Tax foreclosure; Intervention; MCR 2.209; State Treasurer v Bences; Surplus proceeds claims; MCL 211.78t; Schafer v Kent Cnty; Rafaeli, LLC v Oakland Cnty; Extinguishment of mortgage interests; MCL 211.78k(6); Petersen Fin, LLC v City of Kentwood; General Property Tax Act (GPTA)

The court held that the trial court erred by allowing the mortgage assignee to intervene in a GPTA surplus-proceeds proceeding because MCL 211.78t provides the exclusive mechanism to claim surplus proceeds and the assignee failed to comply with that statute. After appellant’s property was foreclosed for unpaid taxes and later sold at auction, she timely filed the required form and motion claiming the surplus proceeds. Appellee, the assignee of the mortgage, did not file the statutory notice or a motion to claim proceeds and instead moved to intervene months later on equitable-subrogation and contract theories. The trial court granted intervention. On appeal, the court held that under Rafaeli former owners have a vested right to surplus proceeds, and that MCL 211.78t creates “the exclusive means of obtaining surplus proceeds.” The court next held that appellee’s mortgage interest was extinguished when title vested absolutely in the treasurer under MCL 211.78k(6), so appellee no longer had a legally protectable interest in the surplus-proceeds action. Because appellee failed to file Form 5743 and failed to file a timely motion under MCL 211.78t, it was not a proper claimant under the statute. The court also held that intervention was improper under both MCR 2.209(A)(3) and (B)(2) because appellee lacked an interest “relating to the property or transaction which is the subject of the action,” and its equitable-subrogation theory did not share a proper common question with the limited statutory distribution proceeding. The court noted that appellee might still sue appellant on the debt separately, but not in this surplus-proceeds case. Reversed and remanded.