The General Property Tax Act (GPTA); Retention of surplus proceeds after a tax-foreclosure sale; Rafaeli, LLC v Oakland Cnty; Post-Rafaeli GPTA amendments providing a limited mechanism for obtaining surplus proceeds; 2020 PA 256; Applicability of Rafaeli or the GPTA amendments; Retroactive application of judicial decisions; County of Wayne v Hathcock; MCL 211.78t(1); Qualified immunity; Holeton v City of Livonia; Inverse condemnation & unjust enrichment; Michigan’s Takings Clause; Available remedies; Post-tax sale interest; Federal takings claim; Freed v Thomas (ED MI); Fox v City of Saginaw (ED MI); MCL 211.78; Excessive fines claims; Class action certification

In these consolidated appeals, the court held that plaintiffs’ inverse condemnation and unjust enrichment claims for defendants’ retention of surplus proceeds after tax-foreclosure sales of plaintiffs’ properties were viable under Rafaeli. Further, Rafaeli applied to pending cases such as those of the named plaintiffs here. It also held that the individual defendants-municipal officials were entitled to qualified immunity. The court rejected plaintiffs’ argument that they were “entitled to any recovery beyond the surplus proceeds from the tax-foreclosure sale but” agreed they were entitled to post-tax sale interest on those proceeds. Finally, it upheld dismissal of their excessive fines claims and found the trial courts did not err in not certifying the cases as class actions. The court concluded that, “as explained in Rafaeli, in their inverse-condemnation and unjust-enrichment claims, plaintiffs alleged viable claims of violation of their common-law property rights protected under Michigan’s Takings Clause to collect the surplus proceeds that are realized from the tax-foreclosure sale of property.” Thus, the trial courts erred in dismissing those claims. In addition, the court rejected defendants’ assertion that the wrong defendants were sued. Defendants’ argument that Rafaeli should only be given prospective application and thus, did not apply to these cases, also failed. The court did not find that the “Supreme Court in Rafaeli overruled clear and uncontradicted caselaw or specifically announced a new rule that at least had not been previously foreshadowed.” Rather, the court held “that Rafaeli, like Hathcock, should be applied to pending cases, such as those of the named plaintiffs, in which a challenge has been raised and preserved.” The court agreed with plaintiffs that the Supreme Court had “indicated its intent that Rafaeli be applied to cases in which the parties are similarly situated to the named plaintiffs’ claims in these cases.” It further found that they “stated valid federal takings claims” and thus, if they prevail, “interest should be added to any judgments . . . .” In ruling that the individual defendants were entitled to qualified immunity, the court noted that at the time of the alleged wrongdoing, Rafaeli had not yet been issued and “governmental entities and their officials could reasonably rely on” U.S. Supreme Court precedent. Affirmed in part, reversed in part, and remanded.