As Introduced 1
123rd General Assembly 4
Regular Session H. B. No. 533 5
1999-2000 6
REPRESENTATIVES D. MILLER-DePIERO-REDFERN-GRENDELL-ALLEN- 8
PATTON-FLANNERY 9
_________________________________________________________________ 10
A B I L L
To amend sections 5721.37, 5721.38, and 5721.39 of 12
the Revised Code to eliminate the time limit 13
within which holders of tax certificates may
request foreclosure. 14
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO: 16
Section 1. That sections 5721.37, 5721.38, and 5721.39 of 18
the Revised Code be amended to read as follows: 19
Sec. 5721.37. (A)(1) With respect to a tax certificate 28
purchased under section 5721.32 of the Revised Code, at any time 29
after one year from the date shown on the tax certificate as the 30
date the tax certificate was sold, and not later than three years 31
after that date, the certificate holder may file with the county 34
treasurer a request for foreclosure on a form prescribed by the 35
tax commissioner and provided by the county treasurer, provided 36
the parcel has not yet been redeemed under division (A) or (C) of 37
section 5721.38 of the Revised Code. 38
(2) With respect to a tax certificate purchased under 40
section 5721.33 of the Revised Code, at any time after one year 41
from the date shown on the tax certificate as the date the tax 43
certificate was sold, and not later than three years after that 44
date or any extension of that date pursuant to division (C)(2) of 45
section 5721.38 of the Revised Code, a private attorney on behalf 46
of the certificate holder may file with the county treasurer a 48
notice of intent to foreclose on a form prescribed by the tax 49
commissioner and provided by the county treasurer, provided the 50
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parcel has not yet been redeemed under division (A) or (C) of 51
section 5721.38 of the Revised Code.
(B) Along with a request filed under division (A)(1) of 53
this section, or a notice of intent to foreclose filed under 54
division (A)(2) of this section and prior to the transfer of 55
title in connection with foreclosure proceedings filed under 56
division (F)(E) of this section, the certificate holder shall 58
submit a payment to the treasurer equal to the sum of the 59
following: 60
(1) The certificate redemption prices of any other prior 62
tax certificates that have been sold on the parcel; 63
(2) Any prior delinquent taxes, assessments, penalties, 65
interest, and charges that are charged against the certificate 66
parcel that is the subject of the foreclosure proceedings and 67
that are not covered by a tax certificate; 68
(3) If the foreclosure proceedings are filed by the county 70
prosecuting attorney pursuant to section 323.25, 5721.14, or 71
5721.18 of the Revised Code, a fee in the amount prescribed by 72
the county prosecuting attorney to cover the prosecuting 73
attorney's legal costs incurred in the foreclosure proceeding; 74
(4) If the foreclosure proceedings are filed by a private 76
attorney on behalf of the certificate holder pursuant to division 77
(F)(E) of this section, any other prior liens. 79
(C)(1) With respect to a certificate purchased under 81
section 5721.32 of the Revised Code, if the certificate parcel 82
has not been redeemed, the county treasurer shall provide 85
certification to the county prosecuting attorney that the parcel 86
has not been redeemed and that the certificate holder has made a 87
foreclosure request. Within ninety days of receiving that 88
certification, the prosecuting attorney shall commence a 89
foreclosure proceeding in the name of the county treasurer in the 90
manner provided under section 323.25, 5721.14, or 5721.18 of the 91
Revised Code, to foreclose the lien vested in the certificate 92
holder by the certificate. The prosecuting attorney shall attach 93
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to the complaint the county treasurer's certification that the 94
parcel has not been redeemed.
(2) With respect to a certificate purchased under section 96
5721.33 of the Revised Code, if the certificate parcel has not 97
been redeemed, the county treasurer shall provide certification 98
to the private attorney that the parcel has not been redeemed. 99
After receipt of that certification, the private attorney may
commence a foreclosure proceeding in the name of the certificate 100
holder in the manner provided under division (F)(E) of this 101
section, to foreclose the lien vested in the certificate holder 103
by the certificate. The private attorney shall attach to the 104
complaint the county treasurer's certification that the parcel 105
has not been redeemed.
(D) The county treasurer shall credit the amount received 108
under division (B)(1) of this section to the tax certificate 110
redemption fund. The tax certificates respecting the payment 111
shall be redeemed as provided in division (E) of section 5721.38 112
of the Revised Code. The amount received under division (B)(2) 114
of this section shall be distributed to the taxing districts to 115
which the delinquencies are owed. The treasurer shall deposit 116
the fee received under division (B)(3) of this section in the 118
county treasury to the credit of the delinquent tax and 119
assessment collection fund. The amount received under division 120
(B)(4) of this section shall be distributed to the holder of the 121
prior lien. 122
(E)(1) If, in the case of a certificate purchased under 124
section 5721.32 of the Revised Code, the certificate holder does 125
not file with the county treasurer a request for foreclosure 128
along with the required payment within three years after the date 129
shown on the tax certificate as the date the certificate was 130
sold, and during that period the parcel is not redeemed or 131
foreclosed upon, the certificate holder's lien against the parcel 132
for the amount of delinquent taxes, assessments, penalties, 133
interest, and charges that make up the certificate purchase price 134
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is canceled.
(2) If, in the case of a certificate purchased under 136
section 5721.33 of the Revised Code, the certificate holder does 138
not file with the county treasurer a notice of intent to 139
foreclose with respect to a certificate parcel within three years
after the date shown on the tax certificate as the date the 140
certificate was sold or any extension of that date pursuant to 141
division (C)(2) of section 5721.38 of the Revised Code, and 142
during that period the parcel is not redeemed, the certificate 144
holder's lien against the parcel for the amount of delinquent
taxes, assessments, penalties, interest, and charges that make up 145
the certificate purchase price is canceled. 146
(F) With respect to tax certificates purchased under 148
section 5721.33 of the Revised Code, upon the delivery to the 149
certificate holder by the county treasurer of the certification 151
provided for under division (C)(2) of this section, a private 152
attorney may institute a foreclosure proceeding under this 153
division in the name of the certificate holder to foreclose such
holder's lien, in any court with jurisdiction, unless the 154
certificate redemption price is paid prior to the time a 155
complaint is filed. The attorney shall prosecute the proceeding 156
to final judgment and satisfaction, whether through sale of the
property or the vesting of title and possession in the 157
certificate holder. If there is a copy of a written undertaking 158
under section 323.31 of the Revised Code attached to the tax 159
certificate or if a copy of such an undertaking is received from
the county treasurer prior to the commencement of the proceeding 160
under this division, the attorney shall not institute the 161
proceeding under this division, unless the attorney receives a 162
certification of the treasurer that such undertaking has become 163
void in accordance with section 323.31 of the Revised Code.
The foreclosure proceedings under this division, except as 165
otherwise provided in this division, shall be instituted and 166
prosecuted in the same manner as is provided by law for the 167
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foreclosure of mortgages on land, except that, if service by 168
publication is necessary, such publication shall be made once a 169
week for three consecutive weeks and the service shall be
complete at the expiration of three weeks after the date of the 170
first publication.
Any notice given under this division shall include the name 172
of the owner of the parcel as last set forth in the records of 173
the county recorder, the owner's last known mailing address, the 174
address of the subject parcel if different from that of the 175
owner, and a complete legal description of the subject parcel. 176
In any county that has adopted a permanent parcel number system, 177
such notice may include the permanent parcel number in addition
to a complete legal description. 178
It is sufficient, having been made a proper party to the 180
foreclosure proceeding, for the certificate holder to allege in 181
such holder's complaint that the tax certificate has been duly 182
purchased by the certificate holder, that the certificate 183
redemption price appearing to be due and unpaid is due and 184
unpaid, and that there is a lien against the property described
in the tax certificate, without setting forth in such holder's 185
complaint any other special matter relating to the foreclosure 187
proceeding. The prayer of the complaint shall be that the court 188
issue an order that the property be sold by the sheriff or, if 189
the action is in the municipal court, by the bailiff, in the
manner provided in section 5721.19 of the Revised Code, unless 190
the complaint includes an appraisal by an independent appraiser 191
acceptable to the court that the value of the certificate parcel 192
is less than the certificate purchase price. In that case, the 193
prayer of the complaint shall be that fee simple title to the
property be transferred to and vested in the certificate holder 194
free and clear of all subordinate liens. 195
In the foreclosure proceeding, the certificate holder may 197
join in one action any number of tax certificates relating to the 198
same owner, provided that all parties on each of the tax 199
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certificates are identical as to name and priority of interest. 200
However, the decree for each tax certificate shall be rendered 201
separately and any proceeding may be severed, in the discretion
of the court, for the purpose of trial or appeal. The court 202
shall make such order for the payment of all costs related 203
directly or indirectly to the redemption of the tax certificate, 204
including, without limitation, attorney's fees of the holder's 205
attorney, as is considered proper. The tax certificate purchased 206
by the certificate holder is presumptive evidence in all courts
and in all proceedings, including, without limitation, at the 207
trial of the foreclosure action, of the amount and validity of 208
the taxes, assessments, charges, penalties by the court and added 209
to such principal amount, and interest appearing due and unpaid 210
and of their nonpayment.
(G)(F) For purposes of this section: 212
(1) "Prior tax certificates" and "prior delinquent taxes, 214
assessments, penalties, interest, and charges" mean tax 215
certificates and delinquent taxes, assessments, penalties, 216
interest, and charges, the liens with respect to which attached 217
to the certificate parcel prior to the attachment of the lien
with respect to the tax certificate that is the subject of the 218
foreclosure proceedings. 219
(2) "Prior liens" means liens that are prior in right to 221
the lien with respect to the tax certificate that is the subject 222
of the foreclosure proceedings. 223
Sec. 5721.38. (A) At any time prior to the commencement 233
of foreclosure proceedings under section 5721.37 of the Revised 234
Code by the submitting of the payment to the county treasurer by 235
the certificate holder under division (B) of that section, the 236
owner of record of the certificate parcel, or any other person 237
entitled to redeem that parcel, may redeem the parcel by paying 238
to the county treasurer an amount equal to the total of the 239
certificate redemption prices of all tax certificates respecting 240
that parcel plus the sum of taxes, assessments, penalties, 241
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charges, and interest charged against the parcel that have become 242
due and payable since the date the last certificate was sold. 243
(B) At any time after the commencement of foreclosure 245
proceedings under section 5721.37 of the Revised Code by the 247
submitting of the payment to the county treasurer by the
certificate holder under division (B) of that section and prior 249
to the filing of the entry of confirmation of sale of a 250
certificate parcel under foreclosure proceedings filed by the
county prosecuting attorney or prior to the decree conveying 252
title to the certificate holder as provided for in division 253
(F)(E) of section 5721.37 of the Revised Code, the owner of 254
record of the certificate parcel or any other person entitled to 255
redeem that parcel may redeem the parcel by paying to the county 256
treasurer the amount described in division (A) of this section 257
plus interest on the certificate purchase price for each tax 258
certificate sold respecting the parcel at the rate of eighteen 259
per cent per year for the period beginning on the day on which 260
the payment was submitted by the certificate holder, together
with an amount equal to the sum of the prosecuting attorney's fee 262
under division (C)(1) of section 5721.37 of the Revised Code if 263
the tax certificate was purchased under section 5721.32 of the 265
Revised Code, and any other costs and fees of the proceeding
allocable to the certificate parcel as determined by the court. 267
(C)(1) During the period beginning on the date a tax 269
certificate is sold under section 5721.32 of the Revised Code and 270
ending one year from that date, the owner of record of the 272
certificate parcel, or any other person entitled to redeem that 273
parcel, may enter into a redemption payment plan with the county 274
treasurer. The plan shall require the owner or other person to 275
pay the certificate redemption price for the tax certificate in 276
installments, with the final installment due no later than one 277
year after the date the tax certificate is sold. 278
(2) During the period beginning on the date a tax 280
certificate is sold under section 5721.33 of the Revised Code and 281
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ending on the date the decree is rendered on the foreclosure 283
proceeding under division (F)(E) of section 5721.37 of the 285
Revised Code, the owner of record of the certificate parcel, or
any other person entitled to redeem that parcel, may enter into a 287
redemption payment plan with the certificate holder and all 288
secured parties of the certificate holder. The plan shall 289
require the owner or other person to pay the certificate 290
redemption price for the tax certificate, an administrative fee 291
not to exceed one hundred dollars per year, and the actual fees 292
and costs incurred, in installments, with the final installment
due no later than three years after the date the tax certificate 293
is sold. The certificate holder shall give written notice of the 294
plan to the applicable county treasurer within sixty days after 295
entering into the plan and written notice of default under the 296
plan within ninety days after the default. If such a plan is 297
entered into, the time period for filing a notice of intent to
foreclose under section 5721.37 of the Revised Code is extended 298
by the length of time the plan is in effect and not in default. 300
(D)(1) Immediately upon receipt of full payment under 303
division (A) or (B) of this section, the county treasurer shall 304
make an entry to that effect in the tax certificate register and 305
notify each certificate holder by certified mail, return receipt 306
requested, that the parcel has been redeemed and the lien 307
canceled and that the tax certificates may be redeemed. The 308
county treasurer shall deposit into the tax certificate 309
redemption fund created in the county treasury an amount equal to 310
the total of the certificate redemption prices, together with 311
interest on the certificate purchase price for each tax 312
certificate sold respecting the parcel at the rate of eighteen 313
per cent per year paid under division (B) of this section for the 314
period beginning when the payment was submitted by the
certificate holder under division (B) of section 5721.37 of the 315
Revised Code and ending when the parcel was redeemed. The county 316
treasurer shall administer the fund for the purpose of redeeming 317
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tax certificates. Interest earned on the fund shall be credited 318
to the county general fund.
(2) If a redemption payment plan is entered into pursuant 320
to division (C)(1) of this section, the county treasurer 321
immediately shall notify each certificate holder by certified 322
mail, return receipt requested, of the terms of the plan. 323
Installment payments made pursuant to the plan shall be deposited 324
in the tax certificate redemption fund. Any overpayment of the 326
installments shall be refunded to the person responsible for
causing the overpayment if the person applies for a refund under 327
this section. If the person responsible for causing the 328
overpayment fails to apply for a refund under this section within 329
five years from the date the plan is satisfied, an amount equal 330
to the overpayment shall be deposited into the general fund of 331
the county.
Upon satisfaction of the plan, the county treasurer shall 334
indicate in the tax certificate register that the plan has been 335
satisfied, and shall notify each certificate holder by certified 336
mail, return receipt requested, that the plan has been satisfied 337
and that tax certificates may be redeemed. 338
If a plan becomes void, the county treasurer immediately 341
shall notify each certificate holder by certified mail, return 342
receipt requested. If a certificate holder files a request for
foreclosure under section 5721.37 of the Revised Code, upon the 343
confirmation of sale resulting from the foreclosure, any money 344
paid under the plan prior to its becoming void shall be applied 345
to payment as prescribed under divisions (A), (B), and (C) of 347
section 5721.39 of the Revised Code. Any residue remaining after 348
such payment shall be disposed of under section 5721.20 of the 349
Revised Code. 350
(E) To redeem a tax certificate with respect to which 352
payment has been made in full under division (A), (B), or (C)(1) 354
of this section, the certificate holder shall present the tax 356
certificate to the county treasurer, who shall prepare the 357
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redemption information. Upon presentation, the county auditor 358
shall draw a warrant on the tax certificate redemption fund in 359
the amount of the certificate redemption price. For a parcel 360
that was redeemed under division (B) of this section, the 361
certificate holder who paid the amounts under division (B) of 363
section 5721.37 of the Revised Code shall be reimbursed for those 365
amounts, together with interest at the rate of eighteen per cent 366
per year on the amount paid under division (B)(1) of that section 367
for the period beginning when the payment was submitted by the 368
certificate holder under division (B) of that section and ending 370
when the parcel was redeemed. The treasurer shall mark all 371
copies of the tax certificate "redeemed" and return the 372
certificate to the certificate holder. The canceled certificate 373
shall serve as a receipt evidencing redemption of the tax 374
certificate. If a certificate holder fails to redeem a tax 375
certificate within five years after notice is served under 376
division (D) of this section that tax certificates may be
redeemed, an amount equal to the certificate redemption price 378
shall be deposited into the general fund of the county. 379
Sec. 5721.39. In its judgment of foreclosure rendered with 389
respect to actions filed pursuant to section 5721.37 of the
Revised Code, the court shall enter a finding with respect to the 391
certificate parcel of the amount of the sum of the certificate 392
redemption prices respecting all the tax certificates sold
against the parcel; interest on the certificate purchase prices 394
of those certificates at the rate of eighteen per cent per year
for the period beginning on the day on which the payment was 395
submitted by the certificate holder under division (B) of section 396
5721.37 of the Revised Code; any delinquent taxes, assessments, 399
penalties, interest, and charges on the parcel that are not 400
covered by a tax certificate; and fees and costs incurred in the
foreclosure proceeding instituted against the parcel, including, 401
without limitation, the fees and costs of the prosecuting 403
attorney represented by the fee paid under division (B)(3) of 404
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section 5721.37 of the Revised Code or the fees and costs of the 406
private attorney representing the certificate holder, and charges 407
paid or incurred in procuring title searches and abstracting 408
services relative to the subject premises. The court may order
the certificate parcel to be sold, without appraisal, in the 410
manner provided for in division (F)(E) of section 5721.37 of the 412
Revised Code and as set forth in the prayer of the complaint, for 413
not less than the amount of its finding, or, in the event that 414
the court finds that the value of the certificate parcel is less 416
than the certificate purchase price, the court may, as prayed for 417
in the complaint, issue a decree transferring fee simple title
free and clear of all subordinate liens to the certificate 418
holder. A decree of the court transferring such fee simple title 419
to the certificate holder is forever a bar to all rights of 420
redemption with respect to the certificate parcel.
Each certificate parcel shall be advertised and sold by the 423
officer to whom the order of sale is directed in the manner
provided by law for the sale of real property on execution. The 424
advertisement for sale of certificate parcels shall be published 425
once a week for three consecutive weeks and shall include the 426
date on which a second sale will be conducted if no bid is 427
accepted at the first sale. Any number of parcels may be 428
included in one advertisement. 429
Whenever the officer charged to conduct the sale offers a 432
certificate parcel for sale and no bids are made equal to at 433
least the amount of the court's finding, the officer shall 434
adjourn the sale of the parcel to the second date that was
specified in the advertisement of sale. The second sale shall be 436
held at the same place and commence at the same time as set forth 437
in the advertisement of sale. The officer shall offer any parcel 438
not sold at the first sale. Upon the conclusion of any sale, or 439
if any parcel remains unsold after being offered at two sales, 440
the officer conducting the sale shall report the results to the 441
court.
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Upon the confirmation of a sale, the proceeds of the sale 444
shall be applied as follows:
(A) The fees and costs incurred in the proceeding filed 446
against the parcel pursuant to section 5721.37 of the Revised 448
Code, not including the county prosecutor's costs covered by the 449
fee paid by the certificate holder under division (B)(3) of that 450
section, shall be paid first.
(B) Following the payment required by division (A) of this 453
section, the certificate holder that requested the foreclosure 454
shall be paid the sum of the amount found due for the certificate 455
redemption prices of all the tax certificates sold against the
parcel; any premium paid by the certificate holder at the time of 456
purchase; interest on the certificate purchase prices of those 458
certificates at the rate of eighteen per cent per year beginning
on the day on which the payment was submitted by the certificate 459
holder under division (B) of section 5721.37 of the Revised Code 460
and ending on the day of the sale; and the amounts paid by the 461
certificate holder under divisions (B)(2) and (3) of section 462
5721.37 of the Revised Code.
(C) Following the payment required by division (B) of this 465
section, any amount due for taxes, assessments, charges, 466
penalties, and interest not covered by the tax certificate 467
holder's payment under division (B)(2) of section 5721.37 of the 468
Revised Code shall be paid, including all taxes, assessments,
charges, penalties, and interest payable subsequent to the entry 469
of the finding and prior to the transfer of the deed of the 470
parcel to the purchaser following confirmation of sale. If the 471
proceeds available for distribution pursuant to this division are 472
insufficient to pay the entire amount of those taxes, 473
assessments, charges, penalties, and interest, the proceeds shall 474
be paid to each claimant in proportion to the amount of those 475
taxes, assessments, charges, penalties, and interest that each is 476
due, and those taxes, assessments, charges, penalties, and 477
interest are deemed satisfied. 478
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Any residue of money from proceeds of the sale shall be 480
disposed of as prescribed by section 5721.20 of the Revised Code. 482
Unless the parcel previously was redeemed pursuant to 484
section 5721.25 or 5721.38 of the Revised Code, upon the filing 486
of the entry of confirmation of sale, the title to the parcel is 487
incontestable in the purchaser and is free and clear of all liens 488
and encumbrances, except a federal tax lien notice of which is 489
properly filed in accordance with section 317.09 of the Revised 490
Code prior to the date that a foreclosure proceeding is 491
instituted pursuant to section 5721.37 of the Revised Code, which 492
lien was foreclosed in accordance with 28 U.S.C.A. 2410(c), and 493
the easements and covenants of record running with the land or 494
lots that were created prior to the time the taxes or 495
assessments, for the nonpayment of which a tax certificate was 496
issued and the parcel sold at foreclosure, became due and 497
payable.
The title shall not be invalid because of any irregularity, 500
informality, or omission of any proceedings under this chapter, 501
or in any processes of taxation, if such irregularity, 502
informality, or omission does not abrogate the provision for 503
notice to holders of title, lien, or mortgage to, or other 504
interests in, such foreclosed parcels, as prescribed in this 505
chapter.
Section 2. That existing sections 5721.37, 5721.38, and 507
5721.39 of the Revised Code are hereby repealed. 508