On April 18, 2024, the Massachusetts Land Court held a hearing in Town of Tyngsborough v. Recco, a case dealing with property owner’s rights. The case deals with the Town of Tyngsborough’s attempt to enforce a tax foreclosure sale against Recco’s property. As a defender for property owner’s rights, we submitted a brief in support of Recco. Despite this, the Land Court held Massachusets’s tax scheme to be constitutional.
As we explained in our brief, the laws in question are found in Chapter 60 of Massachusetts’s General Laws, and they permit towns to enforce a tax foreclosure sale, but do not provide any mechanism for towns to return excess proceeds to former property owners. The Supreme Judicial Court of Massachusetts (Massachusetts’s highest court) clarified in Kelly v. City of Boston, 348 Mass. 385 (1965) “it is clear . . . that the Legislature intended the surplus from a sale of land taken for nonpayment of taxes, on which the right of redemption has been foreclosed in the Land Court, to belong to the municipality.” By saying this, Massachusetts’s highest court established as common law that a town could not return surplus proceeds from tax foreclosure sale to the former property owner. Additionally, we explained “there is no statute within chapter 60 which allows this Court to order compensation to the owner for the difference in value seized and taxes owed.” Any attempt by the court to “insert a compensation provision into chapter 60 where none exists would be legislating.”
Even further, we elaborated that this type of taking statute was recently held unconstitutional by the U.S. Supreme Court in Tyler v. Hennepin County. Under Tyler, Massachusetts’s law has always been unconstitutional because it allows a town to take a property owner’s property in a tax foreclosure sale without returning any excess proceeds. As such, we argued the Massachusetts Land Court should not enforce the statute against Recco.
After receiving all the amicus briefs, the Massachusetts Land Court heard oral arguments on this issue to determine whether it could enforce the takings clauses against Recco. The attorney for Tyngsborough explained the Massachusetts Land Court could enforce the statute because the town intended to return the surplus funds to Recco, regardless of what the law says. Caroline Meade, the attorney for Recco, argued that the law is unconstitutional, and the judge must refuse to enforce the law until the Massachusetts Legislature changes it.
Unfortunately, the Land Court held the scheme to be constitutional. The Court reasoned that “[t]here is nothing in the statute prohibiting the Town from including as one of the terms and conditions of the sale . . . that it will pay any surplus after payment of the tax debt to the foreclosed prior owner of the property . . . .” Finally, the Court also argued Massachusetts’s eminent domain laws could be applied to these situations and provide a means for returning surplus funds.
The Land Court’s decision is concerning. First, it ignores the blatant unconstitutionality of Massachusetts’s tax title foreclosure scheme. Second, it attenuates the plain language of Massachusetts’s highest court’s opinion in Kelly that the Legislature meant for towns to keep the excess proceeds under Chapter 60 and that any action to the contrary “rests in the legislative domain.” Third, it incorrectly attempts to apply eminent domain law (chapter 79) to tax title foreclosure law (chapter 60). Eminent domain law and tax title foreclosure law are two different areas of law contained in two different statutes; any conflation of the two is left to the legislature, not the court. And fourth, it adds meaning to a statute’s language which is not present in the statute’s plain language.
Recco has appealed this decision, and the case is still ongoing. This case is important for property owners, because it establishes if states with unconstitutional statutes will change their laws after the Supreme Court’s decision in Tyler. We are fighting for the rights of property owners here to ensure no one is subject to an unconstitutional taking, and will keep you updated with any developments.