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8290-8299 Sealed Bid: Post-Sale Provisions and Requirements

8290. REPORTS OF SALE
When a sale has been completed, a report of the sale should be sent to the county assessor (Rev. & Tax. Code §3716), the county treasurer, and the county auditor (Rev. & Tax. Code §3718). If form SCO 8-03 was used in obtaining the board of supervisors' approval, the same form may be used for the reports of sale, as outlined in M-8243.  Otherwise, form SCO 8-07 may be used for the reports of sale (M-8291 - M-8292).

8291. REPORT TO TREASURER AND AUDITOR
A report of sale must be provided to the treasurer, with a duplicate to the auditor (Rev. & Tax. Code § 3718).  The report must include the following:

1) The cost of advertising the sale (Rev. & Tax. Code §3718(a));

2) The sums received for individual parcels (Rev. & Tax. Code §3718(b));

3) Identification of the parcels by year, page, and number of the delinquent tax record upon which they appear and of the current roll (Rev. & Tax. Code §3718(c));

4) The cost of recording the deeds (Rev. & Tax. Code §3718(d));

5) The transfer tax collected at the time of the sale (form SCO 8-07 and M-8415); 

6) The amount of fees due to the State ($1.50 per parcel sold plus $5.00 redemption); and

7) The sale fees due to the county ($150.00 per parcel sold).

The auditor must mail a copy to each taxing agency (except for cities, the county, or the State) that is entitled to levy taxes or assessments on the property and that has consented to the sale (Rev. & Tax. Code §3720).

8292. REPORT TO ASSESSOR
Within ten days after the sale, the tax collector must report to the assessor (Rev. & Tax. Code §3716).  The report must include the following:

1) The name of each purchaser (Rev. & Tax. Code §3716(a));

2) The date of the sale (Rev. & Tax. Code §3716(b));

3) The amount for which each property was sold (Rev. & Tax. Code §3716(c)); and

4) The legal description of each property conveyed (Rev. & Tax. Code §3716(d)).

8293. REPORT TO STATE CONTROLLER
This section was deleted on January 1, 1999.

8294. DEPOSIT OF PROCEEDS
The tax collector shall deposit money received from a sale into a tax sale trust fund (Rev. & Tax. Code §3718).

The cost of advertising is deposited in the county general fund and the balance, except the recorder's fee and the transfer tax, is deposited in the delinquent tax sale trust fund (Rev. & Tax. Code §3719).  For distribution of the balance, see M-8500.

The recording fee and the transfer tax must be deposited in an appropriate fund (such as the Tax Collector's Trust Fund) and a warrant drawn in favor of the county recorder for payment or funds transferred to the appropriate recorder's fund.

8295. MARKING ROLLS
The tax collector is required to note the fact and date of sale on the delinquent roll (or abstract sheet) and the current roll on which the property sold at the tax sale appears (Rev. & Tax. Code §3717.5).  No order of cancellation is required.

CAUTION:  Any installments of special assessments that become payable upon the current secured roll after the date of the sale should not be marked off.  Special assessments are defined as levies upon real property for the purpose of paying for improvements, the amount of the levy being based on the benefits accruing to the property.  For a distinction between special taxes and special assessments, see the Property Taxes Law Guide annotations under California Constitution, Article XIII, section 1.

8296. REDUCTION OF TAX CHARGE
The charges against the abstract and the current roll must be reduced by the amount of taxes, costs, penalties (and any applicable fees), special assessments, or other liens satisfied by the sale (Rev. & Tax. Code §3717.5).

8297. NOTICE OF EXCESS PROCEEDS TO PARTIES OF INTEREST
When the sale produces excess proceeds exceeding $150, notice of the right to claim the excess proceeds must be given to parties of interest, by either mail or publication (Rev. & Tax. Code §4676).  If the last known address of a party of interest cannot be obtained, the county must publish notice of the right to claim excess proceeds in a newspaper of general circulation in the county.  Publication is not required if the cost to publish is equal to or greater than the amount of the excess proceeds (Rev. & Tax. Code §4676). For details regarding these notices, see M-8510 and M-9800 et seq.

8298. FAILURE TO CONSUMMATE PURCHASE
If the successful bidder neglects or refuses to consummate the purchase, it is recommended that the sale be voided and a written notice stating this fact be served to the recalcitrant bidder. There is no provision of law whereby the next highest bidder may be declared the purchaser.  If circumstances might justify legal action by the county to enforce payment, the county's legal officer may be contacted.  In this instance, the sale should not be voided without the legal counsel's concurrence.

8299. RETURNED CHECK
When negotiable paper is returned unpaid by the bank, the bid upon which it was accepted should be voided.  The county has a claim against the person tendering the dishonored negotiable paper for the cost of advertising the sale, including but not limited to the published notice required by Revenue and Taxation Code section 3702 (notice of intended sale).  The tax collector shall notify, by registered or certified mail, the person attempting payment, advising him/her that the bid has been voided and stating the amount of the county's claim (Rev. & Tax. Code §§3455-3456; Gov. Code §53062).

If only a part of the payment was dishonored, the cost of the sale should be deducted and the balance refunded.  In both cases, the refund and the notice that the bid was voided should be sent to the purported purchaser by registered or certified mail (Rev. & Tax. Code §§3455-3456; Gov. Code §53062). 

An alternative would be to file an action for damages in the amount of three times the amount of the dishonored paper but not exceeding $1,500, as provided in Civil Code section 1719.  The tax collector should contact the county counsel before using this option.

NOTE:  Voiding the bid restores the right of redemption (Rev. & Tax. Code §3455).