The answer to that may differ from person to person, and may depend heavily on facts not presented here, such as whether the money was paid be the homeowners but didn't make it to the city, whether the city should have or did know the accountant's address was no longer good for decades, etc.
Because I support sane outcomes when this happens to poor communities, I support the same when it happens to rich ones.
I'm not so sure. If a property that is held in common is going to be sold, perhaps a good faith effort to contact the property owners requires a bit more effort, regardless of whether the amount due is small. The sale price was $90k.
As for the winner, kudos to him. Now he'll either settle for a significant amount of court, or mired in years of civil trial.