Michigan Supreme Court rules on Cassopolis property lawsuit

CASSOPOLIS — The Michigan Supreme Court has ruled in favor of the Cass County Treasurer’s Office in a lawsuit that has been ongoing for the better part of a decade.

Last month, the Michigan Supreme Court ruled that the Cass County Treasurer’s Office had given proper notice to the owners of a property on Crooked Creek Road in Cassopolis of foreclosure. The ruling upheld previous rulings made by Cass County Court and the Court of Claims.

“I know the Cass County Treasurer goes above and beyond for notices, and this just affirms that,” said current Cass County Treasurer Hope Anderson. “We go above and beyond for notice of delinquent taxes.”

The lawsuit was first filed in 2014 by 2 Crooked Creek LLC and Russian Ferro Alloys Inc against the Cass County Treasurer after the Crooked Creek house was foreclosed upon. According to a summary released by the Michigan Supreme Court, in 2010, 2CC purchased the property for development in Cass County. 2CC failed to pay the 2011 real property taxes and, in 2013, forfeited the property to the county. From January through May 2013, the defendant’s agent, Title Check, LLC, mailed via first-class and certified mail a series of notices to the address listed in the deed. These notices apprised 2CC of the unpaid property taxes, forfeiture and possibility of foreclosure.  The certified mail was returned as “Unclaimed—Unable to Forward,” but the first-class mail was not returned.  Meanwhile, 2CC constructed a home on the property, obtaining a mortgage for the construction. Title Check continued to mail notices into 2014.

A show-cause hearing was hosted in January 2014, and a judicial foreclosure hearing was hosted in February 2014. No one from 2CC appeared at either hearing. At the judicial foreclosure hearing, Cass Circuit Court Judge Michael E. Dodge entered a judgment of foreclosure.

In July 2014, 2CC moved to set aside the foreclosure judgment on due-process grounds. However, these efforts failed because the circuit court concluded that the defendant’s combined efforts of mailing, posting and publishing notice provided 2CC with notice sufficient to satisfy the requirements of due process. 2CC then appealed the decision.

At the same time 2CC moved to set aside the foreclosure judgment, it filed a separate action in the Court of Claims for monetary damages, alleging that it had not received any notice. The Court of Claims denied the motion and hosted a bench trial.  At the close of 2CC’s proofs, the court granted an involuntary dismissal in favor of the Cass County Treasurer’s Office.

The case was then appealed to the Michigan Supreme Court, which ruled in Cass County’s favor last month, writing that 2CC had received “constitutionally adequate” notice of proceedings.

“This is the best possible decision we could have expected because we have prevailed in all courts,” Anderson said.

The lawsuit predates Anderson’s tenure as treasurer, as she took the position in 2018 following the death of previous treasurer Linda Pruett. Anderson said her involvement with the property began in 2019, as it became the first house she sold at auction as treasurer. The property sold for $1.5 million, which was used to pay delinquent taxes on the property and cover legal fees related to the case. So far, Anderson estimated the lawsuit had generated between $500,000 and $750,000 in legal fees.

“The great news is that [the property] is back on the tax roll, and just by driving by, you can see it is being maintained,” Anderson said. “Houses aren’t meant to be empty that long. It’s for the good of the community that it is back on the tax roll and is looking great.”

There is currently still a suit pending regarding the property in U.S. District Court, but Anderson expects that the decision will be deferred back to the state now that the Michigan Supreme Court has made a ruling.

“Every court has ruled in our favor, and we don’t expect that to change, but we are still incurring expenses,” Anderson said.

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