaning of section 40-c of the Suffolk County Tax Act. Since the error originated with the town officers, the same section of law requires the amounts “paid” by the county in its acquisition of the liens to be charged back to the town.
March 8, 1977