Property Rights

A Challenge to Those Who Would Give Libertarians a Bad Name

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Kermit and Delores Atwood's Kafkaesque predicament began with a $1.63 property tax bill they never received. After years of owing no property tax because of a homestead exemption, the Louisiana couple was suddenly charged this tiny amount in 1996, but the bill was sent to the wrong address. Even though the bill came back undelivered, in 1997 the county auctioned off the Atwoods' house at 4122 Dauphine Street in St. Tammany Parish to pay the delinquent taxes. Having somehow missed the tiny notice in the local legal paper, the Atwoods knew nothing of this until 2000, one week after the deadline for challenging the sale had passed. They complained to the county, and the tax assessor got the state Tax Commission to nullify the sale.

The Atwoods thought everything had been taken care of until they put their house up for sale in 2002. Although they got an offer of $90,000 for the house (the mortgage on which had been paid off since 1968), they found they could not complete the transaction because a local developer claimed to have acquired the property from the company that bought it at the tax auction. The developer, James A. Lindsay II of Bush, Louisiana, is challenging the Tax Commission's retraction of the sale in court, so far without success.

Meanwhile, Hurricane Katrina seriously damaged the Atwoods' uninsured house, which they would have sold years ago had it not been for Lindsay's lawsuit. Delores Atwood, 69, lives in a FEMA-furnished trailer in front of the house, while her 71-year-old husband, who needs a respirator, lives with relatives. They do not want to invest any money in fixing the house until they're sure they own it.

The New Orleans Times-Picayune explains Lindsay's perspective: 

Jamie Land [Lindsay's company] argued that once the three-year redemption period has expired, the state Constitution allows only the courts to annul a tax sale. Therefore, the commission lacked the authority to void the sale of the Atwoods' property, the company contends….

"Look, I don't blame her for being mad about it," Lindsay said. "But when you get down to it, it was her who didn't pay her taxes."

Could this be the same James A. Lindsay II of Bush, Louisiana, who one week before had published a letter in the Times-Picayune defending libertarians against columnist Michael Gerson's portrayal of them as libertines? The headline over the letter: "Libertarians Respect Others."

At least he's not Jewish.

[Thanks to Michael Keferl for the tip.]

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  1. If Lindsay is trying to take the house, he’s probably a dick, but I’d say the state owes him at least a refund plus interest, and maybe more if he can show further damages. But that’s owed by the state, which fraudulently tried to sell him something it had no right to, not the homeowners.

    As for his letter, yes, I suppose there is a big difference between anarchists and libertarian minarchists, but we anarchists don’t appreciate it when others assume we’re lawless hedonists any more than libertarians do. We’re not. Many anarchists recognize and respect the natural rights of others, though we don’t believe that they can only be defended by a territorial monopoly. If you disagree, fine, but that’s no reason to pull a Gerson on us either.

  2. Don\’t they know that $1.63 could of gone to pay for street repair or a donut for one of our brave police men & women who help keep all of us safe from barking dogs and skateboarders? Buncha freeloading, unpatriotic traitors!

  3. Wow. Life imitates art once again.

  4. We need an armed rebellion…

  5. I’ve always been against property taxes .Having to pay a yearly fee to the goverment to keep your house is repulsive.

  6. I agree. Say what you will about the income tax, at least the raw amount you pay is directly correlated with what you can afford to pay.

    [unsubstantiated anecdote] Plus, property taxes have been abused for the vilest of stealth government–farms near cities are taxed as if they were subdivisions rather than farms, forcing the farmers to sell. [/unsubstantiated anecdote]

  7. Plus there’s the cases of people buying a property and after many years the value rises to a point they must sell because of the tax.I had a friend who expeianced this in Florida.

  8. As far as the county are concerned the tax bill (regardless of where it is sent) and the itty bitty notice in the paper are merely courtesies. Homeowners are simply expected to know what they owe in property taxes and when those taxes are due.

    /Sez the girl who received notice that her house in Bloomington, IN was being sold out from under her for non-payment of a tax bill that had never been sent.

    Seriously. I asked, “what bill?” They replied, “the bill we sent last year to the previous homeowners.” I asked if I was supposed to open the mail of people I’d not yet met, in a town to which I’d not yet moved, months before laying eyes on a house I’d not yet purchased and was told, “no, but you should have known anyway.”

    I kept my house, but only after knocking a few county heads together and paying through the nose for the privilege.

  9. “…it was her who didn’t pay her taxes.”

    Yeah, it was her, dagnabbit!

  10. I don’t think the county should have the authority to sell a persons property for unpaid taxes no matter what the amount. The most they should be allowed to do is place a lein on the property. By selling the property it indicates that the government is the true owner of the property not the actual owners. I don’t know of any other enitty that can force the sale of a home in order to get paid. (mortgage is different as they actually own the home and the buyers are buying it from the mortgage or bank, so if the buyers quit paying the mortgage company is only reselling what they already own).

  11. I think an argument can be made for property taxes as city services user fees (not by me), but what about farm land? My wife inherited a little bit of farmland and she gets a modest yearly income for renting it out. The property taxes eat up about a fourth of the money. Why does she pay that? What does she get for that money? There’s no water service, electrical, garbage pick-up, police protection (proven by their manifest disinterest when rednecks tore down some of the fencing), fire protection (they’ll keep it from jumping onto residential property, but they won’t put out burning crops and how often do soy bean field catch on fire anyway), and it is not serviced by a road the county pays upkeep for (a federal two-lane highway is the only way to get to it). But if she doesn’t pay, they take it away and sell it to someone else…

    Argue with her about whether tax monies are taken by force… she’ll rip you to pieces…

  12. jb – I’ve heard of that happening as well. The opposite actually happens in Florida though — developers, before they start building, will literally “rent” cattle to graze on the land — it’s a loophole in Florida law, and with the cattle there it’s taxed as farmland and not a subdivision.

  13. Bronwyn,

    The outstanding tax bill wasn’t apparent, settled and/or prorated for the year at closing? Did your title company, uh, fail and owe you a refund?

  14. “Look, I don’t blame her for being mad about it,” Lindsay said. “But when you get down to it, it was her who didn’t pay her taxes.”

    Right, James, and you’re the cocksucker who’s suing an elderly couple to so you can enforce a government seizure while maintaining that you’re a libertarian.

    If this guy’s a Libertarian, I’ll be happy to called a Libertine.

  15. Gorgonzola, I can’t speak for Bronwyn, of course. I can say that when I’ve closed on houses, the title company was concerned with the procedure only up to the amount that was being financed. So if I bought a billion dollar house and financed $50K, the title insurance, etc was only good for $50K – Not $1B. Furthermore, they seem to do minimal due diligence. So if there have been complicated property tax shenanigans, it’s unlikely the title company would have noticed.

  16. And goober’s got it, although I only bought an $80k house and financed $70. Starter home, dontcha know.

    I wish I could remember all the ridiculous details of how it happened… all I can remember is that I didn’t have an escrow account and yet nobody handed me a check at closing. Somebody screwed up somewhere.

  17. Also, goober? What does a $1b house look like?

  18. I don’t know of any other enitty that can force the sale of a home in order to get paid. (mortgage is different as they actually own the home and the buyers are buying it from the mortgage or bank, so if the buyers quit paying the mortgage company is only reselling what they already own).

    That is the case only in “title-theory” states. In “lien-theory” states the borrower gets the title to the home and the mortgage allows the lender to record a lien on the property.

  19. “At least he’s not Jewish.”

    Eh?

  20. brec–

    Sullum’s expressing his embarrassment at association with a despicable character who happens also to be a libertarian.

    At first I didn’t get it either.

  21. Excuse my ignorance,

    but how does the state seizing property over back taxes scam work? If you’re down to the govt for 10 dollars, and get your property sold out from underneath you to satisfy the debt (no matter how piddling the amount), does the house get sold at something approaching fair market value? Is it sold for the price of the debt? If it’s sold for more, where does the extra money go? To the tax deadbeats who thought they owned it, or does the state keep it?

  22. “I think an argument can be made for property taxes as city services user fees”

    If that is the case, why are we paying utility taxes, sanitation taxes, etc.?

  23. Like 20 for 50,

    It may depend on your jurisdiction, but in general, it’s a regularly scheduled auction at the end of the county-determined due process. At least here, the minimum bid includes all costs due the government (doesn’t matter what’s owed on mortgages or private liens)

    “The first bid or opening bid on each property shall be a sum sufficient to pay all Sheriff’s costs including advertising, all taxes, water rents and municipal claims due to the City of Philadelphia. If there is no other bid price above the opening bid price, the property shall be sold by the auctioneer to the attorney on the writ at that price.”

    It appears the sheriff creates an order of distribution from the proceeds (for all lienholders and claimants including the original owner) within 30 days after the auction.

  24. What does a $1b house look like?

    A giant shimmering golden castle, soaring through the clouds …

  25. The 50 is the new 20,

    It depends on the state. I’ve bought a couple of properties in Texas, so I know that process. One I was the only one interested in the property at auction, so it went for the minimum bid (the amount of taxes & penalties owed, plus expenses and court costs from the judicial foreclosure)- there was nothing left for the owner (who had inherited the vacant lot and not paid taxes on it for 7 or more years). Another property I bought was a vacant house that was a former rental property- at auction there were a few others interested and the price I paid was about 4 times the amount of tax owed on it (which was about 5 years worth of unpaid taxes). There was a mortgage balance owed but the lien was vacated in the foreclosure. I assume the mortgage company and the former owner got to fight over the 5 figure excess proceeds from the sale at auction. For otherwise free and clear properties, the excess proceeds go to the former owner.

    Right, James, and you’re the cocksucker who’s suing an elderly couple to so you can enforce a government seizure while maintaining that you’re a libertarian.

    We live in the world that is, not in the world as it should be. If you’re going to be a purist ideologue, then you need to stay off the public roads, since they are property seized through eminent domain and improved using tax dollars stolen at the point of a gun.

    The guy in this case purchased the property at auction in good faith. He comes off as a cocksucker, but that’s because he idiotically tried to spin the story to an unsympathetic reporter. Should he get screwed out of the money he’s sunk into buying and improving the property, just because the beneficiaries are old? The Atwoods are being stubborn in saying “I don’t owe him 50 cents, not with what he’s put me through.” This should have been settled 5 years ago.

    This is a “government fuck-up” story. Why is it spun here as a “heartless libertarian” story?

  26. Hmmm… Funny you should mention Gerson. He’s already on my shit list:

    http://forums.randi.org/showthread.php?t=87631

    Whether it’s for libertarians or atheists, I owe this control freak a knuckle sandwich.

  27. The first time I bought a house, the title company did a title search: that is they sent somebody to the courthouse to check the records. The second time, they sold me title insurance: they’d pay me if something was wrong with the title.

    Pity they changed, that title search document had a lot of history: land grants and homesteading and tax auctions every couple of years during the depression.

  28. This is a “heartless libertarian” story because the guy is buying land that he knows is stolen by the government from people who either refused or were unaware they were doing something wrong. That makes him a dick.

  29. And people mock me because I choose to rent.

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