Indiana Land Trust Company, f/k/a Lake County Trust Company TR #4340, Appellant-Movant,
XL Investment Properties, LLC, and LaPorte County Auditor, Appellees-Respondents
from the LaPorte Superior Court The Honorable Richard R.
Stalbrink, Jr., Judge Trial Court Cause No.
ATTORNEYS FOR APPELLANT Greg A. Bouwer Jeff Carroll Koransky
Bouwer & Poracky, P.C. Dyer, Indiana
ATTORNEY FOR APPELLEE XL INVESTMENT PROPERTIES, LLC Matthew
J. Hagenow Newby, Lewis, Kaminski & Jones, LLP LaPorte,
ATTORNEY FOR APPELLEE LAPORTE COUNTY AUDITOR J. Alex
Bruggenschmidt Buchanan & Bruggenschmidt, P.C.
Indiana Land Trust Company, f/k/a Lake County Trust Company
TR #4340 (Trust 4340), appeals the judgment of the trial
court denying its motion to set aside a tax deed and quiet
title judgment issued to XL Investment Properties, LLC (XL
Investment). Trust 4340 argues that the trial court
erroneously determined that the motion to set aside was
untimely filed and the tax sale notice process employed by
the LaPorte County Auditor (the Auditor) was statutorily and
constitutionally insufficient. Finding that the motion to set
aside was not untimely and that the notice process was
constitutionally insufficient, we reverse and remand for
Peter Dellaportas is a decades-long real estate developer who
owns many investment properties. At some point in the past,
Dellaportas purchased a 140-acre property, which used to be a
municipal airport, in Michigan City. The property has since
been subdivided into multiple parcels, some of which have
been developed for commercial use.
Dellaportas's company, located in Chicago, is called
Midwest Investment. In June 1993, Dellaportas put one of the
undeveloped parcels, totaling approximately thirty acres (the
Property) into a trust, Trust 4340, with either himself or
Midwest Investment as the beneficiary. Lake County Trust
Company (the Trust Company) was the entity that helped him
process and finalize the trust.
The deed directed that property tax bills for the Property
should be sent to Midwest Investment at 415 North LaSalle
Street, Suite 700, in Chicago. In 1994, Midwest Investment
relocated to Suite 200 in the same building and remained
there for approximately ten years. In 2014, Midwest
Investment moved to 432 North Clark Street, Suite 304, in
Chicago. Midwest Investment did not update the Auditor with
its changes of address.
Midwest Investment paid the property taxes on the Property
from 1993 through 2008 but failed to pay any property taxes
from 2009 through 2015. In 2015, LaPorte County (the County)
determined that the Property's outstanding tax liability
totaled $230, 017.26.
The County held a tax sale in 2015 (the Tax Sale); the
certified Tax Sale list included the Property. The County
engaged SRI, Inc. (SRI), a local government contractor, to
assist with various aspects of the tax sale process,
including the mailing of thousands of tax notices. The Work
Plan Agreement entered into between the County and SRI stated
that the parties (including SRI, the Auditor, and the
Treasurer) would "individually or collectively perform
or cause to be performed by employees of their organization
the actions defined herein which are required to execute the
County Tax Sale in compliance with Ind. Code 6-1.1-24 and
Ind. Code 6-1.1-25." Tr. Ex. 21. The Work Plan Agreement
also stated that "the Auditor agrees to search its
internal records for a better address for the owner(s) of
properties for which the certified mail notices are returned
and provide the results of said searches to SRI . . . ."
In 2015, the General Assembly amended Indiana Code section
6-1.1-24-4. Following that amendment, the Auditor believed it
no longer had an obligation to search for a better address if
certified mail notices were returned as undeliverable.
On July 31, 2015, SRI prepared the notice of the tax sale of
the Property and sent it by certified mail (the Certified
Mail Notice) to Trust 4340 at Suite 700 on North LaSalle
Drive. The Certified Mail Notice did not contain a street
address or common description of the Property. The Certified
Mail Notice was returned, stamped "Return to Sender, Not
Deliverable as Addressed, Unable to Forward," and bore a
handwritten note stating "refused." Tr. Ex. 24. The
notice was also mailed to the same address on the same date
by regular, first-class mail (the First Class Notice). The
First Class Notice was not returned.
SRI generated a "returned mail to search" list for
all entities that were sent notices of the Tax Sale; the list
included Trust 4340. In August 2015, SRI performed an
additional search for addresses of those entities, but
evidently was unable to find the current address for Trust
4340 and/or Midwest Investment.
On August 7, 2015, the address for tax notices for Trust 4340
and the adjacent parcel was changed in the LaPorte County
system used by the Auditor and assessor. Beginning on that
date, the system listed the correct, current address on North
The Auditor did not undertake any effort to find current
addresses for property owners whose certified mail was
returned as undeliverable. Although SRI posted to its website
if first class or certified mail was returned, no one from
the Auditor's office ever checked that website to
determine if mail had been returned. There was never a point
in the process when the Auditor looked for returned mail or
took any action related to it. Indeed, employees of the
Auditor readily admitted they took no action:
• "Q: Did you search your internal records for
this parcel, to your knowledge? A: I just answered that. We
did not because the first-class mail was not returned.
Shall I say it ...