Statutory Procedure for Providing Notice of Redemption Constitutional

Here, the Iowa Court of Appeals was asked to determine whether the manner of providing notice of a property owner’s right of redemption under Iowa Code §447.9  comports with constitutional due process requirements.  

In this case, the defendants purchased the plaintiff’s real estate at a tax sale.  After the tax sale, the defendants notified the plaintiff by certified and regular mail of her right to redeem the property.  But, the certified mail was returned as undelivered and the plaintiff later claimed that she had never received notice of her redemption status. 

The statutory 90-day redemption period expired and the defendant was issued a tax deed to the parcel. The plaintiff sued, claiming that she was entitled to “actual notice” of her rights to redeem the property. Further, she alleged that the statute was unconstitutional on due process grounds.  But, the trial court disagreed, noting that notice is “proper and sufficient” when the notice is mailed both regular and certified to the last known address (even if the party sending the mail knew that the mail wasn’t received by the individual). 

The Iowa Court of Appeals affirmed and noted that the plaintiff failed to address the “threshold question” when challenging a statute on constitutional due process grounds- whether state action is involved. But, notice of the right of redemption was not sent by a state entity in this case.  It was sent by a private entity.  But, some courts have held that a mortgage foreclosure constitutes state action and, when certified mail comes back undeliverable, the parties have an obligation to insure actual delivery of notice.  But, the appellate court, citing past precedent, ruled that notice is effective upon mailing.  Thus, the plaintiff had effectively received notice of her redemption rights and failed to redeem the property.  Nicholson v. Frank, et al, No. 9-832/08-1418, 2009 Iowa App. LEXIS 1631 (Iowa Ct. App., Dec. 17, 2009).