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Bar Journal - September 1, 2001

The Sharpest Tool in the Box? Thomas Tool Services, Inc. v. Town of Croydon

By:

INTRODUCTION-THE TOOL, THE TOWN AND THE TAX

All states need a way to force delinquent taxpayers to produce the money they owe the municipality. In the case of outstanding property taxes, all states allow municipal authorities to use some form of seizure of physical assets, followed by a tax sale in order to produce revenue, thus clearing the debts owed. Often, when carrying out these sales, the municipal authorities seize and sell the entire property in question. A question arises as to whether this wholesale seizure and sale is constitutionally justified, since often the delinquent tax bill amounts to only a small portion of the value of the property seized. A further question arises as to who is entitled to the excess proceeds from the sale.

The Fifth Amendment of the United States Constitution provides that no man may be "deprived of . . . property without due process of law; nor shall private property be taken for public use without just compensation."1 This principle is echoed in the New Hampshire Constitution, part I, article 12, which states that, "no part of a man's property shall be taken from him or applied to public use without his consent . . . ."2 This right derives from the New Hampshire Bill of Rights that declares that among the "natural, essential and inherent rights of all men is the right of acquiring, possessing and protecting property."3 However, all states grant taxing authorities the right to confiscate land when tax debts remain unsettled. The dichotomy between these two principles came to a head before the New Hampshire Supreme Court in the case of Thomas Tool Services, Inc. v. Town of Croydon.4

In Thomas Tool, the town of Croydon, in accordance with the New Hampshire Alternative Tax Lien Procedure,5 seized land in order to obtain several years worth of delinquent taxes owed by the property owner.6 Under the protection granted by the alternative tax lien procedure, the town retains the authority to sell the property at tax auction and retain any proceeds in excess of the tax debt.

In August 2000, the New Hampshire Supreme Court declared the alternative tax lien procedure to be unconstitutional.7 While New Hampshire was put on notice of the possibility of this outcome as early as 1994,8 no changes in the alternative tax lien procedure occurred until Thomas Tool challenged the process. Thomas Tool argued that even after complying with the relevant due process, this form of tax sale constitutes an unjust taking, resulting in an unconstitutional windfall for the municipality.

While the New Hampshire Supreme Court solved Thomas Tool's problem by holding the alternative tax lien procedure unconstitutional, their initial decision created confusion for the New Hampshire tax lien system. The superior court ruled that the "statutory alternative tax lien procedure (RSA 80:58 - 80:87) is constitutional only if it is read to limit the taking of the taxable property to the extent necessary to satisfy the tax debt, interest, reasonable costs and fees, and a reasonable penalty."9 The New Hampshire Supreme Court decision did not follow the wording in the lower court's decision. Instead, it ruled the "statutory alternative tax lien procedure unconstitutional."10 Further, the court did not discuss new, potentially curative legislation enacted before its decision. After the decision, some titles of property tax deeded to municipalities had questionable validity, making tax-deeded property unmarketable. In addition, municipalities faced the prospect of having to re-examine over ten years of previous tax deeds.

In January 2001, the interim members of the Thomas Tool court reconvened to reconsider their decision.11 They declared that application of the holding should not be retrospectively applied.12 The new holding meant that some of the problems faced by the municipalities were solved. Others, however, still remain.

This paper discusses the possible rationale behind the New Hampshire Supreme Court's decision, the subtle differences in the language of the New Hampshire Supreme Court's decision in comparison to that of the superior court, and the repercussions flowing from it.

THE BACKGROUND FACTS

In 1983 Thomas Tool Services, Inc. acquired property in the town of Croydon, New Hampshire for $65,000.13 At that time, Thomas Tool's offices were located in Hackensack, New Jersey.14 The company paid property tax from 1983 until 1988.15 In April of 1988, the company moved from Hackensack to Englewood Cliffs, New Jersey.16 Thomas Tool notified the U.S. Postal Service, and all mail was forwarded to the new address.17 The Town of Croydon sent Thomas Tool's 1988 June and December tax bills to the old address and it was automatically forwarded to the new Englewood Cliffs address.18 The 1988 tax bill was paid, but at no time did the company inform the town of the new address.19 When the 1989 tax bill was sent it was returned "address unknown" to the town of Croydon because the forwarding order had expired.20 The taxes in 1989 went unpaid, and remained so until Thomas Tool received actual notice of the problem in January of 1995.21

In August of 1992, the two-year statutory period of redemption expired on the property and the town tax collector conveyed the real estate to the town by tax deed.22 At that time, the delinquent tax debt was $370.26.23 In late 1994, or early 1995, Thomas Tool employed a company to evaluate their real estate holdings. Through this process, it became apparent that the property in question had been deeded to the town of Croydon due to tax delinquency. Thomas Tool immediately contacted the town in an effort to pay the back taxes and redeem the property.24 The town declined the offer and received voter approval to transfer the deed at a tax auction.25 Neither the briefs nor holdings provide insight into the town's rationale. It may be that the town felt they had correctly followed the alternative tax lien procedure, thus affording Thomas Tool with all necessary due process. Alternatively, it could have been that they stood to gain a property worth $65,000 for a tax bill of $370.26.

In order for a town to receive statutory protection it must formally comply with due process requirements. Under the statute, "due process" requires that the municipality allow one year from the date of mailing the tax bill before issuing notice of the impending lien.26 Thirty days after issuing the notice, the lien automatically attaches and is perfected by recording it in the Register of Deeds. The delinquent taxpayer then has a redemption period of up to two years before the land is deeded to the municipality.27 During this period, the town has a duty to try to contact the current owner.28 The statute requires that notice of the impending lien shall be sent by registered or certified mail, with return receipt requested, to the last known address of the owner, within at least 30 days of the date of execution of the impending lien.29 Even individuals who pay on the last possible day comply with their tax duties to the municipality, and will never encounter this problem.

In August 1996, Thomas Tool brought a petition in equity claiming that the 1992 tax deed was invalid because the notice provision was defective under RSA 80:6030 and 80:7731 and thus violated the owner's right of due process under the Fifth Amendment of the United States Constitution and under part 1, article 12 of the New Hampshire State Constitution.32 Thomas Tool further claimed that the town's tax deed constituted an unconstitutional taking.33 Counsel for Thomas Tool attached the property and it remained unsold throughout the case.34

In 1997, Thomas Tool moved for summary judgment due to lack of notice and the unconstitutionality of the taking.35 The superior court denied summary judgment concerning the adequacy of notice, stating that there were disputed issues of material facts.36 The alternative tax lien procedure requires only that the town send notice by certified or registered mail return receipt requested, to the last known address of the owner. Thomas Tool and the town disputed whether the town adequately tried to locate Thomas Tool. However, summary judgment was granted to Thomas Tool concerning the constitutional issue.37 A jury trial was scheduled to decide the notice issue, but Thomas Tool withdrew the claim.38

The superior court, noting the concurring opinion of Justice Horton in First New Hampshire Bank v. Town of Windham,39 held that the statutory alternative lien procedure, RSA 80:58 - 87, is constitutional only if it is read to limit the taking of the taxable property to only the extent necessary to satisfy the tax debt, interest, reasonable costs, fees and a reasonable penalty.40 The town appealed the summary judgment. It argued that the statute was constitutional in accordance with the takings clause laid out in part 1, article 12 of the New Hampshire Constitution.41

THE APPELLATE ARGUMENTS

On appeal, the town argued that the taking of the property was justified because sufficient notice was provided as required by both the New Hampshire and United States Constitution.42 The town contended that the statute allowed for due process, specifically providing one year to pay followed by a two-year redemption period, after which the land lawfully could be deeded to the town.43 The town argued that after this period of three years, the statute does not allow the owner to redeem the property, and so the court should not allow Thomas Tool to do so.44

In contrast, Thomas Tool argued that despite the two year redemption period afforded by the statute, the alternative tax lien procedure allowed an impermissible taking without just compensation, because the value of the property far outweighed the value of the tax debt.45 Thomas Tool argued once again that to allow the town to sell property and retain the full value of the property, or the proceeds from sale deeded property, above and beyond the tax debt, would mean that the town would receive an unjustified windfall, which is prohibited by both the Federal and State Constitutions.46

THE SUPREME COURT HOLDING AND RATIONALE

In its holding, the New Hampshire Supreme Court settled this argument and the issue raised by Justice Horton in First Bank of New Hampshire v. Town of Windham. Relying on the takings clause of the New Hampshire Constitution, the court declared the alternative tax lien procedure unconstitutional.47 The clause states, "no part of a man's property shall be taken from him, or applied to public uses, without his consent, or that of the representative body of the people."48 The alternative tax lien procedure however, requires that the taxing authority take "only a one hundred percent common and undivided interest in the property and no portion thereof shall be executed in severalty by metes and bounds."49 The town seized one hundred percent of the property worth $65,000 in order to settle a $370 tax debt,50 and did not expect to have to return any excess proceeds. The court stated that this was an unduly harsh penalty to impose on Thomas Tool.51 The Court reasoned that the New Hampshire Constitution requires just compensation in the event of a taking, and thus held that the alternative tax lien procedure violated the takings clause.52

The alternative tax lien procedure gave no guidance as to what to do with the excess proceeds from such a taking. In the 1969 case of Spurgias v. Morrissette,53 the court stated that the town received title free from legal or equitable claims. As a result, the town was under no legal obligation to account to the plaintiff for the proceeds realized upon resale.54 Further, as a general rule in the United States, "the surplus of a tax sale remaining after payment of the taxes, interest, and costs . . . in the case of resale by the state or county, the former owner is not entitled to such surplus unless the Constitution or statute provides otherwise."55 In the Thomas Tool case, the Supreme Court mentioned Spurgias but distinguished it based both on the facts and that the Spurgias court did not address the takings issue.56

In the 1994 case of First New Hampshire Bank, the court first recognized the potential constitutional problems inherent in the alternative tax lien procedure if towns are allowed to take land where the value exceeds that of the tax owed. 57 Justice Horton's language in his First New Hampshire Bank concurrence indicated the possibility for a change in the interpretation of this statute. Several years later the court, in deciding Thomas Tool, borrowed much of Justice Horton's concurring opinion when questioning the constitutionality of the alternative tax lien procedure.

The facts from First New Hampshire Bank are distinguishable from those in Thomas Tool, since the former case was about the notice given to mortgagees in a tax sale. The court set aside a tax deed in favor of the mortgagee, the bank, because of insufficient notice, and held that due process requires that towns notify mortgage holders of impending tax deeds.58 In his concurring opinion, Justice Horton made several points, which the court in Thomas Tool relied upon. Justice Horton discussed the alternative tax lien procedure and queried how much property can be constitutionally taken under the lien.59 Further, he considered whether the court should hold that tax lien deeding should satisfy only the lien and not provide for a fattening of the taxing authority's treasury.60

Justice Horton was impressed by the bank's claim of taking without just compensation.61 The claim led to a discussion of the alternative tax lien procedure that was enacted in 1987.62 The alternative tax lien procedure states that the entire piece of property, as opposed to a small portion, must be sold to satisfy the tax debt.63 Horton questioned the definition of a lien, and asked what could constitutionally be taken under one.64 Having equated the tax lien to an encumbrance on a property to secure the payment for a debt, he asked whether taking the entire property could be constitutionally justified in the face of a tax debt insignificant in value compared to the land involved.65 Justice Horton suggested that to allow taxing authorities to do so, would allow them to fatten their treasuries.66 Horton concluded that the alternative tax lien procedure is constitutional only to the extent that the taking satisfies the amount of the debt, and that any surplus is returned to the landowner.67

There were two parts to the court's decision in Thomas Tool, first to declare the alternative tax lien procedure unconstitutional, and second to bar the defense of laches. When the court drafted its holding the wording it used did not parallel that used by the superior court. The superior court stated that, "the statutory alternative tax lien procedure (RSA 80:58 - 80:87) is constitutional only if it is read to limit the taking of the taxable property to the extent necessary to satisfy the tax debt, interest, reasonable costs and fees, and a reasonable penalty."68 In the New Hampshire Supreme Court holding, the wording instead declared the "statutory alternative tax lien procedure unconstitutional."69 This difference in language caused confusion in tax collection. Because the New Hampshire Supreme Court's language seems to declare the entire statute unconstitutional, the "decision puts at risk the collection of substantial unpaid tax obligations (estimated to exceed $45,000,000)."70

Under the Fifth Amendment of the Federal Constitution and part I, article 12 of the New Hampshire Constitution, the superior court was warranted in following the concurring opinion of Justice Horton in First New Hampshire Bank. Pursuant to this argument, the superior court's reasoning was sound in declaring the statute unconstitutional when a municipality takes property without just compensation.

On appeal, since the defendant did not develop the argument of laches in the brief, the court stated that it would not expend appellate resources to consider applying the bar of laches to the plaintiff's claim.71 Since Thomas Tool did not develop the argument of laches in their brief, the court was correct in affirming the superior court's decision to bar laches.

The court's holdings are clearly stated, and the New Hampshire Supreme Court cited arguments based on both constitutional law and case law to support its position. These justified the court's decision when it affirmed the superior court's position on the constitutionality of the alternative tax lien procedure. The language of the holding suggests that the court considered the superior court's decision that the alternative tax lien procedure was unconstitutional. It would have been helpful in Thomas Tool, however, if the court had elaborated on its rationale for its decision as the three paragraphs analyzing the constitutionality of the alternative tax lien procedure left open questions regarding further interpretations of the statute.

The State grants taxing authorities the ability to lien, and to later sell, property for tax purposes. However, the Fifth Amendment of the United States Constitution protects people from being "deprived of property without due process of law".72 If property is seized, the owner must be given just compensation.73 The New Hampshire Constitution echoes this sentiment in part I, article 12.74 Further, the New Hampshire Bill of Rights declares that all men have the right to acquire, possess and protect their property.75 Since the right to hold and protect property is a fundamental right, it trumps the taxing power when states try to take a greater value of property than is owed for the taxes and related fees.76

While this constitutional right to own property does not prevent municipalities from exercising their taxing power, exercising this authority beyond that required to satisfy the tax debt violates the fundamental right expressed in both the Federal and New Hampshire State Constitutions.77 Therefore, if the taxing authority takes more than the debt secured against the real property, and fails to return the excess, they are essentially retaining private property for public use without just compensation in violation of the express terms of the New Hampshire and Federal Constitutions.78

Considering the Constitutional argument, and Justice Horton's concurring opinion from First New Hampshire Bank.79 the superior court was justified in stating that the Alternative Tax Lien Procedure was constitutional to the extent that it allowed towns to acquire landowners property in order to cover outstanding tax debts. If the town retains any proceeds from the sale in excess of the value of the outstanding debt, the taking is unconstitutional.

In Thomas Tool, this type of unconstitutional taking is what the town of Croydon committed. The town's taxing authority seized property in an effort to satisfy a tax debt. By declining to sell it back to Thomas Tool minus the tax fees, and not offering to return the excess proceeds after tax sale, it was taking private property for public use without just compensation. This exercise of taxing authority power violates the Federal and New Hampshire State Constitutions, despite the allowances made for the state taxing power.

RSA 80:88

One of the tools of statutory interpretation states that if a statute is susceptible to a construction rendering it constitutional, a court should read it as such.80 A second principle is that statutes should be read in their entirety.81 In Thomas Tool, the court considered RSA 80:58 - 80:87, but seemed to disregard the potentially curative effects of RSA 80:88 and 80:89 enacted on June 25, 1998, approximately two years before this decision. RSA 80:88 and 80:89 seem to have been implemented by the legislature as curative measures to answer to the concerns voiced by Justice Horton in his First New Hampshire Bank concurrence.

RSA 80:88 limits the retention of surplus proceeds from tax sales. It states that, "the municipalities recovery of proceeds from the sale shall be limited to back taxes, interest, costs and penalty as defined in RSA 80:90."82 RSA 80:88 further states that any

excess proceeds over and above the amount of municipal recovery . . . within 60 days of settlement by the purchaser . . . the municipality shall file a bill of interpleader . . . naming the former owner, and all persons having a recorded interest in the property as defendants, and paying to the court all amounts over and above those entitled to be retained. The court . . . shall make such disposition of the funds as it finds appropriate, based upon ownership and lien holder interests at the time of the tax deed.83

RSA 80:89 states that:

at any time within 3 years after the date of recording the tax deed, any former owner of the property may give notice . . . of intent to repurchase the property from the municipality, and stating that such owner is ready, willing, and able to pay all back taxes, interest, costs and penalty as defined in 80:90.84

RSA 80:88 and 80:89 did not appear in any briefs until after the court handed down its decision. In fact, although these new statutory sections were mentioned in the appellate oral arguments, reference to them first appeared in briefs when the amici parties raised them.

The New Hampshire Supreme Court does not take account of new legislation passed during the course of a trial and will rarely give an advisory opinion on new legislation unless asked. This meant that procedure prevented the court from addressing earlier constitutional challenges by looking at the entire statute. Since the Court was restricted by procedure, the legislation was not considered and the alternative tax lien procedure was declared unconstitutional. This left municipalities unsure whether they enforce New Hampshire's tax lien laws to provide funding for the services they provide.

RESULT OF THE SUPREME COURT DECISION

When the court explained its reasoning as to why the alternative tax lien procedure violated the takings clause of the New Hampshire Constitution,85 it dropped the exception carved out by the superior court, which allowed at least some takings under the procedure to be constitutional. This would be takings, for instance, where the amount taken does not cover the debt owed. Instead, the court declared the entire procedure unconstitutional. Had the New Hampshire Supreme Court affirmed the superior court's decision, declaring the alternative tax lien procedure unconstitutional only if the municipality took more than owed, the court would have minimized the resulting confusion.

By continuing and declaring the alternative tax lien procedure unconstitutional in its entirety, the court created uncertainty in two areas. First, it gave municipalities and legislators little guidance as to the future of the Alternative Tax Lien Procedure. Second, legislators were unsure whether they had solved the constitutional problem by introducing RSA 80:88 and 80:89, and whether they need to draft a new tax collection alternative.

One source of confusion was that the court did not initially clarify whether its decision applied prospectively only. The municipalities did not know whether they could continue collecting tax under this system, or even if the past taxes collected over the last ten plus years were valid. The amicus briefs filed suggested this holding should be applied to this case and subsequent cases only.86 Had the holding been applied to all takings under the alternative tax lien procedure, then doubt could have been cast upon any title conveyed through this system for the more than ten years that this system had been used.87 If this was the case, previous owners could have attempted to reclaim their property due to the unconstitutionality of the alternative tax lien procedure. If this occurred, large sums of money would have been at stake, which would have potentially opened the door to massive amounts of litigation.88 The amici parties, therefore, argued that this holding should not have applied to any cases filed before August 28, 2000.

The status of the Alternative Tax Lien Procedure was uncertain for a time. As discussed above, RSA 80:88 and 80:89 were enacted after Justice Horton's concurring opinion in First Bank of New Hampshire, with the hope of curing the possible unconstitutionality of the tax system. Since the Thomas Tool holding did not refer to the new legislation it was unclear whether or not the Legislature effectively completed the task.

The Thomas Tool decision created uncertainty for municipal authorities and the tax collecting system, and turned millions of dollars of outstanding tax obligations into potentially unsecured debts. The New Hampshire Department of Revenue instructed the towns of New Hampshire to follow the regular lien procedure, placing liens on the property, but not deeding it to the town when the payment deadline passes. The amicus brief filed on behalf of the New Hampshire Tax Collectors Association and the New Hampshire Municipal Association quoted close to 25,000 outstanding tax liens and outstanding taxes rising into the tens of millions of dollars.89 Further, they noted that title companies no longer issued title insurance on tax deeded property.90 This meant that the municipal authorities could not auction the properties, therefore, they could not collect the tax debt in any real sense.

THE SUPREME COURT'S RECONSIDERATION OF THOMAS TOOL

The interim members of the Thomas Tool court reconvened in January 2001 to clarify the decision handed down in August, 2000.91 In its reconsideration, the court held that its initial decision holding "the alternative tax lien procedure is unconstitutional" was wrong, stating that, "the alternative tax lien procedure governing the tax lien in this case is unconstitutional."92 This, in conjunction with the statement that "the application of the rule announced in this case shall apply to the parties and to any similar cases pending as of the date of this opinion but not concluded, but shall not be retrospectively applied" resolved one of the two questions remaining after the court's last opinion.93 The New Hampshire Tax Collectors' Associations and New Hampshire Municipal Authority now know that none of the properties previously auctioned under this system will be revoked.

As noted above, the New Hampshire Supreme Court is not allowed to take into account legislation passed during the life of a trial, and does not give advisory opinions unless specifically asked. The court announced that "[we] are aware that the legislature amended the alternative tax lien procedure in 1998, RSA 80:61, :88 - :91 (Supp. 2000), but at this time [we] express no opinion as to the constitutionality of the amended process."94

The clarification of the Thomas Tool decision holds that the Alternative Tax Lien System at the time of the decision was unconstitutional. This more recent decision, however, does not clarify what will happen in the future. It does not specify whether the amended alternative tax lien procedure is now constitutional. While the Department of Revenue Administration has said that the tax lien procedure as amended is now constitutional,95 it may take another holding to clarify whether the curative legislation has actually had the desired effect, or whether the legislature needs to draft a new tax lien system. Further, the municipalities may have to wait for the next court's ruling before being able to determine the status of the properties with current liens on them. Under the present ruling, the municipalities in New Hampshire that have been unable to sell properties for several years are still unsure whether they can sell those properties currently pending auction. If the new law does not cover existing liens, severe problems may arise if the statute of limitations on older debts has run out. This would mean that some municipalities may have lost the chance to collect large outstanding debts.

CONCLUSION

Interestingly, the original Thomas Tool parties are no longer intricately involved in this issue. While Thomas Tool was still the plaintiff, the clarification handed down by the court did not affect it. The original statute complained of was still unconstitutional, but regardless of whether the court had continued to declare the statute unconstitutional, or recognized the curative RSA 80:88 and RSA 80:89, Thomas Tool recovered its proceeds. The Town of Croydon, however, has decided that it is not economical for it to pursue this case any further.

The court's decision has, however, left open the question of whether the new sections of the tax law RSA 80:88 and 80:89 cured the problem of unjust taking inherent in the existing law, or whether the entire alternative tax lien procedure is indeed unconstitutional. If the entire system is unconstitutional, this will require the legislature to redraft corrective statutory provisions.

Protecting citizens from the duress inflicted by unconstitutional statutes is a job for the judicial system. However, the state legislature must be allowed the opportunity to correct any mistakes that become apparent. The legislature had already undertaken this task, and finished the job with the passage of RSA 80:88 and 80:89. However, the court could not take into account the result when rendering its decision. Had it been able to take the new law into account, it might have remanded the case to the lower court to have it reheard in light of the new legislation.

In analyzing this case we considered the possibility that the parties had misquoted the issue for appeal. However both briefs clearly quote the language from the superior court asking whether the procedure is unconstitutional unless limited to "the taking of the taxable property to the extent necessary to satisfy the tax debt, interest, reasonable costs and fees, and a reasonable penalty."96 This is not the language used by the New Hampshire Supreme Court.

The confusion caused by this decision could have been avoided if the language of the court's holding had echoed the language of that of the superior court and it some time to correct a decision that people feared may have led to the collapse of the New Hampshire tax system. The clarification still leaves many questions unanswered, but at least enough have now been answered to allow municipalities to resume auctioning properties at tax sales.

ENDNOTES

1. U.S. Const. Amend. V.
2. N.H. Const. pt I, art. 12; see also Burrows v. City of Keene, 121 N.H. 590, 596 (1981).
3. Burrows, 121 N.H. at 596 (quoting N.H. Const. pt I, art. 2).
4. Thomas Tool Services, Inc. v. Town of Croydon, ___ N.H. ___, 761 A.2d 439 (2000).
5. See N.H. Rev. Stat. Ann. 80:76 (1987).
6. Thomas Tool Services, Inc., 761 A.2d at 440.
7. Thomas Tool Services, Inc., 761 A.2d at 441.
8. Thomas Tool, 761 A.2d at 441 (citing First New Hampshire Bank v. Town of Windham, 138 N.H. 319, 332 (1994) (Horton, J., concurring)
9. Thomas Tool Services, Inc., 761 A.2d at 441.
10. Id.
11. Dunn, J., the retired superior court justice appointed under RSA 490:3 did not reconvene in January 2001. This may have been because he did not take part in the initial decision.
12. Thomas Tool Services, Inc. v. Town of Croydon, Clarification Order No. 97-887 (Jan. 30, 2001).
13. Thomas Tool Services, Inc., 761 A.2d at 440.
14. Id.
15. Id.
16. Id.
17. Appellee's Brief at 3, Thomas Tool Services, Inc. v. Town of Croydon, 761 A.2d 439 (N.H. 2000) (No. 97-887).
18. Appellant's Brief at 4, Thomas Tool Services, Inc. v. Town of Croydon, 761 A.2d 439 (N.H. 2000) (No. 97-887).
19. Id.
20. Id.
21. Id.
22. Id.
23. Thomas Tool Services, Inc., 761 A.2d at 441 ($370.26 is the amount pending under the first tax lien attached. After speaking with a local tax attorney it was suggested to us that after several years of 18% interest rates, accumulating years of unpaid taxes and fees the total figure may have been in excess of $5,000. We talked to the Croydon tax collector in order to try to determine the final sum owed minus penalty, but it had not yet been compiled).
24. Appellee's Brief at 3, Thomas Tool Services, Inc., 761 A.2d 439 (No. 97-887).
25. Id.
26. N.H. Rev. Stat. Ann. 80:59 (1987).
27. N.H. Rev. Stat. Ann. 80:76 (1987).
28. N.H. Rev. Stat. Ann. 80:60 (1987).
29. Id.
30. N.H. Rev. Stat. Ann. 80:60 (1987) (Paraphrasing Notice of Lien - The collector has to give notice 30 days prior to execution of the lien. The notice must be sent certified or registered mail, return receipt requested, to the last known address of the owner. The notice will give all pertinent details that are necessary to ascertain the owner, the property and the amount owed to date. The returned receipt, or the returned unclaimed notice is considered prima facie evidence that the collector has complied with notice requirements of this section.).
31. N.H. Rev. Stat. Ann. 80:77 (1987) (quoting Notice to current owner - 30 days prior to executing the deed under 80:76 [Lays out format of Tax deed], tax collector shall notify the current owner of the property by certified mail, return receipt requested of the pending deeding.).
32. Appellant's Brief at 4 - 5, Thomas Tool Services, Inc., 761 A.2d 439 (No. 97-887).
33. Id at 5.
34. Appellee's Brief at 4, Thomas Tool Services, Inc., 761 A.2d 439 (No. 97-887).
35. Appellant's Brief at 5, Thomas Tool Services, Inc., 761 A.2d 439 (No. 97-887).
36. Id.
37. Id. at 6. (The decision did not specify why this was withdrawn, but since the Superior Court decision held the statute unconstitutional, the notice provision point is perhaps moot.)
38. Id.
39. First New Hampshire Bank v. Town of Windham, 138 N.H. 319 (1994) (Horton, J., concurring)
40. Appellant's Brief at 5, Thomas Tool Services, Inc., 761 A.2d 439 (No. 97-887).
41. Id.
42. Id. at 7
43. Id.
44. Id; see also Spurgias v. Morrissette, 109 N.H. 275, 278 (1969) (holding that proceeds from tax sales are considered public funds and as such the town lacks the authority to pay them out on any theory of equity and good conscience (for example returning excess funds to delinquent tax payer for property sold at tax auction)).
45. Appellee's Brief at 5, Thomas Tool Services, Inc., 761 A.2d 439 (N.H. 2000)(No. 97-887).
46. U.S. Const. amend. V; N.H. Const., pt I, art. 12.
47. Thomas Tool, 761 A.2d at 441.
48. Id. (quoting N.H. Const. pt I, art. 12)
49. N.H. Rev. Stat. Ann. 80:61(1987).
50. This is the amount pending under the first tax lien attached. The total bill would amount to a much larger sum since it would include the other unpaid years, interest, fees and a penalty. We talked to the Croydon tax collector in order to try to determine the final sum owed minus penalty, but as of 18th of February, 2001 it had not yet been compiled.
51. Thomas Tool, 761 A.2d at 441.
52. Id.
53. Spurgias, 109 N.H. at 277.
54. Id. at 278
55. 84 C.J.S. Taxation 817 (2001).
56. Thomas Tool Services, Inc., 761 A.2d at 441 - 442 (We find this distinction hard to understand, since the court in Spurgias does seem to deal with takings. Although the Court deals with the tax sale procedure and not the lien procedure, they question the proper disposition of the surplus proceeds from the sale of property acquired from tax sale. This is a narrow distinction, but perhaps enough to allow the court in Thomas Tool to draw a distinction between the taking of the property and the retention of the excess proceeds.).
57. First New Hampshire Bank, 138 N.H. at 331 (Horton, J., concurring).
58. Id. at 327.
59. Id. at 331.
60. Id.
61. Id.
62. Id.
63. Id.
64. Id.
65. Id.
66. Id.
67. Id.
68. Thomas Tool Services, Inc., 761 A.2d at 441.
69. Id.
70. Amicus Curae Brief filed on behalf of the NHMA and NHTCA at 2, Thomas Tool Services, Inc., 761 A.2d 439 (No. 97-887).
71. Thomas Tool Services, Inc., 761 A.2d at 442 (There are New Hampshire Supreme Court rules governing this point, but the court does not cite to them in their opinion. Instead, the Court cites a number of cases to support their position.).
72. U.S. Const. amend. V.
73. Id.
74. See also Burrows, 121 N.H. at 595 - 96.
75. N.H. Const. pt I, art. 2; see also Burrows, 121 N.H. at 595 - 96 (1981)
76. Burrows, 121 N.H. at 595 - 96 (quoting Robbins Auto Parts, Inc. v. City of Laconia, 117 N.H. 235, 237 (1977)).
77. Robbins Auto Parts, Inc., 117 N.H. at 237.
78. U.S. Const., amend. V; N.H. Const., pt I, art. 12.
79. First New Hampshire Bank, 138 N.H. at 331 (Horton, J., concurring).
80. White v. Lee, 124 N.H. 69, 77-78 (1983).
81. Sprague Energy Corp. v. Town of Newington, 142 N.H. 804 (1998).
82. N.H. Rev. Stat. Ann. 80:88, I (1987).
83. N.H. Rev. Stat. Ann. 80:88, II (1987).
84. N.H. Rev. Stat. Ann. 80:89, II (1987).
85. N.H. Const. pt. I, art. 12.
86. Amicus Curae Brief filed on behalf of the NHMA and NHTCA at 23, Thomas Tool Services, Inc., 761 A.2d 439 (No. 97-887).
87. Amicus Curae Brief filed on behalf of the Town of Northumberland at 9, Thomas Tool Services, Inc., 761 A.2d 439 (No. 97-887).
88. Id.
89. Amicus Curae Brief filed on behalf of the NHMA and NHTCA at 23, Thomas Tool Services, Inc., 761 A.2d 439 (No. 97-887).
90. Id.
91. Dunn, J., the retired superior court justice appointed under RSA 490:3 did not reconvene in January 2001. This may have been because he did not take part in the initial decision.
92. Thomas Tool Services, Inc. v. Town of Croydon, Clarification Order No. 97-887 (Jan. 30, 2001).
93. Id.
94. Id.
95. N.H. Dept. of Revenue Admin., Technical Information Release No. 2001-04 (February 27, 2001).
96. Appellee's Brief at 1, Thomas Tool Services, Inc., 761 A.2d 439 (No. 97-887); Appellant's Brief at 3, Thomas Tool Services, Inc., 761 A.2d 439 (No. 97-887).
The Author
H. Scott Bethune, Class of 2002,
Franklin Pierce Law Center,
Concord, New Hampshire.
The Author
Laurie J. Sholtis, Class of 2002,
Franklin Pierce Law Center,
Concord, New Hampshire.

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