Bulletin: PA2014002

Dear Associates:

On November 27, 2013, Act 93 of 2013 was signed into law. Act 93 amends the Municipal Claim and Tax Lien Law (MCTLL) to provide for the enforcement of delinquent property tax claims through judgment liens. This legislation becomes effective January 26, 2014.

This legislation amends the MCTLL (Act 153 of 1923) to permit a taxing district to enforce a delinquent property tax claim in the same manner as a personal judgment, within certain limitations. Specifically, it provides that a taxing district may file a claim for unpaid property taxes in the judgment index in any court of common pleas, provided that the claim has been reduced to judgment under the Real Estate Tax Sale Law (RETSL) or the MCTLL, as applicable. Upon filing, the claim becomes a judgment lien on any real property in that county that is owned by the delinquent taxpayer.

Any such lien, although based on a claim for unpaid taxes, will have the status and priority of an ordinary judgment lien and shall exist separate and apart from the tax lien. The legislation does not affect any other provision of law respecting the collection and enforcement of property taxes, and it does not alter any substantive property rights.

For title purposes, the effect of this Act is to provide taxing districts with an in personam remedy against the delinquent taxpayer when historically a real estate tax lien was strictly an in rem lien against the property for which the taxes were assessed. Therefore, in the event you find a judgment lien for delinquent real estate taxes filed on or after January 26, 2014, by a taxing district, even if the judgment is for taxes on a property that is not part of your transaction, you must secure the satisfaction of the judgment, or the release of the judgment from your subject property, prior to insuring any property owned by and/or being sold by the delinquent taxpayer.

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