In re RW Meridian, LLC (County of Imperial Treasurer-Tax Collector v. Stadtmueller)

The automatic stay in bankruptcy prevents a taxing authority from holding a tax sale of the debtor’s property after the bankruptcy petition is filed even if the tax lien redemption period expired before the petition was filedDistinguishing In re Tracht Gut, LLC (Tracht Gut, LLC v. Los Angeles County Treasurer) (9th Cir. 2016) 836 F.3d 1146 on the ground that it involved a pre-petition tax sale, this decision holds that even after the redemption period has expired on an unpaid tax lien, the property owner holds equitable and legal rights in the property until the tax collector has received the full purchase price at the tax sale of the property.  Hence, the automatic stay in bankruptcy prevents the tax collector from conducting the tax sale after a bankruptcy petition has been filed even if the petition is filed after expiration of the redemption period.

Ninth Circuit Bankruptcy Appellate Panel (Jury, J.); February 3, 2017; 2017 WL 473808


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