Court Opinion

ID: 9915323
Source: CourtListenerOpinion
Date Created: 2024-01-05 06:04:58.047029+00
Date Added: 2024-06-11T13:09:58.678033
License: Public Domain

Court of Appeals, State of Michigan

                                            ORDER
                                                                         Brock A. Swartzle
 Mettler Walloon LLC v Charlevoix County Treasurer                         Presiding Judge

 Docket No.    362484                                                    Colleen A. O’Brien

 LC No.        21-039727-CH                                              Kathleen A. Feeney
                                                                           Judges

               The motion for reconsideration is GRANTED, and this Court's opinion issued September
21, 2023, is hereby VACATED. A new opinion is attached to this order.

                                                       _______________________________
                                                        Presiding Judge

                              January 4, 2024
             If this opinion indicates that it is “FOR PUBLICATION,” it is subject to
                  revision until final publication in the Michigan Appeals Reports.

                           STATE OF MICHIGAN

                            COURT OF APPEALS

METTLER WALLOON LLC,                                                  UNPUBLISHED
                                                                      January 4, 2024
               Plaintiff-Appellant,

v                                                                     No. 362484
                                                                      Charlevoix Circuit Court
CHARLEVOIX COUNTY TREASURER and                                       LC No. 21-039727-CH
MELROSE TOWNSHIP,

               Defendants-Appellees.

                                      ON RECONSIDERATION

Before: SWARTZLE, P.J., and O’BRIEN and FEENEY, JJ.

PER CURIAM.

        Plaintiff’s property was foreclosed because of delinquent property taxes, and defendants
entered into a sale of plaintiff’s property for the property’s minimum bid. Plaintiff appealed the
trial court’s order that granted defendants summary disposition on plaintiff’s claim that its property
was unconstitutionally taken without just compensation. In our opinion issued September 21,
2023, we affirmed the trial court on the grounds that plaintiff’s claims were barred by a statutory
period of limitations. On reconsideration, we vacate our prior opinion and now reverse and remand
for proceedings consistent with this opinion.

                                        I. BACKGROUND

       As this Court previously explained:
               This case arises out of defendants’ actions under the General Property Tax
       Act (GPTA), MCL 211.1 et seq, which was amended by 2020 PA 256. The
       amendment had not yet been enacted when the property was foreclosed, and, under
       the then-existing version of MCL 211.78m, the township in which the property was
       located could purchase the property from the foreclosing governmental unit for the
       “minimum bid” after the state declined to purchase the property. The “minimum
       bid” was defined as the amount of tax delinquency, including interest, penalties,
       and fees due on the property. MCL 211.78m(11). [Mettler Walloon LLC v

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       Charlevoix Co Treasurer, unpublished per curiam opinion of the Court of Appeals,
       issued September 21, 2023 (Docket No. 362484), p 2.]

The relevant facts remain unchanged from this Court’s prior opinion:

              Plaintiff owed $9,835.80 in delinquent property taxes, fees, penalties,
       and/or interest on the property it owned in Melrose Township. The Charlevoix
       County Treasurer filed a judgment of foreclosure that was granted on February 16,
       2018, under MCL 211.78k. Plaintiff failed to timely redeem the property, the
       judgment of foreclosure became effective on April 2, 2018, and the Charlevoix
       County Treasurer took absolute title to the property. Melrose Township purchased
       the property from the Charlevoix County Treasurer for a “minimum bid” of
       $9,766.99 under the then-existing MCL 211.78m(1). It was alleged that at the time
       of the foreclosure the property had an assessed value of $95,100 under MCL
       211.27a(1).

               Plaintiff sued defendants on April 1, 2021, alleging, among other claims,
       that defendants had taken plaintiff’s private property for public use without just
       compensation under the Takings Clause of the Michigan and United States
       Constitutions, Const 1963, art 10, § 2; US Const, Am V. Plaintiff and the
       Charlevoix County Treasurer moved for summary disposition under MCR
       2.116(C)(10), and Melrose Township moved for summary disposition under MCR
       2.116(C)(7) and (C)(8). During the hearing regarding summary disposition, the
       Charlevoix County Treasurer argued for the first time that plaintiff’s claim was
       untimely under MCL 211.78l because it was brought more than two-years after the
       foreclosure. The trial court ordered supplemental briefing on the statutory period
       of limitations, which the parties submitted.

              The trial court, subsequently, held that the statutory period of limitations
       argument was moot because, even if plaintiff’s claim was timely, plaintiff’s claim
       was foreclosed by our Supreme Court’s holding in Rafaeli, LLC v Oakland County,
       505 Mich 429; 952 NW2d 434 (2020), and the trial court granted defendants
       summary disposition under MCR 2.116(C)(10). [Id. at 1]

        This Court heard oral argument from the parties and issued its opinion holding that
plaintiff’s claims were barred by the statutory period of limitations under MCL 211.78l(3), before
it was amended by 2020 PA 256. Id. at 2. Plaintiff has now moved for reconsideration.

                                         II. ANALYSIS

                                   A. RECONSIDERATION

     MCR 7.114(D) explains that motions for reconsideration in this Court are governed by
MCR 2.119(F), which states in relevant part:

               (3) Generally, and without restricting the discretion of the court, a motion
       for rehearing or reconsideration which merely presents the same issues ruled on by
       the court, either expressly or by reasonable implication, will not be granted. The

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         moving party must demonstrate a palpable error by which the court and the parties
         have been misled and show that a different disposition of the motion must result
         from correction of the error.

       Plaintiff argues that MCL 211.78l(3), before 2020 PA 256, did not apply to its claims
because that statutory period of limitation only applied to actions for monetary damages that were
brought under that section. Before 2020 PA 256, MCL 211.78l(3) stated that “an action to recover
monetary damages under this section shall not be brought more than 2 years after a judgment for
foreclosure is entered under section 78k.” (Emphasis added).

        This Court has held that the phrase, “under this section,” for the purposes of MCL 211.78l,
before the amendment, referred to claims involving whether the property owner was given proper
notice because that earlier version of MCL 211.78l(1) only governed claims regarding notice.1 See
River Investment Group, LLC v CASAB, 289 Mich App 353, 354; 797 NW2d 1 (2010); Andrews
v Co of Wayne, unpublished per curiam opinion of the Court of Appeals, issued March 6, 2018
(Case No. 335857), p 3. Further, this Court held in Andrews that claims “for just compensation
under the Takings Clause [do] not fall under [MCL 211.78l] because a takings claim is unrelated
to the provision of notice under the GPTA.” Although this is not binding precedent, Paris
Meadows, LLC v City of Kentwood, 287 Mich App 136, 145 n 3; 783 NW2d 133 (2010), this Court
finds Andrews persuasive because that earlier version of MCL 211.78l consistently referred to
claims under that section for the purposes of notice.

       With that said, though MCL 211.78l, before 2020 PA 256, does not apply to plaintiff’s
claims, some statutory period of limitations must apply. See Doe v Roman Catholic Archbishop
of Archdiocese of Detroit, 264 Mich App 632, 649; 692 NW2d 398 (2004). Defendants argue that
if MCL 211.78l(3), before 2020 PA 256, does not apply, then MCL 211.78l(1), after 2020 PA 256,
should apply. After the 2020 amendment, MCL 211.78l(1) now states:

                 If a judgment for foreclosure is entered under section 78k and all existing
         recorded and unrecorded interests in a property are extinguished as provided in
         section 78k, the owner of any extinguished recorded or unrecorded interest in that
         property shall not bring an action, including an action for possession or recovery of
         the property or any interests in the property or of any proceeds from the sale or
         transfer of the property under this act, or other violation of this act or other law of

1
    Before 2020 PA 256, MCL 211.78l(1) stated:

                If a judgment for foreclosure is entered under section 78k and all
             existing recorded and unrecorded interests in a parcel of property are
             extinguished as provided in section 78k, the owner of any extinguished
             recorded or unrecorded interest in that property who claims that he or
             she did not receive any notice required under this act shall not bring an
             action for possession of the property against any subsequent owner, but
             may only bring an action to recover monetary damages as provided in
             this section.

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       this state, the state constitution of 1963, or the Constitution of the United States
       more than 2 years after the judgment of foreclosure of the property is effective
       under section 78k. Nothing in this section authorizes an action not otherwise
       authorized under the laws of this state. An action to recover any proceeds from the
       sale or transfer of property foreclosed for nonpayment of real property taxes under
       this act must be brought as provided under section 78t.

This section imposes a two-year statutory period of limitation on claims for the proceeds from the
transfer of property under the GPTA or claims arising under the Constitution (i.e., takings claims).
Plaintiff’s claims would seemingly be limited by this period of limitation if this statute were
applied retroactively, because plaintiff is claiming that defendants violated its constitutional right
for just compensation when a taking occurred.

       “Statutes and amended statutes are to be applied prospectively unless the Legislature
manifests an intent to the contrary.” Davis v State Employees’ Retirement Bd, 272 Mich App 151,
155; 725 NW2d 56 (2002). “In determining whether a statute should be applied retroactively or
prospectively only, the primary and overriding rule is that legislative intent governs.” Frank W
Lynch & Co v Flex Technologies, Inc, 463 Mich 578, 583, 624 NW2d 180 (2001) (cleaned up).

       Retroactive application of legislation “ ‘presents problems of unfairness ... because
       it can deprive citizens of legitimate expectations and upset settled transactions.’ ”
       We have therefore required that the Legislature make its intentions clear when it
       seeks to pass a law with retroactive effect. In determining whether a law has
       retroactive effect, we keep four principles in mind. First, we consider whether there
       is specific language providing for retroactive application. Second, in some
       situations, a statute is not regarded as operating retroactively merely because it
       relates to an antecedent event. Third, in determining retroactivity, we must keep in
       mind that retroactive laws impair vested rights acquired under existing laws or
       create new obligations or duties with respect to transactions or considerations
       already past. Finally, a remedial or procedural act not affecting vested rights may
       be given retroactive effect where the injury or claim is antecedent to the enactment
       of the statute. [LaFontaine Saline, Inc v Chrysler Group, LLC, 496 Mich 26, 38-
       39, 852 NW2d 78 (2014) (citations omitted).]

        Our Legislature did not provide a clear indication that its intention was to give the
amendment of MCL 211.78l(1) retroactive effect. See Proctor v Saginaw Co Bd of Comm’rs, 340
Mich App 1, 25; 985 NW2d 193 (2022). In fact, our Legislature made clear that the revised
statutory provisions applied to foreclosed properties sold after July 17, 2020, the day our Supreme
Court issued its opinion in Rafaeli. See In re Muskegon County Treasurer for Foreclosure, __
Mich App __, __; __ NW2d __ (2023) (Docket No. 363764). This makes sense, as the vested
rights of interested property owners would be impaired by an obligation to follow an unforeseen
statutory period of limitation that was retroactively imposed. Plaintiff’s injury was antecedent to
the enactment of the statute, and, thus, in this context, 2020 PA 256 did not retroactively apply a
statutory period of limitations on plaintiff’s claims under MCL 211.78l(1).

       Thus, after further clarification on plaintiff’s motion for reconsideration, it is now clear
which periods of limitation do not apply. It remains unclear, however, what period of limitation

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does apply. Plaintiff’s briefing and oral argument on this point have not been particularly helpful.
Courts do not sit as research attorneys for the parties, and this Court will not do plaintiff’s work
for it. Although it is possible that the general six-year period of limitations under MCL 600.5813
applies to plaintiff’s claim, Hart v Detroit, 416 Mich 488, 499, 503; 331 NW2d 438 (1982), this
Court will leave the matter for the parties and the trial court to answer in the first instance.

     Accordingly, this panel’s earlier opinion in this case, affirming the trial court’s grant of
summary disposition to defendants because plaintiff’s claims were untimely, is vacated.

                                 B. SUMMARY DISPOSITION

          Because the limitations period remains an open question for the parties and trial court to
address on remand, we turn next to the ground on which the trial court granted summary
disposition. The trial court granted summary disposition to defendants because there was no
“surplus” generated at auction, and thereby improperly retained by defendants, as the sale price
was slightly less than the taxes and related costs owed by plaintiff. This was the case even though
it is alleged that the actual, fair market value of the property was far in excess of the sale price.

       On the same day that this panel issued its earlier opinion, a different panel of this Court
published Jackson v Southfield Neighborhood Revitalization Initiative, ___ Mich App ___; ___
NW2d ___ (2023) (Docket No. 361397). The relevant facts in Jackson are similar to those here.
The plaintiffs in Jackson had their properties foreclosed because of delinquent taxes, and the
foreclosing governmental unit sold the properties for the minimum bid under the then-MCL
211.78m. Id. at ___, slip op at 1. The plaintiffs alleged violations of due process, equal protection,
and the Takings Clause among other claims. Id. at ___, slip op at 5. After our Supreme Court
remanded the case to the trial court for proceedings consistent with Rafaeli, the trial court granted
defendants summary disposition. Id. at ___, slip op at 6.

        On appeal, the Jackson Court reversed in relevant part. Consistent with Proctor, 340 Mich
App 1, the Court held that Rafaeli applied retroactively, slip op at 6-7. Further, after analyzing
Hall v Meisner, 51 F4th 185 (CA 6, 2022), the Court held that the minimum-bid process resulted
in the defendants taking the plaintiffs’ properties without just compensation, even though there
was no auction and no monetary “surplus” generated in excess of the unpaid taxes and related
costs. Id. at ___, slip op at 14.

        Although Jackson was issued on the same day as this panel’s earlier opinion, this panel is
bound by Jackson because that opinion was published, whereas this panel’s opinion was not. MCR
7.215(C)(2). Thus, applying Jackson to this case, the trial court erred when it held that defendants
were not required, as a matter of law, to provide plaintiff with any compensation under Rafaeli
because the property was not sold at auction and no surplus proceeds existed. Rather, a
compensable taking can occur when a public body purchases a foreclosed property for an amount
just covering (or not even) unpaid taxes and related costs, but which has an actual, fair market
value well in excess of that amount.

                                        III. CONCLUSION

        Accordingly, this panel’s prior opinion is vacated. We do not resolve the question of which
limitations period applies to plaintiff’s action and remand that matter for the trial court to resolve

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in the first instance. With respect to the trial court’s grant of summary disposition, we reverse as
explained here and remand for proceedings consistent with this opinion. We do not retain
jurisdiction.

                                                             /s/ Brock A. Swartzle
                                                             /s/ Colleen A. O’Brien
                                                             /s/ Kathleen A. Feeney

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