The S.C. Court of Appeals decision states that the county could not keep the interest it earned while several tax sales were being disputed. The ruling upheld a previous local court ruling.
Beaufort County Treasurer Joy Logan disagrees with the ruling, saying it will have an unfair impact on every county in the state.
"It would cause other counties to do the same," she said.
From 1998-99 Key Corporate Capital, National Tax Assistance Corp. and TransAm Tax Certificate Corp. had 12 property tax sales voided because of county mistakes with the cost of the property returned, but not the interest the county earned while the sales were in dispute.
A part of the county's annual sale of property owned by delinquent taxpayers, the contested sales were voided because of invalid notices to the taxpayer and a failure to credit a tax payment, the court ruling states.
The county has resolved several tax sale disputes out of court because of errors in delinquent tax notices sent out before 2001.
Logan said no county in the state returns interest on voided tax sales, regardless of who is at fault, because state law makes no mention of returning interest collected in a voided tax sale.
"The law states once the bid is voided all that is returned is the bid," she said.
But the appeals court decision states the law "implicitly directs the county to return actual interest."
Logan said the county also clearly states on the bidding forms at its annual tax sale that interest is not paid if a sale is voided.
James Ritchie Jr., attorney for the companies involved in the suit, said his clients are looking to the courts to restore fairness to the process.
"If the county makes a mistake, they shouldn't benefit from it," he said.
Ritchie said he expects to know in the next few months whether the state Supreme Court will hear the case or allow the Court of Appeals decision to stand.
Interest collected from the tax sales is distributed between the county, the school district, fire districts and municipalities, Logan said. All the local governments would be affected if the state Supreme Court upholds the lower courts' rulings.
"They'd all have to pay a portion of it," she said.
Another tax sale dispute settled in February 2003 by the state Supreme Court ruled that Beaufort County's tax notices before 2001 gave a due date for tax payments weeks in advance of the actual deadline.