Rupsha 2007, LLC v. Kellum (2011)

Citation: 32 A.3d 402 (D.C. 2011); No. 09-CV-1330 · Court: District of Columbia Court of Appeals · Decided: Nov. 17, 2011

The leading D.C. authority on what happens when the District sells property at a tax sale by mistake — specifically, the difference between treating such a sale as void ab initio versus cancelled, and what the tax-sale purchaser is entitled to recover. The case construes the remedial provisions of D.C. Code Title 47 (§§ 47-1366, 47-1348(c), 47-1361, 47-1377).

Facts

Theresa Banks owned District of Columbia real property and received a Notice of tax delinquency stating that $929.78 was due. An OTR representative incorrectly quoted her a final payoff amount of $1,100.47, which Banks paid as directed. That figure did not, in fact, cover all outstanding taxes. Banks asked that the property be removed from the tax-sale list, but it remained listed and was sold at the tax sale anyway. She learned of the sale only when she was served with a foreclosure complaint, after which she paid all the remaining outstanding taxes.

Rupsha 2007, LLC had purchased the tax certificate on the property and sued to foreclose Banks’s right of redemption. The Superior Court found that the District should not have sold the property — Banks had paid the directed payoff and was not obligated to redeem — and held Rupsha’s tax certificate void ab initio. Rupsha appealed the remedy.

Holding

The Court of Appeals agreed that the District improperly sold the property, because Banks paid the amount stated in her Notice of Delinquency as directed and thus was not obligated to redeem. But it rejected the Superior Court’s “void ab initio” framing. Instead, the court held that the proper remedy was to cancel the tax sale.

“The District should have cancelled the tax sale and thereby paid to Rupsha the purchase price, statutory interest, taxes paid on the property, legal expenses, and attorney’s fees Rupsha incurred in excess of the purchase price.”

Under cancellation, the purchaser is made whole: purchase price + statutory interest + post-sale taxes paid + legal expenses and attorney’s fees under §§ 47-1366, 47-1348(c), 47-1361, and 47-1377. The Superior Court should have set the sale aside as cancelled, not as void ab initio.

Reasoning

• Cancel, don’t void. The District’s statutory scheme provides a remedy — cancellation — for a sale erroneously made (e.g., where the owner had effectively satisfied or been misdirected as to the delinquency). Treating the certificate as void ab initio would strip the purchaser of the reimbursement the statute affords; cancellation restores the purchaser’s outlay while undoing the wrongful sale.
• Purchaser is reimbursed, not penalized. Where the District’s error (not the purchaser’s) caused the improper sale, the innocent tax-sale purchaser is entitled to recover its purchase price, statutory interest, taxes it paid post-sale, and legal expenses/fees — allocating the cost of the mistake to the District rather than the purchaser.
• Owner’s good-faith payment protected. Because Banks paid the payoff she was directed to pay and asked to be removed from the sale list, the underlying sale should not have occurred; the owner’s interest is protected by unwinding the sale.

Practical impact

• For former owners: An owner who pays the directed payoff (or is misdirected by OTR) and is nonetheless sold at tax sale can have the sale cancelled — the certificate purchaser does not take title — but the owner/District must make the purchaser whole.
• For investors / certificate purchasers: When a sale is unwound because of the District’s error, the purchaser is not left empty-handed: it recovers purchase price, statutory interest, post-sale taxes paid, and legal expenses and attorney’s fees in excess of the purchase price. The remedy is cancellation-with-reimbursement, not void-with-forfeiture.

Good-law status

Still good law. Decided Nov. 17, 2011; not overruled or superseded as of last_verified 2026-06-02. It remains the D.C. Court of Appeals’ controlling statement of the cancel-vs-void distinction and purchaser reimbursement for erroneously made tax sales.

Why it matters

Rupsha draws the line that governs every defective D.C. tax sale: an erroneous sale is cancelled (purchaser reimbursed) rather than declared void ab initio (purchaser forfeits). It is the recovery roadmap for a certificate buyer whose sale is unwound through no fault of its own, and it protects an owner who paid the directed payoff.

Related authorities

• aeon-financial-v-district-of-columbia — companion D.C. authority defining when redemption is complete and the scope of reimbursable § 47-1377 expenses.
• tyler-v-hennepin-county — constitutional backdrop on surplus/equity retention.

Applies in →

district-of-columbia — binding D.C. Court of Appeals precedent. Related concepts: void-sale, right-of-redemption, surplus-funds.

Legal information, not legal advice. This page summarizes a court decision for educational purposes and does not create an attorney-client relationship. Verify against the primary opinion and consult a licensed attorney in the relevant jurisdiction before acting. Last verified 2026-06-02.