A $19,349 Tax Debt, a Payment Plan Too Late: A New York Church Loses Its Property

• The church owed $19,349.47 in unpaid property taxes
• A default foreclosure judgment was entered on January 2, 2018
• The pastor later agreed an $8,374.11 instalment plan with the city
• The Appellate Division upheld the sale in November 2020

A Baptist congregation in New York, Eglise Baptiste De La Communion Fraternelle, has lost a court battle to recover property sold over unpaid taxes, according to a decision of the Appellate Division, Second Department, issued on November 25, 2020.

The case, NYCTL 2016-A Trust v Eglise Baptiste De La Communion Fraternelle, Inc., began with a tax lien. The church owed $19,349.47 in unpaid property taxes on property it had bought, which the court described as an investment property. The trust holding the tax lien, NYCTL 2016-A Trust, brought foreclosure proceedings. On January 2, 2018, the Supreme Court entered a default judgment because the church had not responded.

After learning of the judgment, the church’s pastor negotiated an instalment agreement with the city’s Department of Finance for $8,374.11. But the foreclosure sale went ahead anyway, and the church asked the court to vacate both the judgment and the sale, arguing it had acted reasonably once it knew of the problem.

The appeals court disagreed. It found no reasonable excuse for the church’s default and said “the Church failed to set forth any evidence of fraud, collusion, mistake, or misconduct that casts suspicion on the fairness of the sale.” The lower court’s refusal to set aside the sale was affirmed.

The lesson is that a payment plan agreed after a court judgment may come too late. Once a tax lien has been sold and a foreclosure is under way, the process runs on legal deadlines, and missing them can cost a property worth far more than the debt.

Some Jamaican congregations own more than one property, including houses or lots bought as investments. Each carries its own property tax and its own risk. Churches should keep a register of every title they hold, pay property tax on anything not exempt, and respond at once, with a lawyer, to any legal notice. Ignoring a letter can turn a small tax bill into the loss of the land.

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