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2004-UP-285 - Allsbrook v. Horry County

THIS OPINION HAS NO PRECEDENTIAL VALUE.  IT SHOULD NOT BE CITED OR RELIED ON AS PRECEDENT IN ANY PROCEEDING EXCEPT AS PROVIDED BY RULE 239(d)(2), SCACR.

THE STATE OF SOUTH CAROLINA
In The Court of Appeals


Joseph R. Allsbrook, Jr. and Russell Allsbrook,        Appellants,

v.

Horry County, A Body Politic, Billy V. Roberts and Roy C. Roberts,        Respondents.


Appeal From Horry County
Steven H. John, Circuit Court Judge


Unpublished Opinion No. 2004-UP-285
Submitted April 6, 2004 – Filed April 30, 2004


AFFIRMED


John R. Clarke, of North Myrtle Beach, for Appellants.

Mark Andrew Brunty and Thomas C. Brittain, both of Myrtle Beach, for Respondents.

PER CURIAM:  Appellants Joseph R. Allsbrook, Jr., and Russell Allsbrook (Allsbrooks) brought this action against Horry County to set aside a tax sale of real property located in Garden City, South Carolina.  The Allsbrooks also asserted claims against Billy V. Roberts and Roy C. Roberts for equitable avoidance and breach of fiduciary duty related to the tax sale.  The circuit court granted the respondents’ motion for summary judgment, finding the Allsbrooks’ claims were barred by the applicable two-year statute of limitations.  This appeal followed.  We affirm.

FACTUAL/PROCEDURAL BACKGROUND

Carolyn A. Roberts died in July 1991, leaving a holographic will disposing of her personal and real property, including her half-interests in two Garden City lots.  These lots are at the center of the dispute in this case.  The will devised Mrs. Roberts’ 50% interest in one of the lots to her brother, Joseph Allsbrook, Jr., and her 50% interest in the other lot to her nephew, Russell Allsbrook.  Mrs. Roberts’ surviving husband, Billy V. Roberts, was appointed personal representative of the estate. 

As this appeal turns on the application of the statute of limitations, the following timeline is critical:  In April 1993, nearly two years after Mrs. Roberts’ death, Horry County issued an official Notice of Levy on the Garden City lots for failure to pay property taxes.  Because no one claiming an interest in the lots paid the taxes, a delinquent tax sale was held on October 4, 1993.  Respondent Roy C. Roberts was the successful bidder.  In December 1994, Roy Roberts filed the tax deed to the lots in his name. 

The probate hearing for Carolyn Roberts’ estate was held on June 8, 1995.  At the hearing, Joseph Allsbrook challenged Billy Roberts’ distribution of several items of Mrs. Roberts’ personal and real property.  Joseph also argued before the probate judge that Billy Roberts allowed the property in question to be sold for delinquent taxes without notifying the beneficiaries.  Billy’s attorney noted the probate matter was one to determine the assets of the estate, and if Joseph sought some additional remedy he would need to bring a separate action against Billy.  Joseph’s attorney agreed that the lots were assets of the estate, and the probate judge then stated, “So everyone understands it is clearly an asset of the estate, and there is nothing for me to determine under this [provision].”  In its order, the probate court found with respect to the provision on the property in question, “the matter is agreed between the parties and the property contained in paragraph 9 is an asset of the estate.”  Joseph appealed the probate court’s distribution to the circuit court, and later to the Court of Appeals.  This court’s final opinion was filed November 8, 2000.  Allsbrook v. Estate of Roberts, Op. No. 2000-UP-509 (S.C. Ct. App. Filed Nov. 8, 2000).In regard to the Garden City lots, this court held as follows:

Allsbrook asserts the probate court erred in holding the lots in Garden City, devised in paragraph nine of the will, were assets of the estate.  At the hearing, the parties agreed the lots were estate assets. . . . Allsbrook is not aggrieved by this ruling.  See Rule 201(b), SCACR (“Only a party aggrieved by an order, judgment or sentence may appeal.”).  Therefore we affirm the probate court’s disposition of this issue.

Id.

On February 6, 2001, the Allsbrooks filed the present action seeking to set aside the 1993 tax sale of the Garden City lots.  The Allsbrooks alleged Horry County failed to conform to the strict and specific requirements of the statutes governing notice and sale of property to satisfy delinquent taxes.  They further alleged causes of action against Billy Roberts, as personal representative, for breach of fiduciary duty and equitable avoidance stemming from his failure to pay the delinquent taxes on the lots or properly notify the Allsbrooks of the impending tax sale.  On Respondents’ motions for summary judgment, the circuit court dismissed the Allsbrooks’ claims, finding they were barred by the two-year statute of limitations prescribed by South Carolina Code § 12-51-160. 

STANDARD OF REVIEW

When reviewing the grant of a summary judgment motion, the appellate court applies the same standard which governs the trial court:  Summary judgment is proper when there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law.  Laurens Emergency Med. Specialists v. M.S. Bailey & Sons Bankers, 355 S.C. 104, 108-09, 584 S.E.2d 375, 377 (2003); see also McDonnell v. Consol. Sch. Dist. of Aiken, 315 S.C. 487, 489, 445 S.E.2d 638, 639 (1994) (holding a motion for summary judgment can be used to raise the defense of statute of limitations).

LAW/ANALYSIS

I.       Allsbrooks’ Claim Against Horry County

The Allsbrooks first argue the circuit court erred in granting summary judgment in favor of Horry County on their claim seeking to set aside the tax sale.  We find the circuit court properly ruled this cause of action was barred by the statute of limitations.

South Carolina Code Ann. §§ 12-51-40 and 12-51-50 (Supp. 2003) authorize counties to sell the property of taxpayers delinquent in paying their property taxes.  In granting this authority, the Code prescribes the requirements for notice and conduct of the sale—requirements that are strictly enforced.  See § 12-51-40 (a)-(f) (notice requirements); § 12-51-50 (conduct of sale requirements); see also Rives v. Bulsa, 325 S.C. 287, 292-93, 478 S.E.2d 878, 881 (Ct. App. 1996) (holding all requirements of law leading up to tax sales which are intended for the protection of the taxpayer against surprise or the sacrifice of his property are to be regarded as mandatory and are to be strictly enforced).  If a taxpayer or other interested party desires to challenge the propriety of a county tax sale, suit must be filed within the limitations period prescribed by § 12-51-160 which provides in part:  “No action for the recovery of land sold under the provisions of this chapter or for the recovery of the possession may be maintained unless brought within two years from the date of sale.”  S.C. Code Ann. § 12-51-160 (2000).

In the present case, the Allsbrooks do not dispute the fact they brought their action to set aside the tax sale over seven years after the date of sale.  Rather, they contend the two-year limitations period of § 12-51-160 was tolled during the pendency of their appeal from the probate court’s order on the distribution of the estate.  We disagree.

Though our state’s courts have not had occasion to consider the narrow question presented, it is well settled in our nation’s jurisprudence that the pendency of other legal proceedings may toll the statute of limitations on a cause of action where such proceedings prevent enforcement of the remedy by action.  See 54 C.J.S. Limitations of Actions § 121 (1987) (noting that “[w]here a person is prevented from exercising his legal remedy by the pendency of legal proceedings, the time during which he is thus prevented should not be counted against him in determining whether limitations have barred his right”); 51 Am. Jur. 2d Limitations of Actions § 207 (2000) (noting that “[d]uring the period of the restraint incident to other legal proceedings that are of such a character that the law forbids one of the parties to exercise a legal remedy against another, the running of the statute of limitations is postponed, or, if it has commenced to run, is suspended”).

In the main, the courts have found that limitations periods are tolled by other pending actions where the pursuit of additional or alternative legal remedies is expressly prohibited by statute.  Typically, this situation arises under statutory schemes that require the exhaustion of all administrative remedies before common-law claims seeking redress for the injury are permitted.  See, e.g., Trent v. Bolger, 837 F.2d 657, 659-60 (4th Cir. 1988) (holding that when an employee is required to exhaust administrative remedies, applicable limitations period for filing action is tolled pending exhaustion of the administrative channels); Butler v. Glen Oak’s Turf, Inc., 196 Ga. App. 98, 101, 395 S.E.2d 277, 280 (1990) (holding that the statute of limitations was tolled on an employee’s common-law tort claim because she was legally barred from pursuing that claim during the pendency of her workers’ compensation case). 

In the present case, the ongoing probate action involving the disposition of Mrs. Roberts’ estate posed no obstacle to the Allsbrooks’ ability to pursue their remedy under the statute governing county tax sales.  As devisees under the will, their interests in the Garden City lots vested immediately upon her death. S.C. Code Ann. § 62-3-101 (Supp. 2003); see also In re Will of Hall, 318 S.C. 188, 192, 456 S.E.2d 439, 441 (Ct. App. 1995) (holding that devisee of life estate under will received her interest in the property the day the testatrix died).  The fact of pending collateral litigation with respect to the distribution of property under the will did not affect the devisees’ right to pursue their remedies under the tax sale provisions of the Code.  Thus, the two-year limitations period was not tolled during the pendency of the probate action.  Accordingly, we affirm the circuit court’s finding that the Allsbrooks’ action to set aside the tax sale was barred by the statute of limitations.

II.      Allsbrooks’ Claims Against Billy Roberts and Roy Roberts

The Allsbrooks also appeal the circuit court’s dismissal of their causes of action against Billy Roberts and Roy Roberts for “equitable avoidance” [1] and breach of fiduciary duty.  Under these claims, the Allsbrooks essentially alleged Billy Roberts breached his duty of care as personal representative of the estate by failing to ensure the taxes on the Garden City lots were timely paid, failing to notify the Allsbrooks of the tax arrears and impending tax sale, and failing to inform the Allsbrooks of their right to redeem the property.  These causes of action were dismissed by the circuit court as barred by the statute of limitations under S.C. Code Ann. § 12-51-160.

The Allsbrooks argue it was error for the circuit court to apply the limitations period prescribed under the statutory provisions governing tax sales to their claims for breach of fiduciary duty against Billy Roberts.  Under the undisputed facts of the present case, however, we consider this question to be purely academic as it would have no impact on the result reached by the lower court. 

Even if the court applied the maximum three-year statute of limitations generally applied to breach of fiduciary duty claims, the Allsbrooks’ claims would still be barred.  A cause of action for breach of fiduciary duty is governed by the discovery rule and must be brought within three years of the time the person knew or should have known by exercise of reasonable diligence that he had a cause of action.  See S.C. Code Ann. §§ 15-3-530(5) and 15-3-535 (Supp. 2003); Rumpf v. Massachusetts Mut. Life Ins. Co., 357 S.C. 386, 394, 593 S.E.2d 183, 187 (Ct. App. 2004). 

In this case, the Allsbrooks knew by June 1995 that Billy Roberts allowed the property in question to be sold for delinquent taxes and that Roy Roberts had purchased the property at the tax sale.  Indeed, counsel for Joseph clearly admitted at the June 8, 1995, probate hearing that the Allsbrooks were fully aware of the tax sale and its implications, stating:

[W]e will submit to the Court documents that one of the parcels of land that is in the Will, was allowed to be sold for taxes through the Horry County Delinquent Tax Collectors office . . . As fiduciary, [Billy Roberts] has the responsibility to protect those assets of the estate during the administration. . . .  I think it is admitted that the property was sold through the delinquent tax office, and was purchased by Roy Roberts . . .  [Billy] Roberts as fiduciary personal representative, never notified any of the beneficiaries of the delinquent tax notice or anything, and they did not have the opportunity to purchase that property at the tax sale or her interest in it, at the tax sale.

Therefore, actual knowledge of the tax sale can be imputed to the Allsbrooks no later than the date of the probate hearing, nearly six years before they brought the present action in February 2001.  The three-year maximum limitations period of § 15-3-530 was unquestionably exceeded.

We conclude, therefore, that if the circuit court erred by lumping together all of the Allsbrooks’ claims under the umbrella of § 12-51-160’s limitations period, the error is a harmless one. 

CONCLUSION

For these reasons, we find no error with the trial court’s finding that all claims of the Allsbrooks were barred by the applicable statute of limitations.  The order granting summary judgment in favor of Respondents is therefore

AFFIRMED.

HUFF, STILWELL, JJ., and CURETON, A.J., concur.


[1] Our research reveals no cases in South Carolina that recognize a cause of action for “equitable avoidance.”  The allegations under this claim in the Allsbrooks’ complaint mirror those listed under the breach of fiduciary duty cause of action in all material respects.