Tax Deed purchases are popular in many states as a way to acquire real estate at truly rock bottom prices.  Generally a tax deed purchase is first in line after just a few significant "super" lienholders: (1) God, and (2) Code Enforcement Liens.  Practically all others having an interest in the property are wiped out in a tax deed sale.

Past practices for advertising a tax deed sale - a situation where the real estate taxes remain unpaid on the parcel for a certain period of time (which varies from state to state) allowed some administrative agency, usually the tax collector or the clerk of the court, to mail out notices of the tax delinquency and the pending sale of the property.  Some jurisdictions also require posting on the property.  These methods have invariably been supported as technically sufficient to withstand an attack by the property owner that he or she was not given notice of the sale.  This lack of notice is typically because of incorrect mailing addresses or just plain error in the posting on the wrong property. In the past, these sale, even when imperfect, were not set aside by the courts.

Recent cases in Florida (http://www.floridasupremecourt.org/decisions/2006/sc05-1778.pdf), influenced by a United States Supreme Court decision (http://www.supremecourtus.gov/opinions/05pdf/04-1477.pdf), are reversing a trend that favored the tax deed purchaser for what seems like millenia.  The issue here is due process.  The courts have begun to take a dim view of administrative personnel not using common sense where the loss of ownership of real property is concerned.  For example, if a return receipt comes back as "undeliverable as addressed", the courts are now questioning if the "technical" requirement of mailing to the address on the tax collector rolls has been met.  A lot has to do with the ease of finding correct or alternate addresses on the Internet. 

Buyers of Tax Deeds should no longer assume they are immune from attack on clerk error situations.

Be sure to check with your attorney advisor who is knowledgeable in tax deeds when representing to your clients these opportunities.

Richard Zaretsky, Esq., RICHARD P. ZARETSKY P.A. ATTORNEYS AT LAW, 1655 PALM BEACH LAKES BLVD, SUITE 900, WEST PALM BEACH, FLORIDA 33401, PHONE 561 689 6660  RPZ99@FLORIDA-COUNSEL.COM - FLORIDA BAR BOARD CERTIFIED IN REAL ESTATE LAW - We assist Brokers with Short Sales