RAFAELI, LLC v OAKLAND COUNTY Docket No. 156849. Argued November 7, 2019 (Calendar No. 1). Decided July 17, 2020. Rafaeli, LLC, and Andre Ohanessian brought an action in the Oa kland Circuit Court against Oakland County and its tr easurer, Andrew Meisner, alleg ing due-process and equalprotection violations as well as an unconstitutional taking of their properties. Rafaeli owed $8.41 in unpaid property taxes from 2011, which grew to $285.81 after interest, penalties, and fees. Defendants foreclosed on Rafae li’s property for the delinquency , sold the property at public auction for $24,500, and retained all the sale proceeds in exce ss of the taxes, interest, penalties, and fees. Ohanessian owed approximately $6,000 in unpaid taxes , interest, penalties, and fees from 2011. Like Rafaeli’s property, defendants foreclosed on O hanessian’s property for the delinquency, sold his property at auction for $82,000, and reta ined all the proceeds in excess of Ohanessian’s tax debt. Plaintiffs specifically alleged that de fendants, by selling plaintiffs’ real properties in satisfaction of their tax debts and retaining the surplus proceeds from the taxforeclosure sale of their properties, had taken their propertie s without just compensation in violation of the Takings Clauses of the United States and Michi gan Constitutions. The circuit court, Denise K. Langford-Morris , J., granted summary dispositi on to defendants, finding that defendants did not “take” plaintiffs’ properties because plaint iffs forfeited all interests they held in their properties when they failed to pay the taxes due on th e properties. The court determined that property properly forfeited under the General Property Tax Act (GPTA), MCL 211.1 et seq ., and in accordance with due process is not a “taking” barred by either the United States or Michigan Constitution. Because the GPTA properly divested plaintiffs of all interests they had in their properties, the court concluded that plaintiffs did not have a property interest in the surplus proceeds generated from the tax-foreclosure sale of their prope rties. Plaintiffs appealed in the Court of Appeals. In an unpublis hed per curiam opinion issued on October 24, 2017 (Docket No. 330696), the Court of Appeals, M ARKEY , P.J., and M ETER and S HAPIRO , JJ., affirmed the circuit court’s decision and rejected plaintiffs’ argument that the GPT A’s “scheme” allows for unconstitutional takings. Drawing on Bennis v Michigan , 516 US 442 (1996), a United States Supreme Court case regarding civil-asset forfeiture resulting f rom criminal activity, the Court of Appeals held that defendants acquired their interest in plainti ffs’ properties by way of a statutory scheme that did not violate due process and thus that defendant s were not require d to compensate plaintiffs for property that w as lawfully obtained. Plaintiffs sought leave to appeal in the Supreme Court, raising the takings issue as the sole issue on appeal. The Supreme Court granted the application. 503 Mich 909 (2018). Michigan Supreme Court Lansing, Michigan 

# Syllabus Chief Justice: Bridget M. McCormack

C hief Justice Pro Tem:

David F. Viviano Justices: Stephen J. Markman Brian K. Zahra Richard H. Bernstein Elizabeth T. Clement Megan K. Cavanagh This syllabus constitutes no part of the opinion of the Court b ut has been prepared by the Reporter of Decisi ons for the convenience of th e reader. Reporter of Decisions: Kathryn L. LoomisIn an opinion by Justice Z AHRA , joined by Chief Justice M C C ORMACK and Justices M ARKMAN , B ERNSTEIN , C LEMENT , and C AVANAGH , the Supreme Court held : Michigan’s common law recognizes a former property owner’s pro perty right to collect the surplus proceeds that are realized from the tax-foreclosure sal e of property, and this right is vested such that it is to remain free from unlawful governmental inter ference. Accordingly, when the government takes property to satisfy an unpaid tax debt, Michig an’s Takings Clause requires the foreclosing governmental unit to return any proceeds from the t ax-foreclosure sale in excess of the delinquent taxes, interest, penalties, and fees reasonably rela ted to the foreclosure and sale of the property as just compensation. To the extent the GPTA permits the government to retain these surplus proceeds and transfer t hem into the county general fund , the GPTA is unconstitutional as applied to former property owners whose properties were sold at a tax-foreclosure sale for more than the amount owed in unpaid t axes, interest, penalties, and fees related to the forfeiture, foreclosure, and sale of their properties. The trial court’s r eliance on the term “forfeiture” in the GPTA was incorrect, and the Cour t of Appeals erred by relying o n Bennis to conclude that no taking occurred in this case.
1. The trial court’s reliance on the term “forfeiture” in the GPTA was incorrect. Under MCL 211.78(8)(b), “forfeiture” simply permits defendants to see k a judgment of foreclosure. Forfeiture does not affect title, nor does it give the county t reasurer (or the state if the state is the foreclosing governmental unit) a ny rights, titles, or interests to the forfeited property. Therefore, plaintiffs did not “forfeit” all rights, titles, and interests they had in their properties by failing to pay their real-property taxes. 2. The Court of Appeals erred by relying on Bennis to conclude that no t aking occurred in this case. Bennis is distinguishable because the purpose of civil-asset forfeitu re is different than the purpose of the GPTA provisions at issue in this case. Bennis recognized that civil-asset forfeiture serves, at least in p art, to punish the owner of pro perty, but the GPTA is not punitive in nature; its aim is to encourage the timely payment of property taxes and to return tax-delinquent properties to their tax-generat ing status, not necessarily to p unish property owners for failing to pay their property taxes. The Court’s holding in Bennis focused narrowly on forfeited property that was used as an instrumentality for criminal activity and t he government’s interest in deterring illegal activity. In this case, plaintiffs did not use their p roperties for illicit purposes. They simply failed to pay their property taxes, which is not a criminal off ense. Accordingly, the Court of Appeals improperly conflated the meaning of “forfeiture” in an unrelated area of law with the meaning of “forfeiture” as expres sly described under the GPTA. 3. A claim of an unconstitutional taking is distinct from a c laim of property deprivation without due process of law. The remedy for a taking of private property is just compensation, whereas the remedy for bei ng deprived of property without due p rocess of law is the return of the property. In this case, plaintiffs did not dispute the legitim acy of defendants’ authority to foreclose on their properties, nor did plai ntiffs contest the adequacy of defendants’ efforts to notify plaintiffs of the tax delinquency, forfeiture , and foreclosure; instead, p laintiffs challenged defendants’ retention of the surplus proceeds as an unconstitutional taking . Plaintiffs’ request for a determination of just compensation demonstrated that the nature of their claim was a taking without just compensation, not a deprivation of property withou t due process of law. Therefore,there was no legal basis to conclude that defendants’ complianc e with the GPTA’s notice provisions justified defendants’ retention of the surplus proce eds. 4. Under US Const, Am V a nd Const 1963, art 10, § 2, private property shall not be taken for public use without just compensation. Michigan’s Takings C lause has been interpreted to afford property owners greater p rotection than its federal coun terpart when it comes to the state’s ability to take private propert y for a public use under the pow er of eminent domain. A “taking” for purposes of inverse condemnation means that the government has permanently deprived the property owner of any possession or use of the property without the commencement of formalized condemnation proceedings. When such a taking occurs, the prope rty owner is entitled to just compensation for the value of the property taken. In order to assert a takings claim of this nature, a claimant must first establish a vested property right under s tate law. In this case, plaintiffs alleged that they have a cognizable, vested property right to the surpl us proceeds that resulted from the tax-foreclosure sale of their properties under Michigan law tha t is protected by Michigan’s Takings Clause. The primary objective in interpreting a constitutional provision is to determine the text’s original meaning to the ratifiers, the people, at the time of r atification. The whol e of Article 10, § 2 has a technical meaning that must be discerned by examining the purpose and history of the power of eminent domain. People ex rel Seaman v Hammond , 1 Doug 276 (Mich, 1844), United States v Lawton , 110 US 146 (1884), and Nelson v City of New York , 352 US 103 (1956), all address a former property owner’s statutory right to recover th e surplus proceeds. Seaman recognized that the owner or claimant of the land at the time o f the tax-foreclosure sale had a statutory right to recover the surplus. Consistent with Seaman , Lawton not only recognized this statutory right but also made it clear that a Takings Clause vi olation will arise when a tax-sale statute grants a former owner an independent property interest in the surplus proceeds and the government fails to return that surplus. Nelson , on the other hand, held that no federal Takings Clause claim will exist when there is a statutory path to recov er the surplus proceeds but the property owners fail to avail themselves of that procedure. Re ad together, Lawton and Nelson establish that the Takings Clause under the United States Const itution may afford former property owners a remedy when a tax-sale statute provides the divested p roperty owner an interest in the surplus proceeds and the government does not honor that statuto ry interest. However, Seaman , Lawton , and Nelson do not provide direction on what occurs when the statutes gove rning foreclosure make no mention of, or expressly preclude, a divest ed property owner’s right to the surplus proceeds but the divested property owner establishes a property right to the surplus proceeds through some other legal source, such as the common la w. In that instance, the failure to provide the divested property owner an avenue for recovering the surplus proceeds would produce an identical result to Lawton : property to which an individual is legally entitled has been taken without recourse. Michigan’s statutory scheme under the GPTA does not recognize a former property owner’s statutory right to collect these surplus proce eds; therefore, it had to be determined whether plaintiffs have a veste d property right to these surplu s proceeds through some other legal source, such as the common law. 5. Michigan’s common law is adopted from England; therefore, English cases and authorities may be considered when identifying common law. A r eview of English common law supported the notion that an owne r of real or pe rsonal property has a right to any surplus proceeds that remain after the property is sold to satisfy a tax debt. The Magna Carta protected property owners from uncompensated takings and recognized that tax colle ctors could only seize property to satisfy the value of the debt payable to the Crown, leaving the property owner with the excess.Sir William Blackstone similarly explained in the context of ba ilments that whenever the government seized property for de linquent taxes, it did so subj ect to an implied contract in law to either return the property if the tax debt was paid or to rende r back the surplus if the property was sold to satisfy the delinquent t axes. The right to collect the surplus proceeds was also firmly established in the early years of Michigan’s statehood, and thr oughout Michigan’s history the Michigan Supreme Court has held that the government’s takings p ower is limited to only that property which is necessary to serve the public. These fundame ntal principles—that the government shall not collect more taxes than are owed, nor shal l it take more property than is necessary to serve the public—p rotect taxpayers and property ow ners alike from government overreach and have remained a staple in Michigan’s jurisprudenc e. A property owner’s right to collect the surplus proceeds from the tax-foreclosure sale of h is or her property has also withstood the most recent ratification of the Michigan Constitution, as e xemplified by Dean v Dep’t of Natural Resources , 399 Mich 84 (19 76), which recognized a r ight to collect those proceeds under the common-law claim of unjust enrichment. Dean stands for more than just a recognition of the plaintiff’s right to bring a cl aim under unjust enrichment for the surplus proceeds; inherent in Dean ’s holding is Michigan’s protection under the common law of a p roperty owner’s right to collect the surplus proceeds that result from a tax-foreclosure sale. Accordingly, Michigan’s common law recognizes a former pr operty owner’s property right to collect the surplus proceeds that are realized from the tax- foreclosure sale of property, an d this right is veste d such that it is to remain free from unlawful gove rnmental interference. 6. The amendments of the GPTA did not abrogate the common-law right to collect the surplus proceeds. The 1963 Constitution protects a former owne r’s property right to collect the surplus proceeds following a tax-foreclosure sale under Article 10, § 2. While the Legislature is typically free to abrogate the common law, it is powerless to o verride a right protected by Michigan’s Takings Clause. 7. As the foreclosing governmental unit under the GPTA, defen dants were entitled to seize plaintiffs’ properties to satisfy the unpaid delinquent real-pr operty taxes as well as any interest, penalties, and fees associated with the foreclosure and sale of plaintiffs’ properties. But defendants could only collect the amount pla intiffs owed and nothing more. Once defendants foreclosed on plaintiffs’ properties, obtained title to those properties, and sold them to satisfy plaintiffs’ unpaid taxes, interest, penalties, and fees related to the foreclosure s, any surplus resulting from those sales belonged to plaintiffs. Defendants’ retention of those surplus proceeds under the GPTA amounted to a taking of a vested property right requiring just compensat ion. To the extent the GPTA permits defendants to retain these surplus proceeds and transfer them i nto the county general fund, the GPTA is unconstitutional as applied to former property owners w hose properties were sold at a tax-foreclosure sale for more than the amount owed in unpaid ta xes, interest, penalties, and fees related to the forfeiture, foreclosure, and sale of their prope rties. Defendants were required to return the surplus proceeds to plaintiffs, and defendants’ fail ure to do so constituted a government taking under the Michigan Constitu tion entitling plaintiffs to just compensation. 8. The remedy for a government taking is just compensation fo r the value of the property taken. The property “taken” is the surplus proceeds from the t ax-foreclosure sale of plaintiffs’ properties to satisfy their tax d ebts. Therefore, plaintiffs a re entitled to the value of those surplus proceeds as just compensation.Reversed and remanded to the Oak land Circuit Court for further proceedings.
Justice V IVIANO , concurring, agreed with the maj ority’s result but disagreed w ith much of its reasoning. Justice V IVIANO would interpret the Constitution by discerning the ordinary meaning of the term “property” and applying it to the facts of this case, concluding that the property right taken from plaintiffs was their equity in their respectiv e properties and not any independent interest in the surplus proceeds from the tax-foreclosure sale. The majority did not explain which words in the Takings Clause were in need of interpretation, and the majority’s investigation of what the ratifiers understood property to mean ultimately reste d on a flawed understanding of its original meaning. By reasoning that “property” must be defined as the particular types the ratifiers had in mind, the majority interpreted the Takings Clause as exa lting those interests above the Legislature’s authority to modify them, raising serious concern s regarding the separation of powers. Under the majority’s pos ition, any property rights ext ant when the Constitution was ratified would be insulated from legislative change, whereas la ter-developed property rights would presumably be subject to change. The majority’s broad position would not allow the Legislature to repeal rights that were recognized property rights at the ti me of ratification and thereby preserved in the Takings Clause, and this prohibition would ext end even to legislation that prospectively modified or abrogated nonvested property rights—i .e., rights to property that individuals might acquire in the future. Furthermore, the majo rity characterized the property at issue as merely the surplus proceeds from the foreclosure sale but did not consider the property interests that existed before the sale or how those interests a ffected the taxpayer’s entitlement to anything resulting from the sale. And it was far from clear wh at implications the former existence of a statutory right to surplus proceeds had in determining the application of the constitutional right in this case. In sum, Justice V IVIANO would have characterized the p roperty right at issue in this case as the taxpayer’s equity in the property, which best fits the development of ownership rights in property laden with debts and liens. The Legislature did no t purport to abrogate the taxpayer’s equity; therefore, a taking occurred when title to plaintiffs’ property was vested in the government without any possibility of redemption, and plaintiffs were owedthe surplus proceeds from the taxforeclosure sales.

©2020 State of MichiganFILED July 17, 2020

S T A T E O F M I C H I G A N
SUPREME COURT

RAFAELI, LLC, and ANDRE OHANESSIAN, Plaintiffs-Appellants,
v No. 156849
OAKLAND COUNTY and ANDREW MEISNER, Defendants-Appellees.

BEFORE THE ENTIRE BENCH
Z AHRA , J. Plaintiff Rafaeli, LLC, owed $8.41 in unpaid property taxes fro m 2011, which grew to $285.81 after interest, pena lties, and fees. Oakland County and its treasurer, Andrew Meisner (collectively, defendants), foreclosed on Rafaeli’s pro perty for the delinquency, sold the property at public auction for $24,500, and retained a ll the sale proceeds in excess of the taxes, interest, pena lties, and fees. Plaintiff Andre O hanessian owed approximately $6,000 in unpaid taxes, interest , penalties, and fees from 2011 . Like Rafaeli’s property, Michigan Supreme Court Lansing, Michigan 

# OPINION Chief Justice: Bridget M. M cCormack

Chief Justice Pro Tem:

David F. Viviano Justices: Stephen J. Markman Brian K. Zahra Richard H. Bernstein Elizabeth T. Clement Megan K. Cavanagh2 defendants foreclosed on Ohanessi an’s property for the delinque ncy, sold his property at auction for $82,000, and retained all the proceeds in excess of Ohanessian’s tax debt. The issue in this case is whether defendants have committed an unco nstitutional taking by retaining the surplus proceeds from the tax-foreclosure sale of Rafaeli’s and Ohanessian’s (collectively, plaintiffs) properties that exceed the amount pl aintiffs owed in unpaid delinquent taxes, interest, pen alties, and fees under the Gener al Property Tax Act (GPTA). 1 We hold that defendants’ retention of those surplus proceeds is an unconstitutional taking without just compensation under Article 10, § 2 of our 1963 Con stitution. Accordingly, we reverse the judgment of the Court of Appeals and remand this case to the Oakland Circuit Court for proceedings c onsistent with this opinion.
I. FACTS AND PROCEDURAL HISTORY Rafaeli purchased a rental property in Southfield for $60,000 o n August 15, 2011, but failed to pay the 2011 taxes due on the property in the amo unt of $536.24. 2 Defendants mailed to Rafaeli notice of the delinquency on June 11, 2012. Rafaeli sent payment to defendants on August 30, 2012, yet this payment was insufficien t to cover the full amount of the tax delinquency. Defenda nts mailed a second notice of t he delinquency to Rafaeli on September 3, 2012, and Rafaeli sent another payment to defen dants on January 14, 2013; however, even after Rafaeli’s second payment, a deficienc y of $8.41, plus $2.26 in

1 MCL 211.1 et seq

.
2 In plaintiffs’ complaint, Rafaeli alleges that a tax deficienc y remained on the property despite certification from Meisner that all taxes were paid on the property from the previous five years. This led to a tax delinquency of $496.52 plus $39. 72 in penalties, fees, and interest.3 interest, penalties, and fees remained on Rafaeli’s property. On February 1, 2013, defendants sent Rafaeli a third notice of delinquency. This de linquency was never paid, and as a result, on March 1, 2013, Rafaeli’s property was forfe ited in the amount of the unpaid taxes, interest, penalties, and fees. On May 16, 2013, defendants f iled a petition seeking to foreclo se all tax-delinquent properties that were forfeited for unpaid 2011 real-property ta xes, including Rafaeli’s property. On February 26, 2014, a foreclosure hearing was held in the Oakland Circuit Court. Rafaeli did not appear. After the hearing, the court e ntered a judgment of foreclosure that included Rafae li’s property. At the time of t he foreclosure, the delinquency had grown to $285.81 because of penalties, interest , and fees. Rafaeli failed to timely redeem the property by March 31, 2014, resulting in t he transfer to defendants of fee simple title to Rafaeli’s prop erty. On August 19, 2014, de fendants sold Rafaeli’s property at auction to a third party for $24,500. Defendants r etained all the surplus proceeds that exceeded the $285.8 1 debt Rafaeli owed to defenda nts. Ohanessian purchased a 2.7-acre property located in the city of Orchard Lake Village in 2004. Ohanessian pai d $2,510.05 to defendants to sa tisfy his 2010 delinquent property taxes but failed to pay his 2011 property taxes. 3 After Ohanessian’s property was forfeited for the amount of the unpaid taxes, interest, penalti es, and fees, defendants added

3 According to Ohanessian, he moved to California sometime in 20 11. He alleges that he filled out an electronic change-o f-address form on defendants’ website but that he stopped receiving his tax bills when he m oved. He states that he used a mailbox at a UPS store in Eastpointe to receive his propert y-tax bills. Defendants claim that they used this address, as well as Ohanessian’s former re sidence in Livonia, to send Oh anessian notice of the tax delinquency in June 2013, Decembe r 2013, and February 2014. De fendants claim that they received no response to these notices.4 his property to the petition for foreclosure for unpaid 2011 re al-property taxes. The same judgment of foreclosure entered on February 26, 2014, that incl uded Rafaeli’s property also included Ohanessian’s property. At the time of the forecl osure, Ohanessian owed approximately $6,000 in unpaid ta xes, interest, penalties, and fees. Ohanessian failed to redeem his property by March 31, 2014, and defendants obtained fee simple title to his property. On September 26, 2014, defendants sold Ohanessian’s property at auction to a third party for $82,000. Defenda nts retained all the surplus p roceeds exceeding Ohanessian’s tax debts. Plaintiffs filed this action agai nst defendants in the Oakland Circuit Court, alleging due-process and equal-protection violations as well as an uncon stitutional taking. 4 As relevant to this case, plaintiffs specifically alleged that def endants, by selling plaintiffs’ real properties in satisfaction of their tax debts and retainin g the surplus proceeds from the tax-foreclosure sale of their pr operties, had taken their prope rties without just compensation in violation of the Takings Clauses of the United States and Michigan Constitutions. The circuit court granted summary disposition to defendants, fi nding that defendants did not “take” plaintiffs’ properties because plaintiffs forfei ted all interests they held in

4 Prior to filing this action, Rafaeli and a nonparty to this ca se filed a putative class action against the counties of Wayne and Oakland in federal court, ass erting, among other things, an unconstitutional-takings claim. The case was dismissed for lack of subject-matter jurisdiction. Rafaeli, LLC v Wayne Co , unpublished opinion of the United States District Court for the Eastern District of Michigan, issued June 4, 2015 (Case No. 14-13958).5 their properties when they failed to pay the taxes due on the p roperties. 5 The court determined that property properly forfeited under the GPTA and in accordance with due process is not a “taking” barred by either the United States or Michigan Constitution. Because the GPTA prope rly divested plainti ffs of all interests they had in their properties, the court concluded that plaintiffs did not have a property int erest in the surplus proceeds generated from the tax-foreclosure sale of their properties. 6 Plaintiffs appealed in the Court of Appeals. The Court of Appeals affirmed the circuit court an d rejected plaintiffs’ argument that the GPTA’s “schem e” allows for unconstitutional t akings. 7 Drawing on precedent from the United States S upreme Court regarding civil- asset forfeiture resulting from criminal activity, the Court of Appeals held that defendan ts acquired their interest in plaintiffs’ properties “by way of a statutory scheme that did n ot violate due process” and thus defendants were not require d to compensate plaintiffs for property that was lawfully obtained. 8

5 Rafaeli, LLC v Oakland Co , unpublished opinion and order of the Oakland Circuit Court, issued October 8, 2015 (Doc ket No. 15-147429-CZ), p 3.

6 Plaintiffs moved for reconsideration and also moved to amend t heir complaint to add claims of substantive due-process violations, violations of the Eighth Amendment’s prohibition against excessive fin es, and unjust enrichment. Th e circuit court denied reconsideration and denied pla intiffs’ proposed amendment as fu tile.

7 Rafaeli, LLC v Oakland Co , unpublished per curiam opinion of the Court of Appeals, issued October 24, 2017 (Docket No. 330696), p 5.

8 Id ., citing Bennis v Michigan , 516 US 442, 452; 116 S Ct 994; 134 L Ed 2d 68 (1996). Judge S HAPIRO concurred with the majority’s conclusion that plaintiffs faile d to state a compensable takings claim but disagreed with the majority’s rel iance on principles of civilasset forfeiture. Instead, Judge S HAPIRO relied on different authority from the United States Supreme Court, which he concluded had rejected a similar claim to recover the surplus proceeds from a tax-foreclosure sale. Rafaeli (S HAPIRO , J., concurring), unpub op6 Plaintiffs sought leave to appeal in this Court, raising the ta kings issue as the sole issue on appeal. We granted plai ntiffs’ application, ordering the parties to address whether defendants violated the Takings Clause of the United States Con stitution, the Michigan Constitution, or both by retaining the proceeds from the sale o f tax-foreclosed property that exceeded the amount o f the taxes, penalties, interest, and fees owed on the property. 9
II. OVERVIEW OF THE GPTA The GPTA permits the recovery of unpaid real-property taxes, pe nalties, interest, and fees through the foreclosure and sale of the property on wh ich there is a tax delinquency. Under the current process, tax-delinquent propert ies are forfeited to the county treasurers; foreclosed on after a judicial foreclosure h earing; and, if not timely

at 1-2, citing Nelson v City of New York , 352 US 103, 111; 77 S Ct 195; 1 L Ed 2d 171 (1956).

9 Rafaeli, LLC v Oakland Co , 503 Mich 909 (2018).7 redeemed, sold at a public auction. 10 Counties may elect to serve as the “foreclosing governmental unit”; otherwise, the state will do so. 11 Real-property taxes are assessed and collected first by the cit y, township, or village treasurer where the property is located. 12 When property taxes are not satisfied and become

10 Before 1999, delinquent-tax liens were offered at annual tax-l ien sales in which anyone could purchase the tax liens. See Smith, Foreclosure of Real Pr operty Tax Liens Under Michigan’s New Foreclosure Process , 29 Mich Real Prop Rev 51, 51 (2002); see also Alexander, Tax Liens, Tax Sales, and Due Process , 75 Ind L J 747, 760 (2000) (“This transfer of the lien is distinct from the sale of the underlyin g property which occurs at a tax foreclosure sale. Instead, what is transferred is the lien its elf, vesting in the purchaser the right to enforce the lien in acco rdance with statutory procedur es.”). The tax-lien sale was followed by a one-year redemption period. If the property was not timely redeemed, the tax-lien purchaser, or the state if there was no tax-lien purch aser, would be deeded the property and was responsible for the final foreclosure of the p roperty. The former foreclosure process could extend many years, causing properties to deteriorate and become clouded with poor title, which of ten led to title-insurance com panies refusing to insure these properties. As a result, t he Legislature overhauled the GPTA in 1999. See 1999 PA 123. The current scheme expedites the foreclosure process, the reby reducing the amount of abandoned, tax-delinquent prop erties within the state. Give n that the sole issue in this appeal is whether a “taking” occurred, many of the GPTA’s proce dures regarding the notice and hearing requirements, which are relevant to due-proc ess jurisprudence, are either described briefly or omitted entirely from this general overview. For a complete discussion of the current foreclosure process, see Michigan’s New Foreclosure Process , 29 Mich Real Prop Rev at 51. A nd for a comprehensive overview of the prior foreclosure process, see Smith, Foreclosure of Real Property Tax Liens , 75 Mich B J 953 (1996).

11 MCL 211.78(8)(a). Seventy-five o f Michigan’s 83 counties elec t to act as the foreclosing governmental unit. See Michig an Department of Treasury, New Law Tax Foreclosure Archive <https://www.michigan. gov/taxes/0,4676,7-238-43535_55601_55605 -235134--,00.html> (accessed May 12, 2020) [http s://perma.cc/L9V2-BC35].

12 MCL 211.44; MCL 211.45; see also OAG, 2014, No. 7,279 (June 11 , 2014) (“[Real property taxes] are assessed and, in the first instance, collec ted by the city, township, or village treasurer.”).8 delinquent, collection is turned over to the foreclosing govern mental unit. 13 If the county elects to serve as the foreclosing governmental unit, it may cr eate a “delinquent tax revolving fund” that funds local municipalities for the unpaid delinquent taxes. 14 The county treasurer then attempts t o collect the delinquent taxes. 15 On March 1 of each tax year, taxes due in the immediately prece ding year that remain unpaid are returned to th e county treasurer as “delinque nt.” 16 Notice of the delinquency, which mu st explain the effect of failing to pay th e tax delinquency and the possibility of foreclosure, must be afforded to property owners throughout the next 12 months. 17 On March 1 of the year followi ng delinquency, properties with delinquent taxes are “forfeited” to the county treasurer for the amount of the t ax delinquency, as well as any

13 MCL 211.55.

14 MCL 211.87b. Local municipal ities rely heavily on real-proper ty taxes for revenue streams. Thus, counties use the delinquent tax revolving fund to advance municipalities’ funds that would otherwise come from the unpaid real-property t axes. This advance allows local municipalities to continue with their day-to-day operatio ns without having to wait for payment of the delinque nt property taxes.

15 Any taxes, interest, penalties, and fees subsequently collecte d by the county treasurer are deposited into the delinquent tax revolving fund. If delinquen t property taxes are not collected, properties are foreclosed and typically sold at a pu blic auction known as a taxforeclosure sale. In disbursing the proceeds from the tax-fore closure sale, the first priority is to reimburse the delinquent tax revolving fund for “all taxe s, interest, and fees on all of the property . . . .” MCL 211.78m( 8)(a). If the county is ult imately unable to collect the entire amount it advanced to th e municipalities, either by tax collection or foreclosure sales, then the county can charge the m unicipalities back the uncollec ted amount. MCL 211.87b(1). When a surplus exists, the county board of commiss ioners may transfer the surplus into the county’s gene ral fund. MCL 2 11.78m(8)(h).

16 MCL 211.78a(2).

17 See MCL 211.78a through MCL 211.78c; MCL 211.78f.9 interest, penalties, and fees associated with the delinquency. 18 Notably, the term “forfeiture,” as used in the GPTA , means only that a foreclosin g governmental unit may seek a judgment of foreclosure i f the property is not redeemed; it does not affect title. 19 Once forfeiture occurs, the county treasurer must record a cert ificate of forfeiture with the county register of deeds, placing all parties with an interest in the property on notice that the property has been forfeited to the county treas urer, that the property has not been redeemed, and “t hat absolute title to the property will ve st in the county treasurer on the March 31 immediately succeeding the entry of a judgment for eclosing the property . . . .” 20 Forfeited property may be rede emed at any time on or before t hat March 31 date if the total amount of u npaid delinquent taxes, interes t, penalties, and fees are paid to the county treasurer. 21 Meanwhile, foreclosing governmental units must file a petitio n for foreclosure with the circuit court that presides over where the forfeited property is located no later than the 15th day of June following the forfei ture. 22 The petition must “seek a judgment in favor of the foreclosing governmental unit for the forfeited unpaid

18 MCL 211.78g(1).

19 MCL 211.78(8)(b) (“ ‘Forfeited’ or ‘forfeiture’ means a forecl osing governmental unit may seek a judgment of foreclosu re under [MCL 211.78k] if the p roperty is not redeemed as provided under [the GPTA], but does not acquire a right to p ossession or any other interest in the property.”).

20 MCL 211.78g(2).

21 MCL 211.78g(3)(a). This subsec tion details additional taxes, interest, and fees that must be paid to the county treasurer in order to successfully redeem the property. MCL 211.78g(3)(b) through (d).

22 MCL 211.78h(1).10 delinquent taxes, interest, penalties, and fees listed against each parcel of property . . . [and] shall request that a judgment b e entered vestin g absolute title to each parcel of property in the foreclosing governmental unit, without right of redemption. ” 23 A judicial foreclosure hearing must be held in the circuit cour t within 30 days of March 1 of the year after the petition for foreclosure is filed

. 24 After the judicial foreclosure hearing, the judgment of foreclosure must be entered by March 3 0, with an effective date of March 31. 25 Unless the delinquent taxes, interest, penalties, and fees ar e paid on or before March 31, fee simple title to the property vests absolut ely in the foreclosing governmental unit without any further redemption rights availab le to the delinquent taxpayer. 26 Thereafter, the foreclosing governmental unit’s title to the property is not subject to any recorded or unrecorded lien. 27 After foreclosure, and assuming the state, city, village, towns hip, or county where the property is located does not purchase the property, the GPT A provides for one or more auction sales beginning on the third Tuesday in July immediatel y succeeding the entry of

23 Id . Forfeited properties listed in t he petition may be redeemed a fter the petition for foreclosure is filed, in which case the properties are removed from the petition for foreclosure. MCL 211.78h(2).

24 MCL 211.78h(5). In the meantime, the GPTA provides for variou s notices and hearings that must be given before forecl osure is finalized. These incl ude various notices by mail, publication, recordation, and even a personal visit to the prop erty, see MCL 211.78h through MCL 211.78i, as well as a show cause hearing within sev en days of the judicial foreclosure hearing, see MCL 211.78j.

25 MCL 211.78k(5). The final re demption date is March 31. Id

.
26 MCL 211.78k(5) and (6).

27 MCL 211.78k(6).11 the judgment of foreclosure. 28 Once sold, the foreclosing governmental unit deposits the sale proceeds into an account de signated as the “delinquent tax property sales proceeds for the year [the taxes became delinquent]” (hereinafter, the accou nt). 29 Importantly, the account is comprised of the proceeds of all sa les for that year, such that the proceeds of a single sa le are commingled with the proc eeds of all the other sales. 30 The foreclosing governmental unit then distributes the proceeds in the account in a specific order of priority. The first priority is to reimburse the deli nquent tax revolving fund for the full amount of unpaid taxes, interest, and fees owed on the property. 31 This is followed by the annual costs incurred as a result of conducting foreclos ure sales and general

28 MCL 211.78m(2). All property not sold on or before December 3 0 immediately succeeding entry of the judgment of foreclosure is transferred to the city, village, or township where the property is l ocated unless the city, village , or township objects to the transfer. MCL 211.78m(6). If the property remains unsold and is not transferred to the city, village, or township, the fore closing governmental unit r etains the property. Id

. 29 MCL 211.78m(8). Notably, this account is a subsidiary account within the delinquent tax revolving fund. The delinquent tax revolving fund is segre gated into separate accounts for each year’s delinquent taxes. Those accounts continue to e xist until all the delinquent taxes for that tax year have been collected. See generally Mic higan Department of Treasury, 2001-5 Delinquent Tax Revolving Funds Revisions To Accounting After Public Act 123 of 1999 (February 8, 2001), available at <https://www.m ichigan.gov/tre asury/0,4679,7- 121-1751_2194-6024--,00.html> (accessed May 13, 2020) [https://perma.cc/395WFWHC].

30 Money and property within the delinquent tax revolving fund, h owever, remain separate from any other money, property, or assets in the custody of the county treasurer. MCL 211.87b(1).

31 MCL 211.78m(8)(a). In fact, the GPTA requires the delinquent tax revolving fund to be reimbursed regardless of “whethe r or not all of the property wa s sold.” Id

.12 overhead in conducting the forecl osure proceedings for the year

. 32 The statutory scheme for reimbursement is quite exhaustive and even includes costs f or maintaining property foreclosed under the GPTA, def ending title actions, and adminis tering the foreclosure and the disposition of forfeited pr operty for delin quent taxes. 33 The parties acknowledge that sale proceeds are often insufficie nt to cover the full amount of the delinquent taxes, interest, penalties, and fees r elated to the foreclosure and sale of the property. But whe n there are excess proceeds from individual sales, such as the sale of plaintiffs’ properties in this case, those proceeds are used to subsidize the costs for
all foreclosure proceedings and sales for the year of the tax deli nquency, as well as any years prior or subsequent to the delinquency. 34 Then, after the required statutory disbursements are made, surplus proceeds may be transferred to the county general fund in cases in which the county is the foreclosing governmental unit. 35 Of particular importance here, the GPTA does not provide for any disbursement of the sur plus proceeds to the former property owner, nor does it provide former owners a right to ma ke a claim for these surplus proceeds. Michigan is one of nine states with a statutory sche me that requires the

32 MCL 211.78m(8)(b) and (c).

33 MCL 211.78m(8)(e), (f)( ii ), and (f)( iii ).

34 MCL 211.78m(8)(b) throu gh (d); MCL 211.78m(8)(f)( i ).

35 MCL 211.78m(8)(h). In cases in which the state is the foreclos ing governmental unit, “any remaining balance shall be transferred to the land reutili zation fund created under [MCL 211.78n].” MCL 211.78m(8)(g).13 foreclosing governmental unit to disperse the surplus proceeds to someone other than the former owner. 36 It is under this framework that we review plaintiffs’ takings claim.
III. STANDARD OF REVIEW
This Court reviews a circuit cour t’s decision regarding a motio n for summary disposition, as well as any c onstitutional issues, de novo. 37
IV. ANALYSIS A. “FORFEITURE” UNDER THE GPTA AND CIVIL-ASSET FORFEITURE Before turning to plaintiffs’ takings claim, we first address w hy the trial court’s reliance on the term “forfeiture” in the GPTA was incorrect and why the panel majority erred by relying on Bennis v Michigan , a case involving civil-a sset forfeiture, to conclude that no taking occurred in this case. First, the GPTA makes clear that “forfeiture” simply permits de fendants to seek a judgment of foreclosure. 38 Forfeiture does not affect title, nor does it give the county

36 Comment, State Theft In Real Property Tax Foreclosure Procedures , 54 Real Prop Tr & Est L J 93, 101-102 & n 56 (2019) (explaining that Alabama, Ari zona, Illinois, Indiana, Michigan, Minnesota, Mississippi, Montana, and Oregon all requi re the foreclosing governmental unit “to do something with the foreclosure sale su rplus other than return it to the original owner”). Recent legislation has been pro posed requiring the foreclosing governmental unit, in instances in which sale of the property exceeds the minimum bid at auction, to “remit an amount equal to that excess” to the former property owner if th e property was owned and occupied as a principal residenc e before the judgment of forecl osure was entered. See 2019 HB 4219.

37 Sidun v Wayne Co Treasurer , 481 Mich 503, 508; 751 NW2d 453 (2008).

38 MCL 211.78(8)(b).14 treasurer (or the state if the st ate is the foreclosing governm ental unit) any rights, titles, or interests to the forfeited prope rty. Therefore, we reject the premise that plaintiffs “forfeited” all rights, titles, and interests they had in their properties by failing to pay their real-property taxes. Second, Bennis is distinguishable because th e purpose of civil-asset forfeitu re is different than the purpose of the GPTA provisions at issue here

. Bennis recognized that civil-asset forfeiture “serves, at least in part, to punish the owner” of property. 39 But the GPTA is not punitive in nature. Its aim is to encourage the ti mely payment of property taxes and to return tax-delinquen t properties to their tax-gene rating status, not necessarily to punish property owners for fai ling to pay their property tax es. 40 Bennis also recognized that civil-asset forfeiture works as a deterrent, preventing pr operty tainted with criminality from being further used for illicit purposes. 41 To this end, the Supreme Court in Bennis stated that “[t]he government may not be required to compensate an owner for property which it has already lawfully acquired under the exercise of go vernmental authority other

39 Bennis , 516 US at 451-453 (quotation marks and citation omitted).

40 MCL 211.78(1) (“The legislature finds that there exists in thi s state a continuing need to strengthen and revitalize the ec onomy of this state and its mun icipalities by encouraging the efficient and expeditious ret urn to productive use of prope rty returned for delinquent taxes. Therefore, the powers granted in this act relating to t he return of property for delinquent taxes constitute the p erformance by this state or a political subdivision of this state of essential public purposes and functions.”).

41 Bennis , 516 US at 452 (“[F]orfeiture . . . serves a deterrent purpose distinct from any punitive purpose. Forfeiture of property prevents illegal uses both by preventing further illicit use of the property and by imposing an economic penalty , thereby rendering illegal behavior unprofitable.”) (quotatio n marks, brackets, and citati on omitted).15 than the power of eminent domain.” 42 We conclude that Bennis is distinguishable and provides us little guidance as it relates to plaintiffs’ taking s claim. The Court’s holding in
Bennis focused narrowly on forfeited pr operty that was used as an ins trumentality for criminal activity and the gover nment’s interest in deterring il legal activity. 43 In this case, plaintiffs did not use their p roperties for illicit purposes. They simply failed to pay their property taxes, which is not a criminal offense. 44 Accordingly, we conclude that the Court of Appeals improperly conflated the meaning of “forfeiture” in an unrelated area of law with the meaning of “forfeiture” as expressly described under t he GPTA.

42 Id

. 43 Id . at 453 (explaining that the forfeiture of the petitioner’s ca r used in her husband’s criminal activity was consistent with longstanding punitive, de terrent, and remedial goals underlying civil-asset forfeiture); id . at 455 (Thomas, J., concurring) (holding that the forfeiture was permissible because the car was used as an instr umentality of crime and the petitioner did not argue otherwise); id . at 458 (Ginsburg, J., concurring) (“Michigan has decided to deter johns from usi ng cars they own (or co-own) to contribute to neighborhood blight, and that abatement endeav or hardly warrants this Court’ s disapprobation.”).

44 As the Supreme Court of Appeals of Virginia in Martin v Snowden , 59 Va 100, 142-143 (1868), aff’d sub nom Bennett v Hunter , 76 US 326 (1869), stated: This forfeiture cannot be sustai ned as a forfeiture for crime . . . . In such cases, the thing forfeited is the instrument by which the offence was committed, or was the fruit of the offence, and is treated as b eing itself, in some sort, the offender. But the land of a delinquent tax-paye r cannot be brought within the principle of t his class of cases; it is neit her the instrument nor the fruit of any offence. Nor can we suppose that Congress intended to make it a criminal, or even a quasi criminal offence, for a man not to pay his taxes . . . .16 B. DUE PROCESS We also reject defendants’ argum ent that no taking occurred in this case because plaintiffs were afforded the min imal protections of due process . The United States and Michigan Constitutions dictate t hat before the government may t ake property for unpaid taxes, it must provide the property owner sufficient notice of the delinquency and foreclosure proceedings as well as an opportunity to contest th ose proceedings. 45 To this end, the GPTA explicitly states its intent to comply with minim um requirements of due process and not create new rights beyond those prescribed in th e Constitutions of our nation or this state. 46 As long as defendants comply with these due-process considera tions, plaintiffs may not contest the legitimacy of defendants’ author ity to foreclose on their properties for unpaid tax debts, nor may plaintiffs contest the sale of their properties to third-party purchasers. 47

45 US Const, Am V (“[N]or shall private property be taken for pub lic use, without just compensation.”); Const 1963, art 1, § 17 (“No person shall . . . be deprived of life, liberty or property, without due process of law.”).

46 MCL 211.78(2).

47 See Jones v Flowers , 547 US 220, 234; 126 S Ct 1708; 164 L Ed 2d 415 (2006) (“Peop le must pay their taxes, and the government may hold citizens acco untable for tax delinquency by taking their property. But before forcing a cit izen to satisfy his debt by forfeiting his property, due process requires the government to provide adequate notice of the impending taking.”); Sidun , 481 Mich at 509 (“Proceedings that seek to take property from its owner must compor t with due process.”).17 A claim of an uncons titutional taking, however, is distinct fro m a claim of property deprivation without due process of law. 48 In Lingle v Chevron USA Inc , the United States Supreme Court discussed the diffe rence between these two consti tutional clauses: The [Takings] Clause expressly requires compensation where gove rnment takes private property for public use. It does not bar governm ent from interfering with property rights, but rather requires compensat ion in the event of otherwise proper interference amounting to a taking. Conver sely, if a government action is found to be impermissible—for instance bec ause it . . . is so arbitrary as to violate due process—that is the end of the inquiry. No amount of compensation ca n authorize such action. [49]

As Lingle suggests, each constitutional pr ovision protects property owne rs against specific government action, offering different remedies for dis tinct constitutional violations. The remedy for a taking of private property is jus t compensation, while the remedy for being deprived of property without due process of la w is the return of the property. 50 Notably, plaintiffs do not dispute the legitimacy of defendan ts’ authority to

48 Compare Const 1963, art 10, § 2 (Michigan’s Takings Clause) wi th Const 1963, art 1, § 17 (Michigan’s Due Process Clause); see also Peñalver & Strah ilevitz, Judicial Takings or Due Process? , 97 Cornell L Rev 305, 317-318 (2012) (stating that the Taking s Clause and the Due Process Clause of th e Fifth Amendment “have frequen tly been muddled together by courts and commentators alike,” but “grammatically they operate independently of one another and the Supreme Court understands them to protect owners against different kinds of gove rnment harms”) (citation omitted ).

49 Lingle v Chevron USA Inc , 544 US 528, 543; 125 S Ct 2074; 161 L Ed 2d 876 (2005) (quotation marks, citati on, and emphasis omitted).

50 Id .; see also Judicial Takings , 97 Cornell L Rev at 320 (“ Distinguishing between the Takings and Due Process Clauses is consistent with the text of the Constitution, but it also provides a richer conceptual vocabulary for evaluating constitu tional property claims . . . .”). The GPTA, at one point, limited property own ers to a damages action under MCL 211.78 l whenever “he or she did not r eceive any notice required under [the GPTA] . . . .” Once the judgment o f foreclosure was entered an d the former property owner’s interest in the property was extinguished, the former o wner could not bring an18 foreclose on their properties, nor do plaintiffs contest the ad equacy of defendants’ efforts to notify plaintiffs of the ta x delinquency, forfeiture, and fo reclosure. Instead, plaintiffs challenge defendants’ retention of the surplus proceeds as an u nconstitutional taking. Plaintiffs ask this Court to reverse the decision of the Court of Appeals and remand to the circuit court for a determinatio n of just compensation. Plaint iffs’ request for a determination of just compensation demonstrates that the nature of their claim is a taking without just compensation, not a deprivation of property withou t due process of law. Therefore, there is no legal basis to conclude that defendants’ compliance with the GPTA’s notice provisions justifies defe ndants’ retention of the surplu s proceeds.

C. OVERVIEW OF TAKIN GS JURISPRUDENCE AND PLAINTIFFS’ TAKINGS CLAIM
The Fifth Amendment of the Unite d States Constitution, as appli ed to the states through the Fourteenth Amendment , provides, in relevant part: “ [N]or shall private property be taken for public use , without just compensation.” 51 Comparatively, Michigan’s Taking s Clause provides, in relevant part: Private property shall not be taken for public use without jus t compensation therefore being first made or secured in a manner prescribed action for possession. But, in In re Petition By Treasurer of Wayne Co for Foreclosure , 478 Mich 1; 732 NW2d 458 (2007), this Court held that limitatio n unconstitutional. Thus, property owners can now file a motion to set aside their judgme nt of foreclosure if the foreclosing governmental unit failed to comply with due process when providing notice to owners.

51 US Const, Am V; US Const, Am XIV; see AFT Mich v Michigan , 497 Mich 197, 217; 866 NW2d 782 (2015) (“The Fifth Amendment is applied to the sta tes through the Fourteenth Amendment.”), citing Chicago, B & Q R Co v Chicago , 166 US 226, 241; 17 S Ct 581; 41 L Ed 979 (1897).19 by law. If private property consisting of an individual’s prin cipal residence is taken for public use, the amount of compensation made and de termined for that taking shall be not less than 125% of that property’s fair market value, in addition to any othe r reimbursement allowed by law. .

. . “Public use” does not include the taking of private property f or transfer to a private entity for the purpose of economic develo pment or enhancement of tax revenues. Pri vate property otherwise may be taken for reasons of public use as that term is understood on the effecti ve date of the amendment to this constitution that added this paragraph. [52] While we draw on authority discu ssing and interpreting both cla uses, we must keep in mind that Michigan’s Takings C lause has been interpreted to afford property owners greater protection than its federal counterpart when it comes t o the state’s ability to take private property for a public use under the power of eminent do main. 53 Plaintiffs, as the aggrieved property owners, have filed this i nverse-condemnation action alleging that defendants have taken plaintiffs’ properti es without just compensation. A “taking” for purposes of inverse condemnation means that the government has permanently deprived the property owner of any possession or us e of the property without the commencement of formalized condemnation proceedings. 54 When such a taking

52 Const 1963, a rt 10, § 2.

53 Compare Kelo v New London, Conn , 545 US 469; 125 S Ct 2655; 162 L Ed 2d 439 (2005) (holding that the government’s condemnation and transfer of private property to a private entity to facilitate economic development was a permiss ible “public use” under the Fifth Amendment’s Takings Clause), with Wayne Co v Hathcock , 471 Mich 445; 684 NW2d 765 (2004) (holding that a similar condemnation and transf er was not a permissible “public use” under Michigan’s Takings Clause).

54 United States v Clarke , 445 US 253, 257; 100 S Ct 1127; 63 L Ed 2d 373 (1980) (explaining that the property ow ner’s right to bring an inverse -condemnation action is derived from “the self-executing character of the constitutiona l provision with respect to compensation”) (quotation ma rks and citation omitted).20 occurs, the property owner is en titled to just compensation for the value of the property taken. 55 The government’s seizure of real property is the clearest for m of a taking requiring just compensation. 56 But a taking can, and often does, encompass more than just th e physical deprivation of real, tangible property; it also includ es the government’s interference with one’s pers onal, intangible property. 57 In order to assert a takings claim of this nature, a claimant m ust first establish a vested property right under state law. 58 “Because the Constitution protects rather than creates property interests, the existence of a property interes t is determined by reference to existing rules or understandings that stem from an independent source such as state law.” 59 Plaintiffs allege that they have a cognizable, vested property right to the surplus proceeds

55 Hart v Detroit , 416 Mich 488, 494; 331 NW2d 438 (1982) (discussing inversecondemnation actions under Michigan law).

56 Horne v Dep’t of Agriculture , 576 US 350; 135 S Ct 2419, 2425-2426; 192 L Ed 2d 388 (2015) (explaining that a “classi c” or per se taking occurs whe n the government directly appropriates private property for its own use).

57 AFT Mich , 497 Mich at 218 (“The term ‘taking’ can encompass governmenta l interference with rights to bot h tangible and intangible proper ty.”), citing Ruckelshaus v Monsanto Co , 467 US 986, 1003; 104 S Ct 2862; 81 L Ed 2d 815 (1984) (“[I]n tangible property rights protected by state law are deserving of the pro tection of the Taking Clause . . . .”); see also 1 Cooley, General Principles of Cons titutional Law in the United States (1880), p 336 (explaining that the federal Takings Claus e protects “anything of value which the law recognizes as such, and in respect to which the o wner is entitled to a remedy against any one who may disturb him in its enjoyment,” regardle ss of “whether the property be tangible or intangible”).

58 In re Certified Question , 447 Mich 765, 788; 527 NW2d 468 (1994) ( Fun ’N Sun RV, Inc v Michigan ).

59 Phillips v Washington Legal Foundation , 524 US 156, 164; 118 S Ct 1925; 141 L Ed 2d 174 (1998) (quotation mark s and citation omitted).21 that result from the tax-foreclos ure sale of their properties u nder Michigan law that is protected by Michigan’s Takings Clause. Our “primary objective” in inte rpreting a constitutional provis ion such as our state’s Takings Clause is “to determine the text’s original meaning to the ratifiers, the people, at the time of ratification.” 60 This Court has held that “the whole of art 10, § 2 has a technical meaning that must be discerned by examining the ‘purpose and hi story’ of the power of eminent domain.” 61 Accordingly, we must canvass the body of law so that we may ascertain the “common understand ing” of Article 10, § 2 and the property rights protected thereunder. 62
1. A HISTORICAL REVIEW OF CLAIMS FOR SURPL US PROCEEDS FOLLOWIN G A TAX-FORECLOSURE SALE This is not the first time a former property owner has made a c laim for the surplus proceeds that result from the tax -foreclosure sale of the owner ’s property. In People ex rel
Seaman v Hammond , the plaintiff, referred to as th e “relator,” purchased land i n October 1840 that was sold to satisfy the 1837 taxes. 63 The relator received the county treasurer’s certificate of sale, which, acco rding to statute, entitled the “purchaser” to the deed to the land within two years of the sale (October 1842) unless the lan d was redeemed. Before the relator became entitled to the de ed, however, the land was sold again in August 1842 to satisfy the 1838 taxes, this tim e producing a surplus. Accordi ng to the statute, the surplus

60 Hathcock , 471 Mich at 468.

61 Id . at 471.

62 Id

. 63 People ex rel Seaman v Hammond , 1 Doug 276 (M ich, 1844).22 was to be deposited in the state t reasury to the credit of the “owner or claimant” of the land. After the redemption period expire d for the first sale, the rel ator presented his deed for the land and demanded the surplus proceeds from the second sale, bu t he was refused. This Court held that the relator, as the purchaser of the land, was not entitled to receive the surplus proceeds because, under the statute, he was not the owner or claimant of the land at the time of the sale, e xplaining, in relevant part: In that statute, whenever mention is made of the person who bu ys land at a tax sale, he is denominated the purchaser , and no title whatever to the land sold, vests in him, until, at the expiration of two years, he receives the treasurer’s deed, “which conveyance,” says the statute, “shall vest in the person who receives it, an absolute estate in fee simple.” Pri or to that conveyance, he has only a lien upon the land for the repayment of the amount of the tax paid, with twenty per cent interest; he has no right to interfere with the possession of the owner; he cannot enter upon the land for any purpose whatever, nor can he contro l the rents and profits. * * * It is perfectly clear that the individual who has the legal ti tle to the land at the time of the tax sale, is the owner, entitled, under the statute, to the surplus money, if any there be. [64] Thirty-seven years later, the Un ited States Supreme Court, in United States v Taylor , addressed whether a federal stat ute, which permitted the federa l government to conduct tax sales to recover delinquent federal tax debts, gave property ow ners a right to claim the surplus proceeds that res ulted from the tax sales. 65 The Court in Taylor concluded that the

64 Id . at 279-280.

65 United States v Taylor , 104 US 216, 217-218; 26 L Ed 721 (1881). Although we decide this case based on our state C onstitution, we can look for guid ance in the decisions of the United States Supreme Court rega rding surplus proceeds and the federal Takings Clause.23 statute allowed for the recovery of the surplus proceeds. Thre e years later, the Court followed Taylor in United States v Lawton

. 66 In Lawton , the appellee’s property was seized for a tax delinquency of $88, which grew to $170.50 after inter est, penalties, and costs. The board of tax commissioners bought the land on behalf of the United States in satisfaction of the appellee’s ta x debt. The property was “str uck off” for $1,100, leaving a total of $929.50 in excess of the tax debt. The tax debtor sou ght the surplus but was refused. The Court held that th e tax debtor was entitled to th e surplus proceeds, stating: The land in the present case having been “struck off for” and “ bid in” for the United States at the sum of $1,100, we are of [the] opinion tha t the surplus of that sum, beyond the $170.50 tax, penalty, interest, and cos ts, must be regarded as being in the treasur y of the United States, under t he provisions of section 36 of the act of 1861, for the use of the owner, in like manner as if it were the surplus of purchase money received by the United St ates from a third person on a sale of the land to such person for the non-p ayment of the tax. It was unnecessary to go th rough any form of paying money out of the treasury to any officer and then paying it in again to be held for the owner of the land. But, so far as such ow ner is concerned, the surplus money is set aside as his as fully as if it had come from a third person. I f a third person had bid $1,099 in this case, there would have been a surplus of $928.50 paid into the treasury and held for the owner. It can make no diffe rence that the United States acquired the property by bidding one dollar more. To withhold the surplus from the owner would be to violate the fifth amendment to the constitution , and deprive him of his property without due process of law or take his property for public us e without just compensation . If he affirms the propriety of selling or taking mo re than enough of his land to pay the tax and penalty and interest and costs, a nd applies for the surplus mon ey, he must receive at least that. [67]

66 United States v Lawton , 110 US 146; 3 S Ct 545; 28 L Ed 100 (1884).

67 Id . at 149-150 (emphasis added).24 The Supreme Court later clarified the holding of Lawton in Nelson v City of New
York

. 68 In Nelson , the city of New York foreclosed on properties for water charg es that went unpaid for four years. As in Lawton , the delinquencies were fa r lower than the value of the properties, yet the city kept the surplus proceeds after the properties were sold. 69 The property owners challenged th e city’s retention of these su rplus proceeds under the city’s tax-lien foreclosure stat ute. The Court concluded that it was undisputed that the statutory notice provisions were complied with and that the app lication of the statute did not deprive the plaintiffs of procedural due process. 70 The Court then turned to and rejected the plaintiffs’ takings claim. The Court explained that the pl aintiffs’ reliance on Lawton was inappropriate because the takings claim asserted in Lawton was premised on a statutory right to the proceeds. The statute in Lawton required that the surplus proceeds be paid to the former property owner, thus r endering the government’s fail ure to return those surplus proceeds an unconstitutional taking. The statute in Nelson , in contrast, did not require the surplus proceeds to b e paid back to the property owner. Still, the city’s statute provided a property owner a path to obtain the surplus pro ceeds from the s ale. Specifically, the statute

68 Nelson v City of New York , 352 US 103; 77 S Ct 195; 1 L Ed 2d 171 (1956).

69 The water charges for the fir st parcel amounted to $65. The f irst parcel’s property value was assessed at $6,000, and it ultimately sold for $7,000. The water charges for the second parcel amounted to $814.50. The second parcel’s property value was assessed at $46,000, but the city acquired title to that parcel and retained it. Id . at 105-106.

70 Id . at 108-109 (“We conclude . . . tha t the City having taken ste ps to notify appellants of the arrearages and the foreclosure proceedings and their agent having received such notices, its application of the s tatute did not deprive appella nts of procedural due process.”). The Court also re jected the plaintiffs’ equal-prot ection challenge. Id . at 109.25 permitted a property owner to file a timely answer in the forec losure proceeding asserting an interest in the property that exceeded the tax debt. Upon p roof of the owner’s allegation, a separate sale would be directed so that the owner could recei ve the surplus. 71 Because the plaintiffs failed to avail themselves of this opportunity, the Court concluded that they were not entitled to relief. The Court explained: What the City of New York has done is to foreclose real propert y for charges four years delinquent and, in the absence of timely action to redeem or to recovery any surplus , retain the property or the entire proceeds of its sale

. We hold that nothing in the Federal Constitution prevents this where the record shows adequate steps were taken to notify the owners of the charges due and the foreclosure proceedings. [72] Significantly, Seaman , Lawton , and Nelson all address a former property owner’s
statutory right to recover the surplus proceeds. Seaman recognized that the owner or claimant of the land at the time of the tax-foreclosure sale ha d a statutory right to recover the surplus. Con sistent with Seaman , Lawton not only recognized this statutory right but also made it clear that a Takings Clause violation will arise w hen a tax-sale statute grants a former owner an independent pr operty interest in the surplus proceeds and the government fails to return that surplus. Nelson , on the other hand, informs us that no federal Takings Clause claim will exist when there is a statuto ry path to recover the surplus proceeds but the property owners fail to avail themselves of th at procedure. Read together,
Lawton and Nelson establish that the Takings Cla use under the United States Cons titution may afford former property owner s a remedy when a tax-sale stat ute provides the divested

71 Id . at 110 & n 10.

72 Id . at 110 (emphasis added).26 property owner an interest in th e surplus proceeds and the gove rnment does not honor that statutory interest. What Seaman , Lawton , and Nelson do not tell us, however, is what occurs when the statutes governin g foreclosure make no mention of, or expressly preclude, a divested property owner’s right to the surplus proceeds, but the divested property owner establishes a property right to the surplus proceeds through so me other legal source, such as the common law. 73 In that instance, the failure to provide the divested propert y owner an avenue for recovering the surplus proceeds would produce an identical result to Lawton : “Property to which an individual is legally entitled has been t aken without recourse.” 74 Michigan’s statutory scheme un der the GPTA does not recognize a former property owner’s statutory right to collect these surplus proceeds. 75 Therefore, we must determine whether plaintiffs have a vested property right to these surplu s proceeds through some other legal source, such as the common law.
2. VESTED PROPER TY RIGHTS UNDER THE COMMON LAW Like the founders of our nation, Michigan has historically held property rights in the highest regard. Former Mich igan Supreme Court Justice Thom as M. Cooley, one of

73 And even if those cases had directly addressed the issue prese nted here, they would provide only helpful guidance; our decision interpreting Michig an’s Constitution would not be bound by them.

74 Coleman v Dist of Columbia , 70 F Supp 3d 58, 80 (D DC, 2014), citing Lawton , 110 US at 149; see also Clifford, Massachusetts Has A Problem: The Unconstitutionality of the Tax Deed , 13 U Mass L Rev 274, 287 ( 2018) (“In summary, the Coleman court recognized that once a state recognizes a property interest in the taxpaye r, it cannot summarily remove that interest.”).

75 See MCL 211.78m(8)(h) (directi ng that any surplus proceeds fro m the tax-foreclosure sale be transferred into the county’s general fund).27 our nation’s preeminent jurists and learned scholars, wrote tha t the “right to private property is a sacred right; . . . i t was the old fundamental la w, springing from the original frame and constitution of the realm.” 76 [P]roperty . . . is recognized as s uch by the law, and nothing else is or can be. Property and law are born and must die together. Before the la ws, there was no property; take away the laws, all property ceases. [77] Drawing on Sir William Blackstone, Justice Cooley further recog nized that the Magna Carta “guaranteed” the protection of private property aga inst government overreach. 78 Just as the Magna Carta guaranteed property owners due proces s of law, so too did the sacred text limit the King’s ability to take his su bject’s property, real or personal, under principles of eminent domain. 79 Thus, it is without surprise that private-property

76 2 Cooley, Constitutional Limitations (8th ed), p 745 (quotatio n marks and citation omitted).

77 Cooley, General Principles, p 315 (quotation marks and citatio n omitted).

78 Cooley, Constitutional Limitatio ns, pp 733-734, citing 4 Black stone, Commentaries on the Laws of England, p *424.

79 See Magna Carta, Grant 39 (1215) (“No freeman shall be . . . d isseised . . . unless by the lawful judgment of his peers, or by the law of the land.”); see also Horne , 135 S Ct at 2426 (discussing the history of the federal Takings Clause going as far back as the Magna Carta and making no distinction betwee n real or personal private prop erty); Silver Creek Drain Dist v Extrusions Div, Inc , 468 Mich 367, 373, 374 & n 6; 663 NW2d 436 (2003) (explaining that the sovereign’s power of eminent domain and it s “ancient provenance” dates back to the Magna Carta); Peterman v Dep’t of Natural Resources , 446 Mich 177, 186-187 & 187 n 14; 521 NW2d 4 99 (1994) (discussing the history of eminent domain in America).28 rights have been protected from unlawful government takings in every version of this state’s Constitution. 80 “This state’s common law is adopted from England, and to identi fy such law this Court may consider original En glish cases and authorities.” 81 Our review of English common law supports the notion that an owner of real or persona l property has a right to any surplus proceeds that remain after property is sold to sati sfy a tax debt. Just as the Magna Carta protected property ow ners from uncompensated taking s, it also recognized that tax collectors could only seize property to satisfy the va lue of the debt payable to the Crown, leaving the property owner with the excess. 82 In fact, although the “mode of collecting the land tax in England was by distress,” it was a w ell-recognized principle that

80 See Const 1835, art 1, § 19; Const 1850, art 18, § 14; Const 1 908, art 13, § 1; Const 1963, art 10, § 2.

81 People v Woolfolk , 497 Mich 23, 25; 857 NW2d 524 (2014) (citations omitted).

82 See Johnson, The Ancient Magna Carta and the Mode rn Rule of Law: 1215 to 2015 , 47 St Mary’s L J 1, 47 (2015), citing McKechnie, Magna Carta: A Commentary on the Great Charter of King John (Glasgow: James Maclehose & Sons, 2d ed, 1914), p 322. Johnso n explains that when a man died, officers would seek collection o f the deceased’s debts. Ancient Magna Carta , 47 St Mary’s L J at 47. Howev er, these officials would often seize everything, sell the decedent’s property fo r an amount far in e xcess of the debt, and refuse to disgorge the surplus to the decedent’s heirs. Id . As a protection against such abuse practices, Clause 26 of the Magna Carta required that “the valu e of the goods seized had to approximate the value of the debt[,] and the process had to be superintended by worthy men whose function it was to form a check on the actions of the sheriff’s officers.” Id

. (quotation marks and citation omitted); see also Martin , 59 Va at 136 (“The summary methods employed in England in early times for the collection o f debts to the Crown seem to have been turned to purpos es of oppression, and . . . [the] Magna Charta provided for their restraint.”).29 any excess property sold to satisfy a tax debt would be paid ba ck to the owner. 83 Further, Blackstone explained that in the context of bailments, whenever the government seized property for delinquent taxes, it did so subject to “an implied contract in law” to either return the property if the tax debt was paid or “to render back the overplus” if the property was sold to satisfy t he delinquent taxes. 84 The right to collect the surplus proceeds was also firmly estab lished in the early years of Michigan’s statehood. In his treatise on the Law of T axation, Justice Cooley discusses the various methods tha t states used to save the surp lus proceeds for the former owner when that owner’s land was sold for unpaid taxes. 85 The first of these methods was to sell the distressed land for payment of delinquent taxes, an d if the accepted bid exceeded the delinquency, the surplus would be deposited with the local treasury “for the benefit of the party, who shall show his right.” 86 This is precisely what occurred in Seaman . While
Seaman was resolved on then-existing statutory authority, this Court’ s discussion regarding a property owner’s right to collect surplus proceeds is valuable in defining the nature and scope of that right:

83 Martin , 59 Va at 136-137 (explaining that while land was typically on ly taken to satisfy tax debts when personal property was insufficient to satisfy th e debt, any su rplus resulting from the sale of the property ta ken, real or personal, would be paid back to the owner).

84 2 Blackstone, Commentaries on the Laws of E ngland, p *452.

85 Cooley, Law of Taxa tion (3d ed), p 952.

86 Id . As support for this first met hod, Justice Cooley cites the S upreme Court’s decision in Lawton for the notion that if land was sold to the United States for unpaid federal taxes, the United States remained liable to the former owner for any s urplus. Id . at 952 & n 1, citing Lawton , 110 US 146.30 The surplus money produced by th e tax sale, is the property of the person who has the legal title to the land at the time of the s ale, and the moment the amount is ascertained and passed to his credit in th e books of the treasurer, it is as absolutely hi s as though it were in his own keeping; and the right is personal—as unqualifiedl y so as the ownership of any c hattel; and although the surplus spoken of i s produced by the sale of land, yet the right to receive and control it, no more follows the title to the lan d, than does the ownership of the cattle and farmi ng utensils that a man may hap pen to have on his farm when it is sold for taxes, and the purchaser may, w ith as much propriety, claim a right to the latter as the former. [87] Notably, at the time Seaman was decided, a property owner’s right to redeem his property continued after the fore closure sale. That is, it was commonly understood that the delinquent taxpayer would continue to be the legal owner of the property at the time of the foreclosure sale and thus would be entitled to any surplus proc eeds produced from the sale as the “owner or claimant” of the land. This is vastly differe nt from the current version of the GPTA, in which a property owner’s interest in the property is extinguished well before the tax-foreclosure sale. Thus, a fair reading of Seaman demonstrates that in the early years of this state, it was commonly understood that the delinquent t axpayer, not the foreclosing entity, continued to own the lan d at the time of the tax-forecl osure sale and would have been entitled to any surplus, w hich no more followed title to t he land than the former owner’s other personal property. At the same time that it was common for any surplus proceeds to be returned to the former property owner, it was also generally understood that th e government could only collect those taxes actually owed and nothing more. Justice Co oley explained that excessive tax levies were “beyon d the jurisdiction of the offic ers” charged with collecting

87 Seaman , 1 Doug at 281.31 taxes and that even de minimis amounts in excess of the taxes owed were impermissible. 88 This Court recognized a similar principle in 1867, stating that “[n]o law of the land authorizes the sale of propert y for any amount in excess of the tax it is legally called upon to bear.” 89 Indeed, any sale of property for unpaid taxes that was in exc ess of the taxes owed was often rendered voidable at the option of the landowner

. 90 Rather than selling all of a person’s land and risk the sale being voided, officers cha rged with selling land for unpaid taxes often only sold tha t portion of the land that was needed to satisfy the tax debt. 91 That is, early in Michigan’s statehood, it was commonly under stood that the government could not collect more in taxes than what was owed, nor could it sell more land than necessary to collect unpaid taxes. Further, in the context of eminent domain, it was axiomatic tha t the government shall take no more property than necessary for the particular p ublic use for which the taking was done. As Justice Cooley stated:

88 Cooley, Law of Taxation, pp 590-591 (“If the line which the le gislature has established be once passed, we know of no boundary to the discretion of the assessors.”) (quotation marks and citation omitted).

89 Case v Dean , 16 Mich 12, 19 (1867).

90 Cooley, Law of Taxation, p 953 (“A sale of the whole when less would pay the tax would be such a fraud on the law as to render the sale voidable at th e option of the landowner . . . .”).

91 Id . at 952-958. Indeed, this was another method discussed by Jus tice Cooley to ensure that any “surplus moneys” remained with the landowner after the property was sold. Id . at 952-953. The other method was to require that a lien be placed on the land holding the purchaser accountable to pay the e xcess back to the original ow ner. Id . at 952.32 The taking of property must always be limited to the necessity of the case, and consequently no more can be appropriated in any insta nce than the proper tribunal shall adjudge to be needed for the particular u se for which the appropriation is made. When a part only of a man’s premises is needed by the public, the necessity for the appropriation of that part wi ll not justify the taking of the whole, even though compensation be made therefor. The moment the appropriation goes b eyond the necessity of the case, it ceases to be justified on the principles w hich underlie the right of emin ent domain. [92] This Court has consistently rec ognized this c onstitutional prec ept. Throughout this state’s history, this Court has held that the government’s taki ngs power is limited to only that property which is nece ssary to serve the public. 93 Accordingly, these fundamental principles—that the government s hall not collect more taxes than are owed, nor shall it take more property than is necessary to serve the public—protect taxpayers and prope rty owners alike from governm ent overreach. These

92 Cooley, Constitutional Limitations, p 1147.

93 See Peterman , 446 Mich at 201, 202 n 36 (“As an unnecessary taking of prope rty, defendant’s actions violated the strict dictates of the constit utional guarantee that private property may be taken only when necessary for public purposes.” ); Livonia Twp Sch Dist v Wilson , 339 Mich 454, 460; 64 NW2d 563 (1954) (“It is a general princ iple that the legislature cannot authorize the taking of property in excess o f that required for public use.”); Cleveland v Detroit , 322 Mich 172, 179; 33 NW2d 747 (1948) (“In acquiring property for public use it is not permissible for the city to t ake additional property not necessary for that public use for private purposes.”); Berrien Springs Water Power Co v Berrien Circuit Judge , 133 Mich 48, 53; 94 NW 379 (19 03) (“[O]nly so much [land] can be taken as is necessary to the public use.”); Bd of Health of Portage Twp v Van Hoesen , 87 Mich 533, 537; 49 NW 894 (1891) (“It can never be just to ta ke property, under pretence of public benefit, which is not needed by the public . . . .”), citing Paul v Detroit , 32 Mich 108, 114 (1875) (explaining that the 1850 Michigan Constitution added a provision requiring juries to determine the necessity of a taking of priv ate property for public use, as well as the compensation owed for that taking, because there wa s “a well founded belief, founded on experience, that private property was often taken im properly and without any necessity”).33 principles have remained a stapl e in this state’s jurisprudence well after the most recent ratification of our Constitution in 1963. 94 A property owner’s right to colle ct the surplus proceeds from t he tax-foreclosure sale of his or her property has also withstood the most recent ratification of our Constitution, as exemplifie d by our decision in Dean v Dep’t of Natural Resources , which recognized a right to collect those proceeds under the common-l aw claim of unjust enrichment. 95 In Dean , the plaintiff-property owner failed to pay her property taxes for both the city of Flint and Genesee County in the amount of $230 .68 and $146.90, respectively. After the plaintiff failed to appear at the fore closure hearing, the court issued a judgment authorizing the sale o f the plaintiff’s property at a tax sale and stating that if the property was sold to the sta te, the state’s title would bec ome absolute unless the plaintiff timely redeemed the property. 96 The state successfully bid on the plaintiff’s property, starting the one-year redemption period for the plaintiff. Dur ing the redemption period,

94 Detroit v Walker , 445 Mich 682, 701-704; 520 NW2d 135 (1994) (explaining that citizens have a duty to pay their taxes and that the Legislatur e may enact procedural schemes “to secure taxes owed”); Peterman , 446 Mich at 184 (“ ‘[I]t can never be lawful to compel any man to give up his property, when it is not neede d, or to lose it, whether needed or not, without being made whole.’ ”), quoting Paul , 32 Mich at 119; see also Fidlin v Collison , 9 Mich App 157, 167; 156 NW2d 53 (1967) (holding that under t he GPTA’s provision allowing seizure of pe rsonal property to satisfy unpa id taxes, the city treasurer’s seizure of the plaintiffs’ personal property valued at $629.32 to satisfy a $10,500 tax debt was “an excessive distraint” on their property, given that “ ‘[ t ] he amount of property distrained must not be excessive and, if it is, the seizure is illegal ’ ”), quoting 84 CJS, Taxation, § 694, p 1371.

95 Dean v Dep’t of Natural Resources , 399 Mich 84; 247 NW2d 876 (1976).

96 Notice of the hearing was published in the newspaper as requir ed under the former version of the GPTA. Id . at 88, citing MCL 211.66, re pealed by 1999 PA 123.34 the plaintiff paid her delinquent city-prope rty taxes in full b ut mistakenly failed to pay her delinquent county-property taxes. After she failed to timely r edeem her property during the redemption period, the State Treasurer deeded the plaintiff ’s property to the state, which received absolute title to the pr operty and then sold it to a p rivate investor for $10,000. The plaintiff filed an action agains t the state, alleging, in relev ant part, that the state had been unjustly enriched by retaining th e $10,000 following the sale o f her property. The circuit court granted summary dispositio n to the defenda nt, but this Co urt reversed, holding that the plaintiff could bring her s uit for unjust enrichment: In fact, the events out of whic h plaintiff’s claim of unjust e nrichment arises occurred subsequent to the default judgment entered by t he Genesee County Circuit Court: the allege d good-faith attempt at redempt ion, the running of the redemption period after this attempt with plaint iff under the impression that she had in fact redeemed her home, the loss of her home, and the sale of the property by the state for a profit of close to $10,000. [97]

Dean stands for more than just a re cognition of the plaintiff’s rig ht to bring a claim under unjust enrichment for the surplus proceeds. Inherent in Dean ’s holding is Michigan’s protection under our common law of a property owner’ s right to collect the surplus proceeds that r esult from a tax-foreclosure sale. A vi able claim for unjust enrichment requires the complain ing party to show that the othe r party retained a benefit from the complaining party. 98 In concluding that the plaintiff in Dean stated an actionable claim for unjust enrich ment, this Court did not rely on any sta tutory right tha t the plaintiff

97 Dean , 399 Mich at 94-95.

98 Tkachik v Mandeville , 487 Mich 38, 47-48; 790 NW2d 26 0 (2010) (“Unjust enrichment is defined as the unjust retention of money or benefits which i n justice and equity belong to another. No person is unjustly enriched unless the retentio n of the benefit would be unjust.”) (quotation marks and citations omitted).35 had to collect the surplus proceeds. As is the case here, titl e to the plaintiff’s property in
Dean had already vested with the state. Without a statutory right, the plaintiff must have had a common-law right to these surplus proceeds. Otherwise, h er claim of unjust enrichment would not be actionable because it could not have be en said that the state retained a benefit at her expense. In sum, Dean supports the proposition that a property owner has a recognized common-law property right to the surplus proceeds from a taxforeclosure sale. 99 We conclude that our state’s common law recognizes a former pro perty owner’s property right to collect the surplus proceeds that are realize d from the tax-foreclosure sale of property. Having originated as far back as the Magna Carta, having ingratiated itself into English common law, and hav ing been recognized both early in our state’s jurisprudence and as late as our decision in Dean in 1976, a property owner’s right to collect the surplus proceeds from the tax-foreclosure sale of h is or her property has deep roots in Michigan common law. We also recognize this right to be “vested” such that the right is to remain free from unlawful governmental interference . “To constitute a vested right, the interest must be something more than such a mere exp ectation as may be based upon an anticipated continuance of the present general laws; it must have become a title,

99 While Dean stands for the proposition that a claim for the surplus proceed s may be asserted through unjust enrichme nt, the Court of Appeals conclu ded that plaintiffs abandoned their claim of unjust enrichment by failing to develo p it in their briefing below. See Mitcham v Detroit , 355 Mich 182, 203; 94 NW2d 388 (1959) (explaining that a part y’s failure to adequately brief an issue on appeal constitutes aban donment).36 legal or equitable, to the present or future enjoyment of prope rty . . . .” 100 As demonstrated by the discussion earlier, the right to collect these proceeds was beyond a mere expectancy or claim of entitlement. It is as much an interest in property as our kitchen tables; television sets; and, as this Court observed in Seaman , our cattle and farming utensils. 101 Further, the prohibitions against collecting excess taxes, selling more land than needed to collect such taxes, and taking more property than necessary to serve the pub lic all underlie a property owner’s right to collect the surpl us proceeds and were well-est ablished legal principles before 1963. Therefore, we hold that the ratifiers would have commonly understood this common-law property right to be protected under Michigan’s Taki ngs Clause at the time of the ratification of the Michigan Constitution in 1963. 102

100 Fun ’N Sun , 447 Mich at 788 (quotation ma rks and citation omitted); Coole y, General Principles, p 320 (“The test of unlawful interference with prop erty is that vested rights are abridged or taken away. ”) (emphasis added).

101 An often-used metaphor in prope rty law further illustrates thi s point. Property rights are commonly referred to as a “bundle of sticks,” with each sti ck representing a distinct right defined by state law. United States v Craft , 535 US 274, 278; 122 S Ct 1414; 152 L Ed 2d 437 (2002) (“A common idio m describes property as a ‘bund le of sticks’—a collection of individual rights wh ich, in certain combinations, constitute property. State law determines only which sticks are in a person’s bundle.”) (c itation omitted). These sticks range from a property ow ner’s right to use or enjoy the property, the right to eject others from the property, and th e right to dispose of the prope rty altogether. See Adams v Cleveland-Cliffs Iron Co , 237 Mich App 51, 57; 602 NW2d 215 (1999) (“The general concept of ‘property’ comprises various rights—a ‘bundle of sti cks,’ as it is often called— which is usually understood to include ‘[t]he exclusive right o f possessing, enjoying, and disposing of a thing.’ ”), quoting Black’s Law Dictionary (6th ed), p 1216. Unlawful governmental interference with even one stick in that bundle co nstitutes a taking requiring just compensation. Our holding today recognizes that the right to collect any surplus proceeds that result from the sale of a person’s property for u npaid taxes is one stick in the owner’s bundle of rights, entitled to as much protection as any other stick in that bundle.

102 Hathcock , 471 Mich at 471.37 Having recognized both the existence of this vested property ri ght at common law and that the ratifiers of the 1963 Michigan Constitution would have commonly understood this right to be protected under Michigan’s Takings Clause at t hat time, the question now becomes whether the am endments of the GPTA a brogated this commo n-law right. 103 If it did, there is no taking here. The common law “is but the accumulated expressions of the vario us judicial tribunals in their efforts to ascertain what is right and just . . . .” 104 It is dynamic and flexible, not static or fixed like statutory law. 105 The common law is, however, incremental in adapting to society’s changing circumstances, developing gra dually to reflect our policies, customs, norms, and values. 106 Nonetheless, the Legislature may enact legislation that abrogates or alters the co mmon law. Of course, both legis lation and the common law are secondary to our Constitution. Article 3, § 7 of Michigan’ s Constitution provides:

103 While the bulk of the revisions to the GPTA took place in 1999 , the provision allowing counties to transfer any surplus proceeds to their general fund s, MCL 211.78m(8)(h), was not added until 2006. S ee 2006 PA 498.

104 Price v High Pointe Oil Co, Inc , 493 Mich 238, 242; 828 NW2d 660 (2013) (quotation marks and citation omitted).

105 Beech Grove Investment Co v Civil Rights Comm , 380 Mich 405, 430; 157 NW2d 213 (1968) (“The common law does not c onsist of definite rules whic h are absolute, fixed, and immutable like the statute la w . . . .”) (quotation marks and c itation omitted).

106 Price , 493 Mich at 243 (“The common law is always a work in progress and typically develops incrementally, i.e., gr adually evolving as individual disputes are decided and existing common-law rules are cons idered and sometimes adapted to current needs in light of changing times and circumstances.”).38 The common law and the statute laws now in force, not repugnant to this constitution , shall remain in force until they expire by their own limitations, or are changed , amended or repealed. [107]
It is clear that our 1963 Constitu tion protects a former owner’ s property right to collect the surplus proceeds following a tax-foreclosure sale u nder Article 10, § 2. This right existed at common law; was commonly understood to exist i n the common law before the 1963 ratification of our C onstitution; and continues to exi st after 1963, as our decision
in Dean demonstrates. Because this common-law property right is const itutionally protected by our state’s Takings C lause, the Legislature’s amen dments of the GPTA could not abrogate it. While the Legislature is typically free to ab rogate the common law, it is powerless to override a right pro tected by Michigan’s Takings C lause. 108

107 Const 1963, art 3, § 7 (emphasis added).

108 Nothing in our holding today pre vents the Legislature from ena cting legislation that would require former property owne rs to avail themselves of cer tain procedural avenues to recover the surplus proceeds. See, e.g., Nelson , 352 US at 110 & n 10. We only hold that the Legislature may not write t his constitutionally protected v ested property right out of existence. See Munn v Illinois , 94 US 113, 134; 24 L Ed 77 (1876) (“A person has no property, no vested interest, in any rule of the common law. . . . Rights of property which have been created by the common law cannot be taken away withou t due process; but the law itself, as a rule of conduct, may be changed at the will, o r even at the whim, of the legislature, unless prevented by constitutional limitations .”) (emphasis added); see also Mackin v Detroit-Timkin Axle Co , 187 Mich 8, 13; 153 NW 49 (1915) (“ Except as to vested rights , the legislative power exists to change or abolish existing st atutory and common-law remedies.”) (emphasis added). Further, because this common-law property right existed well before 1963, it cannot be said that our Constitution creat ed this property right; rather, this right was, and still is, commonly understood to be protected by Michigan’s Takings Clause. See Phillips , 524 US at 164 (“[T]he Constitu tion protects rather than creat es property interests . . . .”).39 V. APPLICATION A. DEFENDANTS’ RETENTION OF T HE SURPLUS PROCEEDS WAS AN UNCONSTITUTIONAL TAKING As the foreclosing governmental unit under the GPTA, defendants were entitled to seize plaintiffs’ properties to satisfy the unpaid delinquent r eal-property taxes as well as any interest, penalties, and fees associated with the foreclosu re and sale of plaintiffs’ properties. But defendants could only collect the amount plain tiffs owed and nothing more. Once defendants foreclosed on pl aintiffs’ properties, obtained title to those properties, and sold them to satisfy plaintiffs’ unpaid taxes, interest, penalt ies, and fees related to the foreclosures, any surplus resulting from those sales belonged t o plaintiffs. That is, after the sale proceeds are distributed in accordance with the GPTA’s order of priority, any surplus that remains is the property of plaintiffs, and defenda nts were required to return that property to plaintiffs. Defendants’ retention of those su rplus proceeds under the GPTA amounts to a taking of a vested property right requiring just c ompensation. To the extent the GPTA permits defendants to retain these surplus proceeds an d transfer them into the county general fund, the GPTA is unconstitutional as applied to former property owners whose properties were sold at a tax-foreclosure sale for more t han the amount owed in unpaid taxes, interest, penalties, and fees related to the forf eiture, foreclosure, and sale of their properties. Defendants rely on a line of Michigan cases to argue that plain tiffs held no rights, titles, or interests in their properties once foreclosure occur s and fee simple title vests with40 the state. 109 None of these decisions, however, involved a claim for the su rplus proceeds after a foreclosure sale. Rather, these cases all addressed th e former property owners’ ability to retain or convey an in terest in the land that had be en foreclosed. Indeed, one of these cases even noted that the “primary and inducing purpose o f the legislation was to

secure a portion of the unpaid taxes, rather than nothing , and to restore lands to a taxpaying basis, instead of supinely allowing them to accumulate tax deli nquencies with no hope of ever recovering them.” 110 In this case, defendants rec overed the entire amount of plain tiffs’ tax debts and more by way of a surplus. Plaintiffs had a cognizable, vested prop erty right to collect those surplus proceeds. This vested right did not s imply “vanish[] into thin air.” 111 In the same way that the foreclosure process does not elimina te the former property owner’s interest in the personal property that sits on the fore closed land, the vesting of fee simple title to the real property does not extinguish the prope rty owner’s right to collect the surplus proceeds of the sale . This is a separate property right that survives the

109 Krench v Michigan , 277 Mich 168, 179; 269 NW 131 (1936) (holding that a taxforeclosure sale divests the former owner of title and vests ti tle with the state in fee simple with a new chain of title being formed); James A. Welch Co, Inc v State Land Office Bd , 295 Mich 85, 93-95; 294 NW 377 ( 1940) (holding that after the s tate received absolute title to land that was sold for delinquent property taxes, the former owner held no greater interest in title to the land than any other stranger); Meltzer v State Land Office Bd , 301 Mich 541, 545; 3 NW2d 875 (1942) (affirming Krench and Welch and concluding that once absolute title to a tax-foreclosed property vests with the state, the fo rmer owners hold “no interest in the land at the tim e of the tax sale”).

110 Welch , 295 Mich at 92 (quotation mark s and citation omitted; emphasi s added).

111 Armstrong v United States , 364 US 40, 48; 80 S Ct 1563; 4 L Ed 2d 1554 (1960) (holding that the government’s “total dest ruction” of the value of a lie nholder’s lien against government-held property w as an unconstitutional taking).41 foreclosure process. Accordingly, like any other creditor, def endants were required to return the surplus. 112
We see no reason to recharacteriz e these surplus proceeds as pu blic money to be transferred into the county gene ral fund and used for public pu rposes wholly independent of the GPTA without paying just compensation. 113 While plaintiffs’ takings claim was not compensable until their propertie s sold for an amount in excess of their tax debts, that lack of an immediate right to collect the surplus proceeds does not mean that plaintiffs had no right to collect the surplus proceeds at all. 114 Indeed, a former property owner only has a right to collect the surplus proceeds from the tax-foreclosure sale; that is, a former property owner has a compensable takings claim if and only if the tax-fo reclosure sale produces a surplus. Once the sale produces a surplus, the former owner ma y make a claim for the

112 See Lawton , 110 US at 150 (“[S]o far as such owner is concerned, the surp lus money is set aside as his as fully as if it had come from a third person . . . . It can make no difference that the United States acquired the property by bidding one dol lar more.”); Armstrong , 364 US at 48 (“[T]he Government for its own advantage destroyed the value of the liens, something that the Government could do because its property was not subject to suit, but which no private purchaser could have done.”); see also Bank of America, NA v First American Title Ins Co , 499 Mich 74, 91; 878 NW2d 816 (2016) (“No one disputes that t he mortgagee is entitled to recover only his debt. Any surplus va lue belongs to others, namely, the mortgagor or subsequent lienor s.”) (quotation marks and cit ation omitted).

113 See Webb’s Fabulous Pharmacies, Inc v Beckwith , 449 US 155, 164; 101 S Ct 446; 66 L Ed 2 358 (1980) (“[A] State, by ipse dixit , may not transform private property into public property without compensation . . . .”).

114 Id . at 162 (explaining that creditors of a deposit account, whose statutory right to collect a portion of the account’s interest did not accrue until distri bution of the account was ordered, had a cognizable property right despite that right not being immediately compensable).42 surplus proceeds. Again, this hol ds true even though the forme r owner no longer holds title to the property. Moreover, we are unmoved by caselaw from other states that have addressed the disposition of surplus proceeds. Some courts that have confron ted the issue whether a cognizable takings claim can be made for the surplus proceeds h ave only addressed the issue in the context of the federal Takings Clause. 115 Unlike those courts, however, our holding speaks to Michigan’s Taki ngs Clause, which this Court h as, on occasion, interpreted as offering broader protection to property owners. 116 Other courts have limited the inquiry to whether there is statutory authority for a prope rty owner to collect the surplus proceeds, not whether a right existed within their states’ comm on law. 117 Moreover, a few

115 See, e.g., Ritter v Ross , 207 Wis 2d 476, 484-485; 558 NW2d 909 (1996) (analyzing the former property owners’ claim fo r the surplus proceeds under th e federal Takings Clause and holding that no taking under that clause occurred), cert de n 522 US 995 (1997); Auburn v Mandarelli , 320 A2d 22, 25 (Me, 1974) (same).

116 See AFT Mich , 497 Mich at 217 & n 9 (“Although the courts of this state hav e applied the state and federal Takings Cla uses coextensively in many sit uations, this Court has found that [Michigan’s Takings Clause] offers broader protectio n than [the federal Takings Clause].”) (citation omitted), comparing Kelo , 545 US 469, with Hathcock , 471 Mich 445.

117 See, e.g., Kelly v Boston , 348 Mass 385, 388; 204 NE2d 123 (1965) (“We think it is clear from the above history of t he tax statutes that the Legis lature intended the surplus from a sale of land taken for nonpayment of taxes, on which the right of redemption has been foreclosed in the Land Court, to belong to the municipalit y.”); Automatic Art, LLC v Maricopa Co , unpublished opinion of the United States District Court for t he District of Arizona, issued March 18, 2010 (Case No. CV 08-1484-PHX-SRB), p p 5-7 (holding that, under Arizona’s statutory scheme governing tax foreclosures, th e government’s retention of the surplus proceeds is not a n unconstitutional taking becau se “Arizona law does not provide for the recovery of any funds by a previous owner after a tax sale”); Reinmiller v Marion Co , unpublished opinion of the Uni ted States District Court for t he District of Oregon, issued October 16, 2006 (C ase No. CV 05-1926-PK), pp 2- 4 (holding the same under Oregon law).43 courts have addressed the takings issue in the context of other areas of jurisprudence, including tax collection, f orfeiture, and due process. 118 That said, we note that two states, Vermont and New Hampshire, have recognized the government’s obl igation to return any surplus proceeds to the former ow ner after a tax-foreclosure sa le and that the failure to return those proceeds is a taki ng under their state constitutio ns. 119 Similarly, we hold that defendants were required to return the surplus proceeds to plai ntiffs and that defendants’ failure to do so constitutes a government taking under the Mich igan Constitution entitling plaintiffs to just compensation.
B. DEFENDANTS CANNOT RELY ON THE TAXING POWER TO JUSTIFY THEIR RETENTION OF THE SURPLUS PROCEEDS Defendants also contend that their actions are simply a matter of tax collection and that “there can be no taking when a Michigan county foreclosure s on a property for the

118 See, e.g., Balthazar v Mari Ltd , 301 F Supp 103, 105 n 6 (ND Ill, 1969) (“Rather than taking private property for a public purpose, Illinois is here collecting taxes which are admittedly overdue.”), a ff’d 396 US 114 (1969); Sheehan v Suffolk Co , 67 NY2d 52, 60; 490 NE2d 523 (1986) (“There is no constitutional prohibition ag ainst such a full forfeiture.”); Miner v Clinton Co , 541 F3d 464, 475 (CA 2, 2008) (“The retention of any surplus from a tax auction is constitutional because there was no violation of plaintiffs’ right to due process related to t he notices of foreclosure.”).

119 See Bogie v Barnet , 129 Vt 46, 55; 270 A2d 898 (1970) (“No justification for the withholding of this excess from the plaintiff, derived as it wa s from the compelled sale of his land, has been demonstrated. Its retention by the town amo unts to an unlawful taking for public use without compens ation, contrary to . . . the Verm ont Constitution.”); Polonsky v Bedford , ___ NH ___; ___ A3d ___ (2020) (Case No. 2019-0339); slip op at 12 (holding that, under New Hampshire’s Takings Clause, “the ta king of property without just compensation is unconstitu tional, even when the municipali ty has taken the property by tax deed due to the former owner’s failure to pay taxes,” an d that the municipality’s failure to return any excess proceeds to the former owner is an unconstitutional taking), citing Thomas Tool Servs, Inc v Croydon , 145 NH 218, 220; 761 A2d 439 (2000).44 nonpayment of taxes.” 120 The Legislature undoubtedly has the inherent power to levy taxes, and cities and villages a lso have the authority to impos e taxes for public purposes. 121 We recognize that municipalities rely heavily on their citizens to timely pay real-property taxes so that local governments have a source of revenue for th eir operating costs. 122 Nothing in this opinion impedes defendants’ right to hold citiz ens accountable for failing to pay property taxes by taking citizens’ properties in satisfa ction of their tax debts. What defendants may not do under the guise of tax collection is seiz e property valued far in excess of the amount owed in unpaid taxes, penalties, interest, and fees and convert that surplus into a public benefit. The purpose of taxation is to a ssess and collect taxes owed , not appropriate property in excess of what is owed . Defendants’ ability to take plaintiffs’ properties was limited by what plaintiffs actually owed as a re sult of failing to pay their taxes. Thus, defendants’ reten tion of the surplus proceeds amo unts to a taking of plaintiffs’ properties far in excess of plaintiffs’ tax debts that cannot b e justified as a valid form of tax collection.

120 Defendants’ Brief on Appeal (April 3, 2019) at 14.

121 Const 1963, art 9, § 1 (“The legislature shall impose taxes su fficient with other resources to pay the expenses of state government.”); Const 1963, art 7, § 21 (“Each city and village is granted power to levy other taxes for public purposes, subje ct to limitations and prohibitions provided by this constitution or by law.”).

122 Walker , 445 Mich at 702 (“Traditionally, the property tax—and in part icular, the tax on real property—has been the mains tay of municipal revenue-gather ing—the largest single source of municipal revenue.”) ( quotation marks and citation om itted); see also Tax Liens , 75 Ind L J at 756 (explaining that property taxes are the prima ry source of revenue for local governments and that “[t]he failure to collect even a small por tion of property taxes can have a dramatic impact on local governments”).45 Moreover, “the power of taxation should not be confused with th e power of eminent domain . . . .” 123 As Justice Cooley has explaine d, whereas taxation requires ci tizens to bear the burden of public expe nses equally and proportionally, “something exceptional” is taken under the government’s exercise of eminent domain such th at apportionment cannot be achieved, thus requiring compensation “of a pecuniary nature ” to the property owner. 124 By retaining the surplus proceed s and transferring them into th e county general fund to be used for public purposes, defendants are forcing delinquent tax payers to contribute to the general government revenues beyo nd their fair sh are. This is n ot simply an adjustment of “the benefits and burdens of eco nomic life to promote the commo n good.” 125 Rather, this confiscation of the sale proceeds in excess of what is actually owed requires delinquent taxpayers “ ‘alone to bear public burdens which, in all fairnes s and justice, should be borne by the public as a whole.’ ” 126 Michigan’s Takings Clause was “ ‘adopted for the protection of and security to the rights of the individual as a gainst the government . . . .’ ” 127

123 Koontz v St. Johns River Water Mgt Dist , 570 US 595, 617; 133 S Ct 2586; 186 L Ed 2d 697 (2013) (quotation ma rks and citation omitted).

124 Cooley, General Princ iples, pp 333-334.

125 See Penn Central Transp Co v City of New York , 438 US 104, 124; 98 S Ct 2646; 57 L Ed 2d 631 (1978); see also AFT Mich , 497 Mich at 218 (“[G]overnmental action creating general burdens or liabilities, i .e., merely requiring citizens to expend monies for valid public purposes and expenditures, typically will not form the b asis for a cognizable taking claim.”).

126 Webb’s Fabulous Pharmacies , 449 US at 163, quoting Armstrong , 364 US at 49.

127 Bott v Natural Resources Comm , 415 Mich 45, 81 n 43; 327 NW2d 838 (1982), quoting Pearsall v Eaton Co Bd of Supervisors , 74 Mich 558, 561; 42 NW 77 (1889).46 To permit such forced contributions to stand would undermine th e very rights our Takings Clause seeks to protect. Put simply, defendants’ argument that the taxing power justifie s their retention of the surplus proceeds from tax-fo reclosure sales over and above property owners’ tax liabilities is an exceedingly poor attempt at disguising a phys ical taking of property requiring just compensation as a n arbitrary and disproportionat e tax. 128 C. JUST COMPENSATION IS EQUAL TO THE AMOUNT OF SURPLUS PROCEEDS GENERATED FROM THE TAX-FORECLOSURE SALE Having found an unconstitutional taking, we must next decide th e method by which just compensation may be determi ned. This Court has stated tha t the remedy for a government taking is “just compe nsation for the value of the pr operty taken.” 129 As our holding today makes clear, the pr operty “taken” is the surplus proceeds from the taxforeclosure sale of plaintiffs’ properties to satisfy their tax debts. While it could be said that plaintiffs have received at least some compensation, given that they are no longer liable for their delinquent taxes, 130 satisfaction of plaintiffs’ ta x debts cannot constitute just

128 See Acker v Comm’r of Internal Revenue , 258 F2d 568, 574 (CA 6, 1958) (“[D]espite the breadth of the taxing power conferred by the Constitution, there might arise ‘a case where, although there was a seeming exercise of the taxing powe r, the act complained of was so arbitrary as to constrain to the conclusion that it was not the exertion of taxation but a confiscation of property; that is, a taking of the same in vi olation of the 5th Amendment[.]’ ”), quoting Brushaber v Union Pacific R Co , 240 US 1, 24-25; 36 S Ct 236; 60 L Ed 493 (1916).

129 Hart , 416 Mich at 494.

130 See State Theft , 54 Real Prop Tr & Est L J at 124 & nn 219-220 (“In the case o f property tax foreclosure, there is some compensation provided to the own er because the proceeds from the property sale are used to satisfy the amount that the property owner owes the government in taxes, interest, and fees. This is a form of com pensation because after the47 compensation for the value of the property taken, i.e., the sur plus proceeds. Therefore, plaintiffs are entitled to the v alue of those surplus proceeds. Defendants submit that if plaintiffs have, in fact, pleaded a v iable takings claim, then the amount of compensation due could be more than the surp lus proceeds from the tax-foreclosure sale. Plaintiffs make this point in their post argument briefing, arguing that a full remedy for an unconstitutio nal taking requires property owners to be put in as good of position had their properties not been taken at all. That i s, while the surplus proceeds from a tax-foreclosure sale are s ome evidence of the value of t he property and compensation due, plaintiffs contend that it may be less than j ust compensation and may instead constitute the fair marke t value of their properties. 131 We reject the premise that just compensation requires that plai ntiffs be awarded the fair market value of their prope rties so as to be put in as goo d of position had their properties not been taken at all . First, this would run contra ry to the general principle that just compensation is measured by the value of the property taken . In this case, the property

property is sold the former owner’s debt is canceled.”), citing Comment, Tax Foreclosure: A Drag On Community Vitality Or A Tool For Economic Growth? , 81 U Cin L Rev 1615, 1617 (2013) (explaining that the collection of unpaid real-prop erty taxes involves, among other things, “liquidation of the property by public sale in or der to satisfy the debt owed”).

131 Plaintiffs’ Supplemental Brief on Appeal (December 13, 2019) a t 4 n 1, citing United States v Miller , 317 US 369, 373; 63 S Ct 276; 87 L Ed 336 (1943) (stating tha t just compensation for a takings claim requires that the property own er “be put in as good position pecuniarily as he would h ave occupied if his property had not been taken”).48 improperly taken was the surplus proceeds, not plaintiffs’ real properties. 132 Second, plaintiffs are largely responsib le for the loss of their proper ties’ value by failing to pay their taxes on time and in full. If pl aintiffs were entitled to coll ect more than the amount of the surplus proceeds, not only would they be ta king money away from the public as a whole, but they would themselves ben efit from their tax delinquency. 133 Accordingly, when property is taken to satisfy an unpaid tax de bt, just compensation requires the foreclosing governme ntal unit to return any procee ds from the tax-foreclosure sale in excess of the delinquent taxes, interest, penalties, an d fees reasonably related to the foreclosure and sale of the property—no more, no less. 134

132 This distinction also explains w hy the Michigan Takings Clause ’s 125% requirement does not apply. That provision is triggered only when the prop erty taken consists of an individual’s principal residenc e. That is not the case here.

133 In re State Hwy Comm’r , 249 Mich 530, 535; 229 NW 500 (1930) (“Just compensation should neither enrich the individual at the expense of the publ ic nor the public at the expense of the individual.”).

134 Plaintiffs suggest that they a re entitled to the equity they h eld in their properties before foreclosure, but throughout thei r briefing they conflate equity with surplus proceeds, suggesting that they are one in the same. See Plaintiffs’ Brie f on Appeal (February 13, 2019) at 12 (“Equity is realized when property is sold. Thus, logically, common law and statutory law have traditionall y treated the surplus proceeds f rom the sale of foreclosed property as representing the fo rmer owner’s equity.”). Similar ly, the concurring opinion asserts that the property right taken is the equity a former pr operty owner held in his or her property prior to foreclosure. The concurring opinion supports this assertion with scant caselaw, relying primarily on th e “equity of redemption” as rep resenting an owner’s equity interest in property. Yet the concurring opinion acknowledges that equity of redemption and equity are distinct concepts, with the former serving to pr otect the latter. Further, we are unaware of any authority affirming a vested property right to equity held in property generally. Nor is it necessary for us to do so here. The ques tion presented is whether a former property owner retains the ability to collect any surplu s proceeds that might result after the government seizes title to real property for failure to pay taxes and then sells that property for more than the tax delinquency. The earlier discus sion reaffirms a former49 VI. CONCLUSION We hold that plaintiffs, former property owners whose propertie s were foreclosed and sold to satisfy delinquent r eal-property taxes, have a cogn izable, vested property right to the surplus proceeds resulting from the tax-foreclosure sale of their properties. This right continued to exist even af ter fee simple title to plainti ffs’ properties vested with defendants, and therefore, defen dants’ retention and subsequent transfer of those proceeds into the county general fund amounted to a taking of plaintiffs ’ properties under Article 10, § 2 of our 1963 Constitution. The refore, plaintiffs are entitl ed to just compensation, which in the context of a tax-foreclosure sale is commonly understood as the surplus proceeds. Accordingly, we reverse the judgment of the Court of Appeals an d remand this case to the Oakland Circuit Court for procee dings consistent with this opin ion.

Brian K. Zahra Bridget M. McCormack Stephen J. Markman Richard H. Bernstein Elizabeth T. Clement Megan K. Cavanagh

property owner’s vested common-law property right to the surplu s proceeds resulting from a tax-foreclosure sale that is protected by our state’s Takings Clause. Thus, plaintiffs have a compensable takings claim for the surplus proceeds, i.e., the value of the pr operty taken.S T A T E O F M I C H I G A N
SUPREME COURT

RAFAELI, LLC, and ANDRE OHANESSIAN, Plaintiffs-Appellants,
v No. 156849
OAKLAND COUNTY and ANDREW MEISNER, Defendants-Appellees.

V IVIANO , J. ( concurring ). At issue is whether defendant Oakland County’s retention of the surplus proceeds from tax-foreclosure sales constitutes a taking under Article 1 0, § 2 of the 1963 Michigan Constitution. I c oncur with the majority’s result but disagree with much of its reasoning. 1 In its zeal to adopt a pragmatic r ule in order to provide limit ed relief to these plaintiffs and others similarly situated, the ma jority has made a number of do ctrinal missteps. In particular, the majority has applied a flawed interpretive meth odology and, even more fundamentally, has failed to id entify the correct property righ t. These mistakes are not without consequences. The first trenches upon the Legislature’ s power to abrogate nonvested property rights. And the second—by defining plaintif fs’ property right as the right to surplus proceeds, instead of the right to equity more generally—would seemingly

1 I concur in all parts except Parts IV(C), V(A), V(C), and VI.2 encourage and endorse many taking s of a person’s equity without just compensation whenever a foreclosure sale doe s not yield surplus proceeds. I would instead interpret the Constitution in the usual manner, discerning the ordinary meaning of “property” and applying it to the facts her e. Doing so, I conclude that the property right that has been taken from the plaintiffs is t heir equity in their respective properties and not any independent interest in the surplus proc eeds from the tax-foreclosure sale.
I. INTERPRETIVE ISSUES The majority correctly notes that “a claimant must first establ ish a vested property right under state law” in order to have a takings claim and tha t “ ‘the existence of a property interest is determined by reference to existing rules or unders tandings that stem from an independent source su ch as state law.’ ” 2 Then the majority recount s the familiar rule that “[o]ur ‘primary objective’ in in terpreting a constitutional pro vision such as our state’s Takings Clause is ‘to determine t he text’s original meaning to the ratifiers, the people, at the time of ratification.’ ” 3 However, the majority does not explain which words in the Takin gs Clause are in need of interpretation. 4 In fact, rather than go on to e xplain what the ratifiers woul d have

2 Phillips v Washington Legal Foundation , 524 US 156, 164; 118 S Ct 1925; 141 L Ed 2d 174 (1998) (quotation mark s and citation omitted).

3 Wayne Co v Hathcock , 471 Mich 445, 468; 684 NW2d 765 (2004).

4 The Takings Clause reads, in pertinent part: “Private property shall not be taken for public use without just compensation th erefore being first made or sec ured in a manner prescribed by law.” Const 1963, art 10, § 2.3 understood any particular words in the Takings Clause to mean, the majority proceeds to recount historical claims for surplus and a menagerie of other past cases involving vested property rights more generally. Later, when considering whethe r the Legislature might have abrogated a common-law right to the surplus, the majority explains: It is clear that our 1963 Constitution protects a former owner’ s property right to collect the surplus proceeds following a tax- foreclosure sale under Article 10, § 2. This right existed at common law; was c ommonly understood to exist in the commo n law before the 1963 ratificat ion of our Constitution; and continues to exist after 1963, as our decisio n in Dean demonstrates. Because this comm on-law property right is consti tutionally protected by our state’s Takings C lause, the Legislature’s amen dments of the [General Property Tax Act (GPTA), MCL 211.1 et seq .] could not abrogate it. While the Legislature is typically free to abrogate the co mmon law, it is powerless to override a right pro tected by Michigan’s Takings C lause. [5] Though the majority does not ma ke it explicit, I understand its opinion as reasoning that because various past cases and other materials appear to r ecognize some interest on the part of the previous landowner in the surplus proceeds afte r a tax foreclosure, the ratifiers would have understood the term “property” in the Cons titution to encompass such a property right to surplus proceeds. Consequently, that prope rty right must be considered frozen and inviolable under our Takings Clause. And because it is enshrined in the Constitution, the Legislature may not abrogate that common-law right; to do so would run afoul of the Takings Clause. I, of course, take no issue with the general rule that when int erpreting a constitutional provision, we aim to “determine the text’s origi nal meaning to the

5 Ante at 38.4 ratifiers . . . .” 6 Consequently, under our rules of constitutional interpretatio n, the definition of “property” is determined by what the ratifiers un derstood “property” to mean. But the majority’s inve stigation of this c oncept ultimately res ts on a flawed understanding of original meaning. Obviously, the majority cannot say that t he constitutional term “property” means “surplus proceeds.” 7 Rather, what the majority says, at least implicitly, is that the phrase “surplus pro ceeds” falls within the meaning of “property” because the ratifiers would have considered su rplus proceeds to be property at the time of ratification. But the majority never defines t he term “property.” Yet, this question—the semantic content of “property”—should be at the center of any interpreta tion of a legal term or phrase, and its absence here is telling. 8 Compare this with how the United States Supreme Court has defined “property” in the Takings Clause: “The consti tutional provision is addressed to every sort of int erest the citizen may possess.” 9 Whether right or wrong, this definition at least gives the te rm a meaning that can be applie d.

6 Hathcock , 471 Mich at 468.

7 Cf. McGinnis & Rappaport, Original Interpretive Principles as the Core of Originalism , 24 Const Comment 371, 378 (2008) (“The original meaning of the words would not normally be defined by the expected applications, but instead b y the meaning that people at the time would understand the words to have.”).

8 Cooley, Constitutional Limitati ons (5th ed), p 49 (explaining that the purpose of interpretation is to “find[] out the true sense of any form of words”).

9 United States v Gen Motors Corp , 323 US 373, 378; 65 S Ct 357; 89 L Ed 311 (1945).5 By contrast, the majority here fo cuses on what res the ratifier s would have believed were encompassed by the term “property.” 10 This treats the ratifiers’ expectations about the application of the constitutio nal text as binding. Such an approach has been rejected by those who, like myself, consider courts to be bound by the C onstitution’s original textual meaning—it is the publicly accessible meaning of the text, rath er than its intended or expected applications, that binds the courts. 11

10 “Res” is Latin for “thing; event, business; fact; cause; prope rty[.]” University of Notre Dame, William Whitaker’s Words <http://archives.nd.edu/cgi- bin/wordz.pl?keyword=res> (accessed June 26, 2020) [http s://perma.cc/5HEJ-RHSD]. Black’s Law Dictionary (11th ed) now defines it as “ n . [Latin ‘thing’] (17c) 1. An object, interest, o r status, as opposed to a person . . . .”

11 See McConnell, The Importance of Humility in Judici al Review: A Comment on Ronald Dworkin’s “Moral Readi ng” of the Constitution , 65 Fordham L Rev 1269, 1284 (1997) (“Mainstream originalists recognize that the Framers’ analysis of particular applications could be wrong, or that circum stances could have changed and ma de them wrong. . . . [T]hey believe that ‘[w]e are governed by what our lawmakers sa id—by the principles they laid down—not by any information we might have about how they t hemselves would have interpreted those principles or applied them in concrete cases. ’ ”) (citation omitted); Balkin, Living Originalism (Cambridge: The Belknap Press of Harvard University Press, 2011), p 13 (“Fidelity to original meaning as original semantic content does not require that we must apply [for example] the equal protection clause th e same way that people at the time of enactment would have expected it would be applied.” ); Whittington, Constitutional Interpretation: Textual Meanin g, Original Intent, and Judicial Review (Lawrence: University Press of Kansas, 1999), p 178 (“An expect ation, in and of itself, is derived from the text and as a prediction about its effects in the future is on ly contingently related to the text . . . . [T]he author has no special authori ty relative to expectations about effects.”); Scalia, A Matter of Interpretation: Federal Courts and the Law (Princeton: Princeton University Press, 1997), p 144 (“I agree with the distinction . . . between . . . ‘semantic intention’ and the co ncrete expectations of lawgivers. It is indeed the for mer rather than the latter that I follow.”); Rosenthal, Originalism in Practice , 87 Ind L J 1183, 1209 (2012) (“Most originalists draw a distinction between the origina l meaning of constitutional text and its originally intended applications, arguing that only the former is interpretively bi nding.”) (collecting sources); Barnett, An Originalism for Nonoriginalists , 45 Loy L Rev 611, 622 (1999) (“While some6 The ratifiers’ understanding thus establishes the general meani ng of “property” but not necessarily which things fall within that concept. In othe r words, the meaning of “property,” as defined at the time of ratification, establishes the parameters by which we

originalists still search for how the relevant generation of ra tifiers expected or intended their textual handiwork would be applied to specific cases, ori ginal meaning originalists need not concern themselves with t his, except as circumstantial evidence of what the more technical words and phrases in th e text might have meant to a r easonable listener.”). The majority’s emphasis on expected applications rather than th e semantic content of the text itself fundamentally misperceives the object of int erpretation as the ratifiers’ intentions rather than the origi nal public meaning of the text. As Robert Bork described the larger interpretive principl e, the search for the “understa nding of the ratifiers . . . is actually a shorthand formulation” for what courts must interpre t “because what the ratifiers understood themselves to be enacting must be taken to be what t he public of that time would have understood the words to mean. It is important to be clear about this. The search is not for a subjective intention.” Bork, The Tempting of America: The Political Seduction of the Law (New York: Simon & Schuster Inc, 1990), p 144. See also Calab resi & Fine, Two Cheers for Professor Balkin’s Originalism , 103 Nw U L Rev 663, 669 (2009) (“What judges must be faithful to is the enacted law, not the e xpectations of the parties who wrote the law. . . . The enact ment into law of these texts was an open democratic process, and every citizen was e ntitled to think that the words in the texts that were enacted meant what a good dictionary in use at the time said they meant .”). Contemporaneous expec tations about how the constitutional text applied in a case are useful only to the extent th ey shed light on the original p ublic meaning. Whittington, Originalism: A Critical Introduction , 82 Fordham L Rev 375, 385 (2013) (“[E]xpected applications might be helpful to later interpreters in clarifyi ng the substantive content of the embodied constitutional rule . The Founders could be mistak en or disingenuous about the implications of adopting a pr oposed rule, but the rule itse lf must be publicly understandable. If examples of likely applications of the rule are regularly offered and there is widespread agreement on such applications, then they m ay be reflective of the content of the rule in question.”); Original Interpretive Principles , 24 Const Comment at 378 (noting that expected applications are not tantamount to or iginal meaning but can provide evidence o f that meaning).7 determine the things denoted by “property.” 12 It does not necessarily establish, for all time, what those things were. 13 This is particularly the case with a broad concept like prope rty, which covers various classes o f things that can be redefined by the Legislature. 14 For these reasons, the ratifiers’ understanding of which partic ular res were included in the definition of property at a particular moment in time do es not dictate which res we must recognize as “property” under the Takings Clause today. I nstead, I would define the term “property” according to its o rdinary meaning at the time t he Constitution was ratified. Because this case does not turn on fine distinctions in the def initions—but it does turn on

12 See Slocum, Ordinary Meaning: A Theory of the Mo st Fundamental Principle of Legal Interpretation (Chicago: University of Chi cago Press, 2015), p 222.

13 Justice Thomas Cooley recognized , for example, that the same t ext bearing the same meaning could, over time, come to take on a different significa nce because changing circumstances (e.g., technology) could change the objects that fell within the unchanged textual meaning: “The bounds o f [constitutional] power remain t he same, but the new creations that come within its compass give it an importance wh ich those who devised it never dreamed of.” Cooley, The Comparative Merits of Written and Prescriptive Constitutions , 2 Harv L Rev 341, 355 (1889); see also Dist of Columbia v Heller , 554 US 570, 582; 128 S Ct 2738; 171 L Ed 2d 637 (2008) (“Some have mad e the argument, bordering on the frivolous, that only those arms in existence i n the 18th century are protected by the Second Amendment. We do not interpret constit utional rights that way. Just as the First Amendment protects modern forms of communicat ions, . . . and the Fourth Amendment applies to modern f orms of search, . . . the Second A mendment extends, prima facie, to all instruments that constitute bearable arms, even t hose that were not in existence at the time of the founding.”); Scalia & Garner, Reading Law: The Interpretation of Legal Texts (St. Paul: Thomson/West, 2012), p 86 (“The meaning of rules is constant. Only their application to new situations presents a novelty. . . . Broad language can encompass the onward march of science and technology[.]”).

14 See Black’s Law Dictionary (11th ed) (defining “property” as, “[c]ollectively, the rights in a valued resource such as land, chattel, or an intangible” o r “[a]ny external thing over which the rights of possession, u se, and enjoyment are exercise d”).8 having some definition rather than a mere exa mple—it is sufficient for pres ent purposes to employ a common definition of “property” from the relevant peri od: “something owned or possessed; specif : a piece of real estate”; “the e xclusive right to possess, enj oy, and dispose of a thing : OWNERSHIP ”; “something to which a person has a legal title.” 15 Defining property using this t raditional approach to constituti onal interpretation avoids other problems raised by the majority’s reading. One su ch problem is that any property rights extant when th e Constitution was ratified would be insulated from legislative change, whereas later -developed property rights wou ld presumably be subject to change. Though the majority might conclude that the Legisla ture could expand the res in which citizens may have property interests, the majority’s b road position would not allow the Legislature to repeal rights in the res that were rec ognized property rights at the time of ratification and thereby preserved in the protective am ber of the Takings Clause. 16 That is not problematic if the rights the Legislature sought to abrogate were vested. The troubling sweep of the majority’s opinion, however, would exten d its prohibition even to

15 Webster’s Seventh New Collegiate Dictionary (1963); see also The American Heritage Dictionary of the English Language (1969) (“ 1 . Ownership. 2 . A possession, or possessions collectively. 3 . Something tangible or intangibl e to which its owner has legal title.”); 8 Oxford English Dictionary (1933) (“That which one owns; a thing or things belonging to or owned by some p erson or persons; . . . [a] piec e of land owned[.]”).

16 Cf. PruneYard Shopping Ctr v Robins , 447 US 74, 93; 100 S Ct 2035; 64 L Ed 2d 741 (1980) (Marshall, J., concurring) (“Such an appr oach would freeze the common law as it has been constructed by the courts, perhaps at its 19th-century state of development. It would allow no room for change in response to changes in circum stance.”).9 legislation that prospectively modified or abrogated nonvested property rights—i.e., rights to property that individuals might acquire in the future. 17

17 The breadth of the opinion stems , in part, from the majority’s misunderstanding about what it means for a right to be “vested.” The majority suggest s that the right to surplus proceeds is “vested” because “the right to collect these procee ds was beyond a mere expectancy or claim of entitleme nt,” apparently because the pro ceeds can be owned. Ante at 35-36. In other words, the right is somehow vested irrespec tive of any individual circumstances—it is vested in the ether. But that is not how i t works. “To constitute a vested right, the interest must be something more than such a m ere expectation as may be based upon an anticipated continuance of the present general la ws; it must have become a title, legal or equitable, to the present or future enjoyment o f property . . . .” In re Certified Question , 447 Mich 765, 788; 527 NW2d 468 (1994) (quotation marks and c itation omitted). “Vested” means “[h]avi ng become a completed, consumm ated right for present or future enjoyment; not contin gent; unconditional; absolute . . . .” Black’s Law Dictionary (11th ed). This requires a rea l person or entity and a real pr operty right, not simply a property right in the abstract. See Wylie v City Comm of Grand Rapids , 293 Mich 571, 586; 292 NW 668 (1940) (noting, i n the related context of due p rocess, that “ ‘[r]ights are “vested” when the right of enjoyment, present or prospective, h as become the property of some particular person or persons as a present interest’ ”) (ci tation omitted); Cooley, Constitutional Limitations, p 438 (describing vested rights in the context of an individual’s rights and interests); 5 Smith & Philbin, Michig an Civil Jurisp rudence, Constitutional Law (May 2020 update), § 300 (n oting this definition). For instance, I do not have a vested property right in a wild f ox simply because, if I captured one, the law would recognize my ownership of it. Cf. Pierson v Post , 3 Cai R 175; 2 Am Dec 264 (1805). If, before I even don my hunting cap , the Legislature proscribes or limits ownership of foxes, no one would say I have been depr ived of a vested property right in the fox I never owned or caught. At best, I had an ex pectation or hope. In the same way, someone who does not now own a home but would like to own one in the future does not have any vested property right in a home. As Justice Coole y stated, “[A] mere expectation of property in the future is not considered a veste d right . . . .” Cooley, Constitutional Limitations, p 44 0. And as discussed below, the re is no vested right in a mere common-law rule. See post at nn 20-21 and accompanying text. Thus, although the majority purports to cabin its opinion to vested rights, its mi sconception of those rights leads to a wider application th at encompasses nonvested rights as well.10 This would be a novel approach to legislative power over proper ty. We have stated, for example, that the right of redemption—which we have recogni zed is a property right in the context of tax-foreclosure sales 18 —“is not a constitutional right but exists only as permitted by statute, that such rights . . . are subject to abr idgement by the legislature for the reason they are remedial in n ature, and that no vested righ ts arise . . . .” 19 Other courts, too, have recognized that the Legislature’s role in defining pr operty rights extends to removing items from the category of property, if done prospecti vely, i.e., without affecting

18 See Cobleigh v State Land Office Bd , 305 Mich 434, 436-437 ; 9 NW2d 665 (1943).

19 Buckeye Union Fire Ins Co v Michigan , 383 Mich 630, 639; 178 NW2d 476 (1970) (discussing Baker v State Land Office Bd , 294 Mich 587; 293 NW 763 (1940)); see also Dumphey v Hilton , 121 Mich 315, 317; 80 NW 1 (1899) (“It was held by the United States Supreme Court that the right of redemption from tax sales, alth ough it is to be regarded favorably, does not exist, except as permitted by statute. . . . ‘While it may well be doubted whether the legislature could enact an immediate bar to any exi sting right, yet it is clearly settled that to prescribe the period within which any right may be enforced is within their power.’ ”) (citations omitted). We had earlier said that “the equity of redemption”—which was the redemption right at common law—“appertains to and goes with the title to the real estate, and is in law the property of the owner of the fee. It is an interest in land . . . .” Case v Ranney , 174 Mich 673, 681; 140 NW 943 (1913).11 vested rights. 20 And, of course, even the majority recognizes that the Legislat ure may, at times, abrogate the common law. 21 As the United States Supreme Court has explained: A person has no property, no vest ed interest, in any rule of th e common law. That is only one of the forms of municipal law, and is no more sacred than any other. Rights of property wh ich have been created by the c ommon law cannot be taken away without due process; but the law itself, a s a rule of conduct, may be changed at the w ill, or even at the whim, of th e legislature, unless prevented by constitutiona l limitations. Indeed, the gr eat office of statutes is to remedy defects in the common law as they are dev eloped, and to adapt it to the changes of time and circumstances. [22] A vested right, therefore, cannot be divested without just comp ensation. 23 But the Legislature has greater scope to prospectively reshape laws est ablishing property rights as

20 The New York Court of Appeals held, for example, that the legi slature could “extinguish [a] property right by the simple expedient of repealing the pro vision which gives rise to it,” but only prospectively and not as to property already vested. Alliance of American Insurers v Chu , 77 NY2d 573, 585-586; 571 NE2d 672 (1991); id . at 589 (“Nothing in our decision prevents the State from changing the law as it affects future c ontributions.”); 29A CJS, Eminent Domain (June 2020 update ), § 72 (“It has also been hel d that, just as a state legislature has the power to st atutorily create property intere sts, so too may it legislatively alter or take away those same pr operty interests, though its po wer to alter the rights and obligations that attach to completed transactions is not as bro ad as its power to regulate future transactions.”). It is true that these sources refer to statutorily created property rights rather than those that arose fro m the common law. But this dis tinction is immaterial because, as explained below, the L egislature can abrogate the c ommon law.

21 Const 1963, art 3, § 7 (“The common law and the statute laws n ow in force, not repugnant to this constitution, shall remain in force until they expire b y their own limitations, or are changed, amended or repealed.”).

22 Munn v Illinois , 94 US 113, 134; 24 L Ed 77 (1876) (discussing due process).

23 Cf. Bank Markazi v Peterson , 578 US ___, ___; 136 S Ct 1310, 1324; 194 L Ed 2d 463 (2016) (“The Fifth Amendment’s Takings Clause prevents the Legi slature (and other government actors) from deprivi ng private persons of vested pro perty rights except for a ‘public use’ and upon payment of ‘just compensation.’ ”) (quota tion marks and citation omitted); In re Certified Question , 447 Mich at 787-788 (“One who asserts an12 long as those laws function in a way that leaves vested rights untouched. 24 Such actions are not prohibited by the Takings Clause. 25 Thus, for example, the United States Supreme Court has held that the expectation of future child-support ben efits is not protected because it is a “prospective right . . . clearly subject to modificatio n by law, be it through judicial decree, state legislation, o r congressional enactment.” 26 Moreover, as the United States Supreme Court and numerous state supreme courts have established, “the existence of a property interest is dete rmined by reference to existing rules or understandings that stem from an independent source such as state law .” 27 In other

uncompensated taking claim must first establish that a vested property right is affected.”) (emphasis added).

24 See Cooley, Constitutional Limitations, p 440 (“Acts of the le gislature . . . cannot be regarded as opposed to fundamental axioms of legislation, ‘unle ss they impair rights which are vested; because most civil ri ghts are derived from public l aws; and if, before the rights become vested in particular individuals, the convenience of the State procures amendments or repeals of those laws, those individuals have no cause of co mplaint.’ ”) (citation omitted).

25 There is no need to decide in this case whether other constitu tional provisions may limit the Legislature’s ability to defin e property. My point is only that no such limitation may be found in the Takings Clause.

26 Bowen v Gilliard , 483 US 587, 607; 107 S Ct 3008; 97 L Ed 2d 485 (1987); see al so Peterson, The Taking Clause: In Search of Underl ying Principles Part I—A Critique of Current Takings Clause Doctrine , 77 Calif L Rev 1299, 1313 (1989) (“In a number of other takings cases, the Court has said that unless a right created b y positive law is a ‘vested right,’ it is not property within the meaning of the takings cl ause. The Court’s reasoning is that when the government grants A a legal right, it normally retains the power to change the law to promote the general welfare, and thus no taking occu rs when the government exercises its retained power, ev en though the change in the law eliminates A’s rights under the prior law. As the Court expr esses it, A has not lost any ‘ vested rights.’ ”).

27 Phillips , 524 US at 164 (quotation marks and citation omitted; emphasis added).13 words, “the Constitution protects rather than creates property interests . . . .” 28 Citing this rule, one federal court has reasoned that the nature of the “pr operty” at issue in the taxforeclosure context would be found in local law, not the Consti tution itself. 29 Yet by reasoning that “property” must be defined at least as the parti cular types the ratifiers had in mind, the majority interprets the Takings Clause as exalting those interests above the Legislature’s authority to modify them. 30

28 Id . See also Kafka v Montana Dep’t of Fish, Wildlife & Parks , 348 Mont 80, 93; 2008 MT 460; 201 P3d 8 (2008) (“Property interests themselves are no t defined by the [federal] Takings Clause, or for that matte r by [the state’s taking claus e]” but by “ ‘ “background principles” and “rules and understandings” [that] focus on the nature of the citizen’s relationship to the alleged prop erty, such as whether the citiz en had the rights to exclude, use, transfer, or dispose of th e property.’ ”) (citations omitt ed); Cheatham v Pohle , 789 NE2d 467, 473 (Ind, 2003) (“The plaintiff has no property to be taken except to the extent state law creates a p roperty right.”); Mayor & City Council of Baltimore v Bregenzer , 125 Md 78; 93 A 425, 426 (1915) (“T he section of the Constitution q uoted does not define property, nor does it declare what shall be a taking. It leave s those questions to the determination of the courts upon the facts of each particular c ase.”).

29 Coleman v Dist of Columbia , 70 F Supp 3d 58, 80 (D DC, 2014).

30 This result goes well beyond what the United States Supreme Co urt has done. Even with regard to vested property rights, the United States Supreme Cou rt has recognized that “the property owner necessarily expects the uses of his property to be restricted, from time to time, by various measures newly enacted by the State in legitim ate exercise of its police powers; ‘[a]s long recognized, some values are enjoyed under an implied limitation and must yield to the police power.’ ” Lucas v South Carolina Coastal Council , 505 US 1003, 1027; 112 S Ct 2886; 120 L Ed 2d 798 (1992), quoting Pennsylvania Coal Co v Mahon , 260 US 393, 413; 43 S Ct 158; 67 L Ed 322 (1922). “And in the case of personal property, by reason of the State’s traditionally high degree of control o ver commercial dealings, [the property owner] ought to be awar e of the possibility that new r egulation might even render his property economically worthless (at least if the property’s only economically productive use is sale or manufacture for sale).” Lucas , 505 US at 1027-1028. Elaborating on these points in his Lucas dissent, Justice Stevens obs erved that “[a]rresting the development of the common law” would be “a departure from our p rior decisions[.]” Id

. at 1069 (Stevens, J., dissenting ). Legislatures, he explained, “often revise the definition of14 I believe that such a reading raises serious concerns regarding the separation of powers. The Constitution provides that “the legislative power of the State of Michigan is vested in a senate and a house of representatives.” 31 This Court has recognized that the legislative power includes the po wer to abrogate the common law

. 32 In fact, the Constitution specifically allows the common law to be changed: Const 1963, art 3, § 7 states, “The common law and the statute laws now in force, not repugnant to this constitution, shall remain in forc e until they expire by their own limitations, or are changed , amended or repealed.” 33 It is true that this Court has applied the principle that statutes in derogation of the co mmon law must be strictly const rued. 34 But the majority now significantly limits that power by reasoning that any attem pt to prospectively abrogate

property and the rights of property owners. Thus, when the Nat ion came to understand that slavery was morally wrong and mandated the emancipation of all slaves, it, in effect, redefined ‘property.’ ” Id . All of this—in both the majority and dissent—referred to the legislature’s expansive power over property a person already ow ned. In this case, the majority goes in the opposite direction and ties the Legislatur e’s hands in regulating property that does not yet exist and that no one yet owns.

31 Const 1963, art 4, § 1.

32 E.g., Hoerstman Gen Contracting, Inc v Hahn , 474 Mich 66, 74; 711 NW2d 340 (2006) (“The Legislature has the authority to abrogate the common law. ”).

33 Emphasis added.

34 E.g., Rusinek v Schultz, Snyder & Steele Lumber Co , 411 Mich 502, 508; 309 NW2d 163 (1981) (“[S]tatutes in derogation of the common law must be str ictly construed . . . .”).15 a common-law property right in a particular object that existed in 1963, without providing just compensation, is unconstitutional. 35
II. THE PROPERTY RIGHT AT ISSUE The majority’s flawed interpretiv e methodology has led it to ch aracterize the “property” at issue as merely th e surplus proceeds from the for eclosure sale. But the existence and scope of these proceeds are contingent upon the f oreclosure sale—the proceeds spring to life only at t he end of that process. The m ajority does not consider the property interests that exist be fore the sale or how these inte rests affect the taxpayer’s entitlement to anything resulting from the sale. In starting i ts analysis at the end of the process, the majority ignores the laws and history of real-prop erty ownership and creates problematic gaps in the process that fail to respect takings la w. My analysis, by contrast, starts at the beginning: the pro perty owners’ preexisting inter est in the real estate, or their equity.

35 Additionally, I believe that the majority’s approach has broad implications in the realm of regulatory takings. If the ratifiers’ understanding of whic h particular objects an individual may have property rights in is now set in stone in t he Constitution, I see no reason why the ratifiers’ understanding of the scope of their p roperty rights is also not set in stone. In other words, under the majority’s approach, if th e ratifiers believed that their property interest entitled them t o use a res in a variety of wa ys, each of those ways must be read into the definition of “property” under the Takings Clause . Consequently, it would be unconstitutional for a regulation to take away any use of a res that the ratifiers would have understood their property rights to include.16 A. THE MAJORITY’S MISTAKEN APPROACH It is important, at the outset, to note the questionable basis for the majority’s conclusion that “our state’s common law recognizes a former pro perty owner’s property right to collect the surplus proceeds . . . .” The majority re lies, first, on the Magna Carta, saying, “Just as the Magna Carta p rotected property owners from uncompensated takings, it also recognized that tax collectors could only seize propert y to satisfy the value of the debt payable to the Crown, leaving the property owner with the excess.” 36 But the provision of the Magna Carta to which the majority refers conce rns collecting debts by seizing only movable property. 37 It is much more understandable to have a rule discouraging the government from needlessly taking property in excess of the tax debt when the government is seizing va rious movable goods rather tha n real estate—it is easier to take the chair and leave the table than it is to take the ki tchen and leave the living room. Thus, although many of our right s can be traced to the Magna Ca rta, I question whether

36 Ante at 35.

37 Ante at 28. Clause 26 of the Magna Carta reads: If at the death of a man who holds a lay ‘fee’ of the Crown, a sheriff or royal official produces royal letters patent of summons for a debt due to the Crown, it shall be lawful for them to seize and list movable goods found in the lay ‘fee’ of the dead man to the value of the debt, as a ssessed by worthy men. Nothing shall be removed until the whole debt is paid, wh en the residue shall be given over to the executors to carry out the dead man’ s will. If no debt is due to the Crown, all the movable goods shall be regard ed as the property of the dead man, except the reasonable shares of his w ife and children. [Johnson, The Ancient Magna Carta and the Modern Rule of Law: 1215 to 2015 , 47 St Mary’s L J 1, 47 (2 015) (emphasis added).]17 Clause 26 has much bearing on the seizure of real property. 38 Additionally, it is not quite true that tax collectors could only seize property to satisfy t he debt—as “the value of the goods seized had to approximate the value of the debt[.]” 39 Such a rule falls short of one that demands any surplus be retu rned to the previous owner. Next, the majority turns to People ex rel Seaman v Hammond , 1 Doug 276 (Mich, 1844), noting that though Seaman held that the previous landowner was entitled to the surplus, the statutory scheme at the time was different than th e GPTA. Specifically, the statute specified that the excess proceeds must be returned to the owner. 40 The majority appears to recognize that Seaman , and other cases involving statutes, are not particularly instructive. 41 Nevertheless, the majority concludes that “a fair reading of Seaman

38 See Baker, An Introduction to English Legal History (Dayton: LexisNexis, 2002), p 223 (“The most fundamental distinction in the English law of proper ty was between real property (realty) and personal property (personalty).”). Indee d, the conception of ownership of land—real property— was only just emerging in the t hirteenth century from innovations within the feudal system. Id . at 223-237; see also Turner, The Equity of Redemption: Its Nature, History and Conne ction with Equitable Estates Generally (Cambridge: Cambridge University Press, 1931), pp 1-3. The maj ority’s resort to Blackstone is similarly unavailing because Blackstone’s discuss ion of bailments deals with goods rather than real property. See ante at 28-29, citing 2 Blackstone, Commentaries on the Laws of England, p *452.

39 Ancient Magna Carta , 47 St Mary’s L J at 47.

40 Seaman , 1 Doug at 278.

41 The majority also cites United States v Lawton , 110 US 146; 3 S Ct 545; 28 L Ed 100 (1884), and Nelson v City of New York , 352 US 103; 77 S Ct 195; 1 L Ed 2d 171 (1956). See ante at 25 (“Significantly, Seaman , Lawton , and Nelson all address a former property owner’s statutory right to recover the surplus proceeds.”). See also ante at 25-26 (“ Lawton and Nelson establish that the Takings Cla use under the United States Cons titution may afford former property owners a remedy when a tax-sale statute provides the divested18 demonstrates that in the early years of this state, it was comm only understood that the delinquent taxpayer, not the fore closing entity, continued to o wn the land at the time of the tax-foreclosure sale and would ha ve been entitled to any surplu s, which no more followed title to the land than the former owner’s other personal proper ty.” 42 But this is a misreading of Seaman . To the extent that the owne r’s entitlement to the surplus wa s “commonly understood,” it no doubt resulted from the statute that express ly provided such a right. If the majority means this common understanding somehow reflected a common-law right to the surplus, I do not see how. It is just as possible that the statutory scheme provided for a right in the surplus because the L egislature did not believe th e common law recognized such a right. Speculations on what the Legislature thought it was doing are thus unfruitful and far afield from establishing a common-law right to the proc eeds. In sum, it is far from clear what implications the form er existence of a statutory rig ht to surplus proceeds has in determining the application o f the constitutional right in this case. And Dean v Dep’t of Natural Resources , 399 Mich 84; 247 NW2d 876 (1976), can hardly be read as recognizing a longstanding vested property ri ght in the surplus. That case considered an unjust-enrichment c laim. The key determination i n that cause of action is whether retention of the benefit is inequitable, not which part y has the property right. 43 In

property owner an interest in th e surplus proceeds and the gove rnment does not honor that statutory interest.”).

42 Ante at 30.

43 See also Tkachik v Mandeville , 487 Mich 38, 47-48; 790 NW2d 260 (2010) (“Unjust enrichment is defined as the unjust retention of ‘ “money or be nefits which in justice and19 other words, Dean involved an equitable decision based on the specific facts of the case. Those facts, which involved “th e alleged good-fa ith attempt at redemption, the running of the redemption period after this attempt with pla intiff under t he impression that she had in fact redeemed her home, the loss of her home, and the sale of t he property by the State for a profit of close to $10,000,” a re very different than those he re. 44 Dean does not indicate that all former property owners have a property right to the su rplus as a matter of course. 45 B. EQUITY In contrast to the majority’s approach, I would turn to the law of property and the development of property interests in real estate to determine t he rights at issue. The history of equity in real estate is particularly illuminating because t his property right formed in response to foreclosure practices that raised concerns like tho se in the present case. Until mortgages came into widespread u se, creditors generally obtaine d a “gage of land” as security in the debtor’s land, but the creditor could not recov er possession of the land from

equity belong to another.” ’ ”), quoting McCreary v Shields , 333 Mich 290, 294; 52 NW2d 853 (1952) (citation omitted).

44 Dean v Dep’t of Natural Resources , 399 Mich 84, 94-95; 247 NW2d 876 (1976).

45 The majority also cites the brief discussion on surplus procee ds in Cooley, Law of Taxation (3d ed), p 952. See ante at 29. But Cooley never stated the right to surplus was of common-law origin. Instead, the treatise explained that “[v ]arious methods are adopted in different states to save, if possible , something to the owner when his land is sold.” Cooley, Law of Taxation, p 952 (emphasis added). As the majori ty notes, Cooley found support in Lawton , 110 US 146, but that is another case dealing with a statutory scheme rather than the common law. See ante at 29 n 86.20 the debtor. 46 That defect, from the creditor’s perspective, likely led to t he creation of the predominant form of common-law mortgage, in which the mortgagor conveyed the land, usually in fee simple, to the mortgagee on the condition subseq uent that it would be reconveyed to the mortgagor when the debt was repaid at the app ointed time. 47 The harshness of this procedure was evident to many at the time and is similar to harshness involved in the presen t case, namely that it automati cally led to the full loss of

46 Sutherland, The Assize of Novel Disseisin (Oxford: Clarendon Press, 1973), pp 12, 138; see also Hazeltine, General Preface , in Turner, The Equity of Redemption , pp xxiv-xxx (describing the gage as a conveyance on condition precedent); 3 Holdsworth, A History of English Law (3d ed), pp 128-129 (calling the interest a mortgag e but differentiating it from later practices and explaining that the creditor could not disp ossess the debtor if the latter had possession).

47 See An Introduction to E nglish Legal History , pp 311-312 (“[T]he mo rtgagor conveyed the fee to the mortgagee forthwith, on condition that he might re-enter (and regain the fee) if he paid by a certain date. . . . [This] gave the mortgagee a fee simple defeasible by condition subsequent (that i s, payment).”); Simpson, An Introduction to the History of the Land Law (London: Oxford University Pre ss, 1961), p 225 (“[T]he mortgag or conveyed his lands outright in fee simple to the mortgagee, with a coven ant for re-conveyance if the debt was repaid on time; this is the classical common law mortg age . . . .”); 3 Holdsworth, p 129 (“It was probably due chi efly to the latter cause [i.e., the creditor’s inability to recover the land from a debtor in possession] that the peculiar interes t of the mortgagee . . . disappeared. He cea sed to take a peculiar inte rest as mortgagee, and took instead some one of the recognized estates or interests in the land—a fee simple, a life estate, or a term. . . . The debtor might convey the land to t he creditor in fee, with a proviso that if the debt was paid by a fixed date the land should be re conveyed[.]”); Turner, The English Mortgage of Land as a Security , 20 Va L Rev 729, 729 (1934) (“The English mortgage has developed from a fo rm of conveyance in use in the 16th century comprising an absolute conveyance to the lender with a proviso that, on th e borrower repaying the principal with interest and cost s by a fixed day, the lender wo uld reconvey the property to him.”); Lloyd, Mortgages—The Genesis of the Lien Theory , 32 Yale L J 233, 234 (1923) (“If the debt was not paid on the day named, the estate of the creditor became absolute. After default no right of redemption was admitted.”).21 the mortgagor’s interest in the p roperty no matter how much deb t was owed—no surplus was owed or paid to the mortgagor. 48 Equity courts addressed these concerns—in part

48 See Restatement Property, 3d, Mortgages, § 3.1, comment a (“The consequences of payment default were especially harsh on the mortgagor. If for any reason the payment was not made on law day, the bor rower forfeited all interest in [the property].”); 5 Tiffany, Real Property (3d ed, November 2019 update), § 1518 (noting that equity inter vened out of justice because “no foreclosure was necessary [under the com mon-law mortgage], since the mere breach of the condition vested an absolute estate in t he mortgagee”); An Introduction to English Legal History , p 313 (explaining that equity courts began granting relief in this situation because “[t]he moneylender was morally entitled only to the debt, and perhaps some reasonable profit, but ought not to profit unc onscionably from a penal arrangement”); An Introduction to the History of the Land Law , pp 226-227 (“The common law courts construed mortgage t ransactions strictly and unsympa thetically. If the mortgage provided that the mortgagor was to lose his land through defaul ting in payment upon a fixed day then that was that; it mattered nothing that he defau lted by a single day, or that the property was worth infinitely more than the debt.”); 5 Hold sworth, A History of English Law (1924), pp 330-331 (noting that equity granted relief because of the penal character of the forfeiture); Sugarman & Warrington, Land Law, Citizenship, and the Invention of “Englishness”: The Strange World of the Equity of Redemption , in Early Modern Conceptions of Property (Brewer & Staves eds, 1995), p 113 (“A single day’s delay in tendering repayment could result in the borrower losing the ent ire property to the lender, even though the amount of the loan might be far less than the v alue of the land.”); Burkhart, Fixing Foreclosure , 36 Yale L & Pol’y Rev 315, 320 (2018) (noting that this “proc ess,” as incorporated in the American col onies, “often gave lenders an e specially large windfall because land values were increasi ng at a greater rate than had previously occurred anywhere”); Weinberger, Tools of Ignorance: An Appraisal of Deficiency Judgments , 72 Wash & Lee L Rev 829, 849-850 (2 015) (noting that the borrower was not entitled to any surplus and lost title and all in terest in the property); Matti ngly, The Shift From Power to Process: A Functional Appr oach to Foreclosure Law , 80 Marq L Rev 77, 90 (1996) (“The pendulum of power swung towards the borrower with the intervent ion of the Equity Courts, which viewed the borrower’s forfeiture of any interest in the p roperty as unduly harsh.”); Wechsler, Through the Looking Glass: Foreclosure by Sale as De Facto Strict Foreclosure—An Empirical Study of Mort gage Foreclosure an d Subsequent Resale , 70 Cornell L Rev 850, 856 (1985) ( “Equity soon recognized the inju stice of the forfeiture inherent in this situation.”). The same points are true regarding strict foreclosures, which d eveloped along with the changes in mortgage law described above and, as in the pres ent case, transfers title by22 because the transaction functione d as an extension of a securit y interest in the property rather than a true transfer of the fee—by creating the “equity of redemption,” under which the mortgagee could redeem the property by paying off the debt after defaulting. 49 The

court decree rather than automatically by extinguishment of the condition subsequent or by foreclosure sale. In strict foreclosure, as under the common-l aw mortgage or the statutes at issue here, the homeowner loses his or her equity in the pro perty. Ghent, How Do Case Law and Statute Differ? Lessons fr om the Evolution of Mortgage Law , 57 J L & Econ 1085, 1094 (2014) (“Strict forec losure involved the lender goin g to an equity court and asking it to terminate the borrower’s equity of redemption; for eclosure by sale of the property was not permitted, and a ny equity the bor rower had in the property would be lost in the foreclosure.”); Tracht, Renegotiation and Secured Credit: Explaining the Equity of Redemption , 52 Vand L Rev 599, 607 (1999) (“Under strict foreclosure (whe re foreclosure vests title in the lender), there will be a forfeiture by the b orrower and a windfall to the lender if the property is worth more than the debt.”); Brabner- Smith, Economic Aspects of the Deficiency Judgment , 20 Va L Rev 719, 720-721 n 2 (1934) (Strict foreclosure “is a proceeding in which the decree finds that the mortgagee debt is due and has not been paid, that title to the property therefo re is absolute in the mortgag ee, and that the mortgagor is entirely divested of whatever interest he had in the premises a t the time of the execution of the mortgage. There is no sale and no resulting deficiency or surplus.”).

49 See 1 Coote, A Treatise on the Law of Mortgages (2d ed), pp 19 -20 (“[Equity courts] declared it unreasonable that [the mortgagee] should retain for his own benefit, what was intended as a mere pledge; and they adjudged that the breach of the condition was in the nature of a penalty, which ought to be relieved against, and th at the mortgagor had an equity to redeem on payment of princ ipal, interest, and costs . . . .” ); Sugarman & Warrington, Equity of Redemption , p 113 (“Dating from at least the turn of the seventeenth cent ury, the courts of equity determined that the strict date for repayment was somewhat irrelevant. Accordingly, the lender’s claim to the property became subject ‘to a right called the equity of redemption, which arose from the court’s consideration that the real object of the transaction was the creation of a security for the debt. This entitled the [borrower] to redeem (or recover the property), even though he had failed to repay by the appointed time.’ ”) (citation omitted; brack ets in original); Waddilove, The “Mendacious” CommonLaw Mortgage , 107 Ky L J 425, 457 (2019) (“The equity of redemption . . . l ooked to what it deemed to be underlying substance of the mortgage agreement and gave effect to that over legal interpretation.”). The mortgagor’s specific right to redeem property after foreclo sure has been codified in Michigan, and the foreclosure sale purchaser’s deed does not vest until the23 “equity of redemption” was considered—including by this Court—a property right and came to represent the homeowner’s interest in the property, kno wn as “equity.” 50

redemption period ends. See MCL 600.3240(1) and (2); MCL 600.3 236. See also People v March , 499 Mich 389, 416-421; 886 NW2d 396 (2016).

50 As described in the Restatement Property, 3d, Mortgages, § 3.1 , comment a , the “concept [of equitable redemption] evolved from simply a late payment ru le to connote, in addition, the mortgagor’s ownership interest in the land prior to the sat isfaction of the mortgage. The term ‘equity’ became and is t oday the pervasively used term to describe this interest.” See also Case , 174 Mich at 681 (“As a general proposition, the equity of red emption appertains to and goes with the title to the real estate, and i s in law the property of the owner of the fee. It is an interest in land . . . .”); An Introduction to English Legal History , p 314 (“The equity of redemption had thus become a right inhere nt in the land . . . . [T]he great landowner of the seventeen th, eighteenth and nineteenth c enturies was commonly in possession of his land (or some of it) only as the owner of an equity of redemption. The equity could be bought and sold , settled in tail, and even mort gaged. . . . [I]t had become an equitable estate[.]”); An Introduction to the Hi story of the Land Law , pp 227-228 (“[T]he equity of redemption [was] a peculiar form of property which co uld be dealt with by the debtor like other forms of equitable property. . . . In the ei ghteenth century the final touches were put upon the conception; the equity of redemption is spoken of as an estate in the land, and the mortgagor is regarded as the owner in equi ty of the land.”); Turner, The Equity of Redemption , pp 66-67 (“ ‘An equity of redemption is considered as an esta te in land[.] . . . The person having the equity of redemption is co nsidered as the owner of the land . . . . An equity of redemption, . . . unforeclosed, is t he ownership of the land, or the real estate in equity[.]’ ”) (c itation omitted); 6 Holdsworth, A History of English Law (1924), p 663 (“The result had been to make the mortgagor’s equ ity to redeem a right of property. He had an equitable estate in the land; and, subject to the legal rights of the mortgagee, was, in equity, regard ed as its owner.”); 5 Holdswor th, p 332 (“[I]t became clear that this equitable right t o redeem was in substance an e quitable estate in the land which could be c onveyed or settled like any other estate.”); Wa ddilove, Why the Equity of Redemption? , in Land and Credit: Mortgages in the Medieval and Early Modern European Countryside (Briggs & Zuiderduijn eds, 2018), § 5.1, pp 1-2 (“According to the equity of redemption, a mortgagor remained the true owner of mortgaged pr operty throughout a mortgage despite lacking legal title; a mortgagee’s interest wa s mere security for a debt; and a mortgagor was thus entitled to redeem the property at any time . . . until his or her equity of redemption was declared foreclosed by a court.”); Sug arman & Warrington, Equity of Redemption , pp 115-116 (noting the “shift o f the equity of redemption fro m a ‘thing’ to an ‘estate’ in equity, that is, in conceptualizing t he equity of redemption as a kind24 Thereafter, the equity courts “dev eloped the decree of foreclos ure,” which a mortgagee could seek in order to end the mortgagor’s period of equitable redemption; when foreclosure by sale was permitted, “the mortgagee [took] the mo ney owed to her/him, the remainder going to the mortgagor.” 51 Thus the creation of “equity” led to the homeowner’s

of real property rather than as a kind of chattel property,” an d noting further that it was “characterized . . . as a title in eq uity” and “was proprietori al”); Mortgages , 32 Yale L J at 236 (noting that chancery “treat s the equity of redemption not as a mere right but as an estate which the mortgagor may d eal with in any way consistent with the rights of the mortgagee in his security”). Although the terms “equity” and “equity of redemption” now are “interchangeable,” they were “not equivalent” at co mmon law because the equity of redemption originally could not be sold. Sabella, When Enough is To o Much: Overcollate ralization as a Fraudulent Conveyance , 9 Cardozo L Rev 773, 780 n 32 (1987). Once it could be alienated, “the concept changed in meaning to one much closer t o today’s notion of ‘equity.’ ” Id . Still, a distinction exists. In discussing the mortgagor’s interest in the property, one treatis e states, “[T]he ter m ‘equity of redemptio n’ which had previously and appropriately been applied to the mortgagor’s right to get back his property after default was applied somewhat inappropriate ly to this entirely distinct equitable ownership before default.” 1 Nelson, Real Estate Finance Law (6th ed), § 1:3. Compare Black’s Law Dictionary (11th ed) (defining “equity” as “[a]n ownership interest in pr operty”), with id

. (defining “equity of redemption” as “[t]he right of a mortgagor in default to recover property before a foreclosure sale by paying the principal, int erest, and other costs that are due”). Thus, perhaps it is more accurate to say a redemption r ight functions to protect a homeowner’s equity interest. See, e.g., Note, The Big Chill: Applicability of Section 548(a)(2) of the Bankr uptcy Code to Noncollusive Foreclosure Sales , 53 Fordham L Rev 813, 817 n 22, 834 (1985) (observing that the equity interest w as originally called the equity of redemption but noting th at the “debtor can protect hi s equity interest in the property by paying the sale price plus costs,” i.e., exercise t he redemption right, and that the equity of redemption “ordinar ily would serve to preserve hi s equity interest”).

51 Sugarman & Warrington, Equity of Redemption , pp 113-114; see also 2 Dunaway, Law of Distressed Real Estate (December 2019 update), § 26:29 (noti ng that any surplus over the foreclosing mortgagee’s debt is paid to other liens and “[a ]ny balance is distributed to the holder of the equity of rede mption”); 5 Holdsworth, p 331 ( “About the same period therefore we get the foreclosure decree . . . .”); Fixing Foreclosure , 36 Yale L & Pol’y Rev at 319-320 (discussing the transition from strict foreclosure t o foreclosure by public25 right to surplus proceeds from fo reclosure sales. Indeed, as s tated in Restatement Property, 3d, Mortgages, § 7.4 , comment a , “[W]hen a surplus occurs, it represents what remains of the equity of redemption a nd is, as such, a substitute res . The surplus stands in the place of the foreclosed real estate . . . .” 52

auction); How Do Case Law and Statute Differ , 57 J L & Econ at 1094-1095 (discussing the transition from strict forecl osure to foreclosure by sale, which protected the debtor’s equity); Through the Looking Glass , 70 Cornell L Rev at 859 (“Foreclosure by sale was viewed as a logical way of protecting the debtor’s equity in th e property . . . .”); The English Mortgage , p 730 (“Almost as soon as the equity of redemption became est ablished the mortgagee was given an equ itable right of foreclosure[.]”).

52 As the Missouri Court of Appeals stated: [A] foreclosure sale surplus “retains the character of real est ate for the purpose of determining who is e ntitled to receive it, and goes to the person to whom the real estate would have gone but for the conversion. ” Roy v. Roy , 233 Ala. 440, 172 So. 253, 254 (1 937). Such surplus represents the owner’s equity in the real estate. Dodson v. Farm & Home Sav. Ass’n , 208 Ga.App. 568, 430 S.E.2d 880, 881 (1993). It stands in place of the for eclosed property, subject to the same liens and interests that were att ached to the land. Timm v. Dewsnup , 86 P.3d 699, 703 (Utah 2003). Surplus “usually arises because more land is sold . . . than is necessary to satisfy th e mortgage debt. . . . [T]he money stands for the land and the rights the rein are determined as though the court w ere dealing with the land itsel f.” Morris v. Glaser , 106 N.J. Eq. 585, 151 A. 766, 771 (N.J.Ch.1930) aff’d mem ., 110 N.J. Eq. 661, 160 A. 578 (N.J.Err. & App.1932). See also First Fed. Sav. & Loan Ass’n v. Brown , 78 A.D.2d 119, 434 N.Y.S.2d 306, 310 (1980) (foreclosure surplus “stands in place of the land for all purpo ses of distribution among persons having vested interests or liens upo n the land”); East Atlanta Bank v. Limbert , 191 Ga. 486, 12 S.E.2d 865, 867 (1941) (quoting Morris )[.] [ Grand Teton Mountain In vestments, LLC v Beach Props, LLC , 385 SW3d 499, 502-50 3 (Mo App, 2012).] See also Nelson, § 7:32 (“The major underlying principle is that the surplus represents the remnant of the equity of redemption and the security that the f oreclosure eliminated. Consequently, the surplus stands in the place of the foreclosed real estate . . . .”); Tiffany, § 1529 (“Any surplus pr oceeds of sale remain ing after the payme nt of the debt secured by26 Given this history and caselaw, I would characterize the proper ty right at issue here as the taxpayer’s equity in the property. This conclusion best fits the development of ownership rights in property laden with debts or liens. The ma jority’s belief that a property right in the surplus proceeds ex ists apart from the interest in the equity finds no support in the historical record. Indeed, equity formed in response to pr actices like those at issue here, albeit in the private realm, and gives rise to any right in sur plus proceeds. It thus constitutes a disposable property right to th e value of land above any lien s or other interests in the property. 53 And it is a vested right—at least with regard to an individua l who owns

the mortgage are paid to the mortgagor or, if there are subsequ ent purchasers or incumbrancers, such surplus proceeds belong to them, in the ord er of priority in which their rights against the land could have been asserted. In other wor ds, the proceeds of sale are substituted for the land itself, and become subject to outstand ing liens and claims to the same extent and in the same order as the land itself was subjec t thereto.”) (citations omitted); Nelson & Whitman, Reforming Foreclosure: The Uniform Nonjudicial Foreclosure Act , 53 Duke L J 1399, 1483 (2004) (“Sometimes a foreclosure sale yi elds a surplus amount in excess of what is needed to satisfy the mortg age obligation and the expenses of sale. In essence, when a surplus results, it repre sents what remains of the debtor’s ownership o r ‘equity of redemption’ a nd is conceptuall y a substitute res.”). It is true that some courts have found that the surplus proceed s are the property owner’s general funds rather than the real estate. See In re Schiphof , 192 NC App 696, 702; 666 SE2d 497 (2008) (“This C ourt stated that, ‘the surplus funds . . . did not constitute real estate. The surplus funds represented the general funds o f the plaintiffs, the owners of the premises and the grantors in the deed of trus t which was fo reclosed.’ ”), quoting Smith v Clerk of Superior Court , 5 NC App 67, 73-74; 168 SE2d 1 (1969). This does not, however, have any bearing on a homeowner’s entitlement to the p roceeds by virtue of his or her equity in the home. As s tated, “ ‘[E]quity’ is defined as ‘the value of a property * * * above the total of the liens.’ ” Crane , 331 US at 7. Whether that value, realized in the surplus proceeds after a tax foreclosure, is th ought of as representing the real estate or general funds, it is still a result of the right to equity.

53 Black’s Law Dictionary (11th ed) defines “equity” as “[a]n ownership interest in property, esp. in a business.” See also Crane , 331 US at 7 (“ ‘[E]quity’ is defined as ‘the27 property with equity value—becaus e it represents an estate in t he land providing immediate and future benefit. 54 It thus fits the general definition of “property” at the time our Constitution was ratified. 55 If more proof were needed that “equity” is routinely consider ed the relevant property right in the nondebt value of a house, on e need look no further than divorce proceedings, in which hom e equity is part of the proper ty split between the parties. 56 Perhaps for these reasons, numerous courts, parties, and commen tators who have addressed similar cases in the tax-foreclosure context discuss the right to a surplus as related to the homeowner’s equity —and none that I have found (n or any the majority cites) holds that the right to surplus p roceeds is a freestanding prop erty interest independent of the underlying equity interest. 57 The right to equity is, in fact, the very right that plaintif fs

value of a property * * * above the total of the liens.’ ”). O f course, there might be other liens on the property such that a landowner’s equity is less th an the property value minus what was owed in taxes. It is a lso true that equity may fluctu ate as market values change. But I see no reason why a fluctuation in equity would affect wh ether the right is vested. Though a property owner is not guaranteed that real property wi ll sell for a particular amount, the owner’s interest still comes from his title and is more than a “mere expectation.” In re Certified Question , 447 Mich at 788.

54 See In re Certified Question , 447 Mich at 788 (“To constitute a vested right, the interest must be something more than such a mere expectation as may be b ased upon an anticipated continuance of the present general laws; it must have become a title, legal or equitable, to the present or future enjoyment of property . . . .”) (quotatio n marks and citation omitted).

55 See note 15 of this opinion.

56 See, e.g., Rogner v Rogner , 179 Mich App 326; 445 NW2d 232 (1989) (reviewing an award of equity in th e marital home).

57 See Dorce v City of New York , ___ F Supp 3d ___ (SD NY, 2020) (Docket No. 19-cv2216) (discussing the plaintiffs ’ loss of “equity” in their pro perties in the context of a28 takings challenge); Polonsky v Bedford , ___ NH ___; ___ A3d ___ (2020) (Docket No. 2019-0339); slip op at 2, 5 (referring to the excess “equity” o wed to the taxpayer and holding that when a tax deed is issued, a taking occurs “requir ing that [the government] provide just compensation to the former owner when, as here, th e equity in the property exceeds the amount owed”); Automatic Art, LLC v Maricopa Co , unpublished opinion of the United States District Court for the District of Arizona, i ssued March 18, 2010 (Case No. CV 08-1484-PHX-SRB), pp 2, 3, 6 (discussing the statutes an d constitutional challenges to them as affecting the property owner’s equity in the real property); Thomas Tool Servs, Inc v Croydon , 145 NH 218, 220; 761 A2d 439 (2000) (“Assuming that the property is worth substantially m ore than the $370.26 that the defendant paid for it, the defendant has realized an enormous surplus.”); Syntax, Inc v Hall , 899 SW2d 189, 190 n 1 (Tex, 1995) (“The claim for exce ss proceeds concedes the loss o f ownership and simply seeks a return of the excess valu e that was received at the sal e.”); First NH Bank v Windham , 138 NH 319, 327; 639 A2d 1089 (1994) (holding that the state constitution required notice of the tax deedi ng because, in part, the “tax d eeding irreversibly deprives the owner of any equity in the property,” given that no surplus proceeds were then available); Anchorage v Thomas , 624 P2d 271, 273 (Alas, 1981) (finding a statutory right to surplus proceeds and noting “t he basic injustice inherent in requiring delinquent taxpayers to forfeit the total value of their property far in e xcess of taxes due”); Auburn v Mandarelli , 320 A2d 22, 32 (Me, 1974) (“In the absence of contrary provis ion by statute or constitution, a municipality’s title to property acquired un der the tax-lien-mortgageforeclosure statute is absolute, and the city or town has no po wer to part with, nor duty to account for, any surplus value on any” equitable theory.); Bogie v Barnet , 129 Vt 46, 48, 54; 270 A2d 898 (1970) (finding a taking of the property to the extent of the difference between the tax sale bid “and the demonstrated far greater valu e of the property” evidenced by a later sale); Balthazar v Mari Ltd , 301 F Supp 103, 106 (ND Ill, 1969) (“[T]he Illinois tax delinquency statutes allow al l real estate owners to recove r the surplus value of their land.”), aff’d 396 US 114 (1969); Note, Someone to Lien On: Priv atization of Delinquent Property Tax Liens and Tax Sale Surplus in Massachusetts , 61 BC L Rev 667, 670, 691- 694 (2020) (noting that “[e]normously inequitable outcomes occu r as a result [of Massachusetts’s similar tax-foreclosure law] because property o wners can lose all equity in their home” and describing caselaw as addressing whether the government must return “surplus equity” left after the foreclosure sale); Note, State Theft in Real Property Tax Foreclosure Procedures , 54 Real Prop Tr & Est L J 93, 1 05 (2019) (noting that a surpl usretention system like ours “destroys property owners’ home equi ty and leaves them with nothing”); Bartell, Tax Foreclosures as Fraudulent Transfers—Are Auctions Really Necessary? , 93 Am Bankr L J 681, 706 (2019) (arguing that owners concerne d about the price obtainable at a tax sale should preemptively “conduct a p rivate sale that may generate enough proceeds to pay the taxes in full and provide the owner any extant equity”); Clifford, Massachusetts Has a Problem: The Unconstitutionality of the Tax Deed , 13 U29 Mass L Rev 274, 286-287 (2018) (discussing caselaw that address es the proceeds as “surplus equity”) (citation and quotation marks omitted); Kelly , Jr, Bringing Clarity to Title Clearing: Tax Foreclosure and Du e Process in the Internet Age , 77 U Cin L Rev 63, 72 (2008) (“The vast majority of ju risdictions rely on a combined sale and foreclosure process to make sure both that the taxes due are paid in full and that any surplus valu e in the property is made available to the stakeholders whose interests have bee n liquidated.”) (emphasis added). Courts and parties in Takings Cla use challenges to Michigan’s f oreclosure system have focused on the homeowner’s deprivation of equity. See Rafaeli, LLC v Wayne Co , unpublished opinion of the Unite d States District Court for the Eastern District of Michigan, issued June 4, 2015 (Case No. 14-13958), p 8 (“Plaint iffs also claim that the excess equity in their property w as taken without just compensa tion, in violation of the Takings Clause of the Fifth Amendment to the United States Cons titution.”); Petition for Writ of Certiorari at 14, Wayside Church v Van Buren Co , 138 S Ct 380 (2017) (No. 17- 88) (“The property interest at issue here is privately generate d and owned equity.”); cf. Freed v Thomas , unpublished opinion of the United States District Court for t he Eastern District of Michigan, issued Nov ember 7, 2018 (Case No. 17-CV-1 3519), p 2 (“The heart of plaintiff’s complaint is that this statutory scheme is uncon stitutional because it provides no mechanism for the return to the delinquent taxpayer of the ‘ surplus equity’ (i.e., the difference between the equity and the tax bill) or, in the even t that the property is sold for less than fair market value, fo r the return to the delinquent t axpayer of the difference between the sale proceeds and the tax bill.”). A few cases addressing whether a statute provides for surplus t o the homeowner do not mention “equity,” but these cases are not deciding whether a nonstatutory basis exists for the property right in surplus proceeds; thus, they do not c ontradict the regnant interpretation of “surplus” as stemming from equity. See, e.g. , Lake Co Auditor v Burks , 802 NE2d 896 (Ind, 2004) (finding statutory avenues for recover ing surplus); Kelly v Boston , 348 Mass 385; 204 NE2d 123 (1965) (finding no statutory right to surplus). In addition, a handful of opinions rejecting constitutional challe nges to tax-foreclosure statutes like the one here have not mentioned “equity,” but the y did not examine in any detail the potential sources of th e property right at issue. S ee Miner v Clinton Co , 541 F3d 464, 474-475 (CA 2, 2008) (rej ecting a due-process claim becaus e the notices were adequate and an equal-protection claim because no discriminatio n occurred); Reinmiller v Marion Co , unpublished opinion of the Uni ted States District Court for t he District of Oregon, issued October 16, 2006 (Case No. CV 05-1926-PK) (rejec ting a takings claim and stating that Oregon law did n ot provide any property right entitling the homeowner to the proceeds, but onl y discussing the relevant tax-foreclosure statutes rather than common law). In a few cases with more detailed constitutional analyse s, surplus or excess proceeds30 rely on here to support their claim under the Takings Clause. 58 One federal district court provided an insightful discussion on the topic, first summing u p the United States Supreme Court’s caselaw—the same cases the majority here discusses—as “ mak[ing] clear that a Takings Clause violation re garding the retention of equity will not arise when a tax-sale statute provides an avenue for re covery of the surplus equity.” 59 The question in that case was, as here, “[w]hat if the tax-sale statute does not provide a right to the surplus” or an

are mentioned without regard to the homeowner’s equity; nonethe less, the cases do not hold that these proceeds are prope rty without regard to equity. See Sheehan v Suffolk Co , 67 NY2d 52, 59, 60; 490 NE2d 523 (1986) (“There is no constitut ional prohibition against such a full forfeiture” of the “surplus.”); Ritter v Ross , 207 Wis 2d 476, 484; 558 NW2d 909 (App, 1996) (“We thus consider whether the Ritters had a pr operty interest in the excess proceeds of the foreclosure sale . . . .”); Oosterwyk v Milwaukee Co , 31 Wis 2d 513, 517; 143 NW2d 497 (1966) (rejecting an unjust-enrichment claim for surplus proceeds).

58 Plaintiffs’ brief states, “The p rivate property interest at is sue in this case is privately generated and owned equity.” Plaintiffs’ Brief on Appeal (Febr uary 13, 2019) at 11. The majority dismisses this argument, saying that plaintiffs “confl ate equity with surplus proceeds, suggesting that they are one in the same.” Further, the majority criticizes my analysis as stating both that the equity of redemption represen ts an owner’s equity and also acknowledging that the two are distinct. I see nothing inconsi stent with noting the fact that, on one hand, the “equity of redemption” came to represent the homeowner’s interest in the property, i.e., the equity, but, on the other hand, that there were and are certain distinctions between the two con cepts, such as alienability, se e note 50 of this opinion. The majority goes on to say that it is unnecessary to discuss w hether a property right to equity exists here because the question is whether the forme r property owner may collect surplus proceeds. However, it is necessary to begin the analys is with a vested right in the equity because, as explained above , there is no such thing as a vested right in surplus proceeds independent of the righ t to equity. Additionally, for the reasons we discuss below, even taken on its own terms, the right to surplus proceeds set forth in the majority’s opinion is evanescent given that it can be so easily taken away.

59 Coleman , 70 F Supp 3d at 80 (emphasis added).31 “avenue for recover[ing]” it? 60 The court continued, “A property interest in equity could conceivably be created by some other legal source,” including c aselaw—although not the Takings Clause itself. 61 Throughout the opinion, the pro perty right was characterized as “surplus equity.” 62 In short, the relevant property right in this case is the taxpa yers’ equity interest, not some contingent right to proceeds if there is a foreclosure sal e. Equity has better historical grounding than any novel and free standing right to proceeds—ind eed, it is the reason entitlement to proceeds may exist—and is a common enough concep t that I cannot comprehend the majority ’s efforts to avoid it. C. CONSEQUENCES My difference of opinion with the majority on this point is no small matter. Characterizing the property right at issue as equity has very r eal consequences here. For one thing, the GPTA does not clearly abrogate any of a person’s property rights in their real estate or in their equity generally. Instead, the GPTA si mply allocates the surplus proceeds after the tax-foreclosur e sale. Accordingly, it canno t be said to have abrogated the common-law right to equity. 63

60 Id

. 61 Id . at 80-81.

62 See, e.g., id

. 63 Defendants have not raised the argument that the Legislature a brogated the common-law right to equity. See Mich Gun Owners, Inc v Ann Arbor Pub Sch , 502 Mich 695, 709-710; 918 NW2d 756 (2018) (noting that parties raise the arguments in our adversary system). Under the regnant interpretive pr inciple noted above, “ ‘legisl ative amendment of the32 In addition, the statute contemplates—and indeed, expressly pro vides for—a number of scenarios in which the re will be no surplus proceeds. For our purposes, the first key point in the process occurs when the court enters the forec losure judgment. This must occur before March 30, and the judgment must become effective o n March 31. 64 When it becomes effective, the taxpayer loses his or her redemption rig hts and absolute title vests in the government. 65 The following day, April 1, the foreclosing governmental unit obtains the right to possession. 66 Afterward, the state has until th e first Tuesday in July to buy the property from the foreclosing governmental unit for the greater of either the min imum bid—which equals the

common law is not lightly presu med,’ ” and the “Legislature ‘sh ould speak in no uncertain terms’ when it exercises its authority to modify the common law .” Dawe v Dr Reuven BarLevav & Assoc, PC , 485 Mich 20, 28; 780 NW2d 272 (2010) (citation omitted). Lik e the majority’s view that the Legisla ture cannot abrogate common-law property rights extant before 1963, this principle rais es separation-of-powers concern s as well. See A Matter of Interpretation , pp 27-28. But it is longstanding, and no party has challenge d it here. Under this canon, it is reasonably apparent that the Legislature left untouched the taxpayer’s common-law right to equity. Nothi ng in the statute clearly dis places that right. The same could not be said, however, for the majority’s separate right t o surplus proceeds, which the Legislature very clearly attempted to extinguish in the GPTA. In any event, the parties’ failure to address this argumen t means that it should not be re solved in this case.

64 MCL 211.78k(5). These dates are for uncontested cases. The j udgment in contested cases becomes effective 10 days a fter the hearing, and 21 days after entry of the judgment the taxpayer loses his or her redemption rights and absolute ti tle vests in the government. MCL 211.78k(5) and(6). In contes ted cases, the government obta ins the right to possession 22 days after judgment enters. MCL 211.78g(1).

65 MCL 211.78k(5) and(6).

66 MCL 211.78g(1).33 debt and various additional costs 67 —or the “fair market value.” 68 This protects the foreclosing unit, which would be certain to recoup the debt and costs if the state exercises its right to purchase. And under this option the property migh t sell for a price reflecting the debt and the equity. But if t he state declines, the next s eries of options ensures that no surplus will occur. Next, the “city, village, or township” whe re the property is located can purchase the property “for a publ ic purpose” at the minimum bid , meaning that no surplus would result. 69 If they pass on the purchase, then the county has the chance to buy it (without being required to have a “public purpose” for doing so ), again for the minimum bid. 70 If any of these last few governmental units—city, village, to wnship, or county— buys the property a nd subsequently sells it, any excess proceed s (less additional costs) are distributed in various funds. 71 If the property goes unpurchased after all this, the foreclosin g unit holds one or more auctions from July to November. 72 Although the statute prescribes notice requirements, it allows the foreclosing unit to “adopt procedures governing the conduct of the sale . . . .” 73

67 MCL 211.78m(16)(a).

68 MCL 211.78m(1).

69 Id

. 70 Id

. 71 Id

. 72 MCL 211.78m(2).

73 Id

.34 To sell the property, the fore closing unit must receive at leas t the “minimum bid.” 74 If the property goes unpurchased after a n auction, the city, village, township, or county can buy it for the minimum bid without needing a public purpose to do s o. 75 At the final auction, there is no minimum bid. 76 Property that is not purchased is transferred to the city, vi llage, or township where it is located u nless the unit objects, in whi ch case the property goes to the foreclosing unit. 77 In light of this statutory frame work, the majority’s focus on t he surplus proceeds as the relevant property, and thus t he postsale retention as the t aking, produces puzzling results. Because “a property owne r has a claim for a violation of the Takings Clause as soon as a government takes his property for public use without paying for it,” 78 under the majority’s theory, no constitutio nal issues occur until the sur plus proceeds are retained. It does not matter that once title has vested in the government wi thout chance of redemption, the taxpayer’s property—his or h er equity—has been taken. Cons equently, the majority’s view of the case would seemingly be that if the property does n ot sell at auction and is simply transferred to a governmen tal unit, the taxpayer is out of luck: no proceeds, let alone

74 Id

.
75 MCL 211.78m(3).

76 MCL 211.78m(5).

77 MCL 211.78m(6) and(7).

78 Knick v Scott Twp , 588 US ___, ___; 139 S Ct 2162, 2170; 204 L Ed 2d 558 (2019).35 a surplus, have been produced o r retained by the government. 79 Perhaps worse still, governmental units have numerous opportunities to purchase the property for the minimum bid, i.e., for the debt (and costs), and thus obtain it for an amount that will usually be much less than fair market value. Yet in those cases, too, because no surplus would result, the majority leaves the taxpayer without a remedy. The better view, under the law described above, is that the pro perty taken is the taxpayer’s equity and that this occurs when title vests in the government with no opportunity for redemption. In that circumstance, if the gover nment retains the property, the taxpayer would be able to seek compensation for the depriva tion of his or her equity. 80 If the property is sold, any surp lus represents the remaining e quity in the property and is owed as the just compensation due the taxpayer. 81 Returning the surplus would usually satisfy the Takings Clause by “leav[ing the property owner] ‘in as good as position as if his lands had not been taken,’ ” 82 i.e., by leaving the property o wner with the representation of what was taken.

79 Of course, the majority might c ounter that this is a question for another day because the properties here were sold. But it is hard to imagine what the majority would do in such a case besides either denying the takings claim under the theory it adopts here or reconsidering whether it is bas ed on the taxpayer’s right to th e equity in his or her property.

80 See Polonsky , slip op at 5 (noting that the statutory scheme did not requir e the government to sell the foreclosed property but that, in those c ases, the government has conflicts with the Takings Claus e by failing to pay over the eq uity).

81 See note 52 of this opinion and accompanying text.

82 Dep’t of Transp v Tomkins , 481 Mich 184, 198; 749 NW2d 71 6 (2008) (citation omitted).36 To elaborate on this last point, awarding the surplus as “just compensation” only makes sense in light of the underlying principle that the surpl us represents the owner’s equity. 83 It is, of course, possible that the surplus might not capture the value of a taxpayer’s property. 84 But the “just compensation” req uirement does not require loca l governments to impoverish themselves. 85 Thus, taxpayers seeking some speculative value beyond the surplus realized in the tax sale might often lack me ritorious claims. It is also worth noting, in this regard, that the taxpayers would be free to conduct a private sale of the property during the redemption period prior to title vestin g in the government and, by failing to do so, might be considered to have agreed to the val ue produced by the taxforeclosure sale. 86

83 See note 52 of this opinion.

84 See State Theft , 54 Real Prop Tr & Est L J at 126 (noting that limiting the ta xpayer to the surplus might cause him or her to lose some equity but argu ing that this result might be consistent with the “just com pensation” requirement).

85 See United States v Commodities Trading Corp , 339 US 121, 123; 70 S Ct 547; 94 L Ed 707 (1950) (“Fair market value has normally been accepted as a just standard. But when market value has been too diffi cult to find, or when its applic ation would result in manifest injustice to owner or public, co urts have fashioned and applied other standards. . . . [T]he dominant consideration always remains the same: What compensati on is ‘just’ both to an owner whose property is taken and to the public that must pay t he bill?”) (citation omitted); In re State Hwy Comm’r , 249 Mich 530, 535; 229 NW 500 (1930) (“Just compensation should neither enrich the individual at the expense of the publ ic nor the public at the expense of the individual.”).

86 See Tax Foreclosures , 93 Am Bankr L J at 706-707 (arguing that courts reviewing whether foreclosure laws protect the debtor’s “equity” should c onsider that the debtor’s “right of redemption provides to the owner of the property the opportunity to realize the full fair market value of the property” less the taxes owed, an d the debtor’s failure to avail37 On the other hand, by limiting the compensation to the surplus (when one exists), the majority risks depriving taxpayers of “just compensation.” As demonstrated above, the statute gives governmental units t he option to ensure that ther e will be no surplus. Under the majority’s regime, a rationa l governmental actor is incenti vized to buy properties that have a market value above the minimum bid amount that must be p aid or to take other steps to limit or eliminate surpluses. For example, both the Legisla ture in constructing the statutory framework and the foreclosing unit in prescribing sal e procedures could design rules that diminish the probab ility of obtaining fair market va lue in the tax-foreclosure sale. Indeed, while it might be true that most sale prices now do not even cover the taxes owed, the foreclosing unit would have little incentive to conduct a s ale that earns anything more than the delin quent tax sum. 87 Consequently, I would not now rule out the possibility that “just compensation” might require something greater than the su rplus in a particular case, especially in cases in which the government purchased the prope rty for the minimum bid. But we have no reason to decide that issue in this case because , although plaintiffs nominally distinguish equity and surplus, they have offered no argument suggesting that the tax foreclosures here faile d to obtain a fair price for the ir properties.

themselves of this relief constitu tes agreement to the “price o btained by the state foreclosure process”).

87 The majority seems untroubled by the possibility that what it might have taken away with one hand—i.e., the Legislature’s authority to prospectivel y abrogate the supposed common-law right to surplus proceeds—it has given with the othe r by defining the right so that the Legislature can shrink or erase those surplus proceeds

.38 III. CONCLUSION Although I agree with the majority as to the ultimate dispositi on of this case, I disagree with its reasoning. I would not define the constituti onal term “property” by merely citing an example of what the ratifiers might have thought woul d fall within the meaning of that term. Instead, I would give the word its ordinary mean ing at the time the Constitution was ratified and then apply that meaning to the ca se at hand. In addition, I would examine the relevant property right: the taxpayers’ equit y in the real property. Equity falls within the semantic scope of “property” under our Constitution. And the Legislature did not purport to abrogate the taxpayer’s equity. Therefore, a taking occurred when title to plaintiffs’ property was vested in the government without any possibility of redemption. In this case, I agree with the majority that plain tiffs are owed the surplus proceeds from the tax-foreclosure sales.

David F. Viviano