United States District Court, E.D. Michigan, Southern Division
CYNTHIA M. BIETLER and STEPHANIE STARKS, Plaintiff,
STATE OF MICHIGAN, et al., Defendants.
ORDER GRANTING IN PART AND DENYING IN PART THE UNITED
STATES' MOTION FOR SUMMARY JUDGMENT [#26], CANCELING
HEARING AND DISMISSING ACTION
GERSHWIN A. DRAIN, UNITED STATES DISTRICT JUDGE.
7, 2017, Defendant and Counterclaim Plaintiff, the United
States of America, brought the present motion for Summary
Judgment . The United States asserts that its federal tax
liens against Dorothy Palmer have priority over the requested
attorney fees and interest on the unpaid balance of the land
contract between Counterclaim Defendant Paul Misiewicz and
Palmer. Upon review of the parties' briefing, the Court
finds that oral argument will not aid in the resolution of
this matter. Accordingly, the Court will resolve the United
States' present motion on the submitted briefs.
See E.D. Mich. L.R. 7.1(f)(2).
Cynthia M. Bietler and Stephanie Starks filed the instant
action in the Oakland County Circuit Court seeking to quiet
title on a parcel of property. The original Defendants
included both the State of Michigan and the United States of
America; however, the State of Michigan conceded to
Plaintiffs' request and is no longer involved in the
matter. Dkt. No. 7, p. 3 (Pg ID 66). The United States
removed the action to this Court and filed a Counterclaim
against Bietler and Starks and joined Paul Misiewicz, who was
formerly married to Bietler and currently engaged to Starks,
which introduced questions of priority. Dkt. No. 2, p. 7 (Pg.
United States then filed its first Motion for Summary
Judgment asserting that the federal tax liens take priority
over the Counterclaim Defendants' interests in the
property in question. . Though, upon further litigation,
the United States acknowledged Misiewicz's priority and
withdrew the motion. Dkt. No. 25, p. 1 (Pg. ID 188). The
United States' second Motion for Summary Judgment solely
concerns whether attorney fees and interest also have
priority over the United States' federal tax liens. .
26, 2010, Plaintiff and Counterclaim Defendant Bietler and
Counterclaim Defendant Misiewicz sold, by land contract, the
real property at 30649 Whittier Ave., Madison Heights, MI
48071 to Dorothy Palmer. Dkt. No. 1, p. 16 (Pg. ID 16). The
agreed upon price came to $119, 900.00. Id. Palmer
made all payments under the land contract except for the
final lump sum of $82, 746.56. Dkt. No. 26-3, p. 1 (Pg. ID
209). Additionally, on three different dates in 2011 and one
final date in 2015, the United States recorded Notices of
Federal Tax Liens against Dorothy Palmer. Dkt. No. 1, pp. 18,
20, 22, 26 (Pg. ID 18, 20, 22, 26). The liens were never
gave Palmer a notice of forfeiture of the land contract and
subsequently filed suit in Michigan State Court in August
2015. Dkt. No. 26-4, p. 5 (Pg. ID 221). After receiving
notice of the filing, Palmer informed Misiewicz that she
would vacate the property and quit claim her interest to
whomever he requested. Dkt. No. 26-6, p. 1 (Pg. ID 231). On
September 8, 2015, Palmer executed and recorded a quitclaim
deed to the property in favor of Bietler and Starks. Dkt. No.
1, p. 28 (Pg. ID 28). The forfeiture action was thereafter
dismissed because Misiewicz failed to show up for the hearing
on September 9, 2015. Dkt. No. 26-4, p. 5 (Pg. ID 221).
April 15, 2016, Bietler and Starks filed the current action
to quiet title against the State of Michigan and the United
States of America, asserting priority over the liens filed by
each Defendant against Palmer. Dkt No. 1, p. 1 (Pg. ID 1).
The Defendants removed the action on May 20, 2016.
Id. On June 22, 2016, this Court entered a
stipulated order quieting title against Defendant State of
Michigan because it chose to concede to Plaintiffs'
requests. . Further, on May 24, 2017, the parties agreed
to sell the property in question and hold the disputed
proceeds from the sale in escrow pending the Court's
adjudication of priority. .
United States joined Misiewicz so that it could assert its
priority against each individual who claimed to have interest
in the property. Dkt. No. 2, p. 7 (Pg. ID 35).
Misiewicz's counsel asserted from the beginning that the
United States had priority over Bietler and Starks, but not
over Misiewicz, the original land contract vendor. Dkt. No.
15, p. 4 (Pg. ID 111). Accordingly, the United States focused
its claim against Misiewicz, the original land contract
time of the sale, the United States admitted Misiewicz was
due the principle under the land contract, which he was paid
at closing. Id. The title company from the closing
is holding $69, 818.99 in escrow from the sale. The interest
sought by Misiewicz comes to a total of $12, 174.82.
Id. Misiewicz also seeks to recover attorney fees in
the amount of $26, 587.50, bringing his requested relief to a
total of $38, 762.32. Id. Finally, if the proceeds
are disbursed so that Misiewicz receives the interest and
attorney fees, the United States will receive $31, 056.67
towards Palmer's tax indebtedness. Id.
previously mentioned, the United States conceded after its
first motion for summary judgment that Misiewicz has priority
over the federal liens. Therefore, the only issue presently
before the court involves the United States' assertion
that the proceeds of the sale should not extend to the
payment of interest and attorney fees. .