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159856 - 2 Crooked Creek, LLC v Cass County Treasurer

2 Crooked Creek LLC and Russian Ferro Alloys, Inc.,

 

Aaron Lindstrom

 

Plaintiffs-Appellants,

 

v

(Appeal from Ct of Appeals)

 

 

(Ct of Claims – Talbot, M.)

 

Cass County Treasurer,

 

Thomas King

 

Defendant-Appellee.

 

Summary

Plaintiff 2 Crooked Creek, LLC (2CC) owned property in Cass County subject to a mortgage held by plaintiff Russian Ferro Alloys, Inc. (RFA). Defendant Cass County Treasurer included the subject property in her annual tax foreclosure petition for nonpayment of 2011 taxes, and the circuit court entered a tax foreclosure judgment in early 2014, extinguishing plaintiffs’ property interests. Plaintiffs assert that they never received notice of the foreclosure, and they were damaged as a result by the loss of real property worth over $3.5 million. Plaintiffs filed suit in the Court of Claims for monetary damages under MCL 211.78l, which allows the owner of a property interest that was extinguished by a tax foreclosure to bring an action to recover monetary damages if the owner claims that it “did not receive any notice required under this act. . . .” Following plaintiffs’ presentation of proofs at trial, the Court of Claims granted defendant’s motion for involuntary dismissal, finding that RFA was not entitled to any notice. Regarding 2CC, the court found that (1) 2CC’s manager’s claim that he did not receive notice was not credible, (2) 2CC was charged with knowledge of the notice posted on the property, and (3) 2CC failed to present any evidence of its damages. The Court of Appeals affirmed in a published opinion. The Supreme Court has ordered oral argument on plaintiffs’ application for leave to appeal to address whether 2CC (an owner of a property interest that was extinguished by tax foreclosure after being accorded notice sufficient to satisfy minimum due process requirements) can sustain an action to recover monetary damages under MCL 211.78l(1) by claiming that it “did not receive any notice required under this act” due to a lack of actual notice and, specifically, whether constructive notice is sufficient to fall within the confines of “any notice” under MCL 211.78l(1) such that 2CC can be charged with knowledge of the notice that was posted to the subject property during a time when 2CC was exercising control and dominion over it. See In re Treasurer of Wayne Co for Foreclosure (Perfecting Church), 478 Mich 1 (2007).​