HOUSE BILL No. 6046

December 2, 2014, Introduced by Rep. Price and referred to the Committee on Local Government.

A bill to amend 2003 PA 258, entitled

"Land bank fast track act,"

by amending section 9 (MCL 124.759).

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

Sec. 9. (1) An authority may initiate an expedited quiet title

and foreclosure action under this section to quiet title to real

property held by the authority or interests in tax reverted

property held by the authority by recording with the register of

deeds in the county in which the property subject to expedited

quiet title and foreclosure is located a notice of pending

expedited quiet title and foreclosure action in a form prescribed

by the department of treasury. The notice shall include a legal

description of the property, the street address of the property if

available, the name, address, and telephone number of the

authority, a statement that the property is subject to expedited

quiet title proceedings and foreclosure under this act, and a

statement that any legal interests in the property may be

extinguished by a circuit court order vesting title to the property

in the authority. If a notice is recorded in error, the authority

may correct the error by recording a certificate of correction with

the register of deeds. A notice or certificate under this

subsection need not be notarized and may be authenticated by a

digital signature or other electronic means. Property is not

subject to an expedited quiet title and foreclosure action under

this section if the property was forfeited under section 78g of the

general property tax act, 1893 PA 206, MCL 211.78g, and remains

subject to foreclosure under section 78k of the general property

tax act, 1893 PA 206, MCL 211.78k. If an authority has reason to

believe that a property subject to an expedited quiet title and

foreclosure action under this section may be the site of

environmental contamination, the authority shall provide the

department of environmental quality with any information in the

possession of the authority that suggests the property may be the

site of environmental contamination.

(2) After recording the notice under subsection (1), an

authority shall initiate a search of records identified in this

subsection to identify the owners of a property interest in the

property who are entitled to notice of the quiet title and

foreclosure hearing under this section. The authority may enter

into a contract with or may request from 1 or more authorized

representatives a title search or other title product to identify

the owners of a property interest in the property as required under

this subsection or to perform the other functions set forth in this

section required for the quieting of title to property under this

act. The owner of a property interest is entitled to notice under

this section if that owner's interest was identifiable by reference

to any of the following sources before the date that the authority

records the notice under subsection (1):

(a) Land title records in the office of the county register of

deeds.

(b) Tax records in the office of the county treasurer.

(d) Tax records in the office of the local treasurer.

(3) An authority may file a single petition with the clerk of

the circuit court in which property subject to expedited

foreclosure under this section is located listing all property

subject to expedited foreclosure by the authority and for which the

authority seeks to quiet title. If available to the authority, the

list of properties shall include a legal description of, a tax

parcel identification number for, and the street address of each

parcel of property. The petition shall seek a judgment in favor of

the authority against each property listed and shall include a

date, within 90 days, on which the authority requests a hearing on

the petition. The petition shall request that a judgment be entered

vesting absolute title in the authority, without right of

redemption for each parcel of property listed, as provided in this

section. Prior to the entry of judgment under this section, the

authority may request the court to remove property erroneously

included in the petition, or any tax delinquent properties redeemed

prior to the hearing.

(4) The clerk of the circuit court in which a petition is

filed under subsection (3) shall immediately set the date, time,

and place for a hearing on the petition for foreclosure. The date

shall be set by the clerk and shall not be more than 10 days after

the date requested by the authority in the petition. In no event

may the clerk schedule the hearing later than 90 days after the

filing of a petition by the authority under subsection (3).

(5) After completing the records search under subsection (2),

an authority shall determine the address or addresses reasonably

calculated to inform those owners of a property interest in

property subject to expedited foreclosure under this section of the

pendency of the quiet title and foreclosure hearing under

subsection (11). If, after conducting the title search, the

authority is unable to determine an address reasonably calculated

to inform persons with a property interest in property subject to

expedited tax foreclosure, or if the authority discovers a

deficiency in notice under subsection (10), the following shall be

considered reasonable steps by the authority to ascertain the

addresses of persons with a property interest in the property

subject to expedited foreclosure or to ascertain an address

necessary to correct a deficiency in notice under subsection (10):

(a) For an individual, a search of records of the county

probate court for the county in which the property is located.

(b) For an individual, a search of the qualified voter file

established under section 509o of the Michigan election law, 1954

PA 116, MCL 168.509o, which is authorized by this subdivision.

with the county clerk.

(d) For a business entity other than a partnership, a search

of business entity records filed with the corporation division of

the department.

(6) Not less than 30 days before the quiet title and

foreclosure hearing under subsection (11), the authority shall send

notice by certified mail, return receipt requested, of the hearing

to the persons identified under subsection (5) with a property

interest in property subject to expedited foreclosure. The

authority shall also send a notice via regular mail addressed to

the "Occupant" for each property subject to expedited foreclosure

if an address for the property is ascertainable.

(7) Not less than 30 days before the quiet title and

foreclosure hearing under subsection (11), the authority or its

authorized representative or authorized agent shall visit each

parcel of property subject to expedited foreclosure and post

conspicuously on the property notice of the hearing. In addition to

the requirements of subsection (8), the notice shall also include

the following statement: "THIS PROPERTY HAS BEEN TRANSFERRED TO THE

____________________ LAND BANK FAST TRACK AUTHORITY AND IS SUBJECT

TO AN EXPEDITED QUIET TITLE AND FORECLOSURE ACTION. PERSONS WITH

INFORMATION REGARDING THE PRIOR OWNER OF THE PROPERTY ARE REQUESTED

TO CONTACT THE LAND BANK FAST TRACK AUTHORITY AT

_________________________.".

(8) The notice required under subsections (6) and (7) shall

include:

(a) The date on which the authority recorded under subsection

(1) notice of the pending expedited quiet title and foreclosure

action.

(b) A statement that a person with a property interest in the

property may lose his or her interest, if any, as a result of the

quiet title and foreclosure hearing under subsection (11).

the street address of the property, if available.

(d) The person to whom the notice is addressed.

(e) The date and time of the hearing on the petition for

foreclosure under subsection (11) and a statement that the judgment

of the court may result in title to the property vesting in the

authority.

(f) An explanation of any rights of redemption and notice that

the judgment of the court may extinguish any ownership interest in

or right to redeem the property.

(g) The name, address, and telephone number of the authority.

(h) A statement that persons with information regarding the

owner or prior owner of any of the properties are requested to

contact the authority.

(9) If the authority is unable to ascertain the address

reasonably calculated to inform the owners of a property interest

entitled to notice under this section, or is unable to provide

notice under subsection (6) or (7), the authority shall provide

notice by publication. ~~Prior~~ Through December 31, 2014, prior to

the hearing, a notice shall be published for 3 successive weeks,

once each week, in a newspaper published and circulated in the

county in which the property is located. Beginning January 1, 2015,

prior to the hearing, the authority shall provide tier A public

notice as provided in the local government public notice act. If no

paper is published in that county, publication shall be made in a

newspaper published and circulated in an adjoining county. This

publication shall substitute for notice under subsection (6) or

(7). The published notice shall include all of the following:

(a) A legal description, parcel number of the property, and

the street address of the property, if available.

(b) The name of any person not notified under subsection (6)

or (7) that the authority reasonably believes may be entitled to

notice under this section of the quiet title and foreclosure

hearing under subsection (11).

property may lose his or her interest, if any, as a result of the

foreclosure proceeding under subsection (11).

(d) The date and time of the hearing on the petition for

foreclosure under subsection (11).

(e) A statement that the judgment of the court may result in

title to the property vesting in the authority.

(f) An explanation of any rights of redemption and notice that

judgment of the court may extinguish any ownership interest in or

right to redeem the property.

(g) The name, address, and telephone number of the authority.

(h) A statement that persons with information regarding the

owner or prior owner of any of the properties are requested to

contact the authority.

(10) If prior to the quiet title and foreclosure hearing under

subsection (11) the authority discovers any deficiency in the

provision of notice under this section, the authority shall take

reasonable steps in good faith to correct the deficiency before the

hearing. The provisions of this section relating to notice of the

quiet title and foreclosure hearing are exclusive and exhaustive.

Other requirements relating to notice and proof of service under

other law, rule, or other legal requirement are not applicable to

notice or proof of service under this section.

(11) If a petition for expedited quiet title and foreclosure

is filed under subsection (3), before the hearing, the authority

shall file with the clerk of the circuit court proof of notice by

certified mail under subsection (6), proof of notice by posting on

the property under subsection (7), and proof of notice by

publication, if applicable. A person claiming an interest in a

parcel of property set forth in the petition for foreclosure who

desires to contest that petition shall file written objections with

the clerk of the circuit court and serve those objections on the

authority before the date of the hearing. The circuit court may

appoint and utilize as the court considers necessary a special

master for assistance with the resolution of any objections to the

foreclosure or questions regarding the title to property subject to

foreclosure. If the court withholds property from foreclosure, an

authority's ability to include the property in a subsequent

petition for expedited quiet title and foreclosure is not

prejudiced. No injunction shall issue to stay an expedited quiet

title and foreclosure action under this section. The circuit court

shall enter judgment on a petition to quiet title and foreclosure

filed under subsection (3) not more than 10 days after the

conclusion of the hearing or contested case, and the judgment shall

be effective 10 days after the conclusion of the hearing or

contested case. The circuit court's judgment shall specify all of

the following:

(a) The legal description and, if known, the street address of

the property foreclosed.

(b) That fee simple title to property foreclosed by the

judgment is vested absolutely in the authority, except as otherwise

provided in subdivisions (c) and (e), without any further rights of

redemption.

for unpaid taxes or special assessments, except future installments

of special assessments and liens recorded by this state or the

authority under the natural resources and environmental protection

act, 1994 PA 451, MCL 324.101 to 324.90106, are extinguished.

(d) That, except as otherwise provided in subdivisions (c) and

(e), the authority has good and marketable fee simple title to the

property.

(e) That all existing recorded and unrecorded interests in

that property are extinguished, except a visible or recorded

easement or right-of-way, private deed restrictions, plat

restrictions, or restrictions or other governmental interests

imposed under the natural resources and environmental protection

act, 1994 PA 451, MCL 324.101 to 324.90106.

(f) A finding that all persons entitled to notice and an

opportunity to be heard have been provided that notice and

opportunity. A person shall be deemed to have been provided notice

and an opportunity to be heard if the authority followed the

procedures for provision of notice by mail, for visits to property

subject to expedited quiet title and foreclosure, and for

publication under this section, or if 1 or more of the following

apply:

(i) The person had constructive notice of the hearing by

acquiring an interest in the property after the date of the

recording under subsection (1) of the notice of pending expedited

quiet title and foreclosure action.

(ii) The person appeared at the hearing under this subsection

or submitted written objections to the clerk of the circuit court

under this subsection prior to the hearing.

(iii) Prior to the hearing under this subsection, the person had

actual notice of the hearing.

(12) Except as otherwise provided in subsection (11)(c) and

(e), fee simple title to property set forth in a petition for

foreclosure filed under subsection (3) shall vest absolutely in the

authority upon the effective date of the judgment by the circuit

court and the authority shall have absolute title to the property.

The authority's title is not subject to any recorded or unrecorded

lien, except as provided in subsection (11) and shall not be stayed

or held invalid except as provided in subsection (13). A judgment

entered under this section is a final order with respect to the

property affected by the judgment and shall not be modified,

stayed, or held invalid after the effective date of the judgment,

except as provided in subsection (14).

(13) An authority or a person claiming to have a property

interest under subsection (2) in property foreclosed under this

section may within 21 days of the effective date of the judgment

under subsection (12) appeal the circuit court's order or the

circuit court's judgment foreclosing property to the court of

appeals. An appeal under this subsection is limited to the record

of the proceedings in the circuit court under this section. The

circuit court's judgment foreclosing property shall be stayed until

the court of appeals has reversed, modified, or affirmed that

judgment. If an appeal under this subsection stays the circuit

court's judgment foreclosing property, the circuit court's judgment

is stayed only as to the property that is the subject of that

appeal and the circuit court's judgment foreclosing other property

that is not the subject of that appeal is not stayed. To appeal the

circuit court's judgment foreclosing property, a person appealing

the judgment shall pay to the authority any taxes, interest,

penalties, and fees due on the property and provide notice of the

appeal to the authority within 21 days after the circuit court's

judgment is effective. If the circuit court's judgment foreclosing

the property is affirmed on appeal, the amount determined to be due

shall be refunded to the person who appealed the judgment. If the

circuit court's judgment foreclosing the property is reversed or

modified on appeal, the authority shall refund the amount

determined to be due to the person who appealed the judgment, if

any, and forward the balance to the appropriate taxing

jurisdictions in accordance with the order of the court of appeals.

(14) The authority shall record a notice of judgment for each

parcel of foreclosed property in the office of the register of

deeds for the county in which the foreclosed property is located in

a form prescribed by the department of treasury. If an authority

records a notice of judgment in error, the authority may

subsequently record a certificate of correction. A notice or

certificate under this subsection need not be notarized and may be

authenticated by a digital signature or other electronic means.

After the entry of a judgment foreclosing the property under this

section, if the property has not been transferred by the authority,

the authority may cancel the foreclosure by recording with the

certificate of error in a form prescribed by the department of

treasury, if the authority discovers any of the following:

(a) The description of the property used in the expedited

quiet title and foreclosure proceeding was so indefinite or

erroneous that the foreclosure of the property was void.

(b) An owner of an interest in the property entitled to notice

of the expedited quiet title and proceedings against the property

under this section was not provided notice sufficient to satisfy

the minimum due process requirements of the constitution of this

state and the constitution of the United States.

in violation of an order issued by a United States bankruptcy

court.

(15) If a judgment of foreclosure is entered under subsection

(12), and all existing recorded and unrecorded interests in a

parcel of property are extinguished as provided in subsection (12),

the owner of any extinguished recorded or unrecorded interest in

that property who claims that he or she did not receive notice of

the expedited quiet title and foreclosure action shall not bring an

action for possession of the property against any subsequent owner,

but may only bring an action to recover monetary damages as

provided in this subsection. The court of claims has original and

exclusive jurisdiction in any action to recover monetary damages

under this subsection. An action to recover monetary damages under

this subsection shall not be brought more than 2 years after a

judgment for foreclosure is entered under subsection (12). Any

monetary damages recoverable under this subsection shall be

determined as of the date a judgment for foreclosure is entered

under subsection (12) and shall not exceed the fair market value of

the interest in the property held by the person bringing the action

under this section on that date, less any taxes, interest,

penalties, and fees owed on the property as of that date. The right

to sue for monetary damages under this subsection shall not be

transferable except by testate or intestate succession.

(16) The owner of a property interest with notice of the quiet

title and foreclosure hearing under subsection (11) may not assert

any of the following:

(a) That notice to the owner was insufficient or inadequate in

any way because some other owner of a property interest in the

property was not notified.

(b) That any right to redeem tax reverted property was

extended in any way because some other person was not notified.

(17) A person holding or formerly holding an interest in tax

reverted property subject to expedited foreclosure under this

section is barred from questioning the validity of the expedited

foreclosure under this section if 1 or more of the following apply:

(a) Prior to the transfer of the property to the authority,

the property was deeded to this state under section 67a of the

general property tax act, 1893 PA 206, MCL 211.67a, and the person

or the person's predecessor in title was notified of a hearing

regarding the deeding of the property as required by section 131e

of the general property tax act, 1893 PA 206, MCL 211.131e.

(b) Prior to the transfer of the property to the authority,

title to the property vested in a foreclosing governmental unit

following a circuit court hearing under section 78k of the general

property tax act, 1893 PA 206, MCL 211.78k, and the person or the

person's predecessor in title was notified of the hearing under

section 78i of the general property tax act, 1893 PA 206, MCL

211.78i.

(18) The failure of an authority to comply with any provision

of this section shall not invalidate any proceeding under this

section if a person with a property interest in property subject to

foreclosure was accorded the minimum due process required under the

state constitution of 1963 and the constitution of the United

States.

(19) It is the intent of the legislature that the provisions

of this section relating to the expedited quiet title and

foreclosure of property by an authority satisfy the minimum

requirements of due process required under the constitution of this

state and the constitution of the United States but that the

provisions do not create new rights beyond those required under the

state constitution of 1963 or the constitution of the United

States. The failure of an authority, this state, a political

subdivision of this state, or a local unit of government to follow

a requirement of this section relating to the expedited quiet title

and foreclosure of property held by an authority shall not be

construed to create a claim or cause of action against an

authority, this state, a political subdivision of this state, or a

local unit of government unless the minimum requirements of due

process accorded under the state constitution of 1963 or the

constitution of the United States are violated.

(20) As used in this section, "authorized representative"

includes 1 or more of the following:

(a) A title insurance company or agent licensed to conduct

business in this state.

(b) An attorney licensed to practice law in this state.

nationally recognized organization in the field of land title

searching.

(d) A person with demonstrated experience in the field of

searching land title records, as determined by the authority.

Enacting section 1. This amendatory act does not take effect

unless Senate Bill No.____ or House Bill No. 5560 (request no.