Surplus proceeds from a tax-foreclosure sale; Rafaeli, LLC v Oakland Cnty; Notice of intent to seek surplus proceeds (Form 5743); MCL 211.78t(2); Constitutional challenges to MCL 211.78t; In re Petition of Muskegon Cnty Treasurer for Foreclosure; Substantive due-process; In re Petition of Barry Cnty Treasurer for Foreclosure; Takings claim; Nelson v City of NY; Knick v Scott Twp, PA; A trial court’s statutory authority under MCL 600.2301 to overlook defects in a notice of intention; Unjust enrichment; Wright v Genesee Cnty

The court held that the trial court did not err by denying respondents’ amended motion to disburse the proceeds that remained from the tax-foreclosure sales of their properties after the satisfaction of their tax delinquencies, interest, penalties, and fees. The trial court found their “challenges to the constitutionality of MCL 211.78t unavailing and their recovery of remaining proceeds barred by their failure to timely submit their notices of intention.” On appeal, the court rejected their constitutional challenges to the statute. It “has held that the statutory scheme stated in MCL 211.78t passes constitutional muster.” As long as the statutory scheme “‘comports with due process—and MCL 211.78t does—whether such a scheme makes sense or not, or whether a “better” scheme could be devised, are policy questions for the Legislature, not legal ones for the Judiciary.’ For the same reason, respondents’ assertion of a substantive due-process violation is also unavailing.” The court noted that respondents acknowledged that it held in Muskegon Treasurer “that the respondents did not have a compensable takings claim because the Legislature provided a statutory pathway for respondents to recover any remaining proceeds, the petitioner followed the statutory scheme, and the respondents failed to take the minimally burdensome step of filing a timely notice of intention. The same holding applies to the facts” here. Also, in “the absence of an infringement on a constitutional guarantee, the reasoning in Nelson remains persuasive.” The defenses “and counterclaims discussed in Nelson provided property owners the opportunity to assert that their properties were worth more than they owed in taxes and fees and the means to recover the surplus. The functional equivalent in our Legislature’s scheme is the proper and timely submission of Form 5743.” Further, nothing “in the Knick holding undermines the relevant holding in Nelson.” And respondents cited “no authority supporting the proposition that a circuit court furthers justice by disregarding the plain, unambiguous requirements of a duly enacted statute that passes constitutional muster.” The court also rejected their unjust enrichment claim. “Petitioner followed the statutory scheme set forth by our Legislature as the exclusive mechanism for the recovery of remaining proceeds. Under this statutory scheme, petitioner lacks the discretion to disburse remaining proceeds to foreclosed property owners who did not comply with the notice requirements of MCL 211.78t(2).” The court found their remaining arguments meritless, noting it was “bound to follow Barry Treasurer and Muskegon Treasurer on” those issues. Affirmed.