Municipalities and municipal authorities are given a priority lien for “municipal claims.” Municipal claims include claims for taxes, sewer and water rents and other services provided by municipalities and municipal authorities. These municipal claims constitute a lien from the date when lawfully imposed and assessed even though they have not been filed of record at that time. However, the Municipal Claims and Tax Liens Act requires that all municipal claims for taxes, water rents and sewer rents be filed in the Court of Common Pleas of the county in which the property is located before the last day of the third calendar year after the year in which the taxes or sewer or water rents are first payable.
In a recent case involving a tax sale of real estate, the Pennsylvania Commonwealth Court held that the failure of the municipality to file a lien against the property within the three year time period bars it from filing that lien against the new owner of the property. In Keller v. Scranton City Treasurer, (2011), the City attempted to enforce its claim for unpaid taxes against the property now owned by a bona fide purchaser at the tax sale. The City had not filed liens against the property prior to the tax sale. The Court held that the failure of the City to file a lien against the property within three years caused the City to lose its right to enforce the lien against the property in the hands of the new owner.
It should be noted that a municipality which does not file a lien within the three-year period does not lose all of its right to collect the delinquent amounts. If ownership of the property has not changed, the municipality may still file the lien, but it may lose priority to intervening mortgages or liens against the property. However, if the delayed claim is filed after ownership has transferred to a purchaser, the lien cannot be reattached to the property. The Act also permits the municipality to bring suit against the owner of the property at the time the taxes, water or sewer rents became payable to hold the owner personally liable for amounts owed.
— Stu Cohen