Surplus tax foreclosure proceeds; MCL 211.78t; Rafaeli, LLC v Oakland Cnry; Retroactivity; Schafer v Kent Cnty; In re Kent Cnty Treasurer for Foreclosure

Holding that a Rafaeli-based surplus-proceeds claim must be pursued exclusively through MCL 211.78t, which applies retroactively, and that plaintiffs did not comply with that statute, the court affirmed. Plaintiffs owned two parcels that were foreclosed upon and sold for unpaid taxes, leaving a surplus. The trial court granted summary disposition for defendants, noting that plaintiffs’ “only avenue for recovery” was the post-Rafaeli procedure in MCL 211.78t, which they did not use. On appeal, the court rejected plaintiffs’ argument that MCL 211.78t did not apply because their suit predated the statute, quoting Schafer: “Rafaeli has full retroactive effect” and “MCL 211.78t, which establishes a procedure for processing claims made under Rafaeli, applies retroactively to claims arising prior to its enactment.” It further relied on MCL 211.78t(11) and the court’s characterization that the statute is the “sole mechanism” to recover surplus proceeds. The court also rejected plaintiffs’ effort to proceed outside the statute, emphasizing that “there is no compensable takings claim when statutory procedures exist for property owners to recover surplus proceeds and a property owner’s failure to follow those procedures results in a forfeiture of surplus proceeds.” The statute also requires that “the claimant must file a motion with the circuit court in the same proceeding in which a judgment of foreclosure was effective,” which this action was not, rendering remand futile.