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                                                       PRINTER'S NO. 874

THE GENERAL ASSEMBLY OF PENNSYLVANIA


SENATE BILL

No. 777 Session of 2007


        INTRODUCED BY BROWNE, BOSCOLA, ERICKSON, RAFFERTY, COSTA,
           KASUNIC, FERLO, LOGAN, O'PAKE AND ORIE, APRIL 23, 2007

        REFERRED TO FINANCE, APRIL 23, 2007

                                     AN ACT

     1  Amending the act of May 16, 1923 (P.L.207, No.153), entitled "An
     2     act providing when, how, upon what property, and to what
     3     extent, liens shall be allowed for taxes and for municipal
     4     improvements, for the removal of nuisances, and for water
     5     rents or rates, sewer rates, and lighting rates; for the
     6     procedure upon claims filed therefor; the methods for
     7     preserving such liens and enforcing payment of such claims;
     8     the effect of judicial sales of the properties liened; the
     9     distribution of the proceeds of such sales, and the
    10     redemption of the property therefrom; for the lien and
    11     collection of certain taxes heretofore assessed, and of
    12     claims for municipal improvements made and nuisances removed,
    13     within six months before the passage of this act; and for the
    14     procedure on tax and municipal claims filed under other and
    15     prior acts of Assembly," changing the date from which, and
    16     the rate of which, interest is charged on certain delinquent
    17     taxes and other municipal claims; providing for the duties of
    18     third-party collectors and for adoption of ordinance for the
    19     exclusive collection of taxes; further providing for locality
    20     index; and modernizing the law relating to collection of such
    21     taxes and claims.

    22     The General Assembly of the Commonwealth of Pennsylvania
    23  hereby enacts as follows:
    24     Section 1.  Section 1 of the act of May 16, 1923 (P.L.207,
    25  No.153), referred to as the Municipal Claim and Tax Lien Law,
    26  amended August 14, 2003 (P.L.83, No.20) and July 15, 2004
    27  (P.L.726, No.83), is amended to read:

     1     Section 1.  Be it enacted, &c., That the word "taxes," as
     2  used in this act, means any county, city, borough, incorporated
     3  town, township, school, bridge, road, or poor taxes, together
     4  with and including all penalties, interest, costs, charges,
     5  expenses and fees, including reasonable attorney fees, as
     6  allowed by this act and all other applicable laws.
     7     Except with respect to counties of the second class, the word
     8  "delinquent," as used in this act, refers to taxes that remain
     9  unpaid on December 31 of the calendar year in which they were
    10  assessed; and municipal claims, other than tax claims, that
    11  remain unpaid ninety days after the date of billing for such
    12  claims.
    13     The word "highway," as used in this act, means the whole or
    14  any part of any public street, public road, public lane, public
    15  alley, or other public highway.
    16     The words "tax claim," as used in this act, mean the claim
    17  filed to recover taxes.
    18     The words "municipal claim," as used in this act, unless
    19  specifically indicated otherwise, mean and include (1) the claim
    20  arising out of, or resulting from, a tax assessed, service
    21  supplied, work done, or improvement authorized and undertaken,
    22  by a municipality, although the amount thereof be not at the
    23  time definitely ascertained by the authority authorized to
    24  determine the same, and a lien therefor be not filed, but
    25  becomes filable within the period and in the manner herein
    26  provided, (2) the claim filed to recover for the grading,
    27  guttering, macadamizing, or otherwise improving, the cartways of
    28  any public highway; for grading, curbing, recurbing, paving,
    29  repaving, constructing, or repairing the footways thereof; for
    30  laying water pipes, gas pipes, culverts, sewers, branch sewers,
    20070S0777B0874                  - 2 -     

     1  or sewer connections therein; for assessments for benefits in
     2  the opening, widening or vacation thereof; or in the changing of
     3  water-courses or the construction of sewers through private
     4  lands; or in highways of townships of the first class; or in the
     5  acquisition of sewers and drains constructed and owned by
     6  individuals or corporations, and of rights in and to use the
     7  same; for the removal of nuisances; or for garbage fees,
     8  recycling fees, landlord licensing and inspection fees, water
     9  rates, lighting rates, or sewer rates, and (3) the claim filed
    10  to recover for work, material, and services rendered or
    11  furnished in the construction, improvement, maintenance, and
    12  operation of a project or projects of a body politic or
    13  corporate created as a Municipal Authority pursuant to law. A
    14  municipal claim shall be together with and shall include all
    15  penalties, interest, costs, fines, charges, expenses and fees,
    16  including reasonable attorney fees, as allowed by this act and
    17  all other applicable laws.
    18     The word "claimant," as used in this act, means the plaintiff
    19  or use-plaintiff in whose favor the claim is filed as a lien.
    20     The word "contractor," as used in this act, means the person
    21  or persons who, under contract with the legal plaintiff,
    22  performed the work for which the lien is given.
    23     The word "property," as used in this act, means the real
    24  estate subject to the lien and against which the claim is filed
    25  as a lien.
    26     The word "owner," as used in this act, means the person or
    27  persons in whose name the property is registered, if registered
    28  according to law, and, in all other cases, means any person or
    29  persons in open, peaceable and notorious possession of the
    30  property, as apparent owner or owners thereof, if any, or the
    20070S0777B0874                  - 3 -     

     1  reputed owner or owners thereof in the neighborhood of such
     2  property.
     3     The word "municipality," as used in this act, means any
     4  county, city, borough, incorporated town, township, school
     5  district, or a body politic and corporate created as a Municipal
     6  Authority pursuant to law and any assignees thereof.
     7     The words "charges, expenses, and fees," as used in this act,
     8  include all sums paid or incurred by a municipality to file,
     9  preserve and collect unpaid taxes, tax claims, tax liens,
    10  municipal claims and municipal liens, including, but not limited
    11  to, prothonotary and sheriff fees, postage expenses, [and] title
    12  search expenses and title insurance fees. A county, city,
    13  borough, incorporated town, township, school district or
    14  municipal authority may also recover as "charges, expenses, and
    15  fees" the charges, expenses, commissions and fees of third-party
    16  collectors retained by the county, city, borough, incorporated
    17  town, township, school district or municipal authority, provided
    18  that the charges, expenses, commissions and fees of such third-
    19  party collectors are approved by legislative action of the
    20  county, city, borough, incorporated town, township, school
    21  district or municipal authority which levies the unpaid taxes,
    22  tax claims, tax liens, municipal claims and municipal liens.
    23     Section 2.  Section 3 of the act, amended August 14, 2003
    24  (P.L.83, No.20), is amended to read:
    25     Section 3.  (a)  All municipal claims, municipal liens,
    26  taxes, tax claims and tax liens which may hereafter be lawfully
    27  imposed or assessed on any property in this Commonwealth, and
    28  all such claims heretofore lawfully imposed or assessed within
    29  six months before the passage of this act and not yet liened, in
    30  the manner and to the extent hereinafter set forth, shall be and
    20070S0777B0874                  - 4 -     

     1  they are hereby declared to be a lien on said property, together
     2  with all charges, expenses, and fees incurred in the collection
     3  of any delinquent account, including reasonable attorney fees
     4  under subsection (a.1), added thereto for failure to pay
     5  promptly; and municipal claims and municipal liens shall arise
     6  when lawfully imposed and assessed and shall have priority to
     7  and be fully paid and satisfied out of the proceeds of any
     8  judicial sale of said property, before any other obligation,
     9  judgment, claim, lien, or estate with which the said property
    10  may become charged, or for which it may become liable, save and
    11  except only the costs of the sale and of the writ upon which it
    12  is made, and the taxes, tax claims and tax liens imposed or
    13  assessed upon said property.
    14     (a.1)  [It is not the intent of this subsection to require
    15  owners to pay, or municipalities to sanction, inappropriate or
    16  unreasonable attorney fees, charges or expenses for routine
    17  functions.] Attorney fees incurred in the collection of any
    18  delinquent account, including municipal claims, municipal liens,
    19  taxes, tax claims and tax liens, shall be in an amount
    20  sufficient to compensate attorneys undertaking collection and
    21  representation of a municipality or its assignee in any actions
    22  in law or equity involving claims arising under this act. A
    23  municipality by ordinance, or by resolution if the municipality
    24  is of a class which does not have the power to enact an
    25  ordinance, shall adopt the schedule of attorney fees. Where
    26  attorney fees are sought to be collected in connection with the
    27  collection of a delinquent account, including municipal claims,
    28  municipal liens, taxes, tax claims and tax liens, the owner may
    29  petition the court of common pleas in the county where the
    30  property subject to the municipal claim and lien, tax claim and
    20070S0777B0874                  - 5 -     

     1  lien or taxes is located to adjudicate the reasonableness of the
     2  attorney fees imposed. In the event that there is a challenge to
     3  the reasonableness of the attorney fees imposed in accordance
     4  with this section, the court shall consider, but not be limited
     5  to, the following:
     6     (1)  The time and labor required, the novelty and difficulty
     7  of the questions involved and the skill requisite to properly
     8  undertake collection and representation of a municipality in
     9  actions arising under subsection (a).
    10     (2)  The customary charges of the members of the bar for
    11  similar services.
    12     (3)  The [amount of the delinquent account collected and the]
    13  benefit to the municipality from the services.
    14     (4)  The contingency or the certainty of the compensation.
    15     (a.2)  Any time attorney fees are awarded pursuant to any
    16  provision of law, the municipality shall not be entitled to
    17  duplicate recovery of attorney fees under this section.
    18     (a.3)  (1)  At least thirty days prior to assessing or
    19  imposing attorney fees in connection with the collection of a
    20  delinquent account, including municipal claims, municipal liens,
    21  taxes, tax claims and tax liens, a municipality shall, by United
    22  States certified mail, return receipt requested, postage
    23  prepaid, mail to the owner the notice required by this
    24  subsection.
    25     (2)  If within thirty days of mailing the notice in
    26  accordance with clause (1) the certified mail is refused or
    27  unclaimed or the return receipt is not received, then at least
    28  ten days prior to assessing or imposing attorney fees in
    29  connection with the collection of a delinquent account, a
    30  municipality shall, by United States first class mail, mail to
    20070S0777B0874                  - 6 -     

     1  the owner the notice required by this subsection.
     2     (3)  The notice required by this subsection shall be mailed
     3  to the owner's last known post office address by virtue of the
     4  knowledge and information possessed by the municipality and by
     5  the county office responsible for assessments and revisions of
     6  taxes. It shall be the duty of the municipality to determine the
     7  owner's last post office address known to said collector and
     8  county assessment office.
     9     (4)  The notice to the owner shall include the following:
    10     (i)  A statement of the municipality's intent to impose or
    11  assess attorney fees within thirty days of mailing the notice
    12  pursuant to clause (1) or within ten days of the mailing of the
    13  notice pursuant to clause (2).
    14     (ii)  The manner in which the imposition or assessment of
    15  attorney fees may be avoided by payment of the delinquent
    16  account.
    17     (b)  With the exception of those claims which have been
    18  assigned, any municipal claim, municipal lien, tax, tax claim or
    19  tax lien, including interest, penalty and costs, imposed by a
    20  city of the first class, shall be a judgment only against the
    21  said property when the lien has been docketed by the
    22  prothonotary. The docketing of the lien shall be given the
    23  effect of a judgment against the said property only with respect
    24  to which the claim is filed as a lien. The prothonotary shall
    25  maintain an in rem index, the form and location of which shall
    26  be within the prothonotary's discretion. All tax claims, water
    27  rents or rates, lighting rates, power rates and sewer rates
    28  heretofore filed are hereby ratified, confirmed and made valid
    29  subsisting liens as of the date of their original filing.
    30     (c)  A writ of execution may issue directly without
    20070S0777B0874                  - 7 -     

     1  prosecution to judgment of a writ of scire facias. Any property
     2  sold in execution shall be sold in compliance with the
     3  provisions of section 31.2.
     4     (d)  Attorney fees may be imposed and collected in accordance
     5  with this section upon all taxes, tax claims, tax liens,
     6  municipal claims, municipal liens, writs of scire facias,
     7  judgments or executions filed on or after December 19, 1990.
     8     Section 3.  Section 9 of the act, amended February 21, 2006
     9  (P.L.46, No.18), is amended to read:
    10     Section 9.  Claims for taxes, water rents or rates, lighting
    11  rates, power rates and sewer rates must be filed in the court of
    12  common pleas of the county in which the property is situated
    13  unless the property is situate in the City of Philadelphia and
    14  the taxes or rates do not exceed the maximum amount over which
    15  the Municipal Court of Philadelphia has original jurisdiction,
    16  in which event the claim must be filed in the Municipal Court of
    17  Philadelphia. All such claims shall be filed on or before the
    18  last day of the third calendar year after that in which the
    19  taxes or rates are first payable, except that in cities and
    20  school districts of the first class claims for taxes and other
    21  municipal claims, which have heretofore become liens pursuant to
    22  the provisions of this act or which have been entered of record
    23  as liens or which have been liened and revived, shall continue
    24  and remain as liens for the period of twenty years from such
    25  revival, entry or lien by operation of law, whichever shall have
    26  last occurred; and other municipal claims must be filed in said
    27  court of common pleas or the Municipal Court of Philadelphia
    28  within six months from the time the work was done in front of
    29  the particular property, where the charge against the property
    30  is assessed or made at the time the work is authorized; within
    20070S0777B0874                  - 8 -     

     1  six months after the completion of the improvement, where the
     2  assessment is made by the municipality upon all the properties
     3  after the completion of the improvement; and within six months
     4  after confirmation by the court, where confirmation is required;
     5  the certificate of the surveyor, engineer, or other officer
     6  supervising the improvement, filed in the proper office, being
     7  conclusive of the time of completion thereof, but he being
     8  personally liable to anyone injured by any false statement
     9  therein. Where a borough lies in more than one county, any such
    10  claim filed by such borough may be filed in each of such
    11  counties. In case the real estate benefited by the improvement
    12  is sold before the municipal claim is filed, the date of
    13  completion in said certificate shall determine the liability for
    14  the payment of the claim as between buyer and seller, unless
    15  otherwise agreed upon or as above set forth. A number of years'
    16  taxes or rates of different kinds if payable to the same
    17  plaintiff may be included in one claim. Interest as determined
    18  by the municipality at a rate not to exceed ten per cent per
    19  annum shall be collectible on all taxes, tax claims and
    20  municipal claims from the date [of the completion of the work
    21  after it is filed as a lien, and on claims for taxes, water
    22  rents or rates, lighting rates, or sewer rates from the date of
    23  the filing of the lien therefor] on which the claims become
    24  delinquent or as otherwise provided by law for counties of the
    25  second class: Provided, however, That after the effective date
    26  of this amendatory act where municipal claims are filed arising
    27  out of a municipal project which required the municipality to
    28  issue bonds to finance the project interest shall be collectible
    29  on such claims at the rate of interest of the bond issue or at
    30  the rate of twelve per cent per annum, whichever is less. Where
    20070S0777B0874                  - 9 -     

     1  the provisions of any other act relating to claims for taxes,
     2  water rents or rates, lighting rates, power rates, sewer rents
     3  or rates or for any other type of municipal claim or lien
     4  utilizes the procedures provided in this act and where the
     5  provisions of such other act establishes a different rate of
     6  interest for such claims or liens, the maximum rate of interest
     7  of ten per cent per annum as provided for in this section shall
     8  be applicable to the claims and liens provided for under such
     9  other acts: Provided, however, That after the effective date of
    10  this amendatory act where municipal claims are filed arising out
    11  of a municipal project which required the municipality to issue
    12  bonds to finance the project interest shall be collectible on
    13  such claims at the rate of interest of the bond issue or at the
    14  rate of twelve per cent per annum, whichever is less.
    15     Claims for taxes, water rents, or rates, lighting rates,
    16  power rates and sewer rates may be in the form of written or
    17  typewritten lists showing the names of the taxables, including
    18  the name and last known address, with its zip code, of the owner
    19  of each property against which a claim is being filed, and
    20  descriptions of the properties against which the claims are
    21  filed, together with the amount of the taxes due such
    22  municipality. Such lists may be filed on behalf of a single
    23  municipality, or they may cover the unpaid taxes due any two or
    24  more municipalities whose taxes are collected by the same tax
    25  collector, provided the amounts due each municipality are
    26  separately shown. All tax claims, water rents, or rates,
    27  lighting rates, power rates and sewer rates, heretofore filed in
    28  such form, are hereby ratified, confirmed and made valid
    29  subsisting liens as of the date of their original filing.
    30     A number of years' taxes or rates of different kinds, if
    20070S0777B0874                 - 10 -     

     1  payable to the same plaintiff, may be included in one claim.
     2  Municipal claims shall likewise be filed within said period,
     3  where any appeal is taken from the assessment for the recovery
     4  of which such municipal claim is filed. In such case the lien
     5  filed shall be in the form hereinafter provided, except that it
     6  shall set forth the amount of the claim as an undetermined
     7  amount, the amount thereof to be determined by the appeal taken
     8  from the assessment upon which such municipal claim is based,
     9  pending in a certain court (referring to the court and the
    10  proceeding where such appeal is pending). Upon the filing of
    11  such municipal claim, the claim shall be indexed by the
    12  prothonotary upon the judgment index and upon the locality index
    13  of the court, and the amount of the claim set forth therein as
    14  an undetermined amount.
    15     If final judgment is not obtained upon such appeal within
    16  twenty years from the filing of such municipal claim, the
    17  claimant in the lien shall, within such period of twenty years,
    18  file a suggestion of nonpayment, in the form hereinafter set
    19  forth, which shall have the effect of continuing the lien
    20  thereof for a further period of twenty years from the date of
    21  filing such suggestion, except that with respect to claims for
    22  taxes and other municipal claims, in cities and school districts
    23  of the first class, if final judgment is not obtained upon such
    24  appeal within twenty years from the filing of such municipal
    25  claims, the claimant in the lien shall, within such period of
    26  twenty years, file a suggestion of nonpayment in the prescribed
    27  form which shall have the effect of continuing the lien thereof
    28  for a further period of twenty years from the date of filing
    29  such suggestion. Such municipal claim shall be revived in a
    30  similar manner during each recurring period of twenty years
    20070S0777B0874                 - 11 -     

     1  thereafter, until final judgment is entered upon said appeal and
     2  the undetermined amount of such municipal claim is fixed in the
     3  manner hereinafter provided, except that with respect to claims
     4  for taxes and other municipal claims, in cities and school
     5  districts of the first class, such municipal claims shall be
     6  revived in a similar manner during each recurring period of
     7  twenty years thereafter until final judgment is entered upon
     8  said appeal and the undetermined amount of such municipal claim
     9  is fixed in the manner hereinafter provided.
    10     When the final judgment is obtained upon such appeal, the
    11  court in which said municipal claim is pending shall, upon the
    12  petition of any interested party, make an order fixing the
    13  undetermined amount claimed in such claim at the amount
    14  determined by the final judgment upon said appeal, which shall
    15  bear interest from the date of the verdict upon which final
    16  judgment was entered, and thereafter the amount of said claim
    17  shall be the sum thus fixed. Proceedings upon said municipal
    18  claim thereafter shall be as in other cases.
    19     Where, on final judgment upon said appeal, it appears that no
    20  amount is due upon the assessment for the recovery of which such
    21  claim is filed, the court in which such municipal claim is
    22  pending shall, upon the petition of any interested party, make
    23  an order striking such municipal claim from the record, and
    24  charge the costs upon such claim to the plaintiff in the claim
    25  filed.
    26     Where such appeal is discontinued, the court in which such
    27  municipal claim is pending shall, upon the petition of any
    28  interested party, make an order fixing the undetermined amount
    29  claimed at the amount of the original assessment, which shall
    30  bear interest from the date that such assessment was originally
    20070S0777B0874                 - 12 -     

     1  payable, and thereafter the amount of such claim shall be the
     2  sum thus fixed.
     3     In counties of the second class and municipalities therein,
     4  interest at the applicable per annum rate shall accrue monthly
     5  on all taxes, tax claims and municipal claims on the first day
     6  of the month for the entire month, or part thereof, in which the
     7  taxes, tax claims or municipal claims are paid. Interest shall
     8  not be paid on a per diem basis. In counties of the second
     9  class, all county taxes after the same become delinquent, as
    10  provided by law, shall include a penalty of five per centum for
    11  such delinquency.
    12     In counties of the second class, taxes and tax claims, when
    13  collected, shall be paid into the county treasury for the use of
    14  the county unless the taxes and tax claims are assigned, in
    15  which event there is no requirement that the taxes and tax
    16  claims collected by the assignee be paid into the county
    17  treasury.
    18     In counties of the second class, the county shall not be
    19  required to advance or pay any fee to the prothonotary for the
    20  filing of paper or electronic filing or performing any services
    21  for the second class county relating to the filing,
    22  satisfaction, assignment, transfer, revival, amendment,
    23  enforcement and collection of taxes, tax claims and tax liens.
    24  The prothonotary shall accept filings by or on behalf of the
    25  second class county relating to the taxes, tax claims and tax
    26  liens and note the cost for such service performed on the
    27  docket, and the second class county, its employees,
    28  representatives, agents and assigns shall thereafter collect
    29  such fee as a cost as part of the taxes, tax claims and tax
    30  liens.
    20070S0777B0874                 - 13 -     

     1     Section 4.  Sections 14 and 18 of the act are amended to
     2  read:
     3     Section 14.  Any defendant named in the claim, or any person
     4  allowed to intervene and defend thereagainst, may, at any stage
     5  of the proceedings, present his petition, under oath or
     6  affirmation, setting forth that he has a defense in whole or in
     7  part thereto, and of what it consists; and praying that a rule
     8  be granted upon the claimant to file an affidavit of the amount
     9  claimed by him, and to show cause why the petitioner should not
    10  have leave to pay money into court; and, in the case of a
    11  municipal claim, to enter security in lieu of the claim;
    12  whereupon a rule shall be granted as prayed for. Upon the
    13  pleadings filed, or from the claim and the affidavit of defense,
    14  and without a petition where an affidavit of defense has been
    15  filed, the court shall determine how much of the claim is
    16  admitted or not sufficiently denied; and shall enter a decree
    17  that upon payment by such petitioner to the claimant of the
    18  amount thus found to be due, with interest and costs if anything
    19  be found to be due, or upon payment into court, if the claimant
    20  refuses to accept the same, and upon payment into court of a sum
    21  sufficient to cover the balance claimed, with interest and
    22  costs, or upon the entry of approved security in the case of a
    23  municipal claim, that such claim shall be wholly discharged as a
    24  lien against the property described therein, and shall be
    25  stricken from the judgment index. Thereafter the material,
    26  disputed facts, if any, [shall] may be tried by a jury or the
    27  court, without further pleadings, with the same effect as if a
    28  writ of scire facias had duly issued upon said claim, to recover
    29  the balance thereof; but the jury or the court shall be sworn to
    30  try the issues between the claimant and the parties who paid the
    20070S0777B0874                 - 14 -     

     1  fund into court or entered security, and verdict, judgment and
     2  payment, or execution, shall follow as in other cases. The same
     3  course may be pursued, at the instance of any owner, where the
     4  claim has not in fact been filed, and if, in that event, the
     5  petitioner complies with the decree made, the money paid into
     6  court or security entered shall stand in lieu of the claim and
     7  the latter shall not be filed, and if filed shall be stricken
     8  off upon motion.
     9     Section 18.  The sheriff to whom the scire facias is given
    10  for service shall add to the writ, as parties defendant, all
    11  persons, other than those named therein, who may be found in
    12  possession of the property described, or any part thereof, and
    13  in case no one is found in possession by the sheriff he shall
    14  post a true copy of the writ on the most public part of said
    15  property; and he shall add to the said writ the names of any
    16  persons, not already named therein, whom he may ascertain to
    17  have an interest in the property described, or any part thereof,
    18  which writ shall then be further served as follows:
    19     (a)  By serving, as in the case of a summons, such of those
    20  named in the writ, or added thereto, as may be found in the
    21  county in which the writ issued; and,
    22     (b)  Where the sheriff has information that those named in
    23  the writ, or added thereto, or any of them, may be found in any
    24  other county of this Commonwealth, the said person shall be
    25  served, as in the case of a summons, by the sheriff of the
    26  county in which the said defendants or any of them may reside,
    27  he being deputized for that purpose by the sheriff of the county
    28  in which the writ issues; and,
    29     (c)  (1)  (i)  In case any of those named in the writ, or
    30  added thereto, cannot be found by the sheriff, or their
    20070S0777B0874                 - 15 -     

     1  residences within this Commonwealth are unknown to him, or in
     2  case they reside without the Commonwealth or are deceased, the
     3  said writ may be served [by advertising a copy thereof, or a
     4  brief notice of the contents of the same, once a week for three
     5  successive weeks, in one newspaper of general circulation in the
     6  county, and in the legal periodical, if any, designated by the
     7  court for that purpose: Provided, however, That any defendant
     8  may accept service of said writ, in person or by counsel, with
     9  the same effect as if duly served therewith by the sheriff.] as
    10  follows:
    11     (A)  advertising a copy thereof, or a brief notice of the
    12  contents of the same, once a week for three successive weeks, in
    13  one newspaper of general circulation in the county, and in the
    14  legal periodical, if any, designated by the court for that
    15  purpose. If service is authorized by advertising upon the heirs
    16  and assigns of a deceased defendant, service may be made by
    17  advertising against the heirs or assigns generally if their
    18  identity is unknown; or
    19     (B)  in the alternative, service may be made in accordance
    20  with Pa.R.C.P. No.410 (relating to real property actions) for
    21  service in real property actions.
    22     (ii)  Notwithstanding subparagraph (i), any defendant may
    23  accept service of said writ, in person or by counsel, with the
    24  same effect as if duly served therewith by the sheriff.
    25     (2)  Where the said writ, or the brief notice of the contents
    26  thereof, have been advertised as aforesaid, the same shall have
    27  the same effect as if the writ had been personally served; and
    28  all those named therein, or added thereto, as to whom
    29  publication has been made, shall file their affidavit of
    30  defense, as required by the said writ, within fifteen days after
    20070S0777B0874                 - 16 -     

     1  the date of the last weekly advertisement of the said writ; and
     2  all those named therein or added thereto, who have been served
     3  as in case of a summons, shall file their affidavit of defense,
     4  as required by said writ, within fifteen days after such
     5  service. Service of any such writ may be made at any time within
     6  three months from the date on which it was issued, but it shall
     7  be served and returned at the earliest date possible, and the
     8  plaintiff may require its return at any time, whether or not it
     9  be actually served.
    10     Section 5.  Section 26 of the act, amended February 21, 2006
    11  (P.L.46, No.18), is amended to read:
    12     Section 26.  (a)  It shall be the duty of the prothonotaries
    13  of the courts of common pleas to keep a locality index, in which
    14  shall be entered all tax or municipal claims hereafter filed,
    15  and, upon any written order therefor, they shall give a
    16  certificate of search, showing all the claims filed against any
    17  property. For so doing they shall receive the sum of twenty-five
    18  cents, and five cents additional for each claim certified, and
    19  no more.
    20     (b)  (1)  In addition to the requirements of subsection (a),
    21  [the department or public official responsible for collection of
    22  delinquent taxes in a city of the first class or other
    23  municipality that utilizes this act for the collection of
    24  delinquent taxes, and the county treasurer in a county of the
    25  second class,] any municipality that utilizes the act for the
    26  collection of delinquent taxes shall maintain [as] a public
    27  record [a list of] with respect to all properties against which
    28  taxes [were] are levied, the whole or any part of which were due
    29  and payable in a prior year and which remain unpaid. [This list
    30  shall describe the property and identify its location, provide
    20070S0777B0874                 - 17 -     

     1  the name and last known address, including the zip code, of the
     2  owner of the property and the amount of unpaid taxes, penalties
     3  and interest due, for all years other than the current tax year.
     4  If taxes on the list are paid or another settlement had been
     5  agreed to or if a tax sale of the property is held, this fact
     6  shall be noted on the list.] In a city of the first class, the
     7  public record shall be maintained by the department or public
     8  official responsible for collection of delinquent taxes. In a
     9  county of the second class, the public record shall be
    10  maintained by the county treasurer. The record shall be
    11  considered to be a public record under the act of June 21, 1957
    12  (P.L.390, No.212), referred to as the Right-to-Know Law, and
    13  shall contain all of the following for each property:
    14     (i)  Its location.
    15     (ii)  The property owner's name.
    16     (iii)  The last known address, including the zip code of the
    17  owner, if available.
    18     (iv)  The amount of unpaid taxes, penalties and interest due
    19  for all years other than the current tax year.
    20     (2)  In addition to the requirements of subsection (a), the
    21  department or public official responsible for collection of
    22  delinquent taxes may report any nonpayment of taxes, including
    23  liens, to one or more consumer reporting agencies, as defined by
    24  the Fair Credit Reporting Act (Public Law 91-508, 15 U.S.C. §
    25  1681 et seq.).
    26     (3)  Unless otherwise provided for by the municipality, a
    27  third-party collector responsible for a given year's taxes shall
    28  comply with all requirements of clause (1). A municipality and
    29  third-party collector may agree to delegate the municipality's
    30  requirements under clause (1) to the third-party collector.
    20070S0777B0874                 - 18 -     

     1  Absent such delegation, the municipality shall be the custodian
     2  of the list in clause (1). This requirement may be met by
     3  publishing the information electronically or by paper lists.
     4     (4)  Certifications of taxes due and taxes paid, in a form
     5  acceptable to the county, city, borough, incorporated town,
     6  township or school district, may be issued by the municipality
     7  and third-party collector at the request of any person or
     8  entity. A reasonable fee for preparing and issuing
     9  certifications of taxes due and taxes paid shall be chargeable
    10  by the municipality and third-party collector to the person or
    11  entity requesting the certification if the fee is approved by
    12  legislative action of the county, city, borough, incorporated
    13  town, township or school district. A certification issued by a
    14  third-party collector under this act shall be deemed as if it
    15  were issued by the county, city, borough, incorporated town,
    16  township or school district. Any person or entity that relies
    17  upon a certification issued by a municipality or a third-party
    18  collector in accordance with this act shall not be liable for
    19  any claim or action for damages or monetary loss caused by the
    20  inaccuracy of the certification.
    21     (5)  The term "third-party collector," as used in this
    22  subsection, means any entity appointed by the municipality and
    23  delegated the responsibility of collecting delinquent taxes on
    24  behalf of the municipality under this act.
    25     Section 6.  Section 31 of the act, amended November 29, 2004
    26  (P.L.1299, No.163), is amended to read:
    27     Section 31.  The lien of a tax or a municipal claim shall not
    28  be divested by any judicial sale of the property liened, where
    29  the amount due is indefinite or undetermined, or where the same
    30  is not due and payable; nor shall the lien of a tax or municipal
    20070S0777B0874                 - 19 -     

     1  claim be divested by any judicial sale of the property liened,
     2  as respects so much thereof as the proceeds of such sale may be
     3  insufficient to discharge; nor, except as hereinafter provided,
     4  shall a judicial sale of the property liened, under a judgment
     5  obtained on a tax or municipal claim, discharge the lien of any
     6  other tax or municipal claim than that upon which said sale is
     7  had, except to the extent that the proceeds realized are
     8  sufficient for its payment, after paying the costs, charges and
     9  fees, including reasonable attorney fees, expenses of the sale,
    10  and of the writ upon which it was made, and any other prior tax
    11  or municipal claims to which the fund may first be applicable.
    12  On any such sale being made all tax claims shall be paid out of
    13  the proceeds thereof: first, the oldest tax having priority; and
    14  municipal claims shall be paid next, the oldest in point of lien
    15  having priority. Mortgages, ground-rents, and other charges on
    16  or estates in the property which were recorded, or created where
    17  recording is not required, before any tax other than for the
    18  current year accrue, or before the actual doing of the work in
    19  front of or upon the particular property for which the municipal
    20  claim is filed, shall not be disturbed by such sale unless a
    21  prior lien is also discharged thereby.
    22     In case the property be not sold for a sum sufficient to pay
    23  all taxes and municipal claims, together with the costs thereon,
    24  the plaintiff in any such claim may postpone the sale by
    25  announcement to the assembled bidders or as may otherwise be
    26  provided by local rule or conditions of sale, without payment of
    27  costs, and file his petition setting forth that more than one
    28  year has elapsed since the filing of his claim; that he has
    29  exposed the property to sheriff's sale thereunder, and was
    30  unable to obtain a bid sufficient to pay the upset price in
    20070S0777B0874                 - 20 -     

     1  full; and, if the plaintiff is not a municipality as defined in
     2  this act, that he will bid sufficient to pay the upset price,
     3  and upon the production of searches or a title insurance policy
     4  showing the state of the record and the ownership of the
     5  property, and of all tax and municipal claims, mortgages,
     6  ground-rents, or other charges on or estates in the land, the
     7  court shall grant a rule upon all parties thus shown to be
     8  interested to appear and show cause why a decree should not be
     9  made that said property be sold, freed, and cleared of their
    10  respective claims, mortgages, charges, and estates. If, upon a
    11  hearing thereafter, the court is satisfied that service has been
    12  made of said rule upon the parties respondent, in the manner
    13  provided in section 39.2, and that the facts stated in the
    14  petition be true, it shall order and decree that said property
    15  be sold at a subsequent sheriff's sale day, to be fixed by the
    16  court without further advertisement, and the court may fix a
    17  common date and place of sale for more than one of said
    18  properties if it deems a joint sale to be advantageous. All
    19  property at sheriff's sale shall be sold, clear of all claims,
    20  liens, mortgages, charges, and estates, to the highest bidder at
    21  such sale; and the proceeds realized therefrom shall be
    22  distributed in accordance with the priority of such claims; and
    23  the purchaser at such sale shall take, and forever thereafter
    24  have, an absolute title to the property sold, free, and
    25  discharged of all tax and municipal claims, liens, mortgages,
    26  charges, and estates of whatsoever kind, subject only to the
    27  right of redemption as provided by law. In counties of the
    28  second class, upon return of the writ upon which the sale was
    29  made and upon the expiration of the statutory right of
    30  redemption and if no petition to set aside the sale is pending,
    20070S0777B0874                 - 21 -     

     1  the prothonotary shall satisfy all tax claims and municipal
     2  claims divested by the judicial sale in accordance with the
     3  order of court authorizing such sale.
     4     Any person interested may, at any time before the sale, pay
     5  the petitioner the whole of his claim, with interest, costs,
     6  charges, expenses, fees and attorney fees, whereupon the
     7  proceedings on petition shall at once determine.
     8     For the purpose of enabling the petitioner in any such
     9  proceedings to give the notice required, he may take the
    10  testimony of the defendant in the claim, or of any other person
    11  whom he may have reason to believe has knowledge of the
    12  whereabouts of any of the parties respondent, either by
    13  deposition, commission, or letters rogatory.
    14     Any municipality, being a claimant, shall have the right, and
    15  is hereby empowered, to bid and become the purchaser of the
    16  property at such sale; and while the said property, so
    17  purchased, is held and owned by any county, city, borough,
    18  incorporated town, township, school district or a body politic
    19  and corporate created as a municipal authority pursuant to law,
    20  it shall not be subject to tax claims, unless it be redeemed by
    21  the former owner or other person having the right to redeem, as
    22  provided by law. If, however, a municipality shall become the
    23  purchaser at said sale, the former owner or other person,
    24  desiring to redeem, shall pay all taxes and municipal claims
    25  accrued and chargeable against the property prior to the sale
    26  thereof, together with the costs and interest thereon, and also
    27  all taxes and claims, whether filed or not, which would have
    28  accrued and become chargeable against the property had the same
    29  been purchased at the sale by some party other than the
    30  municipality.
    20070S0777B0874                 - 22 -     

     1     Upon the delivery by the sheriff of a deed for any property
     2  sold under a tax or municipal claim, the judgment upon which
     3  such sale was had shall thereupon and forever thereafter be
     4  final and conclusive as to all matters of defense which could
     5  have been raised in the proceeding, including payment, and no
     6  error or irregularity in obtaining or entering of such judgment
     7  shall effect the validity thereof.
     8     Section 7.  Section 39.2 of the act, amended February 7, 1996
     9  (P.L.1, No.1) and August 14, 2003 (P.L.83, No.20), is amended to
    10  read:
    11     Section 39.2.  (a)  In cities of the first class, notice of a
    12  rule to show cause why a property should not be sold free and
    13  clear of all encumbrances issued by a court pursuant to a
    14  petition filed by a claimant under section 31.2 of this act
    15  shall be served by the claimant upon owners, mortgagees, holders
    16  of ground rents, liens and charges or estates of whatsoever kind
    17  as follows:
    18     (1)  By posting a true and correct copy of the petition and
    19  rule on the most public part of the property;
    20     (2)  By mailing by first class mail to the address registered
    21  by any interested party pursuant to section 39.1 of this act a
    22  true and correct copy of the petition and rule; and
    23     (3)  By reviewing a title search, title insurance policy or
    24  tax information certificate that identifies interested parties
    25  of record who have not registered their addresses pursuant to
    26  section 39.1 of this act, the city shall mail by first class
    27  mail and either by certified mail, return receipt requested, or
    28  by registered mail to such addresses as appear on the respective
    29  records relating to the premises a true and correct copy of the
    30  petition and rule.
    20070S0777B0874                 - 23 -     

     1  Service of notice pursuant to this section shall be deemed
     2  accomplished on the date of mailing. The city shall file an
     3  affidavit of service with the court prior to seeking a decree
     4  ordering the sale of the premises.
     5     (a.1)  In counties of the second class and municipalities
     6  therein, notice of a rule to show cause why a property should
     7  not be sold free and clear of all liens and encumbrances issued
     8  by a court pursuant to a petition filed by a claimant under
     9  sections 28 and 31.1 of this act shall be served by the claimant
    10  upon owners, mortgagees, holders of ground rents, liens and
    11  charges or estates of whatsoever kind as follows:
    12     (1)  By posting a true and correct copy of the petition and
    13  rule on the most public part of the property.
    14     (2)  By reviewing a title search, title insurance policy or
    15  tax information certificate that identifies interested parties
    16  of record, the county or municipality shall mail by first class
    17  mail and either by certified mail, return receipt requested, or
    18  by certificate of mailing to such addresses as appear on the
    19  respective records relating to the premises a true and correct
    20  copy of the petition and rule. Notice pursuant to this section
    21  shall be deemed accomplished on the date of mailing. The county
    22  or municipality shall file an affidavit of service with the
    23  court prior to seeking a decree ordering the sale of the
    24  premises.
    25     (a.2)  Except in cities of the first class, counties of the
    26  second class and municipalities located in counties of the
    27  second class, notice of a rule to show cause why a property
    28  should not be sold free and clear of all liens and encumbrances
    29  issued by a court pursuant to a petition filed by a claimant
    30  under section 31 shall be served by the claimant upon owners,
    20070S0777B0874                 - 24 -     

     1  mortgagees, holders of ground rents, liens and charges or
     2  estates of whatsoever kind as follows:
     3     (1)  By posting a true and correct copy of the petition and
     4  rule on the most public part of the property.
     5     (2)  By reviewing a title search, title insurance policy or
     6  tax information certificate that identifies interested parties
     7  of record, the county or municipality shall mail by first class
     8  mail and either by certified mail, return receipt requested, or
     9  by certificate of mailing to such addresses as appear on the
    10  respective records relating to the premises a true and correct
    11  copy of the petition and rule. Notice pursuant to this
    12  subsection shall be deemed accomplished on the date of mailing.
    13  The county or municipality shall file an affidavit of service
    14  with the court prior to seeking a decree ordering the sale of
    15  the premises.
    16     (b)  No party whose interest did not appear on a title
    17  search, title insurance policy or tax information certificate or
    18  who failed to accurately register his interest and address
    19  pursuant to section 39.1 of this act shall have standing to
    20  complain of improper notice if the city shall have complied with
    21  subsection (a) of this section. This provision shall not apply
    22  if the mortgage or interest was otherwise properly recorded in
    23  the Office of the Recorder of Deeds and the document contains a
    24  current address sufficient to satisfy the notice requirements of
    25  this section. Notwithstanding any other requirement set forth in
    26  this act or any other law to the contrary, the notice required
    27  by subsection (a) of this section shall constitute the only
    28  notice required before a court may enter a decree ordering a tax
    29  sale.
    30     (b.1)  No party whose interest did not appear on a title
    20070S0777B0874                 - 25 -     

     1  search or title insurance policy, because of the party's failure
     2  to record or properly record its interest, shall have standing
     3  to complain of improper notice if the county or municipality
     4  shall have complied with subsection (a.1). This provision shall
     5  not apply if the mortgage or interest was otherwise properly
     6  recorded in the Office of the Recorder of Deeds and the document
     7  contains a current address sufficient to satisfy the notice
     8  requirements of this section. Notwithstanding any other
     9  requirement set forth by subsection (a.1), notice thereunder
    10  shall constitute the only notice required before a court may
    11  enter a decree ordering a tax sale free and clear of liens.
    12     (b.2)  If the county or municipality shall have complied with
    13  subsection (a.2), no party whose interest did not appear on a
    14  title search or title insurance policy because of the party's
    15  failure to record or properly record its interest shall have
    16  standing to complain of improper notice. This provision shall
    17  not apply if the mortgage or interest was otherwise properly
    18  recorded in the Office of the Recorder of Deeds and the document
    19  contains a current address sufficient to satisfy the notice
    20  requirements of this section. Notwithstanding any other
    21  requirement of subsection (a.2), notice thereunder shall
    22  constitute the only notice required before a court may enter a
    23  decree ordering a tax sale free and clear of liens.
    24     (c)  Notice of the court's decree ordering a tax sale,
    25  together with the time, place and date of the sale, shall be
    26  served by first class mail on all parties served with the
    27  petition and rule, on any parties whose interest appeared of
    28  record after the filing of the petition but before the court's
    29  decree and on any creditor who has obtained judgment against the
    30  owner of the premises prior to the date of the decree. The city
    20070S0777B0874                 - 26 -     

     1  shall file an affidavit of service of these notices prior to the
     2  date of the sale.
     3     (d)  Except in cities of the first class, in sales pursuant
     4  to a petition filed by a claimant under section 31 or 31.1,
     5  notice of the court's decree ordering a tax sale, together with
     6  the time, place and date of the sale, shall be served along with
     7  the notice of sheriff's sale and shall be provided to all
     8  parties entitled to receive notice pursuant to Pa.R.C.P.
     9  No.3129.1 (relating to sale of real property; notice;
    10  affidavit).
    11     (e)  Except in cities of the first class, in sales pursuant
    12  to a petition filed by a claimant under section 28 or 31, notice
    13  of the court's decree ordering a sale, together with the time,
    14  place and date of the sale, shall be served by first class mail
    15  upon all parties who receive notice pursuant to Pa.R.C.P.
    16  No.3129.1 prior to the initial sale. Notice under this section
    17  shall be provided no later than seven days prior to the
    18  continued sale.
    19     Section 8.  The act is amended by adding a section to read:
    20     Section 42.  Notwithstanding any other provision of law, any
    21  taxing district in this Commonwealth may adopt an ordinance or a
    22  resolution if the taxing district is of a class which does not
    23  have the power to enact an ordinance to collect taxes under this
    24  act exclusively and independently of any other statute governing
    25  the collection of taxes, including the act of July 7, 1947
    26  (P.L.1368, No.542), known as the "Real Estate Tax Sale Law" and
    27  independent of any county tax claim bureau. Any taxing district
    28  which adopts an ordinance or resolution to collect taxes under
    29  this section shall not be required to comply with any of the
    30  procedures or provisions of the "Real Estate Tax Sale Law,"
    20070S0777B0874                 - 27 -     

     1  including the obligation to make annual returns to any county
     2  tax claim bureau. For the purposes of this section, the term
     3  "taxing district" shall have the same meaning as given to it
     4  under section 102 of the "Real Estate Tax Sale Law".
     5     Section 9.  This act shall apply as follows:
     6         (1)  The amendment of section 3 of the act shall apply
     7     retroactively to January 1, 1996.
     8         (2)  The addition of section 42 of the act shall apply
     9     retroactively to January 1, 2005.
    10     Section 10.  This act shall take effect in 60 days.














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