Laws, Regulations & Annotations

Property Taxes Law Guide – Revision 2014
 

Revenue and Taxation Code

Property Taxation

Part 6. Tax Sales

CHAPTER 7. Sale to Private Parties After Deed To State

Section 3691

3691. Power to sell. (a) (1) (A) Five years or more, or three years or more in the case of nonresidential commercial property, after the property has become tax defaulted, the tax collector shall have the power to sell and shall attempt to sell in accordance with Section 3692 all or any portion of tax-defaulted property that has not been redeemed, without regard to the boundaries of the parcels, as provided in this chapter, unless by other provisions of law the property is not subject to sale. Any person, regardless of any prior or existing lien on, claim to, or interest in, the property, may purchase at the sale. In the case of tax-defaulted property that has been damaged by a disaster in an area declared to be a disaster area by local, state, or federal officials and whose damage has not been substantially repaired, the five-year period set forth in this subdivision shall be tolled until five years have elapsed from the date the damage to the property was incurred.

(B) A county may elect, by an ordinance or resolution adopted by a majority vote of its entire governing body, to have the five-year time period described in subparagraph (A) apply to tax-defaulted nonresidential commercial property.

(C) For purposes of this subdivision, "nonresidential commercial property" means all property except the following:

(i) A constructed single-family or multifamily unit that is intended to be used primarily as a permanent residence, is used primarily as a permanent residence, or that is zoned as a residence, and the land on which that unit is constructed.

(ii) Real property that is used and zoned for producing commercial agricultural commodities.

(2) When a part of a tax-defaulted parcel is sold, the balance continues subject to redemption and shall be separately valued for the purpose of redemption in the manner provided by Chapter 2 (commencing with Section 4131) of Part 7.

(3) The tax collector shall provide notice of an intended sale under this subdivision in the manner prescribed by Sections 3704 and 3704.5 and any other applicable statute. If the intended sale is of nonresidential commercial property that has been tax-defaulted for fewer than five years, all of the following apply:

(A) On or before the notice date, the tax collector shall also mail, in the manner specified in paragraph (1) of subdivision (c) of Section 2924b of the Civil Code, notice containing any information contained in the publication required under Sections 3704 and 3704.5 to, as applicable, all of the following:

(i) The parties specified in paragraph (2) of subdivision (c) of Section 2924b of the Civil Code.

(ii) Each taxing agency specified in paragraph (3) of subdivision (c) of Section 2924b of the Civil Code.

(iii) Any beneficiary of a deed of trust or a mortgagee of any mortgage recorded against the nonresidential commercial property, and any assignee or vendee of these beneficiaries or mortgagees.

(B) For purposes of this paragraph:

(i) "Notice date" means a date not less than 45 days nor more than 120 days before an intended sale or not less than 45 days nor more than 120 days before the date upon which the property may be sold.

(ii) "Recording date of the notice of default" as used in subdivision (c) of Section 2924b of the Civil Code means a date that is 30 days before the notice date.

(iii) "Deed of trust or mortgage being foreclosed" as used in subdivision (c) of Section 2924b of the Civil Code means the defaulted tax lien.

(b) (1) (A) Three years or more after the property has become tax-defaulted and a request has been made by a city, county, city and county, or nonprofit organization pursuant to Section 3692.4, or a request has been made by a person or entity that has recorded a nuisance abatement lien on that property, to offer that property at the next scheduled tax sale, the tax collector shall have the power to sell and may sell all or any portion of tax-defaulted property that has not been redeemed, without regard to the boundaries of parcels, as provided in this chapter at the next scheduled tax sale, unless by other provisions of law the property is not subject to sale. Any person, regardless of any prior or existing lien on, claim to, or interest in, the property, may purchase at the sale.

(B) When a part of a tax-defaulted parcel is sold, the balance continues subject to redemption and shall be separately valued for the purpose of redemption in the manner provided by Chapter 2 (commencing with Section 4131) of Part 7.

(2) Before the tax collector sells vacant residential developed property pursuant to this subdivision, actual notice, by certified mail, shall be provided to the property owner, if the property owner's identity can be determined from the county assessor's or county recorder's records. The tax collector's power of sale shall not be affected by the failure of the property owner to receive notice.

(3) Before the tax collector sells vacant residential developed property pursuant to this subdivision, notice of the sale shall be given in the manner specified by Section 3704.7.

(c) The amendments made to this section by the act adding this subdivision apply to property that becomes tax defaulted on or after January 1, 2005.

History.—Amended by Stats. 1941, p. 138 (First Extra Session 1940), in effect June 1, 1941. Repealed and reenacted by Stats. 1941, p. 1430, operative June 1, 1941, which added to original provisions the reference to Sections 3550.5 and 3554. Stats. 1943, p. 1988, in effect August 4, 1943, added second sentence. Stats. 1945, p. 2193, in effect September 15, 1945, added provision permitting acceptance of negotiable paper, and revised second clause of first sentence. Stats. 1947, p. 2024, in effect September 19, 1947, amended first paragraph by adding provision that boundaries of parcels in which property deeded to state may be disregarded, and added second paragraph. Stats. 1984, Ch. 988, in effect September 11, 1984, substituted the first sentence for former first sentence which provided "The tax collector may sell for lawful money of the United States or negotiable paper as the tax collector in his discretion may elect all or any portion of tax-deeded property without regard to the boundaries of the parcels in which it was deeded to the state, as provided in this chapter, unless by other provisions of law "such tax-deeded property is not subject to sale", and substituted "tax-

defaulted" for "tax-deeded" in the second paragraph, and made grammatical changes. Stats. 1986, Ch. 1420, effective January 1, 1987, added "has" before "become tax-defaulted" and inserted "," after "redeemed" and after "parcels" in the first sentence of the first paragraph; and deleted ", if the right of redemption has not been terminated" after "subject to redemption", and substituted "(commencing with Section 4131) of Part 7" for ", Part 7, Division 1 of this code, except that no application need be made" after "Chapter 2" in the first sentence of the second paragraph. Stats. 1995, Ch. 189, in effect July 24, 1995, added ", and upon . . . shall sell," after "may sell" and substituted "that" for ''which" after "tax-defaulted property" in the first sentence of the first paragraph. Stats. 1995, Ch. 906, in effect January 1, 1996, added subdivision letter and numerical designation "(a)(1)" before the first paragraph, added the third sentence to subdivision (a)(1), added numerical designation "(2)" before the second paragraph, and added subdivision (b). Stats. 1996, Ch. 699, in effect January 1, 1997, substituted "shall attempt to sell in accordance with Section 3692" for "may sell, and upon the request of a holder of a tax certificate sold in connection with that property, shall sell," after "power to sell" in the first sentence of subdivision (a)(1). Stats. 1997, Ch. 546 (SB 1107) deleted "after the effective date of the act that adds this subdivision in the case of vacant residential developed property" after "abatement lien" in the first sentence of subdivision (b)(1)(A). Amended by Stats. 2004, Ch. 944 (AB 2144), in effect January 1, 2005. Stats. 2007, Ch. 340 (AB 1745), in effect January 1, 2008, substituted "not less than 45 days nor more than 120 days" for "at least 90 days" twice after "means a date" and "intended sale or" in the first sentence of clause (i) of subparagraph (B) of paragraph (3) of subdivision (a) and deleted "subject to a nuisance abatement lien or" after "tax defaulted and", deleted a comma after "nonprofit organization", added "or a request has been made by a person or entity that has recorded a nuisance abatement lien on that property," after "Section 3692.4,", substituted "tax sale" for "public auction" after "the next scheduled", and added "at the next scheduled tax sale" after "in this chapter" in the first sentence of subparagraph (A) of paragraph (1) of subdivision (b).

Note.—See note following Section 2194.

Purchase by county officer.—Any county officer who does not in his official capacity conduct the sale may purchase at the sale. See Section 1090 of the Government Code. Title Guarantee and Trust Co. v. Woody, 63 Cal.App.2d 209.

Amendment permitting former owner to purchase at tax sale not retroactive.—The 1943 amendment to this section, permitting purchase by any person regardless of any prior lien, claim to or interest in the property, is not a curative statute, does not apply to sales made before its effective date, and does not apply to sales other than sales for cash or negotiable paper as provided in Chapter 7. Merchants Finance Corp. v. Mahomed, 82 Cal.App.2d 649.

Soldiers' and Sailors' Relief Act.—This section and Sections 3694, 3696, and 3697, which provide that a sale from the state may be made at any time after deed to the state, are modified by Section 205 of the Soldiers' and Sailors' Civil Relief Act of 1940, as amended in 1942, providing that the period of military service shall not be included in computing any period provided by law for the redemption of real property sold or forfeited to enforce a tax or assessment. Margraf v. Los Angeles County, 144 Cal.App.2d 647.

Sale after condemnation.—A tax deed issued by the county tax collector after the state had taken possession and commenced construction of a highway on the property is void. People ex rel. Department of Public Works v. Fink, 226 Cal.App.2d 19.

Effect on subsurface interest.—A special district's tax title and its collector's deed do not divest an owner of a subsurface estate held in fee simple where the district did not intend to and did not levy taxes upon the mining rights. The owner's defense and cross-complaint were not barred by the statute of limitations contained in the California Water Code. Nevada Irrigation District v. Keystone Copper Corp., 224 Cal.App.2d 523.