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RENDERED: APRIL 19, 2013; 10:00 A.M. NOT TO BE PUBLISHED

Commonwealth of Kentucky Court of Appeals
NO. 2012-CA-000448-MR SOUTHERN TAX SERVICES, LLC APPELLANT

v.

APPEAL FROM LAWRENCE CIRCUIT COURT HONORABLE JOHN DAVID PRESTON, JUDGE ACTION NO. 10-CI-00131

TAX EASE LIEN INVESTMENTS 1, LLC; DARVIN WOODROW JAMES; JUDITH P. JAMES; DAVID PERRY; SHEILA PERRY; EQUITY ONE, INC.; SANDY VALLEY FINANCIAL SERVICES, INC.; COMMONWEALTH OF KENTUCKY, COUNTY OF LAWRENCE, BY AND ON RELATION OF JONATHAN MILLER, SECRETARY OF FINANCE AND ADMINISTRATION CABINET; INTERSTATE NATURAL GAS COMPANY, LLC; A-1 TREASURE COAST; U.S. BANK, NATIONAL ASSOCIATION, AS SUCCESSOR IN INTEREST TO WACHOVIA CUSTODIAN FOR SASS MUMI V DTA; AND KENTUCKY TAX BILL SERVICING, INC.

APPELLEES

OPINION REVERSING AND REMANDING ** ** ** ** ** BEFORE: KELLER,1 LAMBERT, AND MOORE, JUDGES. LAMBERT, JUDGE: Southern Tax Services, LLC (STS) has appealed from the February 6, 2012, order of the Lawrence Circuit Court denying its motion for summary judgment related to its ability to recover penalties, interest, attorney fees, and other costs associated with its acquisition of tax bills for 2008 and 2009 on property located in Lawrence County. The basis of the circuit court's ruling was lack of statutory notice to the owners of the property pursuant to Kentucky Revised Statutes (KRS) 134.490. Because we disagree with the circuit court's ruling as a matter of law, we reverse the order on appeal. Tax Ease Lien Investments 1, LLC, (Tax Ease) instituted the underlying action by filing a complaint in Lawrence Circuit Court against David Perry and Sheila Perry (the Perrys), among other defendants, seeking a lien, the sale of the property, and a judgment for the amount of a Certificate of Delinquency, along with interest, penalties, costs, and attorney fees, pursuant to KRS Chapter 134. Tax Ease had purchased a delinquent tax bill from the Lawrence County Sheriff for 2003 property taxes at 13788 US Highway 23. Other defendants were named so as to notify them that they may claim an interest in the property by virtue of a lien.
1

Judge Michelle M. Keller concurred in result in this opinion prior to her appointment to the Kentucky Supreme Court. Release of this opinion was delayed by administrative handling.

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In their answer to the complaint, the Perrys stated that Tax Ease failed to name an indispensible party to the complaint; namely, the owners of the property, Darwin Woodrow James and Judith James (the Jameses). The Perrys indicated that they only had an equitable interest in the property as they were purchasing the property through a land contract with the Jameses. Tax Ease then moved to file an amended complaint to name the Jameses as defendants, which the circuit court granted. In their answer and counterclaim, the Jameses first stated that the complaint should be dismissed for failure to join several other parties that had purchased delinquent tax bills on the subject property, including STS, the appellant herein, which had purchased tax bills for the years 2008 and 2009. In addition, the Jameses stated that Tax Ease failed to provide the fifty-day notice required by KRS 134.490 and therefore was only entitled to recover the cost of the acquisition of the 2003 tax bill. The Jameses filed a cross-claim against the Perrys alleging breach of contract for the Perrys' failure to make payments pursuant to the land contract or to pay the state and county property taxes as they had agreed. Tax Ease moved for and obtained leave to file a second amended complaint to name additional parties having an interest in the subject property, including STS. Tax Ease indicated that STS had purchased the 2008 property tax bill number 7198 and the 2009 property tax bill number 7245. STS filed an answer and cross-claim against the Perrys and the Jameses, seeking payment of the delinquent tax bills, costs, fees, and interest. In their answers to the second

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amended complaint and to STS's cross-claim, the Jameses again raised the notice defense required by KRS 134.490. Tax Ease filed a motion for summary judgment related to whether it complied with the notice requirements of KRS Chapter 134. In the motion, Tax Ease explained that while the actual owners of the subject property were the Jameses, the property taxes were assessed in the name of the Perrys, apparently due to the existence of a land contract between the parties. Tax Ease purchased the delinquent tax bill for 2003, and it sent its first statutory notice to the Perrys on July 16, 2007, informing them that it had purchased the certificate pursuant to KRS 134.490. The Lawrence County Property Valuation Administrator (PVA) had the Perrys' names and address listed as the owners for the subject property. Tax Ease did not dispute the Jameses' claim that they never received notice of its purchase of the tax bill. However, Tax Ease argued that it had a valid and enforceable lien against the subject property owned by the Jameses, noting that the Jameses had the duty to ensure the taxes on the property were paid on an annual basis and to ensure that the PVA had the correct contact information on record. Because it provided proper notice to the address listed with the PVA as required by the statute, Tax Ease contended that it met the statutory notice requirement of KRS 134.490. Another defendant, US Bank National Association, filed a motion for summary judgment making similar arguments. The Jameses filed a response in opposition to both motions.

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The court held a hearing, and on January 13, 2012, the circuit court entered an order ruling on the two pending motions for summary judgment. After setting forth the complicated factual and procedural history of the case,2 the circuit court noted that the PVA incorrectly issued the tax bill in the name of the Perrys rather than the Jameses and that legal title to the property remained with the Jameses at all times. Because the tax bills listed the Perrys, both Tax Ease and US Bank sent the statutory notices to the Perrys' address. The court considered the different versions of KRS 134.490 that had been in effect at the time the tax bills had been purchased and concluded that the legislature, through the use of the terms "taxpayer" and "owner," intended that the taxpayer and the owner were the same individuals. While the court opted to hold the Jameses responsible for the tax bills, it held that neither Tax Ease nor US Bank provided proper notice and were not permitted to recover costs, fees, interest, or administrative expenses. Because other claims were still pending, the court did not make the order final or appealable. STS then filed its own motion for summary judgment, detailing its purchases of the delinquent tax bills and its notification to the Perrys pursuant to the PVA records. Like Tax Ease and US Bank, STS argued that it was entitled to recover not only the purchase price for the delinquent tax bill, but fees and costs as well. In support of its argument that it provided proper statutory notice, STS stated that it complied with the plain meaning of KRS 134.490 as a third-party purchaser
2

Aptly describing this history, the court commented, "Into this morass, the Court must wade."

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by mailing the statutory notice to the address in the PVA records. STS contends that the General Assembly must have intended "taxpayer" to refer to the person listed as the owner in the PVA records. In response, the Jameses stated that the court's prior order was applicable to STS. The Commonwealth, another defendant, also moved for summary judgment. Following another hearing, the circuit court ruled on STS's motion by order entered February 6, 2012, and held that its prior order was applicable to STS, as the Jameses argued. Because nothing else remained to be decided, the court entered a final order setting forth the recovery for Tax Ease and the other thirdparty purchasers of the delinquent tax bills as well as Lawrence County. The court permitted Lawrence County to recover interest from February 1, 2012, as well as the 13% county attorney's commission fee, but did not permit any other parties to recover anything but the acquisition cost of the tax bill. The court addressed and dealt with the remaining parties, ordered the property to be sold, and set forth the distribution of the proceeds by the commissioner. The court specifically denied STS's motion insofar as it sought penalties, interest, attorney fees, and other costs, but permitted it to recover the acquisition costs. This appeal by STS followed.3

3

STS was the only party to file an appeal from the circuit court's rulings, and no party filed a cross-appeal in the present matter. Tax Ease filed an appellee brief in the present appeal, but limited its brief to arguing that it provided proper statutory notice and should therefore be permitted to recover fees and costs. Because Tax Ease did not file an appeal on its own behalf, it is not permitted to make any argument seeking relief for itself. Therefore, we shall disregard Tax Ease's brief.

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In its brief, STS continues to argue that it complied with the statutory notice requirements set forth in KRS 134.490 when it mailed the notice to the name and address listed in the PVA records.4 Likewise, the Jameses continue to argue that STS did not comply with the notice requirements and is therefore not entitled to any recovery over the amount of the tax bill. An appellate court's standard of review from a summary judgment is well-settled in the Commonwealth: The standard of review on appeal when a trial court grants a motion for summary judgment is "whether the trial court correctly found that there were no genuine issues as to any material fact and that the moving party was entitled to judgment as a matter of law." . . . Because summary judgment involves only legal questions and the existence of any disputed material issues of fact, an appellate court need not defer to the trial court's decision and will review the issue de novo. Lewis v. B & R Corp., 56 S.W.3d 432, 436 (Ky. App. 2001) (footnotes omitted). As a general rule, a party may not appeal from an order denying a motion for summary judgment because such orders are inherently interlocutory. However, there is an exception to this rule, as this Court explained in Roman Catholic Bishop of Louisville v. Burden, 168 S.W.3d 414, 419 (Ky. App. 2004): It is well settled in this Commonwealth that the denial of a motion for summary judgment is interlocutory and is not appealable. In [Transportation Cabinet, Bureau of Highways, Com. of Ky. v. Leneave, 751 S.W.2d 36 (Ky.
4

STS includes an additional argument in its brief that the circuit court discriminated against it because it permitted Lawrence County to recover interest and fees. We agree with the Jameses that this argument is not properly before the court because STS did not raise this before the circuit court, nor was it listed as an issue in its prehearing statement.

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App. 1988)], this Court held: "The general rule under CR 56.03 is that a denial of a motion for summary judgment is, first, not appealable because of its interlocutory nature and, second, is not reviewable on appeal from a final judgment where the question is whether there exists a genuine issue of material fact." There is, however, an exception to this general rule, which was also addressed in Leneave: "The exception applies where: (1) the facts are not in dispute, (2) the only basis of the ruling is a matter of law, (3) there is a denial of the motion, and (4) there is an entry of a final judgment with an appeal therefrom." [Footnotes omitted.] STS's appeal from the order denying its motion for summary judgment meets this exception and is properly before this Court for review; the facts are not in dispute, the basis for the circuit court's ruling was an issue of law, STS's motion was partially denied, and a final judgment has been entered from which STS has appealed. The sole question before this Court relates to the interpretation of KRS 134.490. The interpretation of a statute is a matter of law. Commonwealth v. Garnett, 8 S.W.3d 573, 575

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