Ligon v. City of Detroit

739 N.W.2d 900
Michigan Court of Appeals·Decided October 11, 2007·No. 264266·Published·Cited by 4 cases

Opinion

739 N.W.2d 900 (2007)

William LIGON, Plaintiff-Appellee/Cross-Appellant,
v.
CITY OF DETROIT, Defendant-Appellant/Cross-Appellee.

Docket No. 264266.

Court of Appeals of Michigan.

Submitted November 8, 2006, at Detroit.
Decided June 26, 2007, at 9:05 a.m.
Released for Publication October 11, 2007.

*902 Draugelis & Ashton, L.L.P. (by Edward Draugelis), Clawson, for the plaintiff.

*903 John E. Johnson, Jr., Corporation Counsel, and Joanne D. Stafford, Supervising Assistant Corporation Counsel, for the defendant.

Before: WHITBECK, C.J., and SAWYER and JANSEN, JJ.

PER CURIAM.

In this inverse condemnation action,[1] defendant city of Detroit (the city) appeals as of right a partial judgment for plaintiff William Ligon. Ligon cross-appeals the same judgment. We affirm in part, vacate in part, and remand for entry of an amended judgment in favor of Ligon consistent with this opinion.

I

In 1980, Ligon and his partner, Fonzie Robinson, jointly executed a land contract to purchase from Paul Kales a certain parcel of real property located in the city. Ligon and Robinson each held a one-half interest in the property as cotenants and jointly operated a business in a building situated on the land. Although a deed was not recorded, Ligon claimed that he paid off the land contract in 1988.

In about 1990, Robinson filed for bankruptcy, and the bankruptcy estate acquired Robinson's one-half interest in the property. In 1991, Ligon entered into a land contract to purchase Robinson's former one-half interest from the bankruptcy estate. At the end of the land contract term in 1995, the bankruptcy trustee delivered a deed conveying Robinson's former one-half interest to Ligon. The bankruptcy trustee's deed was delivered in November 1995 and recorded in February 1996.

In January 1996, the city commenced tax foreclosure proceedings against the property, naming Ligon, Robinson, and other defendants. Detroit v. Kales, Wayne Circuit Court Docket No. 96-601825-CH. Ligon argued that he had not personally received notice of the tax foreclosure proceedings. In July 1996, a default judgment was entered in the tax foreclosure proceedings. Then, in August 1996, an "Order Vacating Judgment as to William Ligon Only" was entered in the tax foreclosure proceedings. The city later agreed to voluntarily dismiss Ligon altogether as a party to the tax foreclosure proceedings. In October 1997, as a result of the tax foreclosure proceedings, the state of Michigan executed a deed reconveying the property to the city. In 2000, the city took possession of the property and building. The city demolished the building "in error" in 2002. Ligon then commenced this action.

II

A trial court's decision on a motion for summary disposition is reviewed de novo. Hess v. Cannon Twp., 265 Mich. App. 582, 589, 696 N.W.2d 742 (2005). Constitutional claims are also reviewed de novo. Id. Specifically, appellate courts review de novo whether a taking of private property is constitutional. City of Novi v. Robert Adell Children's Funded Trust, 473 Mich. 242, 248, 701 N.W.2d 144 (2005). Following a bench trial, we review for clear error the trial court's factual findings and review de novo its conclusions of law. Glen Lake-Crystal River Watershed Riparians v. Glen Lake Ass'n., 264 Mich. App. 523, 531, 695 N.W.2d 508 (2004). Finally, we review for an abuse of discretion a trial court's ruling on a motion to amend *904 a judgment. See McDonald's Corp. v. Canton Twp., 177 Mich.App. 153, 158, 441 N.W.2d 37 (1989).

III

Both the state and federal constitutions prohibit the taking of private property for public use without just compensation.[2] U.S. Const., Am. V; Const. 1963, art. 10, § 2; Adams Outdoor Advertising v. East Lansing (After Remand), 463 Mich. 17, 23, 614 N.W.2d 634 (2000). The "property" protected by the constitutions includes not only title, but all character of vested rights, including possession, dominion, control, and the right to make any legitimate use of the premises. Rassner v. Fed. Collateral Society, Inc., 299 Mich. 206, 213-214, 300 N.W. 45 (1941).

IV

On the parties' motions for summary disposition, the trial court ruled that at the time the city demolished the building, Ligon had a valid one-half ownership interest in the property. The city argues that this ruling was erroneous. We disagree with the city.

Ligon acquired a valid one-half interest in the property as a purchaser under the land contract with Kales, which was recorded. A land contract may be recorded, and the recording of a land contract "shall have the same force and effect" as the recording of a deed. MCL 565.354. As the city correctly concedes, a land-contract vendee is vested with equitable title, and his or her interest is an interest in the real estate. Darr v. First Fed. S. & L. Ass'n of Detroit, 426 Mich. 11, 19-20, 393 N.W.2d 152 (1986); Gilford v. Watkins, 342 Mich. 632, 637, 70 N.W.2d 695 (1955). A land-contract vendee accordingly is the equitable owner of the property. Pittsfield Charter Twp. v. City of Saline, 103 Mich.App. 99, 104, 302 N.W.2d 608 (1981). Although no deed from Kales was ever recorded, Ligon never gave up his purchaser's interest under the land contract and never relinquished his equitable title. Ligon acquired a protected one-half interest in the property by way of the land contract with Kales.

When the city began tax foreclosure proceedings in January 1996, it appears that Ligon did not receive notice. As a general rule, when notice to an affected party has been constitutionally deficient, a resulting tax foreclosure judgment against that party violates his or her right to due process. See, generally, In re Petition by Wayne Co. Treasurer, 478 Mich. 1, 732 N.W.2d 458 (2007). In such a case, the proper remedy is to vacate the judgment of foreclosure and restore the party's ownership interest in the property at issue. Id. Of particular note here, a party's knowledge of a tax delinquency does not equate to notice of a foreclosure proceeding. Detroit v. John J. Blake Realty Co., 144 Mich.App. 432, 437, 376 N.W.2d 114 (1984).

Even if Ligon had received constitutionally adequate notice, after the tax foreclosure proceedings were commenced and a default judgment was entered, the city voluntarily dismissed Ligon as a party to the proceedings and the trial court entered an "Order Vacating Judgment as to William Ligon Only." Because Ligon was dismissed as a p

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Ligon v. City of Detroit, 739 N.W.2d 900 (Mich. Ct. App. 2007).

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