Bill Text: MI SB0809 | 2009-2010 | 95th Legislature | Engrossed

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Bill Title: State agencies (existing); natural resources; powers and duties of the department of environmental quality under land bank fast track act; transfer to the department of natural resources. Amends secs. 7, 9 & 10 of 2003 PA 258 (MCL 124.757 et seq.). TIE BAR WITH: SB 0807'09

Spectrum: Partisan Bill (Republican 2-0)

Status: (Engrossed - Dead) 2009-12-02 - Referred To Committee On Government Operations [SB0809 Detail]

Download: Michigan-2009-SB0809-Engrossed.html

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SB-0809, As Passed Senate, December 2, 2009

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SENATE BILL No. 809

 

 

September 15, 2009, Introduced by Senators RICHARDVILLE and McMANUS and referred to the Committee on Appropriations.

 

 

 

     A bill to amend 2003 PA 258, entitled

 

"Land bank fast track act,"

 

by amending sections 7, 9, and 10 (MCL 124.757, 124.759, and

 

124.760).

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 7. (1) Except as an authority otherwise agrees by

 

intergovernmental agreement or otherwise, on terms and conditions,

 

and in a manner and for an amount of consideration an authority

 

considers proper, fair, and valuable, including for no monetary

 

consideration, the authority may convey, sell, transfer, exchange,

 

lease as lessor, or otherwise dispose of property or rights or

 

interests in property in which the authority holds a legal interest

 

to any public or private person for value determined by the

 

authority. If the department of environmental quality natural

 

resources determines that conditions on a property transferred to

 

an authority under section 78m(15) of the general property tax act,

 

1893 PA 206, MCL 211.78m, represent an acute threat to public

 

health, safety, and welfare, or to the environment, the authority

 

shall not convey, sell, transfer, exchange, lease, or otherwise

 

dispose of the property until after a determination by the

 

department of environmental quality natural resources that the

 

acute threat has been eliminated and that conveyance, sale,

 

transfer, exchange, lease, or other disposal of the property by the

 

authority will not interfere with any response activities by the

 

department. The transfer and use of property under this section and

 

the exercise by the authority of powers and duties under this act

 

shall be considered a necessary public purpose and for the benefit

 

of the public.

 

     (2) All property held by an authority shall be inventoried and

 

classified by the authority according to title status and

 

suitability for use.

 

     (3) A document, including, but not limited to, a deed,

 

evidencing the transfer under this act of 1 or more parcels of

 

property to an authority by this state or a political subdivision

 

of this state may be recorded with the register of deeds office in

 

the county in which the property is located without the payment of

 

a fee.

 

     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 natural resources 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.

 

     (c) Tax records in the office of the local assessor.

 

     (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.

 

     (c) For a partnership, a search of partnership records filed

 

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).

 

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

 

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 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. 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).

 

     (c) 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

 

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.

 

     (c) That all liens against the property, including any lien

 

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

 

register of deeds of the county in which the property is located a

 

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 state constitution of

 

this state 1963 and the constitution of the United States.

 

     (c) A judgment of foreclosure was entered under this section

 

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 former 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.

 

     (c) A person accredited in land title search procedures by a

 

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.

 

     Sec. 10. (1) If an authority has reason to believe that

 

property held by the authority may be the site of environmental

 

contamination, the authority shall provide the department of

 

environmental quality natural resources with any information in the

 

possession of the authority that suggests that the property may be

 

the site of environmental contamination.

 

     (2) If property held by an authority is a facility as defined

 

under section 20101(1)(o) of the natural resources and

 

environmental protection act, 1994 PA 451, MCL 324.20101, prior to

 

the sale or transfer of the property under this section, the

 

property is subject to all of the following:

 

     (a) Upon reasonable written notice from the department of

 

environmental quality natural resources, the authority shall

 

provide access to the department of environmental quality natural

 

resources, its employees, its contractors, and any other person

 

expressly authorized by the department of environmental quality

 

natural resources to conduct response activities at the property.

 

Reasonable written notice under this subdivision may include, but

 

is not limited to, notice by electronic mail or facsimile, if the

 

authority consents to notice by electronic mail or facsimile prior

 

to provision of notice by the department of environmental quality

 

natural resources.

 

     (b) If requested by the department of environmental quality

 

natural resources to protect public health, safety, and welfare or

 

the environment, the authority shall grant an easement for access

 

to conduct response activities on the property as authorized under

 

chapter 7 part 201 of the natural resources and environmental

 

protection act, 1994 PA 451, MCL 324.20101 to 324.20302 324.20142.

 

     (c) If requested by the department of environmental quality

 

natural resources to protect public health, safety, and welfare or

 

the environment, the authority shall place and record deed

 

restrictions on the property as authorized under chapter 7 part 201

 

of the natural resources and environmental protection act, 1994 PA

 

451, MCL 324.20101 to 324.20302 324.20142.

 

     (d) The department of environmental quality natural resources

 

may place an environmental lien on the property as authorized under

 

section 20138 of the natural resources and environmental protection

 

act, 1994 PA 451, MCL 324.20138.

 

     (3) For purposes of part 201 of the natural resources and

 

environmental protection act, 1994 PA 451, MCL 324.20101 to

 

324.20142, an authority shall be considered a local unit of

 

government. Except as provided under parts 111, 115, and 315 of the

 

natural resources and environmental protection act, 1994 PA 451,

 

MCL 324.11101 to 324.11153, 324.11501 to 324.11550, and 324.31501

 

to 324.31529, the acquisition or control of property through tax

 

delinquent forfeiture, foreclosure, or sale, abandonment, court

 

order, circumstances in which the authority has acquired title or

 

control of the property under this act, or by a transfer of the

 

property to the authority by this state, an agency or department of

 

this state, or any local unit of government of this state shall not

 

subject the authority to liability under the natural resources and

 

environmental protection act, 1994 PA 451, MCL 324.101 to

 

324.90106, unless the authority is responsible for an activity

 

causing a release on the property or other activity giving rise to

 

liability under the natural resources and environmental protection

 

act, 1994 PA 451, MCL 324.101 to 324.90106. This subsection shall

 

not be considered to restrict or diminish any protection from

 

liability that is otherwise available to the authority under the

 

natural resources and environmental protection act, 1994 PA 451,

 

MCL 324.101 to 324.90106.

 

     Enacting section 1. This amendatory act does not take effect

 

unless Senate Bill No. 807                                    

 

          of the 95th Legislature is enacted into law.