County Kept $24,500 On Foreclosed Home Over Bill of $8.41, But Supreme Court Says, ‘Not So Fast’

In 2014, Oakland County foreclosed on a home owned by Uri Rafaeli because he owed $8.41 for property taxes from 2011. The county then sold Rafaeli’s property for $24,500 and kept the proceeds, even though they greatly exceeded the unpaid tax bill.

The Michigan Supreme Court ruled July 17 that Oakland County engaged in “an unconstitutional taking without just compensation” in violation of the state constitution.

The high court ordered the case back to the circuit court so it can be resolved under new guidance.

“At minimum, today's opinion means people will get the extra profits from the sale of their tax foreclosed property going forward,” said Christina Martin, a senior attorney for the Pacific Legal Foundation. “People who have already lost their property this way will probably need to sue to get paid. But there are class actions pending around the state that could help many, many people, if the courts allow them to proceed as class actions. Rafaeli's case will be sent to the trial court where hopefully it will be allowed to be certified as a class action.”