YOUNG, J.
This case concerns the jurisdiction of circuit courts to modify judgments of foreclosure when the foreclosing governmental unit deprives the property owner of due process. Generally, the provision of the General Property Tax Act (GPTA),
FACTS AND PROCEDURAL HISTORY
The property owner in this case, Perfecting Church, purchased two parcels for use as parking lots during its church services. Both parcels were transferred by a single deed that the church properly recorded. Nevertheless, after the church purchased and recorded a single deed for both the parcels, the Wayne County Treasurer listed one parcel on the Wayne County foreclosure listing. The church paid the outstanding taxes on that parcel and the treasurer assured the church that there were no further outstanding taxes on either parcel. Despite those assurances, the treasurer initiated foreclosure proceedings against the other parcel. However, the church never received notice of the pending foreclosure because the treasurer did not comply with the notice provisions of the GPTA. Specifically, the treasurer sent the statutorily required notice to the previous owner and did not post a notice on either of the parcels.
Subsequent to the sale, the church learned of the foreclosure and sale, and it filed a motion for relief from the foreclosure judgment in the Wayne Circuit Court. That court granted the church's motion and the Court of Appeals denied the intervening parties' delayed application for leave to appeal.
STANDARD OF REVIEW
This Court reviews questions of law, such as issues of constitutional and statutory construction, de novo.
ANALYSIS
Under the GPTA, a "foreclosing governmental unit shall file a single petition with the clerk of the circuit court of that county listing all property forfeited and not redeemed to the county treasurer under [MCL 211.78g] to be foreclosed under [MCL 211.78k]. . . ."
The statute also provides for an appeal to the Court of Appeals within 21 days of the judgment of foreclosure.
The intervening parties challenge the propriety of the grant of relief from judgment obtained by the church. They argue that MCL 211.78k(6) precludes the circuit court from staying or holding the governmental unit's title invalid. Furthermore, because the church did not avail itself of the redemption or appeal provision contained in subsections 6 and 7, it is limited to an action for monetary damages under MCL 211.78l.
The intervening parties accurately construe these provisions of the GPTA. If a property owner does not redeem the property or appeal the judgment of foreclosure within 21 days, then MCL 211.78k(6) deprives the circuit court of jurisdiction to alter the judgment of foreclosure. MCL 211.78k(6) vests absolute title in the foreclosing governmental unit, and if
However, the church argues that because the county denied it due process when taking its property, the church can avoid the limitations of the statute. The intervening parties respond that regardless of the property owner's claim, the statute only provides for one remedy once the redemption and appeals period has passed—a claim for monetary damages under MCL 211.78l.
As stated, we believe that the intervening parties' interpretation of the GPTA is correct. The act does not provide an exception for property owners who are denied due process. Thus, the intervening parties correctly assert that the GPTA does not provide relief for the church or other property owners who are denied due process.
The question then becomes whether such a regime is constitutional when it operates to deprive a property owner of its property without due process. This Court must presume a statute is constitutional and construe it as such, unless the only proper construction renders the statute unconstitutional.
As noted above, the statute permits a foreclosing governmental unit to ignore completely the mandatory notice provisions of the GPTA, seize absolute title to a taxpayer's property, and sell the property, leaving the circuit court impotent to provide a remedy for the blatant deprivation of due process. That interpretation, allowing for the deprivation of due process without any redress would be patently unconstitutional.
CONCLUSION
Because there is no construction of the GPTA that renders the statute constitutional in cases where the taxing authority has denied the taxpayer due process, the statute is unconstitutional as applied to those individuals. In the present case, the county completely failed to comply with the notice provisions in the GPTA. As such, the county deprived the church of its property without providing due process. Therefore, for the reasons stated, we affirm the order of the Wayne Circuit Court that restored the church's title to the property in question.
CLIFFORD W. TAYLOR, MAURA D. CORRIGAN and STEPHEN J. MARKMAN, JJ., concur.
MICHAEL F. CAVANAGH, J. (concurring in the result only).
I concur with the result reached by the majority. I write separately, however, to note that I do not agree that the notice procedures in the General Property Tax Act, MCL 211.1 et seq., necessarily satisfy due process. See Smith v. Cliffs on the Bay Condo. Ass'n, 463 Mich. 420, 432, 434, 617 N.W.2d 536 (2000) (Kelly, J., dissenting). Despite being in compliance with the statute, an agency's action may still fail to give a property owner constitutionally required reasonable notice.
MARILYN J. KELLY, J., concurs.
WEAVER, J. (concurring in the result only).
Recent amendments of Michigan's General Property Tax Act (GPTA), MCL 211.1 et seq., streamlined and expedited the real property tax foreclosure process.
I would hold that the relevant provisions of MCL 211.78 et seq.
I. FACTS
On July 1, 1999, respondent Perfecting Church purchased two vacant Wayne County properties for $100,000 and used both properties as parking lots for church service attendees.
Pursuant to MCL 211.78i, the treasurer's office had a duty to mail notice of the pending foreclosure to the current owner, Perfecting Church. However, because of a recording error in the treasurer's office, the properties were not listed on the tax rolls as being owned by Perfecting Church, and so the treasurer's office sent the foreclosure notice to the former owner, not to Perfecting Church. In addition, the posted notice of foreclosure was incorrectly placed on a neighbor's adjacent lot, rather than on either the first lot or the second lot owned by Perfecting Church.
Consequently, Perfecting Church never received notice of the pending foreclosure. It was not until October 2003, seven months after the circuit court entered the foreclosure judgment, that Perfecting Church became aware of the tax delinquency pertaining to the first lot when the church's general manager saw it listed in the Wayne County forfeiture listing. After contacting the Wayne County Treasurer's office, Perfecting Church obtained and paid the tax bill for the first lot on October 14, 2003.
At that time, Perfecting Church also inquired about the tax status of the second lot and was advised by the treasurer's office that payment of taxes on the first lot would cover the second lot as well, because both properties were listed on the same deed. Apparently, this assertion by the treasurer's office was incorrect, and Wayne County subsequently sold the second lot at auction. On November 4, 2003, the treasurer conveyed the second lot by quitclaim deed to the purchasers at the auction, intervening appellants Matthew Tatarian and Michael Kelly (appellants).
On May 14, 2004, pursuant to MCR 2.612(C)(1)(d) and (f), Perfecting Church filed a motion for relief from the judgment
Appellants sought leave to appeal in this Court. This Court granted the application and directed the parties to include among the issues to be briefed: (1) whether the trial court retained jurisdiction to grant relief from the judgment of foreclosure pursuant to MCR 2.612(C), notwithstanding the provisions of MCL 211.78l(1) and (2); and (2) whether MCL 211.78l permits a person to be deprived of property without being afforded due process.
II. STANDARD OF REVIEW
Whether a court has subject-matter jurisdiction is a question of law that this Court reviews de novo. Lapeer Co. Clerk v. Lapeer Circuit Judges, 465 Mich. 559, 566, 640 N.W.2d 567 (2002). Questions of statutory construction are also reviewed de novo. Grimes v. Dep't of Transportation, 475 Mich. 72, 76, 715 N.W.2d 275 (2006). Finally, questions concerning the constitutionality of a statutory provision are subject to review de novo. City of Taylor v. Detroit Edison Co., 475 Mich. 109, 115, 715 N.W.2d 28 (2006).
III. ANALYSIS
The GPTA authorizes county treasurers to foreclose on tax-delinquent property and to sell the property at auction to satisfy tax delinquencies. Republic Bank v. Genesee Co. Treasurer, 471 Mich. 732, 737, 690 N.W.2d 917 (2005). However, a person may not be deprived of property without due process of law. Const. 1963, art. 1, § 17; U.S. Const., Am. XIV, § 1. In Dow v. Michigan, 396 Mich. 192, 210, 240 N.W.2d 450 (1976), this Court held that due process requires that before the government takes a person's property by foreclosure, the person must be afforded notice and the right to contest the foreclosure. Following our decision in Dow, the Legislature added additional notice provisions to the GPTA to satisfy the constitutional due process requirements set forth in Dow. See, e.g., Smith v. Cliffs on the Bay Condo. Ass'n, 463 Mich. 420, 428-429, 617 N.W.2d 536 (2000). As a result, the GPTA sets forth an extensive set of procedures to provide a property owner with notice in the tax foreclosure and sale process. Id. at 428, 617 N.W.2d 536.
This Court must presume that MCL 211.78 et seq. are constitutional. People v. McQuillan, 392 Mich. 511, 536, 221 N.W.2d 569 (1974). A presumption exists that the Legislature would not violate the constitution. Id. If a statute can be interpreted as being either constitutional or unconstitutional, this Court must choose the constitutional interpretation of the statute. Id.
Section 78i(10)
Essentially, § 78i(10) provides that as long as the property owner against whom foreclosure is sought is accorded notice satisfying minimum due process, the failure of the governmental entity to comply with other provisions in this section does not invalidate the proceeding. The linchpin of a valid foreclosure then is that a property owner must be "accorded the minimum due process required under the state constitution of 1963 and the constitution of the United States."
The next relevant provision is MCL 211.78k(6), which defines the state of the title to the foreclosed property. The version of § 78k(6) in effect at the time of this foreclosure stated:
After title vests in the foreclosing governmental entity pursuant to § 78k(6), MCL 211.78l establishes what remedy is available to the owner of the extinguished property interest. It states, in pertinent part:
MCL 211.78l thus provides that once the prior owner's interest in a foreclosed property has been extinguished, the prior owner "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." Moreover, MCL 211.78l(2) states that the Court of Claims has exclusive jurisdiction over "any action to recover monetary damages under this section."
Here, respondent Perfecting Church did not bring an action for possession against appellant subsequent owners. Instead, Perfecting Church sought relief from the foreclosure judgment on the basis that the judgment was void because Perfecting Church never received notice of the foreclosure action. Appellants do not contest that Perfecting Church was deprived of notice, but argue that, despite this fact, MCL 211.78l precludes Perfecting Church from challenging the foreclosure. Appellants argue that MCL 211.78l limits Perfecting Church to seeking recovery for monetary damages, and establishes that the Court of Claims has exclusive jurisdiction over such an action. I disagree.
As a preliminary matter, I note that a circuit court has power to grant relief from a judgment under MCR 2.612(C). MCR 2.612(C)(1) states:
Contrary to appellants' assertion, MCL 211.78l does not divest the circuit court of its power to grant relief from a judgment as specified by MCR 2.612(C)(1). Indeed, nothing in either MCL 211.78l or MCL 211.78k(6) removes the circuit court's power
Further, MCL 211.78k(6) only addresses the state of the title that the government receives. Although MCL 211.78k(6) states that the government's title shall not be "stayed or held invalid," the government can only receive fee title to the property through a valid foreclosure proceeding. In situations where the property owner did not receive "the minimum due process required under the state constitution of 1963 and the constitution of the United States," the foreclosure proceeding is invalid under MCL 211.78i(10). In re Petition by Wayne Co. Treasurer for Foreclosure of Certain Lands for Unpaid Prop. Taxes, 265 Mich.App. 285, 293, 698 N.W.2d 879 (2005).
It follows that a foreclosing governmental unit cannot receive fee title to property when the property owner was not provided with minimum due process notice of an impending foreclosure. Therefore, MCL 211.78k(6) does not preclude a circuit court from modifying its judgment pursuant to MCR 2.612(C) when a property owner has not been provided constitutionally adequate notice of the foreclosure. The majority and I disagree on this point. While the majority holds that the language of MCL 211.78k(6) vesting absolute title in the foreclosing governmental unit limits a court's ability to modify judgments, I believe the correct, and constitutional, interpretation of the GPTA is that MCL 211.78i(10) invalidates any foreclosure proceeding when a foreclosing governmental unit's failure to provide adequate notice results in the property owner not being "accorded the minimum due process required under the state constitution of 1963 and the constitution of the United States."
Thus, it is necessary to determine whether the foreclosure on Perfecting Church's property met the minimum due process notice requirements. Both the Michigan and United States constitutions guarantee that a person shall not be deprived "of life, liberty or property, without due process of law." Const. 1963, art. 1, § 17; U.S. Const., Am. XIV, § 1. Due process of law entitles a person whose interest is at stake to "`notice and an opportunity to be heard.'" Dusenbery v. United States, 534 U.S. 161, 167, 122 S.Ct. 694, 151 L.Ed.2d 597 (2002), quoting United States v. James Daniel Good Real Prop., 510 U.S. 43, 48, 114 S.Ct. 492, 126 L.Ed.2d 490 (1993). Due process protects a real estate owner's interest in property. Dow, supra at 204, 240 N.W.2d 450. "People must pay their taxes, and the government may hold citizens accountable for tax delinquency by taking their property. But before forcing a citizen to satisfy his debt by forfeiting his property, due process requires the government to provide adequate notice of the impending taking." Jones v. Flowers, 547 U.S. 220, ___, 126 S.Ct. 1708, 1718, 164 L.Ed.2d 415, 430 (2006).
For the first component of due process—notice of an impending taking—to be constitutionally adequate, the notice must be "reasonably calculated, under all the circumstances, to apprise interested parties of the pendency of the action and
The GPTA requires the foreclosing governmental unit to mail notice to the property owner as identified by the property's deed filed with the county register of deeds. MCL 211.78i(6). Here, however, the treasurer mailed notice to the previous owner; consequently, Perfecting Church never received the mailed notice to which it was entitled under MCL 211.78i(6). The GPTA also requires the foreclosing governmental unit to post notice at the property in question. MCL 211.78i(3)(d). But here, the treasurer posted the foreclosure notice on a lot neighboring the property in question. Thus, a foreclosure notice was never posted at Perfecting Church's property. There was an absolute failure to provide notice under the GPTA. Although actual notice is not a requirement of due process, the foreclosing governmental unit must make a reasonable effort to provide notice. Dow, supra at 211, 240 N.W.2d 450. When the government utterly fails to comply with any of the notice procedures provided in a foreclosure statute, the government has not made a reasonable effort to provide notice.
For the second component of due process—an "opportunity to be heard"—to be constitutionally adequate, the hearing must be "at a meaningful time and in a meaningful manner." Armstrong v. Manzo, 380 U.S. 545, 552, 85 S.Ct. 1187, 14 L.Ed.2d 62 (1965); Van Slooten v. Larsen, 410 Mich. 21, 53, 299 N.W.2d 704 (1980). "A hearing would not be `at a meaningful time' unless the owner of a significant interest in the property had an opportunity to cure any delinquency determined upon the hearing and avoid foreclosure and the taking of his property by the state." Dow, supra at 206 n. 21, 240 N.W.2d 450. The property owner must be able to contest the government's right to foreclose. Id. at 210, 240 N.W.2d 450. If the only hearing available to a property owner is a hearing in the Court of Claims for money damages, the property owner is deprived of an opportunity to contest the foreclosure and to defend his or her land. "`The opportunity to defend one's property before it is finally taken is so basic that it hardly bears repeating.'" Id. at 205 n. 20, 240 N.W.2d 450, quoting Arnett v. Kennedy, 416 U.S. 134, 180, 94 S.Ct. 1633, 40 L.Ed.2d 15 (1974) (White, J., concurring in part and dissenting in part).
The United States Supreme Court has held that the government does not always have to provide a hearing before the deprivation of a right. Parratt v. Taylor, 451 U.S. 527, 540-541, 101 S.Ct. 1908, 68 L.Ed.2d 420 (1981). But the situations in which a postdeprivation hearing passes constitutional scrutiny are limited to those in which a predeprivation hearing would be unworkable. Id. at 541, 101 S.Ct. 1908. The United States Supreme Court has held that the Due Process Clause is not implicated when the government negligently causes the loss of property. Daniels v. Williams, 474 U.S. 327, 328, 106 S.Ct. 662, 88 L.Ed.2d 662 (1986). "Historically, this guarantee of due process has been applied to deliberate decisions of government officials to deprive a person of life, liberty, or property." Id. at 331, 106 S.Ct. 662. Appellants argue that the treasurer's negligence in providing notice means that a due process analysis does not apply. But the treasurer deliberately
Appellants also argue that the purpose behind the GPTA should prevail over the Due Process Clause. They argue that the Legislature's express intention to streamline the foreclosure process should take precedence over a person's constitutional right to defend the person's property against a taking. It is true that, in enacting the GPTA, the Legislature intended to create a faster system in which purchasers of foreclosed property could receive clear title to put the land into productive use. Nevertheless, the United States Constitution requires that a person be provided with notice and a hearing before property can be taken. In Dow, supra at 209, 240 N.W.2d 450, the Court quoted Stanley v. Illinois, 405 U.S. 645, 656, 92 S.Ct. 1208, 31 L.Ed.2d 551 (1972), in which the United States Supreme Court stated:
The government "exert[s] extraordinary power against a property owner" when it takes and sells an owner's property. Jones, supra, 547 U.S. at ___, 126 S.Ct. at 1721, 164 L.Ed.2d at 433. The Due Process Clause is designed to protect citizens against that use of power. The Legislature cannot circumvent the constitutional obligation of due process in order to speed up the foreclosure process and convey clear title to land it acquired through foreclosure.
I note that the Legislature amended the GPTA in 2003 by enacting 2003 PA 263, which added a new subsection, MCL 211.78k(5)(g), describing the finality of the circuit court's judgment of foreclosure.
That subsection effectively prohibits a circuit court from using MCR 2.612(C) to grant relief from the judgment of foreclosure for any reason because it states that the circuit court's judgment "shall not be modified, stayed, or held invalid. . . ." By prohibiting the circuit court from granting relief from judgment, MCL 211.78k(5)(g) leaves a displaced property owner deprived of notice, without the minimum due process accorded under the statute, only with the option of bringing a separate action. This result initiates MCL 211.78l (1), which in turn establishes that the property owner may only bring an action for monetary damages. Despite the fact that the property owner was deprived of property without notice, the owner is precluded
Unlike the majority, I am satisfied that the 1999 amendments of the GPTA can be construed so as not to violate the constitutional guarantee of due process when the government fails to provide notice before foreclosing on property. MCL 211.78l does not prohibit the circuit court from using MCR 2.612(C) to grant relief from a judgment of foreclosure. Therefore, a property owner can file a motion for relief from a judgment of foreclosure to defend against an unconstitutional governmental taking of property. A property owner deprived of notice still receives a meaningful opportunity to be heard by bringing a motion pursuant to MCR 2.612(C) for relief from the judgment. By using MCR 2.612(C), the property owner can still defend the property interest inasmuch as the circuit court still has the authority to set aside the foreclosure. In doing so, the circuit court preserves the property owner's interest in the land.
The circuit court correctly applied MCR 2.612(C) to grant Perfecting Church's motion for relief from the judgment of foreclosure. Perfecting Church is not limited to a suit for monetary damages under the 1999 amendments of the GPTA, which were in effect when the treasurer filed the foreclosure petition. Perfecting Church did not receive adequate notice to protect its property from the government's taking. Because the 1999 amendments did not prohibit the circuit court from modifying its judgment, the circuit court properly retained jurisdiction to modify its judgment of foreclosure pursuant to MCR 2.612(C), thereby affording Perfecting Church the opportunity to defend its ownership interest in the parking lot.
IV. CONCLUSION
I would hold that under the relevant provisions of MCL 211.78 et seq. in effect at the time the petition for foreclosure was filed in this matter, the circuit court was not deprived of jurisdiction to grant relief to Perfecting Church pursuant to MCR 2.612(C). Perfecting Church was not limited to a recovery of monetary damages because Perfecting Church was completely deprived of adequate notice of the pending foreclosure. Because the absence of notice was a denial of the minimum due process required under both the Michigan Constitution, Const. 1963, art. 1, § 17, and the United States Constitution, U.S. Const., Am. XIV, § 1, Perfecting Church was entitled to relief from the circuit court's foreclosure judgment.
I would affirm the circuit court's order granting Perfecting Church's motion for relief from the judgment of foreclosure.
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