FAQ: MNP Class Action

Frequently Asked Questions for MNP Class Members

1. What is the MNP case about?

1. What is the MNP case about?

During May of each calendar year, the Jefferson County Tax Collector conducts tax sales of land whose owners have failed to pay the property tax due during the preceding year. Tax sale purchasers (“Investors”) often make Overbids – bids in excess of the taxes, interest, penalties and costs due – which result in excess funds being received by the Jefferson County Treasurer when properties are sold at tax sales. The Treasurer deposits the excess funds into a segregated account (the “Redemption Fund”), which earns interest.

Taxpayers whose property is sold at tax sales have the right to redeem their property for up to three years after the sale. When taxpayers redeem their properties, in addition to paying all past-due amounts owed to the taxing authorities, they also are required to pay an amount equal to 12% interest on the Overbids. When a Taxpayer redeems, the Treasurer pays the excess funds, along with the 12% paid by the Taxpayer, to the Investor.

The interest earned on the redeeming taxpayers’ excess funds is neither credited to the Taxpayer nor paid to the Investor. The Treasurer estimates that approximately $3 million of accrued interest attributable to excess funds on properties that have been redeemed is being held in the Redemption Fund. The MNP Plaintiffs contend that the Taxpayers are the owners of the excess funds and the interest on those funds.

2. Who is a member of the MNP Class?

All Jefferson County taxpayers whose property was sold within the 13 years before the filing of this action, or since that time, at a tax sale for delinquent ad valorem taxes owed by such owners, and which sale produced an excess over the taxes, interest, penalties and costs due, and who have redeemed said properties before a Final Judgment in this case, or other date determined by the Court.

This class shall not include claims based upon tax sales for the years between 1994 and 1998 by persons or entities who participated in Maples v. Williams, CV 98-05330.

3. What are the terms of the Settlement?

The Defendants have agreed to disburse the accrued interest in the Redemption Fund. Each MNP Class Member whose tax sale resulted in an excess funds on which interest is being held in the Redemption Fund will be entitled to an amount equal to the Class Member’s pro rata share of the interest in the Redemption Fund, after payment of MNP Class Counsel’s fees, incentive payments to Ruth Evans and MNP Holdings, LLC and administrative fees of the MNP Class settlement, including mailing and publication costs (the “Net Distribution”). Moreover, the Defendants have agreed that, subject to any material future changes in the governing law, they will pay accrued interest to taxpayers who redeem their properties in the future.

4. Who will receive money from the Settlement?

MNP Class members will receive a check from the Redemption Fund. Class Notices were mailed to the persons who are class members, according to the Jefferson County Tax Collector’s records. If you believe that you may be entitled to a Net Distribution and did not receive a Notice in the mail, you may wish to contact Class Counsel to determine whether you are a class member. Click here for Class Counsel’s contact information.

5. I received a letter from the Treasurer stating that my property was sold at a tax sale. Does this mean I have lost my house?

No. You were sent a check because, at some time in the past, property listed in your name in the Tax Collector’s Office was sold and then later redeemed. The letter from the Treasurer with your check referring to a tax sale does not pertain to the May, 2008 tax sale. If you paid the property taxes that were due by December 31, 2007 and if all prior years’ taxes have been paid, there is no reason to believe your property was sold. If you have questions about whether the taxes were paid, please call the Jefferson County Tax Collector’s office at 205-325-5500.