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2420-2427 Delinquent Payment Enforcement: Property Seizure and Sale – Sale Process

2420. NOTIFICATION OF SALE
The tax collector must give notice, either by publication or by posting in three public places, at least one week (seven days) prior to selling any seized property (Rev. & Tax. Code §2957 and M-9912). The form and content of the notice are covered in M-9900 et seq.

2421. REDEMPTION
The owner may redeem seized property at any time before it is sold (Rev. & Tax. Code §2959). The amount necessary to redeem includes:

1) The original tax;

2) The delinquency penalty;

3) Additional penalties;

4) A $10 cost, pursuant to Revenue and Taxation Code sections 2621 or 2706, that which may have been transferred from the secured roll;

5) A $15 tax collector's seizure fee;

6) Mileage fees and costs of the keeper/marshal/sheriff (Gov. Code §26726);

7) The cost of advertising (publishing or posting); and

8) Other costs incurred that are directly attributable to the seizure and sale procedure (Rev. & Tax. Code §§2922(e), 2958; Gov. Code §26720 et seq.); e.g., a locksmith hired to change a lock or gain entrance to the property.

2422. CONDUCTING SALE
The public auction must be held at the exact time and location specified in the notice. A sufficient amount of the property shall be sold to pay the taxes, penalties and costs. It is suggested that appropriate retailers, as indicated in the telephone yellow pages, be contacted as potential bidders.

The person conducting the sale begins by reading the notice of the tax collector's seizure in full (form SCO 9-06) and then proceeds to sell the seized property at the highest bid obtainable (Rev. & Tax. Code §2958).

If the seized property consists of more than one article, the articles may be offered for sale separately or collectively, until the required amount has been received. A minimum bid may be established. This is especially appropriate when selling encumbered equipment.

2423. COSTS OF SALE
Costs of sale include, but are not limited to, the costs of advertising, the same mileage and keepers fees as allowed by law to the sheriff for seizing and keeping property under attachment (Gov. Code §26720 et seq.), and a fee not exceeding $15 for each seizure, which may be charged by the tax collector making the seizure (Rev. & Tax. Code §2958).

2424. ADMINISTRATIVE HEARING
It is unconstitutional to sell seized property without giving the owner an administrative hearing (T.M. Cobb Co. v. County of Los Angeles, 128 Cal. Rptr. 655; 16 Cal. 3d 606).

The law provides no formal requirements for conducting the hearing.

2425. SALE OF SEIZED PROPERTY
The actual sale of property is usually unnecessary in pre-delinquency seizures where the assessee has taken the matter to court, because the assessee's bond covers the taxes and costs when the county prevails. However, when the assessee prevails in court and subsequently fails to pay the tax, his/ her assets may again be seized. The assessee is then additionally liable for all the costs the county incurred in connection with the original seizure and its aftermath (Rev. & Tax. Code §2955).

The auction should be held at the time and location specified in the public notice. Commence the sale by reading the notice of sale in full (form SCO 9-06).

There is no legal requirement to have seized assets appraised or to obtain a minimum bid for each item. An item is sold for the highest bid obtainable. Terminate the sale when enough money has been raised to cover all taxes and costs.

2426. MEDIUM OF PAYMENT
Payment shall be in the medium specified in the notice and as announced prior to the beginning of the sale. If payment is made by personal check, it is suggested that the bill of sale not be executed and delivered until the check has cleared the bank.

2427. ACCEPTANCE OF BID/BILL OF SALE
The property is sold when the final bid is accepted by the auctioneer (Rev. & Tax. Code §2959). Opening and subsequent bids are only "received," whereas the final bid is "accepted." By coincidence, the opening and closing bids might be the same.

"A sale at public auction is completed when the auctioneer publicly announces, by the fall of the hammer, or in any other customary manner, that the item is sold." (Young v. Patterson (1908) 9 Cal. App. 469).

NOTE: In Gentillalli v. San Diego County (1966) 240 Cal. App. 2d 456, the court ruled that the owner had the right to redeem property up to the time of payment of the price bid for the property sold and delivery thereof to the buyer, along with a bill of sale; however, Revenue and Taxation Code section 2959 provides that the right of redemption is terminated when the auctioneer accepts the final bid. A copy of the bill of sale should be retained in the records of the sale (M-2407). Form SCO 2-08 is recommended.