If the foreclosed mortgage is guaranteed by a federal agency or a Government Sponsored Entity (GSE), requirements in addition to those provided by Louisiana law will govern the state court foreclosure action. Although by the time a mortgage is foreclosed in state court, most clients have either failed to take advantage of programs available to them, or they will have applied for modification and been denied, the following sections will discuss some aspect of those programs in the following sections.

The purpose of the Federal Housing Administration (FHA) within the Department of Housing and Urban Development is to expand homeownership opportunities for people who are not adequately served by the private market.

FHA does not lend money; private lenders finance the home purchase loan, and the FHA guarantees the lender that it will be made whole in the event of a mortgage default.

Mortgage servicers of FHA loans must comply with the FHA loan servicing guidelines.1  These guidelines formerly provided six different options for homeowners who were threatened with foreclosure: forbearance, refinancing, loan modification, partial claim, pre-foreclosure sale, and deed in lieu of foreclosure. However, the COVID-19 era resulted in the suspension of some of these programs and the creation of others. Any client with an FHA loan should be referred to a HUD counselor for the latest information.

Mortgage servicers must review an FHA loan for these loss mitigation options before proceeding to foreclosure.2

HUD-guaranteed loans must be at least 3 months past due before foreclosure. Additionally, all Consumer Financial Protection Bureau rules and regulations must be complied with. HUD may pursue a deficiency judgment but currently (as of May 2023) does not do so as a matter of policy and politics.

• 1 24 C.F.R. §§ 203.500–.685.
• 2See U.S. Dep’t of Hous. & Urb. Dev., Handbook 4000.1, FHA Single Family Housing Policy Handbook tit. I, § III(A)(2)(j) (2021.

The Department of Veterans Affairs (VA) guarantees loans made by lenders to veterans. Mortgage servicers of VA loans must comply with special servicing guidelines.1  A mortgage company’s failure to comply with the VA Loan Servicing Guidelines may be a complete defense to a mortgage foreclosure action.

• 138 C.F.R. §§ 36.4275–.4283.

The United States Department of Agriculture (USDA) operates the Rural Housing Service, which provides single-family Direct and Guaranteed Loans under its directive to improve the economy and quality of life in rural America.

USDA is the lender and servicer for Direct Loans. Special servicing for Direct Loans include workout agreements, protective advances in which USDA pays taxes and insurance on behalf of borrower.

USDA Guaranteed Loans are guaranteed by the USDA against default by the borrower. USDA Guaranteed Loans will not be serviced by the USDA and will not necessarily be identifiable from the loan documents. Special loss mitigation options are available to borrowers with USDA Guaranteed Loans.1

• 1See U.S. Dep’t of Agric. Rural Dev., HB-1-3555, SFH Guaranteed Loan Program Technical Handbook ch. 18 (rev. Oct. 14, 2020).

The Consumer Financial Protection Bureau (CFPB) also imposes requirements on private mortgage lenders and servicers which, if not complied with, may be a defense to the state court foreclosure action.

You can help preserve home ownership for low-income clients by a simple check-up of their real estate. Check for the following:

• Is the homeowner listed as the homeowner in the assessor and conveyance records?
• Is the homeowner’s address in the assessor’s records correct?
• Has there been a tax sale, blight adjudication or other adverse government action?
• Is the homeowner getting the correct homestead exemption?
• Is the homeowner the surviving spouse of an active-duty service member?1
• Is the homeowner a 100% disabled veteran due to a service-connected injury or the surviving spouse of such a person?2
• Is the homeowner eligible for an age freeze for being 65 or older?
• Is the homeowner permanently totally disabled as determined by a court order?

If the owner’s name and correct address are not listed with the assessor, the owner won’t get notices of tax sales, code enforcement, and other adverse government actions. If the assessor’s records list another person as the owner, there may have been a tax sale.

• 1See La. Const. art. VII, § 21(M).
• 2The ad valorem tax exemption for disabled veterans under La. Const. art. VII, § 21(K) is distinct from the homestead exemption established by La. Const. art. VII, § 20 and offers a benefit in addition to a homestead exemption. The exemptions under La. Const. art. VII, § 21(K) and La. Const. art. VII, § 20(A)(3) may be cumulated under certain circumstances, but a tax assessor must conduct a fact-specific inquiry when both exemptions are claimed. La. Att’y Gen. Op. No. 16-0206 (June 22, 2017).

A Louisiana taxpayer is entitled to a $75,000 homestead exemption from ad valorem taxes on the taxpayer’s primary home (provided that the taxpayer lives in that home). For co-owned homesteads, the owners who occupy the homestead are entitled to a homestead exemption prorated for their ownership.

Homeowners should timely apply for the homestead exemption each year. If a homeowner has forgotten to file the homestead exemption application, the assessors will generally process retroactive homestead exemptions for the last 3 years.1  A homestead exemption may be granted to an heir without the opening of a judicial succession.2  However, if there is a will, an assessor may decline to grant a homestead exemption.

• 1If taxes were erroneously paid on exempt property, the taxpayer’s refund claims must be made within 3 years. LaNasa v. City of New Orleans, 99-CA-2989 (La. App. 4 Cir. 8/27/03), 855 So.2d 404; La. Att’y Gen. Op. 07-0228 (Sept. 4, 2007); La. Att’y Gen. Op. 04-0221 (Sept. 23, 2004).
• 2La. Atty. Gen. Op. 91-262 (Aug. 2, 1991) (opining that an affidavit of heirship may suffice as proof of ownership).

Some parishes may allow partial payment of ad valorem taxes. However, a partial payment of delinquent taxes will not stop the tax collector from selling the property at tax sale for the remaining amounts due.

Ad valorem taxes are real obligations or in rem obligations on the land itself,1 which means that a client cannot not be sued personally for delinquent real estate taxes. Rather, a lien on the property is sold at a tax sale subject to a right of redemption. If no person bids on the property at tax sale, the tax lien will be adjudicated to the taxing authority.

Tax sales in Louisiana are authorized by Section 25 of Article VII of the Louisiana Constitution. In 2008, the Louisiana Legislature comprehensively amended and restated the law governing the payment and collection of property taxes, tax sales, and redemptions.2  Under the reforms, tax sales switched from a “tax sale deed” to a “tax sale title.”3  The tax sale title is sold as a tax sale certificate, which is redeemable for three years (or eighteen months if the property is blighted) from the date of tax sale certificate recordation. Redemption is made by making a combined payment of a 5% penalty plus a simple interest rate of 1% per month.

• 1La. C.C. art. 1763; see Eagle Pipe & Supply, Inc. v. Amerada Hess Corp., 2010-2267 (La. 10/25/11), 79 So. 3d 246; Ducote v. City of New Orleans, 176 So. 2d 198, 201 (La. App. 4. Cir. 1965).
• 2See La. R.S. 47:2121, et seq. These amendments became effective January 1, 2009.
• 3La. R.S. 47:2121(A)(1).

If the tax sale certificate is not redeemed, it “transfers to its holder ownership of the tax sale property, free of the ownership and other interests, claims, or encumbrances held by all duly notified persons.”1  Importantly, a tax sale certificate only converts to ownership once both the redemption period has expired and the interested parties are duly notified. The expiration of the redemption period does not automatically mean that the tax sale purchaser owns the property.2  The key in any tax sale defense is to determine that your client was not “duly notified.”

A party can be “duly notified” by anyone, i.e., the tax collector or the tax sale purchaser, either before or after the tax sale occurred. The tax sale party can be duly notified even without actual receipt of notice.3  If a tax sale party is “duly notified” after the expiration of the redemptive period, a tax title will convert to ownership 6 months after the tax sale party is duly notified.4  To prevent the tax sale purchaser from becoming the owner, the debtor must file a nullity action within that 6-month prescriptive period.5

• 1La. R.S. 47:2121(C)(1).
• 2See La. R.S. 47:2121(B) (providing that a tax sale has no effect on non-duly-notified interested parties).
• 3La. R.S. 47:2122(4).
• 4See generally Cent. Props. v. Fairway Gardenhomes, LLC, 2016-1855 (La. 6/27/17), 225 So. 3d 441.
• 5La. Const. art. VII, § 25(C) (“Annulment. No sale of property for taxes shall be set aside for any cause, except on proof of payment of the taxes prior to the date of the sale, unless the proceeding to annul is instituted within six months after service of notice of sale.”).

After the redemption period expires, the holder of the tax sale certificate may bring an action to quiet title. A tax title can be quieted under any manner provided by law.1  Several statutes provide protocols for a tax sale purchaser to quiet title and cancel interests: La. R.S. 47:2266 (Quiet Title action), La. R.S. 47:2271, et seq. (Monition action), and La. R.S. 47:2157 (Affidavit procedure). Under each procedure, the 6-month prescriptive period begins on a different date.

A Quiet Title action is a lawsuit filed under ordinary procedure, whereby the tax sale party’s right to file a nullity action prescribes 6 months after the date of service.2

A Monition action for tax sales is a lawsuit filed in district court, but reflects more of a summary or executory proceeding in nature. There are no defendants, and no service is required. Tax sale monitions mirror monitions for judicial sales under La. R.S. 13:4941, except that in tax sale monitions the tax sale purchaser must mail notices to the tax sale parties and present an affidavit of noticing efforts in court.3  For tax sale monitions, the 6-month prescriptive period to bring a nullity action commences on the date of first advertisement.4

Quieting Title by Affidavit under La. R.S. 47:2157 is similar to the affidavit required in the monition proceeding, except that the 6-month prescriptive period to file a nullity action commences on the date the notice was mailed, not the date of publication. Quieting Title by Affidavit does not require a judicial confirmation of title. Under this statute, the recorder of mortgages and conveyances is directed to cancel the interests of all named parties named in the affidavit recorded by the tax sale purchaser.

• 1La. Const. art. VII, § 25(D).
• 2La. R.S. 47:2266(A)(1).
• 3La. R.S. 47:2277.
• 4La. R.S. 47:2275.

Tax debtors have a constitutional right to redeem property sold at a tax sale by paying the delinquent taxes, accrued taxes, interest, and penalties within the time for redemption.1  “Once the property owner timely redeems his property, the rights of the tax sale purchaser to the ownership or possession of the property are dissolved.”2  Louisiana law favors redemption of property sold at tax sales.3

• 1The redemptive period is 3 years (or 18 months if the property is blighted). La. Const. art. VII, § 25(B).
• 2Smith v. Brumfield, 2013-1171, p. 16 (La. App. 4 Cir. 1/15/14), 133 So. 3d 70, 79.
• 3Fleckinger v. Smith, 319 So. 2d 881, 885 (La. App. 4 Cir. 1975); ACORN Cmty. Land Ass’n of La. v. Zeno, 2005-CA-1489 (La. App. 4 Cir. 6/21/06), 936 So. 2d 836.

In general, property may be redeemed within 3 years of the recordation of the tax deed in the conveyance records.1  A “tax sale certificate” is considered a “tax deed” for redemption purposes. Always check the recordation date to determine how much time is left for redemption. In some parishes, many months can pass between the tax sale and the recordation of the tax sale certificate.

While a tax sale redemptive period is peremptive,2  in some cases an untimely redemption may relate back to a timely redemption request or similar action if the tax collector was unable to timely process that request.3  Computer issues, hurricane closures, and emergency COVID-19 closures are the most common reasons for a tax collector’s inability to process tax sale redemptions. If your client has attempted to redeem a tax sale, but the tax collector was unable to complete the request for any reason, your client must preserve all communications and take detailed notes of each unfulfilled redemption request. For an unfulfilled redemption request to be deemed timely, the client must continuously make redemption requests until the tax collector is able to comply.

In addition, the Governor has the power to “suspend the provisions of any regulatory statute . . . if strict compliance with the provisions of any statute . . . would in any way prevent, hinder, or delay necessary action in coping with the emergency.”4  Suspension of tax sale redemptive periods has occurred numerous times under the Governor’s emergency powers following hurricanes and during the COVID-19 pandemic. In some instances, the Legislature has codified the suspension of the tax sale period, as it did after the COVID-19 “stay at home” orders.5

• 1La. Const. art. VII, § 25(B)(1); see Hamilton v. Royal Int’l Petroleum Corp., 2005-C-846 (La. 2/22/06), 934 So. 2d 25.
• 2La. R.S. 47:2241.
• 3Harris v. Guardian Funds, Inc., 425 So. 2d 1322 (La. App. 4 Cir. 1983) (lawsuit to redeem filed within 3 years); Becnel v. Woodland, 628 So. 2d 89, 91 (La. App. 5 Cir. 1993) (oral request to redeem within 3 years is sufficient); Miss. Land Co. v. S & A Props. II, Inc., pp. 5–7 (La. App. 3 Cir. 5/8/02), 817 So. 2d 1200, 1204–05 (erroneous payment within 3-year redemption period held sufficient effort to redeem); S.A. Mortgage Serv., Co. v. Lemoine, 01-CV-250 (La. App. 5 Cir. 10/17/01), 800 So. 2d 1015 (redemption timely where insufficient amount paid because city gave tax debtor the wrong redemption amount); Succession of Caldarera v. Zeno, 2009-1397, pp. 6–8 (La. App. 4 Cir. 7/16/10), 43 So. 3d 1080, 1085–86 (succession’s timely attempts to redeem were delays by erroneous city records).
• 4La. R.S. 29:724(1).
• 5See La. R.S. 9:5828, et seq.

A shorter 18-month redemptive period exists for blighted or abandoned property sold at a tax sale.1  In Padilla v. Schwartz, the Fourth Circuit Court of Appeal held that this 18-month period only applies when the tax sale occurred under the statutory authority for sales of blighted property.2  However, the tax sale in Padilla occurred prior to the tax sale revisions, and so its holding can no longer be relied on as a tax sale defense. In Smith v. Brumfield, the same court distinguished Padilla by holding that in order for the 18-month redemptive period to apply, the property need only have been judicially declared blighted or abandoned prior to the tax sale.3  However, in In re Flag Boy Properties, LLC, Praying for Monition, the Fourth Circuit held that a code violation judgment rendered subsequent to a judgment of blight that does not declare the property blighted for a second time is “sufficient proof of compliance” that the property is no blighted and, therefore, not subject to an 18-month redemptive period.4

• 1La. Const. art. VII, § 25(B)(2).
• 2Padilla v. Schwartz, 2006-CA-1517 (La. App. 4 Cir. 3/11/09), 11 So. 3d 6.
• 3Smith v. Brumfield, 2013-1171 (La. App. 4 Cir. 1/15/14), 133 So. 3d 70.
• 4In re Flag Boy Properties, LLC, 2021-0644 (La. App. 4 Cir. 3/10/22).

If a third-party does not buy the property at the tax sale, it is adjudicated to the city or parish. In “adjudicated sales”, the property may be redeemed beyond the 3-year period until any of the following occurs:

• The later of 60 days or 6 months, as applicable, after the notice required by R.S. 47:2206 [notice of potential sale or donation] or the filing of the sale or donation transferring the property from the political division pursuant to R.S. 47:2201, et seq.
• The granting of the order of possession pursuant to R.S. 47:2232 [suit by political subdivision to obtain possession of adjudicated property].
• 60 days or 6 months as applicable after the notice required by R.S. 47:2236 [declaration of political subdivision by ordinance of its intent to acquire property].1

Some taxing authorities allow for redemption of an adjudication lien until the day the act transferring the property to a third party is filed. As a result, there may not be a real need to litigate a defense to an adjudicated lien as its redemption period extends well beyond the three years. A tax debtor’s best defense is to simply redeem the adjudicated tax sale.

• 1La. R.S. 47:2246(A).

Any person may redeem a tax sale through the tax collector. However, the redemption is in the name of the tax debtor and for the debtor’s benefit.1  The basic redemption price is the delinquent tax, accrued taxes since the tax sale, a 5% penalty, costs, and simple interest at 1% per month. Upon payment of the redemption costs, the tax collector must issue a redemption certificate to the name of the tax debtor and file it in the appropriate conveyance records.2

Governmental liens can also be added to the tax sale redemption price. La. R.S. 13:2575(C)(2) mandates that “[a]ny liens placed against such immovable property shall be included in the next annual ad valorem tax bill and shall be paid along with such taxes . . . .” However, La. R.S. 47:2244, apparently allows the tax collector to require the payment of all amounts accrued under other government liens at the time of the redemption payment, not just those placed on the tax bill. Whether a tax collector can require payment of governmental liens that have not been included on the tax bill has not yet been tested in the courts.

Tax sale purchasers are required to pay the taxes for subsequent tax years.3  If the tax sale purchaser fails to pay, the property can be sold again at tax sale. However, a tax sale purchaser has a right to redeem the subsequent tax sale within 3 years of that sale.4  The interest of a tax sale purchaser who chooses not to redeem following a subsequent tax sale can be terminated just as an original tax debtor’s interest would.5  However, until a subsequent tax sale’s redemption period has passed, a tax sale purchaser’s failure to pay subsequent taxes does not affect the purchaser’s ability to quiet the purchaser’s own tax title.

• 1La. R.S. 47:2242.
• 2La. R.S. 47:2245.
• 3La. R.S. 47:2161.
• 4Virtocom Fin. v. Palo Verde, 03-CA-621 (La. App. 5 Cir. 2/23/04), 869 So.2d 194.
• 5See La. R.S. 47:2122(19) (providing that a prior tax sale purchaser is a “tax sale party” whose interest may be cancelled).

If the redemption period has expired, aside from negotiating a redemption payoff directly with the tax sale purchaser, a tax debtor’s best remedy is to file a lawsuit to annul the tax sale. A template for a petition to annul a tax sale is located in Section 9 of this chapter.

To be successful, claimants must first establish they are a “tax sale party”, which means that they had a recorded interest in the mortgage or conveyance records entitled them to tax sale notice.1  This requirement mainly affects heirs or legatees, who often have no recorded interest. However, while heirs or legatees may not bring a nullity action in their own right, an heir to an unopened succession can assert a nullity action based on the claims of the decedent.2

• 1La. R.S. 47:2122(19) (“‘Tax sale party’ means the tax notice party, the owner of property, including the owner of record at the time of a tax sale, as shown in the conveyance records of the appropriate parish, and any other person holding an interest, such as a mortgage, privilege, or other encumbrance on the property, including a tax sale purchaser, as shown in the mortgage and conveyance records of the appropriate parish.”).
• 2Woodard v. Upp, 2013-0999, pp. 5–7 (La. App. 1 Cir. 2/18/14), 142 So. 3d 14, 18–19.

With the 2008 revisions, the Legislature eliminated absolute nullity as a tax sale defense.1  Under current law, “[n]o tax sale shall be set aside except for a payment nullity, redemption nullity, or a nullity under R.S. 47:2162, all of which are relative nullities.”2  It is well settled that “the language in effect at the time of the tax sale . . . applies . . . .”3  Consequently, any tax sale occurring in 2009 or later can only be nullified on one of these grounds.

A redemption nullity is “the right of a person to annul a tax sale in accordance with R.S. 47:2286 because he was not duly notified at least six months before the termination of the redemptive period.”4  After 2008, a nullity no longer occurs because the tax debtor was not notified before the tax sale. Instead, the nullity occurs if the party was not “duly notified” before the expiration of the redemptive period. With the revisions, the exhaustive list of “duly notifying” statutes found in La. R.S. 47:2122(4) intentionally does not contain the pre-sale noticing statute, La. R.S. 47:2153. The result is that a client cannot claim that the tax sale is a nullity for failure of pre-sale notice. Instead, nullity must be based on a failure of notice sufficiently in advance of the end of the redemptive period.

A payment nullity is invoked when the tax debtor can demonstrate that he actually paid the taxes for the delinquent year in question.5  A nullity under La. R.S. 47:2162 is a prohibited purchaser nullity, as happens when, for example, the tax sale purchaser is an employee of the tax collector or tax assessor. These two nullities are rare.

• 1See Adair Asset Mgmt., LLC v. Turney, 50,574 (La. App. 2 Cir. 05/04/16), 195 So. 3d 501, 513; Alpha Cap. US Bank v. White, 2018-0827 (La. App. 1 Cir. 12/21/18), 268 So. 3d 1124, 1129; Stow-Serge v. Side by Side Redevelopment, Inc., 2020-0015 (La. App. 4 Cir. 6/10/20), 302 So. 3d 71, 76. But see Deichmann v. Moeller, 2018-0358 (La. App. 4 Cir. 12/28/18), 318 So. 3d 833, 835 (holding that a tax sale can still be declared an absolute nullity when all sides plead as such and one side files a motion for judgment on the pleadings).
• 2La. R.S. 47:2286.
• 3Cent. Props. v. Fairway Gardenhomes, LLC, 2016-1855 (La. 6/27/17), 225 So. 3d 441, 448.
• 4La. R.S. 47:2122(10).
• 5La. R.S. 47:2122(8).

In order for a tax title to convert to ownership, all parties must be “duly notified”:1

“Duly notified” means, with respect to a particular person, that an effort meeting the requirements of due process of law has been made to identify and to provide that person with a notice that meets the requirements of R.S. 47:2156, 2157, 2206, 2236, or 2275, or with service of a petition and citation in accordance with R.S. 47:2266, regardless of any of the following:

• Whether the effort resulted in actual notice to the person.
• Whether the one who made the effort was a public official or a private party.
• When, after the tax sale, the effort was made.2

Failure to provide notice of the date on which the tax sale will convert to ownership creates a redemption nullity.3  However, failure to provide notice under one statute can be cured by sending notice under a different statute enumerated in La. R.S. 47:2122(4). Furthermore, the Louisiana Supreme Court has specifically held that a tax sale purchaser may send curative tax sale noticing.4

The most common due process violations are failure to provide notice to a reasonably ascertainable address and failing to send additional notice if the original notice is returned undeliverable. The U.S. Supreme Court has spoken to both situations.

As regards addresses, notice by mail or other means as certain to ensure actual notice is a minimum constitutional precondition to a proceeding which will adversely affect the liberty or property interests of any party, whether unlettered or well versed in commercial practice, if its name and address are reasonably ascertainable.5  Failure to provide notice a reasonably ascertainable address often occurs when there have been multiple tax sales. Assessors assess properties in the name of the latest tax sale purchaser.6  Forgetting that the assessed address belongs to the latest tax sale purchaser, municipalities often mail tax sale notices in the name of the tax debtor to the assessed address.

Tax collectors must take an additional noticing step if all of the tax sale noticing efforts were returned to sender: “[W]hen mailed notice of a tax sale is returned unclaimed, the State must take additional reasonable steps to attempt to provide notice to the property owner before selling his property, if it is practicable to do so.”7  If any of the tax sale noticing was returned to the tax collector, be sure that any follow-up notice was sent to a separate address. Tax collectors have been known to send a second round of notice to the same insufficient address.

• 1La. R.S. 47:2121(C)(1).
• 2La. R.S. 47:2122(4).
• 3La. R.S. 47:2122(10), 2286.
• 4Cent. Props. v. Fairway Gardenhomes, LLC, 2016-1855 (La. 6/27/17), 225 So. 3d 441, 451 (“[W]e hold that, under the language of the applicable statutes, post-sale notice to the interested tax party may be effectuated by a tax sale purchaser . . . .”).
• 5Mennonite Bd. of Missions v. Adams, 462 U.S. 791, 800 (1983).
• 6La. R.S. 47:2161.
• 7Jones v. Flowers, 547 U.S. 220, 225 (2006).

In the rare occurrence when a tax collector fails to send any presale notice and when neither the tax collector nor the tax sale purchaser cure the pre-sale defect by sending post-sale notice, the tax debtor can file suit to have the tax sale cancelled.1  The difference between cancellation and nullification is slightly favorable economically for the tax debtor, but can be devastating for the tax sale purchaser.

When a tax sale is canceled, the taxing authority must return to the tax sale purchaser only the amount of the taxes paid. In other words, the tax sale purchaser will not receive any interest. In turn, the tax debtor is relieved of the obligation to make the 5% redemption payment and to pay 1% monthly interest. However, the tax debtor is still liable to the taxing authority for 1% per month since the tax sale.2

Because proving the elements of a cancellation claim is more difficult than proving those of a redemption nullity claim, best practice is to bring a cancellation claim in the alternative to a redemption nullity claim. Additionally, courts have also discouraged cancellation claims due to the lack of interest paid to the tax sale purchaser.3

• 1La. R.S. 47:2153(C)(1) (“In the absence of actual notice of the sale to a tax sale party, including a transferee, or the demonstration of a reasonable effort to provide notice, where the name and address of the tax sale party were reasonably ascertainable or where the transfer was recorded after the tax collector completed his pre-sale tax sale party research, the tax collector shall cancel the sale of the property and refund the tax sale purchaser the tax sale purchase price.”).
• 2La. R.S. 47:2127(B).
• 3See Klein v. Henderson, 2021-0317 (La. App. 4 Cir. 11/17/21), 332 So. 3d 764.

An action for a redemption nullity is subject to a prescriptive period of 6 months from the tax debtor being duly notified (if the tax sale certificate was recorded more than three, but less than 5 years ago) or 60 days (if the tax sale certificate was recorded more than 5 years ago).1  A client who has timely filed a nullity action only needs to prove a defect in the La. R.S. 47:2156 notice. If the nullity action is untimely, your client will likely need to survive an exception of prescription by proving a defect in whichever secondary form of notice the tax sale purchaser is claiming.

The date on which prescription begins to run and the procedure for asserting the nullity will differ depending on how the tax sale debtor was duly notified.

Quiet Title Action: If your client is served with a petition to quiet title,2  prescription runs from the date of service. Note that if the tax sale was recorded more than 5 years prior, the delay for answering the suit is only 10 days. However, this shortened period to answer does not affect the nullity prescription period.3  If the tax sale purchaser has filed a quiet title action, the nullity “action may be brought as a reconventional demand or an intervention . . . ” by the tax debtor.4  A tax debtor who files a separate action to annul the tax sale risks having the nullity action suit dismissed on an exception of lis pendens.5

Monition Action: If your client receives a monition notice, the notice should state that the prescriptive period to bring a nullity action commenced at first date of advertisement.6  The proper method to counter a monition action is by “intervention in a monition proceeding under R.S. 47:2271 through 2280.”7  Just as with a quiet title action, a separate action to nullify a tax sale could be dismissed on an exception of lis pendens.

Affidavit Procedure: If your client received a tax sale notice sent pursuant to La. R.S. 47:2157, the letter should state that the prescriptive period to file a nullity action commenced on the date of the notice. In this procedure, the tax sale purchaser shifts the burden onto the tax debtor to initiate a lawsuit by filing a nullity action in the district court of the parish in which the property is located.8

• 1La. R.S. 47:2287(A)(1).
• 2La. R.S. 47:2266.
• 3La. R.S. 47:2266(B).
• 4La. R.S. 47:2286.
• 5Dave v. Witherspoon, 2020-0239 (La. App. 4 Cir. 11/4/20), 310 So. 3d 593, 597 (“This court has recognized and held that the filing of a new suit naming new and additional parties will not defeat an exception of lis pendens. The party to the earlier filed suit is entitled to have the later filed suit dismissed as to him, and the new parties remain in the later filed suit.”).
• 6La. R.S. 47:2275.
• 7La. R.S. 47:2286.
• 8Id.

A tax sale nullity judgment has no effect until the prevailing party has paid the nullity amount to the tax collector.1  The tax debtor has one year to deliver the nullity payment or else the nullity judgment will be dismissed with prejudice. This dismissal then allows the tax sale purchaser to quiet title without opposition.2

• 1La. R.S. 47:2290.
• 2La. R.S. 47:2291 cmt e. (“Subsection C requires payment of the costs within one year of the issuance of the final judgment declaring the tax sale a nullity and setting the costs. This period is suspended while an appeal is pending. Payment of costs must be made within this time period, or else the judgment can be vacated and the case dismissed with prejudice.”).

A tax sale is voidable if it was made while a bankruptcy stay was in effect.1  However, because the redemptive period is peremptive,2  a bankruptcy proceeding filed after the tax sale will not suspend the redemptive period.3

• 1Joshua Inv. Corp. v. Home Sales Consulting, Inc., 39,251-CA (La. App. 2 Cir. 1/19/05), 892 So. 2d 151; Bertini v. Britton, 93 CA 0779 (La. App. 1 Cir. 4/8/94), 635 So. 2d 712.
• 2La. R.S. 47:2241.
• 3In re Curley, 572 B.R. 622, 637 (Bankr. E.D. La. 2017) (“While the automatic stay prevents AP from taking steps to quiet title, it does not stay the redemptive period.”).

Unless a court states otherwise, property belonging to an active-duty servicemember may not be sold for delinquent taxes.1  However, if the servicemember commences active duty after the property is sold at tax sale, federal law provides that the servicemember may redeem the property “during the period of military service or within 180 days after termination of or release from military service.”2  However, because that law also provides that it “may not be construed to shorten any period provided by the law of a State . . . for redemption,”3  the servicemember may have longer than 180 days after leaving active duty if the 3-year redemptive period under Louisiana law would provide for a longer time. During the active-duty stay, the interest charged to the servicemember is 6% per year.4

Although federal law does not shorten the redemptive period, the courts have not yet determined whether it extends the peremptive period under La. R.S. 47:2241. However, the Supremacy Clause as well as public policy in favor of protecting the rights and interests of active-duty servicemembers should favor allowing the servicemember the longer of Louisiana’s redemptive period or the 180-day period following the end of active duty.

• 150 U.S.C. § 3991(b)(1) (“Property described in subsection (a) may not be sold to enforce the collection of such tax or assessment except by court order and upon the determination by the court that military service does not materially affect the servicemember’s ability to pay the unpaid tax or assessment.”).
• 250 U.S.C. § 3991(c) (“When property described in subsection (a) is sold or forfeited to enforce the collection of a tax or assessment, a servicemember shall have the right to redeem or commence an action to redeem the servicemember’s property during the period of military service or within 180 days after termination of or release from military service. This subsection may not be construed to shorten any period provided by the law of a State (including any political subdivision of a State) for redemption.”).
• 3Id.
• 450 U.S.C. § 3991(d) (“Whenever a servicemember does not pay a tax or assessment on property described in subsection (a) when due, the amount of the tax or assessment due and unpaid shall bear interest until paid at the rate of 6 percent per year. An additional penalty or interest shall not be incurred by reason of nonpayment. A lien for such unpaid tax or assessment may include interest under this subsection.”).