MSC grants leave for two real estate cases

The Michigan Supreme Court granted leave to hear two controversial real estate cases on Wednesday.

The first is Residential Funding Co. v. Saurman, a case in which the Court of Appeals said the Mortgage Electronic Registration Systems (MERS) didn’t have authority to foreclose or evict the residents whose homes are in foreclosure. (See “COA rules mortgage processor has no authority to forecloseon or evict homeowners” and  “Will MSC sour on ‘Saurman’?”).

In Saurman, MERS, “a mechanism to provide for the faster and lower cost buying and selling of mortgage debt,” began non-judicial foreclosures by advertisement on several homes. The COA said it couldn’t do that because it was not the owner of the debt, someone with an interest in the debt, or a servicing agent of the mortgager.

The other case involved the property taxation of land in development, Toll Northville v. Twp of Northville. (See “Sorry, no refund”).

In Toll Northville, some home developers sought to get a refund of overpaid property taxes. The overpayment was the result of the developers being assessed based on improvements made to the land in development. The assessment was based on a statute that the Michigan Supreme Court later declared unconstitutional.

The developers were originally granted their refunds by the Michigan Tax Tribunal, but the COA reversed, finding the tribunal didn’t have jurisdiction to hear the appeals because they weren’t timely filed in the year of the assessment, even if the assessment may have been correct under the stricken law, which was in effect at that time.

Hearings for both cases have not yet been scheduled.

Part of funeral protest law too vague to enforce, fed court rules

A federal judge’s decision to strike part of Michigan’s funeral protest law as unconstitutional has both sides declaring victory. [Detroit Free Press]

Judge Thomas Ludington struck subsection (c) of MCL 750.167d, which states:

(c) Engage in any other conduct that the person knows or should reasonably know will disturb, disrupt, or adversely affect the funeral, memorial service, viewing of the deceased person, funeral procession, or burial

Ludington said the subsection was unconstitutional because it was too vague for police to enforce. He left the remainder of the statute intact.

In the case, police pulled an Army vet and his wife from a 2007 funeral procession for having an anti-war sign on their vehicle.  The Freep’s David Ashenfelter talked to both the ACLU and Michigan Attorney General’s office, with both declaring victory.

“It’s a complete vindication of Lewis and Jean Lowden,” said Detroit attorney Hugh (Buck) Davis, who represented the family with the American Civil Liberties Union of Michigan.

He said they were humiliated for simply trying to attend a funeral. Lowden could not be reached for comment.

The Michigan Attorney General’s Office, which had tried to get the suit dismissed, also declared victory.

“This is a victory for protecting the sanctity of funerals and the privacy of families who have suffered a tragic loss,” said spokesman John Sellek, saying Ludington’s decision struck two words — “adversely affect” — from the statute. “The law essentially remains in place.”

Michigan’s affirmative action ban found unconstitutional

The Sixth Circuit is on a roll in dealing with polarizing political issues.

Earlier this week, it made news by finding the health care mandate constitutional under the Commerce Clause. Today, in Coalition of Defend Affirmative Action v Regents of the University of Michigan, it strikes again, finding Proposal 2, Michigan’s ban on affirmative action, to be unconstitutional under the Equal Protection Clause of the 14th Amendment.

Judge Guy Cole, writing for the majority:

Hunter and Seattle thus expounded the rule that an enactment deprives minority groups of equal protection of the laws when it: (1) has a racial focus, targeting a goal or program that “inures primarily to the benefit of the minority”; and (2) works a reallocation of political power or reordering of the decision making process that places “special burdens” on a minority group’s ability to achieve its goals through that process. Seattle, 458 U.S. at 470; Hunter, 393 U.S. at 391.

Applying this rule here, we conclude that Proposal 2 targets a program that “inures primarily to the benefit of the minority” and reorders the political process in Michigan in such a way as to place “special burdens” on racial minorities.

Proposal 2, like Initiative 350 [from Seattle], has a “racial focus,” because the Michigan universities’ affirmative-action programs “inure[] primarily to the benefit of the minority, and [are] designed for that purpose,” for the reasons articulated by the Court in Seattle.  …  Just as the desegregative busing programs at issue in Seattle were designed to improve racial minorities’ representation at many public schools, … race-conscious admissions policies increase racial minorities’ representation at institutions of higher education[.]  Indeed, underrepresented minorities lobbied for the
adoption of such policies at Michigan’s universities in the first place for this reason … and, further, the unrebutted evidence in the record indicates that Proposal 2 will likely negatively impact minority representation at Michigan’s institutions of higher education.  Ample evidence thus grounds our conclusion that race conscious admissions policies “inure[] primarily to the benefit of the minority.”

The 6th Circuit slapped down former Attorney General Mike Cox’s argument that the law affected women, therefore wasn’t racially based.

The court found that Proposal 2 sets up racially based obstacles in that anyone seeking to change the admissions policy based on race must first to convince the public to repeal Proposal 2 before trying to convince the board running the respective university to change its policy, whereas if a person sought to change an admission policy based on other factors, it need only do the latter.

Judge Julia Smith Gibbons dissented from the Equal Protection analysis, finding Proposal 2 didn’t restructure the political process “to burden the ability of minorities to enact beneficial legislation” thus wasn’t unconstitutional.