| Stone Bridge Farms, Inc. v County of Columbia |
| 2011 NY Slip Op 07551 [88 AD3d 1209] |
| October 27, 2011 |
| Appellate Division, Third Department |
| Stone Bridge Farms, Inc., et al., Appellants, v County of Columbiaet al., Respondents. In the Matter of the Foreclosure of Tax Liens by County of Columbia.County of Columbia, Respondent; Stone Bridge Farms, Inc.,Appellant. |
—[*1] Rob Fitzsimmons, County Attorney, Hudson (Tal G. Rappleyea of counsel), forrespondents.
Peters, J. Appeal from an order of the Supreme Court (McGrath, J.), entered September 16,2010 in Columbia County, which granted a motion by the County of Columbia, in a proceedingpursuant to RPTL article 11 and action for declaratory judgment, for summary judgmentdeclaring that the County is entitled to foreclosure upon a certain tax lien and granting it ajudgment of foreclosure.
Stone Bridge Farms, Inc.'s sole asset is a certain parcel of real property located in the Townof Greenport, Columbia County. Fred Mazzacano, the sole shareholder of Stone Bridge, [*2]died in 1991 and bequeathed equal shares of stock in Stone Bridgeto plaintiff Gary Mazzacano (hereinafter Mazzacano) and his brother. Thereafter, Stone Bridgewas dissolved by Proclamation/Annulment of Authority by the Department of State. Due toStone Bridge's failure to pay taxes on the property, the County of Columbia commenced aforeclosure proceeding in 2000. Subsequently, the County withdrew the subject property fromthe foreclosure proceeding pursuant to RPTL 1138 because it was concerned about possibleliability for the remediation and clean up of an alleged environmental issue associated with theproperty.
Both prior to the commencement of the foreclosure proceeding and after its withdrawal, theCounty engaged in discussions with Mazzacano, who had been managing the property, regardingthe creation of an installment payment plan that would allow Stone Bridge to pay its past-duetaxes over time. Ultimately, defendant Kenneth Wilber, the treasurer and tax enforcement officerfor the County, orally agreed to accept monthly payments of what Mazzacano could afford afterhe paid Stone Bridge's operating expenses. Between 2002 and 2009, the County accepted andsent Mazzacano receipts for Stone Bridge's monthly payments. During this same time period, theCounty engaged in discussions with Jan Exman, who was interested in obtaining the County'senvironmentally challenged properties with outstanding tax liens, remediating and cleaning upany such environmental issues and reselling the properties. In January 2006, the County enteredinto a contract with Exman with respect to Stone Bridge's property. Litigation ensued when theCounty failed to perform under the contract and, eventually, a settlement agreement was enteredinto between the County and Exman whereby the County agreed to recommence foreclosureproceedings on the Stone Bridge property and convey the property to Exman.
In April 2009, Mazzacano and Stone Bridge (hereinafter collectively referred to as plaintiffs)commenced an action seeking a declaration that the installment payment plan was valid andbarring foreclosure of the tax liens. Shortly thereafter, the County began rejecting the paymentsmade by Mazzacano and reinstated the foreclosure proceeding against the property. After theaction and foreclosure proceeding were combined for joint trial, the County moved for summaryjudgment declaring that it was entitled to foreclose upon the liens and granting it a judgment offoreclosure. Supreme Court granted the motion and plaintiffs now appeal.
Supreme Court did not err in granting the County a judgment of foreclosure. In support of itssummary judgment motion, the County demonstrated that Stone Bridge failed to pay the fullamount of taxes on the subject parcel for several years, that the property appeared on the list ofdelinquent taxes every year since 1996, and that it followed all proper procedures in reinstatingthe property to foreclosure pursuant to RPTL 1138 (4). The County also established that StoneBridge had not entered into an installment payment plan that complies with RPTL 1184 or LocalLaw No. 3 (1995) of the County of Columbia.[FN1]Thus, the burden shifted to [*3]plaintiffs to raise a triable issue offact regarding a viable defense to foreclosure (see CPLR 3212 [b]; Matter of Village of Fleischmanns[Delaware Natl. Bank of Delhi], 77 AD3d 1146, 1147 [2010]; Matter of County of Orange [Al TuriLandfill, Inc.], 75 AD3d 224, 236 [2010]).
While acknowledging that the partial payments made to the County were not in compliancewith RPTL 1184 or Local Law No. 3, plaintiffs allege that the County could validly enter into analternative repayment plan outside of this statutory framework. We disagree. Because "a localmunicipality may not act in excess of the powers conferred upon it by the Legislature[,] efforts tocarve out settlements of real property tax disputes in fashions not falling within the statutoryframework are invalid" (Matter ofCounty of Sullivan v Town of Tusten, 72 AD3d 1470, 1471 [2010] [internal quotationmarks and citation omitted]; see Rose v Eichhorst, 42 NY2d 92, 95 [1977]; Sawicki v County of Suffolk, 4 AD3d465, 466 [2004]; People ex rel. Beard's Erie Basin, Inc. v Sexton, 247 App Div 754,754-755 [1936]). Thus, inasmuch as the oral installment agreement for the payment of delinquenttaxes neither complied with the requirements of RPTL 1184 or Local Law No. 3, it is invalid anddoes not constitute a defense to foreclosure (see Matter of County of Sullivan v Town ofTusten, 72 AD3d at 1472).
Even if such an agreement were valid and enforceable, plaintiffs have failed to show that itwould preclude foreclosure under these circumstances. To that end, plaintiffs failed to submit anycompetent proof that the installment payment plan allowed for reduced payments of currenttaxes, rather than just delinquent taxes. Indeed, the documentary evidence submitted by theparties referencing the oral payment plan plainly refers to delinquent taxes only, and it isundisputed that Stone Bridge has failed to pay its current taxes for each year since the agreementand that the property appeared on the County's list of delinquent taxes for each subsequent year.Thus, the failure to pay Stone Bridge's current taxes would provide an independent basis forforeclosure.
Plaintiffs also allege that the County should be equitably estopped from foreclosing on thetax lien, claiming that Mazzacano was improperly induced into making payments on StoneBridge's tax obligations with the understanding that the County would not foreclose on theproperty. " 'The doctrine of estoppel will be applied against governmental agencies only inexceptional cases' in which there has been 'a showing of fraud, misrepresentation, deception, orsimilar affirmative misconduct, along with reasonable reliance thereon' " (Matter of Countyof Orange [Al Turi Landfill, Inc.], 75 AD3d at 238, quoting Yassin v Sarabu, 284AD2d 531 [2001], lv dismissed 98 NY2d 645 [2002]; see Bender v New York CityHealth & Hosps. Corp., 38 NY2d 662, 668 [1976]; Matter of Village of Fleischmanns[Delaware Natl. Bank of Delhi], 77 AD3d at 1147; Delaware County Dept. of Social Servs. v Pontonero, 31 AD3d999, 1001 [2006]). Here, plaintiffs have failed to show any misrepresentation or othermisconduct on the part of the County or Wilber. As previously noted, the record is devoid of anyevidence that the agreement between the parties was intended to reduce payments of currenttaxes that became due, or that the County or Wilber made any such representation.[FN2]In any event, any reliance by Mazzacano on the actions or promises of the County to mean thathe could indefinitely make partial payments of not only the delinquent taxes owed, but also thecurrent tax obligations that [*4]became due, would not bereasonable or justified.
Nor did the County violate the implied covenant of good faith and fair dealing when itrefused to continue to accept payments on Stone Bridge's tax obligations. The County enteredinto the agreement in an attempt to allow Stone Bridge to avoid foreclosure and continued toaccept reduced payments for approximately seven years. Plaintiffs, however, were unable to paythe current taxes on the property, let alone the delinquent taxes, resulting in a tax obligationexceeding $700,000 at the time the foreclosure proceeding was reinstated. Under thesecircumstances, it was not improper for the County to terminate the informal agreement andproceed to foreclosure so that it could recover a fraction of the taxes due on the property.
Finally, we reject plaintiffs' contention that, given the particular circumstances of this case,Supreme Court should have extended Stone Bridge's time to redeem the property. The time fixedby statute to redeem is in the nature of a statute of limitations and may not be extended by thecourt (see Matter of City of Binghamton [Ritter], 128 AD2d 266, 268 [1987]; City ofPeekskill v Perry, 272 App Div 940, 940 [1947]; see also RPTL 1102 [4]; 1110 [2]).Plaintiffs' remaining contentions have been fully reviewed and found to be lacking in merit.
Mercure, J.P., Stein, Garry and Egan Jr., JJ., concur. Ordered that the order is affirmed,without costs.
Footnote 1: RPTL 1184 authorizes countiesto enact local legislation providing for the installment payment of eligible delinquent taxes andsets forth certain requirements for an acceptable payment plan. The County here enacted LocalLaw No. 3 authorizing such installment agreements which, consistent with the requirements ofRPTL 1184 (3), provides that any such agreement must be for a term of 24 months, paymentsmust be made quarterly in equal amounts and the initial payment must be 25% of the delinquenttaxes owed.
Footnote 2: For this same reason, theCounty's acceptance of the installment payments between 2002 and 2007 cannot constitute aratification of the otherwise invalid oral agreement.