DLT List, LLC v. M7VEN Supportive Housing & Development GroupAnnotate this Case
Appellee M7VEN Supportive Housing and Development Group (“M7”) failed to pay taxes on two properties in Carroll County, and, consequently, the Tax Commissioner conducted a tax sale. The properties were purchased by Appellant DLT List, LLC (“DLT”), for a total of $110,000, and the tax sale resulted in excess funds of approximately $105,000. The Commissioner notified M7, DLT, and others of excess funds, and, M7 filed a certificate of authorization seeking to receive the excess funds. Though there were no other claims made on the funds, the Commissioner did not release the funds. Appellee Design Acquisition, LLC, as a lienholder against M7, redeemed the properties from DLT, and DLT issued quitclaim deeds of redemption to M7. Design Acquisition filed a declaratory judgment action claiming entitlement to the excess funds, and the Commissioner filed an equitable interpleader action for the purpose of distributing the excess funds. The two actions were consolidated. The trial court determined that, because M7 was the only entity to have made a claim for the excess funds or to have had a recorded interest in the properties at the time of the tax sale, the Commissioner should have timely released the excess funds to M7. DLT and Design Acquisition appealed, arguing that Design Acquisition had first priority to the excess funds as the redeeming creditor. The Court of Appeals overruled the controlling case law in this matter, applied OCGA 48-4-5 (a) to the question of excess funds and determined that Design Acquisition had no claim to the excess funds because it was not a lienholder at the time of the tax sale. The Georgia Supreme Court granted certiorari to consider whether a redeeming creditor after a tax sale has a first priority claim on excess tax-sale funds. Though the Court disagreed with the rationale employed by the Court of Appeals, the Supreme Court nevertheless affirmed its decision.