United States District Court, E.D. Michigan, Southern Division
OPINION AND ORDER DENYING DEFENDANTS' MOTION TO
BERNARD A. FRIEDMAN SENIOR UNITED STATES DISTRICT JUDGE.
matter is before the Court on defendants' motion to
dismiss for lack of subject-matter jurisdiction [docket entry
6]. This motion is fully briefed. Pursuant to E.D. Mich. LR
7.1(f)(2), the Court shall decide this motion without a
following facts are summarized from the complaint and
briefing: For several decades, plaintiff owned and lived on a
thirty-five acre parcel in Gratiot County, Michigan. This
land is worth approximately $100, 000. From 2014 to 2015,
plaintiff failed to pay almost $2, 000 in property taxes,
costs, and interest. In June 2016, the Gratiot County
treasurer, defendant Michelle Thomas, filed a petition in
Gratiot County Circuit Court under the General Property Tax
Act (“GPTA”), Mich. Comp. Laws § 211.78, to
foreclose on plaintiff's property. In February 2017, the
circuit court granted the petition and foreclosure, and title
transferred to Gratiot County. In August 2017, defendants
sold plaintiff's land for $42, 000 to cover his $2, 000
tax bill and kept the balance (“surplus equity”).
In October 2017, plaintiff filed this complaint, asserting
violations of the Fifth Amendment's takings clause and
Eighth Amendment's excessive-fines clause.
November 2017, defendants filed the instant motion to dismiss
under Fed.R.Civ.P. 12(b)(1) for lack of subject-matter
jurisdiction. Defendants raise three jurisdictional
challenges to plaintiff's Fifth Amendment eminent domain
claim: Ripeness, The Tax Anti-Injunction Act, and
Court has jurisdiction over eminent domain claims only if
they are ripe. Bigelow v. Michigan Dep't of Nat.
Res., 970 F.2d 154, 157 (6th Cir. 1992). For a claim
challenging a state action to be ripe, plaintiff must show
both that the state government decision was final and that
there are no available state court remedies. Williamson
Cty. Reg'l Planning Comm'n v. Hamilton Bank of
Johnson City, 473 U.S. 172, 186, 194 (1985). Here,
plaintiff adequately shows both.
government decision is final when “the government
entity charged with implementing the regulations has reached
a final decision regarding the application of the regulations
to the property at issue.” Id. at 186. Here,
Gratiot County implements the GPTA, has already sold
plaintiff's property to cover his back taxes, and refuses
to remit the surplus equity. This appears to be a final
decision under Williamson.
addition to showing finality, a plaintiff must first
“seek compensation through the procedures the State has
provided for doing so.” Williamson, 473 U.S.
at 194. This analysis looks to potential “remedies
under state substantive law.” 13B Charles Alan Wright
& Arthur R. Miller, Federal Practice and
Procedure § 3532.1 n.43 (3d ed. 2014). But
critically, plaintiff must adhere to this requirement only if
the potential remedies are “reasonable, certain, and
adequate.” Williamson, 473 U.S. at 194.
Merriam-Webster's Dictionary 367 (3d ed. 1986) defines
the word certain as “fixed, ” “settled,
” or “sure.”
defendants believe that inverse condemnation is a sufficient
state law remedy. Plaintiff conversely argues that the
doctrine of inverse condemnation does not apply here, or, at
the very least, it is not certain that it does. The Court
agrees with plaintiff. Were he to file this suit in state
court, he would face significant substantive and
first to the substantive problems: Michigan has long
recognized the right of inverse condemnation. Hart v.
City of Detroit, 331 N.W.2d 438, 441 (Mich. 1982). As a
general rule, though, inverse condemnation claims recover
property that the government has taken under its taxing
power, not its eminent domain power. See Merkur Steel
Supply, Inc. v. City of Detroit, 680 N.W.2d 485, 494
(Mich. Ct. App. 2004) (“An inverse condemnation suit is
one instituted by a private property owner whose property,
while not formally taken for public use, has been damaged by
a public improvement undertaking or other public
activity.”). Consequently, Michigan courts rarely
countenance inverse condemnation claims to remedy an abuse of
the taxing power, which is the kind of claim at issue here.
And when they do, it is only in the context of general taxing
power excesses, not of GPTA foreclosure sales. Wayside
Church v. Van Buren Cty., 847 F.3d 812, 823 (6th Cir.
2017) (Kethledge, J., dissenting) (stating that no Michigan
court has “determined, as a matter of state law,
whether a local government's appropriation of property
pursuant to the taxing power generally, or to the [GPTA] in
particular, is a taking to the extent the government takes
property worth more than the amount of taxes owed”).
Michigan Court of Appeals further solidified these points in
Rafaeli, LLC v. Oakland Cty., No. 330696, 2017 WL
4803570 (Mich. Ct. App. Oct. 24, 2017) [hereinafter
Rafaeli I]. Just like here, the plaintiff
in Rafaeli I brought an eminent domain challenge to
a county's taking of the tax foreclosure sale's
surplus equity. 2017 WL 4803570, at *1-2. In denying his
claim, the court stated:
The government may not be required to compensate an owner for
property which it has already lawfully acquired under the
exercise of governmental authority other than the power of
eminent domain. Defendants obtained the property by way of a
statutory scheme that did not violate due process. The
constitution does not require them to compensate plaintiffs
for the lawfully-obtained property.
Id. at *4 (internal quotation marks and citations
omitted). In other words, because the county took the
plaintiff's property via the GPTA and did not violate due
process, the plaintiff had no claim under either eminent
domain or inverse condemnation.
like Rafaeli I, the statutory scheme defendants used
is the GPTA and there is no serious due process claim. If the
Michigan Court of Appeals would not recognize the Rafaeli
I plaintiff's claim, is it really settled or sure
that Michigan would recognize the instant plaintiff's
identical claim? The Court believes not. Rafaeli I
casts serious doubt on ...