Quiet title action; Joinder of a party; MCL 600.2932; MCR 2.207; MCR 2.205(A); Distinguishing Hofmann v Auto Club Ins Ass’n; Effect of a quitclaim deed; Peters v Cartier; Reinstatement of a mortgage; Invalid discharge of a mortgage; Plasger v Leonard; Ferguson v Glassford; “Race-notice” recording of a mortgage; MCL 565.29; Bona fide purchaser; Foreclosure by advertisement; MCL 600.3204; Slander of title; MCL 565.108; Malice

The court held that the trial court did not err by quieting title to the property at issue in favor of plaintiffs-previous owner (Gifford) and current owner (his company, WG Enterprises) and ordering that the assignment of the prior mortgage to defendant-bank, the rescission of the discharge of that mortgage, and the sheriff’s deed after foreclosure were to be rescinded and removed from the chain of title. But it found the trial court erred by granting plaintiffs summary disposition on their slander of title claim. Without plaintiffs’ knowledge, defendant foreclosed on the property and it was sold at a sheriff’s sale. Plaintiffs sued to quiet title and for slander of title. Defendant counterclaimed for declaratory relief. The trial court granted plaintiffs summary disposition, denied defendant summary disposition, and dismissed the counterclaim. It ordered that title to the property be quieted against defendant and in plaintiffs’ favor “in ‘fee simple absolute,’ and that the recorded ‘rescission of release of mortgage,’ the assignment of the mortgage, and the sheriff’s deed after foreclosure were all ‘rescinded and removed from the chain of title.’” It also awarded plaintiffs damages for slander of title. The court found that the trial court did not err by sua sponte deciding to add Gifford as a party, noting his addition “was intended to facilitate the court’s analysis and ultimate resolution of the competing property interests at stake.” As a practical matter, he “clearly had an interest in the property through” his company, even if that interest was legally indirect. The court also rejected defendant’s claim that the trial court erred by finding plaintiffs were bona fide purchasers for value, and thus, defendant “was not entitled to rescind the discharge of the mortgage from the previous property owner and thereby reinstate the prior mortgage interest in” the property. “Gifford was a bona fide purchaser and had valid title to convey, and therefore WG Enterprises acquired all of” his interest in the property, which was superior to defendant’s asserted interest. As to setting aside the foreclosure by advertisement, the mortgage “had been discharged and it could not be reinstated against Gifford, a bona fide purchaser for value.” Because defendant “did not hold a valid mortgage interest in the property, it could not foreclose on the mortgage by advertisement . . . .” But as to the slander of title claim, the evidence did not show defendant “acted with the intention or desire to injure WG Enterprises, or that the documents were knowingly filed with the intention to cause” it injury. Affirmed in part, reversed in part, vacated in part, and remanded.