NTUF Files Brief to Protect Michigan Property Owners' Rights

On December 1, NTUF’s Taxpayer’s Defense Center filed a new brief in Schafer v. Kent County with the Michigan Supreme Court. We explained how the Court could retroactively apply Rafaeli, LLC v. Oakland County, its landmark case which requires the government to return any remaining proceeds from a foreclosure sale to the property owner after taxes are paid.

In Schafer, Kent County argued plaintiffs should not be entitled to surplus proceeds from their foreclosure sales because the sales happened before Rafaeli was decided. We disagreed. Our brief urged the Court that under its reasoning in Rafaeli, the right for property owners to receive the excess proceeds was a common law right which existed before and after the 1963 ratification of the Michigan Constitution.

Given this backdrop, we urged the Court to give Rafaeli full retroactive effect. Because the right of a property owner to receive excess proceeds from a foreclosure was a pre-existing common law right, it did not constitute a new law. As such, the Court should properly apply Rafaeli retroactively to the Michigan plaintiffs. We suggested the Court could limit the retroactive effect of Rafali to four years–the maximum amount of time the Michigan’s Department of Treasury has to assess a tax deficiency. 

This case is important to protecting the rights of Michigan property owners, and to limit any government overreach in this area. We will continue to monitor this case and provide updates with any progress.