Michael Durgin knew he couldn’t afford the three-bedroom house with gray siding in Webster that he’d inherited.

The annual notices of overdue tax bills were continual reminders.

After the fifth year of missed bills, Durgin owed nearly $28,000 in back taxes to the town. Interest and penalties brought the total to just over $39,000.

Durgin knew the town had taken ownership of the house for back taxes in 2018, but it wasn’t until he was searching for a new apartment on Zillow three years later that he learned it had been sold, he said.

By law, he was owed the difference between the sale price of his house and the amount he owed to the town. It’s a check that he’s still waiting to arrive.

In 2020, another New Hampshire homeowner, Richard Polonsky, was in a similar spot. The town of Bedford seized his home for unpaid taxes and sold it at auction for a profit of $83,000, which the town attempted to keep. Polonsky went to court and the state Supreme Court unanimously ruled that towns must return excess proceeds to the former owner.

In Durgin’s case, the town of Webster sold Durgin’s house for just over $105,000 through a sealed bid process that was publicly posted. With the sale, the town netted $41,300 in proceeds, after accounting for back taxes and legal fees.

Durgin wants the money that’s owed to him.

“It would have been nice to have the surplus funds,” he said. “That’s a fresh start for me.”

Tax deed process

New Hampshire state law allows for towns to seize and sell property for unpaid taxes and fees after an owner fails to settle the debt or make payment arrangements for three years. It’s a process spelled out in state law, yet local tax collectors have the discretion to decide to take these properties without public notice.

From 2020 to 2024, Durgin’s house was one of 4,000 properties in the state that were seized by municipalities.

In some communities, properties are sold soon thereafter, with owners given a 90-day “buy back” period where they can regain ownership if they pay off the entirety of the outstanding balance. Other municipalities may hold onto the homes or land, or sell them further down the road.

To sell a property, towns can host a public auction or accept offers through a sealed bid process. The town of Webster chose the latter.

In 2021, three years after the town took ownership of the property, Webster sought sealed bids.

Interested bidders were allowed to make an appointment to view the property with Town Administrator Dana Hadley, and at a minimum, offers had to be $65,000 for the raised ranch home built in 1965.

The highest bid was opened and accepted at a select board meeting that September. Wesley Rose, who owns a local logging company, purchased the property for $105,129.

Hadley, who has worked in local towns for nearly four decades, said the process was standard: public notices were posted, and discussions of the sale ensued at select board meetings.

The New Hampshire Supreme Court set a precedent in the Polonsky case that the money had to be returned. The United States Supreme Court later agreed, ruling on a similar case in Minnesota in 2023.

Unless a former owner is “easily identified,” New Hampshire state law now states that 60 days after a property is sold, a bill of interpleader must be filed with the county superior court. The filing lists all former owners, interested parties and the amount that should be paid. A judge then determines how the money should be dispersed.

Hadley said he had not seen a case like this before. A recent sale involved owners who were deceased, but rarely had an identified party been out of touch.

“I have never encountered that before,” he said. “It doesn’t happen very much. It’s kind of unusual.”

Excess funds

It wasn’t a typical case for Superior Court Judge Martin Honinberg, either.

“We don’t see these every day,” he said in a status hearing on May 12.

In the aftermath of the sale, the town of Webster stated that they tried to locate Durgin. Call-outs to longtime residents provided no leads: an unusual outcome for a small town of less than 2,000.

Hadley also turned to the internet, according to an affidavit. A Michael Durgin existed in Dunbarton, so he mailed a letter and called a phone number. The notice was returned to sender and the line was disconnected.

The town then asked the court for permission to publish notices in two local papers. Judge Andrew Schulman, who presided over the motion, was skeptical but ultimately signed off on the request.

“For better or for worse, it is extremely difficult in today’s society to fall so far off the grid that one can’t be located through due diligence,” wrote Schulman.

Nearly a year later, Durgin had still not been located. As a result, the town filed paperwork with the court, asking a judge to allow the municipality to keep the money.

“The town absorbed and dispersed this money a long time ago in its normal operations,” said Christopher Hawkins, legal counsel for Webster. “There’s no fund of money sitting there, either in the court or in the town for this money. We’re now two years down the road.”

At the time his house was seized, Durgin didn’t have his “priorities straight.” A long-term relationship had just ended, and he had a few encounters with law enforcement on theft and drug charges. He’d also never owned a home before.

That doesn’t mean he was off the grid, though. A Google search brought up a series of articles about him, and he could have been located through the criminal cases in the New Hampshire court system.

When the house was sold, he was living just a few doors down from Webster Town Hall. His grandparents lived up the street, and for better or for worse, local police knew his address, he said.

Still, it took three years before he realized the town sold the home. When he reached out to the town inquiring about the excess funds, he said, but was told it was too late and a judge had already ruled that Webster could keep the proceeds.

At a hearing in July, Honinberg will decide where the money should go.

“If they make a determination that it needs to go back to Mr. Durgin, of course it would,” said Hadley. “We’re waiting for the court to make that determination.”

To Durgin, it’s the least they could do.

“I’m not asking for anything crazy,” he sai  d. “I’m just asking them to follow the law.”