Garden State Investment v. Township of Brick

Summary of Facts and Issues: Garden State Investment (GSI) purchased tax sale certificates on vacant lots in Brick Township. GSI paid taxes on the properties and bided their time until entitled to commence foreclosure actions. During the foreclosure process, GSI finally obtained title searches, and discovered that the properties were encumbered by state-held conservation easements granted in 2001. The Township's tax collector, who handled the tax sale certificate process, was not aware of the conservation easements. GSI filed suit to rescind the tax sale certificate purchases and reimbursement of the property taxes it had paid.
Holding: The trial court held on summary judgment in favor of the Township, and the appellate court affirmed. The appellate court noted that GSI had a duty as tax sale certificate purchaser to investigate the title. In contrast, the Township had no such duty to investigate. The court further distinguished the current case from Twp. of Middletown v. Simon, discussed below, where the municipality had taken affirmative steps to undermine the tax sale certificate owner's interests. Analysis and Notes: This is the latest of several buyer-beware cases, which hold that a purchaser of an interest in property is obligated to investigate the title prior to the purchaser, and has record notice of any recorded encumbrances, including conservation easements.