Macomb County Treasurer Foreclosure Petition Reversed
Summary
The Michigan Court of Appeals reversed and remanded a tax foreclosure case involving the Macomb County Treasurer. The court found that the trial court erred in allowing Banyon Investments, LLC, to intervene in the case concerning surplus proceeds from a tax-foreclosure sale.
What changed
The Michigan Court of Appeals, in the case of In re Petition of Macomb County Treasurer for Foreclosure (Docket No. 367856), reversed and remanded a trial court order that had allowed Banyon Investments, LLC, to intervene in a tax foreclosure proceeding. The appeal centered on whether intervention was proper under MCR 2.209, with the appellant arguing against it and the Treasurer supporting the intervention. The case involves tax foreclosure under the General Property Tax Act (GPTA), MCL 211.1 et seq., specifically concerning surplus proceeds from a residential property sale in Warren.
This decision has significant implications for parties involved in tax foreclosure sales in Michigan, particularly regarding the distribution of surplus proceeds and the right to intervene in such proceedings. Regulated entities, such as county treasurers and property owners involved in tax sales, should review their intervention policies and procedures. While no specific compliance deadline is mentioned, the reversal suggests that prior intervention orders may need to be re-evaluated, and parties should consult legal counsel to understand the impact on ongoing or future tax foreclosure cases in Michigan.
What to do next
- Review intervention policies and procedures related to tax foreclosure sales.
- Consult legal counsel regarding the implications of this decision on ongoing or future tax foreclosure cases.
Source document (simplified)
Jump To
Top Caption Disposition Lead Opinion
Support FLP
CourtListener is a project of Free
Law Project, a federally-recognized 501(c)(3) non-profit. Members help support our work and get special access to features.
Please become a member today.
March 18, 2026 Get Citation Alerts Download PDF Add Note
In Re Petition of MacOmb County Treasurer for Foreclosure
Michigan Court of Appeals
- Citations: None known
- Docket Number: 367856
Disposition: Reversed and Remanded
Disposition
Reversed and Remanded
Lead Opinion
If this opinion indicates that it is “FOR PUBLICATION,” it is subject to
revision until final publication in the Michigan Appeals Reports.
STATE OF MICHIGAN
COURT OF APPEALS
In re PETITION OF MACOMB COUNTY
TREASURER FOR FORECLOSURE.
MACOMB COUNTY TREASURER, FOR PUBLICATION
March 18, 2026
Petitioner-Appellee, 2:05 PM
v No. 367856
Macomb Circuit Court
ANNAMARIE BUTTERWORTH, LC No. 2021-002014-CH
Respondent-Appellant,
and
BANYON INVESTMENTS, LLC,
Intervening-Respondent-Appellee.
Before: RIORDAN, P.J., and WALLACE and TREBILCOCK, JJ.
RIORDAN, P.J.
-1-
In this tax-foreclosure case under the General Property Tax Act (GPTA), MCL 211.1 et
seq., respondent-appellant Annamarie Butterworth1 appeals by leave granted2 the trial court’s
August 30, 2023 order granting the motion of respondent-appellee Banyon Investments, LLC, to
intervene in the case. On appeal, appellant argues that the trial court erred by allowing appellee to
intervene under MCR 2.209. Appellee argues otherwise. Petitioner-appellee Macomb County
Treasurer, representing the foreclosing governmental unit (FGU), has filed a brief on appeal as
well, urging this Court to uphold the order granting intervention. After careful consideration of
the parties’ respective arguments, however, we reverse the trial court and remand to that court for
further proceedings.3
I. FACTS
The general facts of this case are undisputed and involve MCL 211.78t of the GPTA, which
governs surplus proceeds following a tax-foreclosure sale of a residential property in the City of
Warren. In early June 2021, petitioner filed its petition for tax foreclosure in the trial court, seeking
to foreclose upon each specifically-identified “parcel of property which remains unredeemed after
forfeiture to the Macomb County Treasurer on March 1, of this year, or forfeited in prior years . .
. .” One of the properties listed was the subject property at issue in this case.
In 2015, appellant purchased the subject property in Warren for $65,450. The purchase
was partially financed through a loan in the amount of $49,600 from Insiders Cash, LLC. Insiders
Cash recorded a mortgage and, in July 2018, assigned its mortgage interest to appellee. Appellee
promptly recorded its interest. However, appellant failed to pay taxes on the subject property for
a few years. As a result, as noted, petitioner initiated foreclosure proceedings in June 2021, which
resulted in a tax-foreclosure judgment against the subject property in February 2022.4
In June 2022, appellant provided petitioner with her “Form 5743” under MCL 211.78t of
the GPTA, which gave petitioner notice of her intent to claim any surplus proceeds from the
upcoming foreclosure sale. As the deadline under MCL 211.78t(2) to submit the Form 5743 was
1
Specifically, appellant is the trustee of American Estate & Trust FBO Annamarie Butterworth
IRA. For ease of discussion, we refer to appellant as a natural person, notwithstanding that she
generally acted on behalf of that legal entity.
2
In re Petition of Macomb Co Treasurer for Foreclosure, unpublished order of the Court of
Appeals, entered February 16, 2024 (Docket No. 367856).
3
For ease of discussion, we refer to Butterworth as “appellant,” Banyon Investments as “appellee,”
and the Macomb County Treasurer as “petitioner.”
4
“Under MCL 211.78k(6), fee simple title vest[s] absolutely in the Treasurer at the time of
foreclosure, extinguishing all liens and existing interests in the property except as provided in
MCL 211.78k(5)(c) and (e).” Petersen Fin, LLC v City of Kentwood, 337 Mich App 460, 471-
472; 976 NW2d 691 (2021). In this case, the foreclosure judgment was entered on February 4,
2022; appellant did not pay the delinquent taxes and related fees by March 31, 2022, as permitted
by MCL 211.78k(5)(c); and the various exceptions set forth in MCL 211.78k(5)(e) do not apply.
Thus, appellee no longer had any legal interest in the property by March 31, 2022, at the latest.
-2-
July 1, 2022, it was timely submitted. In the Form 5743, appellant falsely indicated that there were
no “other interests in this property, which were in effect immediately prior to foreclosure.” In
September 2022, the subject property sold at auction for $53,001.
On May 15, 2023, appellant filed a timely motion to claim the surplus proceeds from the
foreclosure sale as required by MCL 211.78t(4).5 In the motion, appellant explained that the
subject property sold for $53,001.00, that the amount of unpaid taxes and other related fees was
$10,495.37, that petitioner was statutorily entitled to a 5% commission in the amount of $2,650.05,
and that she was therefore entitled to surplus proceeds of $39,855.58.
Appellee did not file a Form 5743, which was due by July 1, 2022, or file a motion to claim
surplus proceeds, as appellant did in May 2023. Instead, on July 21, 2023, appellee filed a motion
to intervene in the proceedings. In the motion, appellee alleged as follows:
¶ 7. On or about May 18, 2023, Banyon received a letter from the Macomb
County Treasurer’s office indicating that the Property had been sold and that as
assignee of a mortgage that was not discharged on the Property, Banyon may be
entitled to surplus from the auction.
¶ 8. Unbeknownst to Banyon, on May 12, 2023, Claimant Annamarie
Butterworth (“mortgagor”) filed a motion to claim the surplus falsely asserting the
Property was not encumbered by a lien or other security interest at the time of
Judgment of Foreclosure which was untrue as she executed the mortgage in 2014
divesting all interest in the property.
¶ 9. Claimant falsely alleges in her pleading that she is entitled to surplus
proceeds of $39,855.58 and submitted a false Notice to Claimant with the Circuit
Court with the intent to collect the proceeds by not disclosing her outstanding
mortgage on the Property.
¶ 10. Banyon asserts it has a right to intervene pursuant to MCR 2.209(A)
because it claims an interest in the Property or transaction which is the subject of
the action and is so situated that disposition of the action may as a practical matter
impair or impede its ability to protect and collect on its assignment. Banyon’s
interests are not adequately represented by the existing parties since each existing
party is only interested in its own claim for money.
¶ 11. Alternatively, Banyon may intervene pursuant to MCR 2.209(B)
because its claim and the main action have questions of law and fact in common,
for example, the priority of the claims of the various parties.
¶ 12. Contemporaneously with the filing of this motion, Banyon will seek
equitable subrogation through its intervening complaint for breach of contract
involving debt owed by the Claimant to Banyon pursuant to the Standard Mortgage
5
The motion was signed on May 12.
-3-
Clause in the mortgage which specifically provides that in such case of default,
“The proceeds of any award or claim for damages that are attributable to the
impairment of Lender’s interest in the Property are hereby assigned and shall be
paid to Lender.” [Citations omitted.]
Accompanying the motion was a proposed complaint, alleging that “[u]nder the terms of
the Mortgage, Banyon is entitled to equitable subrogation for Claimant’s default involving debt
owed by the Claimant to Banyon,” and “Banyon is entitled to subrogate in place of the Claimant
for default and surplus proceeds should be rightfully distributed to Banyon and not Claimant.”
In August 2023, petitioner filed a response to the motion to intervene, urging the trial court
to grant the motion to determine the proper recipient of the surplus proceeds. Appellant filed a
response as well, arguing that the trial court should deny the motion because appellee did not have
a property interest in the surplus proceeds, as it failed to comply with MCL 211.78t. Thus,
appellant argued, appellee failed to satisfy the requirements for intervention by right under MCR
2.209(A) or permissive intervention under MCR 2.209(B).
At the August 21, 2023 motion hearing, counsel for appellee represented that appellee “did
receive notice from the county of potential surplus on the property.” However, counsel explained,
she was not sure at that time whether appellee received notice of the underlying foreclosure
proceedings:
The one piece that I don’t know for sure, and I need to flush out with my client, is
a little bit whether or not they received timely notice of the foreclosure action itself.
So that is still a question mark.
Even so, we didn’t receive --
My client didn’t receive a letter related to the surplus itself until May 18 of
2023 well past the July 1st deadline. So there was --
At that point, the trial court said that it would grant the motion to intervene and set a date
for an evidentiary hearing.6
6
MCL 211.78i(1) requires the FGU to “initiate a search of records . . . to identify the persons with
a property interest in the property entitled to notice [of] . . . the foreclosure hearing under [MCL
211.78k].” Thus, it appears that petitioner should have provided appellee with timely notice of
these proceedings. However, it is unclear whether appellee timely received notice of these
foreclosure proceedings, such that it would have been able to comply with the various requirements
in MCL 211.78t. At a May 30, 2023 hearing, petitioner represented that “it’s undisputed Mr.
Banyon received a copy of the notice of the tax foreclosure hearing, which also included the notice
that he needs to file a Notice of Intent to Claim Proceeds, and he didn’t do so.” On the other hand,
as noted, counsel for appellee represented at the August 21, 2023 motion hearing that she was not
certain whether appellee received such notice. The parties’ respective briefs on appeal are silent
regarding this matter.
-4-
Later that month, the trial court entered its written order providing that “Banyon
Investment, LLC’s Motion to Intervene is Granted.” Appellant filed an application for leave to
appeal from that interlocutory order, arguing that the trial court erred by allowing appellee to
intervene because appellee’s asserted lien interest was extinguished when it failed to comply with
the provisions of MCL 211.78t governing surplus proceeds. Thus, according to appellant, appellee
had no recognized legal interest in the instant proceedings. This Court granted the application for
leave to appeal. In re Petition of Macomb Co Treasurer for Foreclosure, unpublished order of the
Court of Appeals, entered February 16, 2024 (Docket No. 367856).
II. STANDARD OF REVIEW
“This Court reviews de novo a trial court’s resolution of issues of law, including the
interpretation of statutes and court rules.” State Treasurer v Bences, 318 Mich App 146, 149; 896
NW2d 93 (2016) (quotation marks and citation omitted). “A trial court’s decision on a motion to
intervene is reviewed for an abuse of discretion.” Id. (quotation marks and citation omitted). “An
abuse of discretion occurs when the decision results in an outcome falling outside the principled
range of outcomes.” Auto-Owners Inc Co v Keizer-Morris, Inc, 284 Mich App 610, 612; 773
NW2d 267 (2009) (quotation marks and citation omitted).
III. DISCUSSION
Appellant argues that the trial court abused its discretion by granting appellee’s motion to
intervene because appellee has no legal interest in the instant proceedings. According to appellant,
appellee’s mortgage lien was extinguished by operation of the GPTA because appellee failed to
timely comply with the provisions of the GPTA governing surplus proceeds. Appellee responds
that it was entitled to intervene because “[t]he intervention in the instant action is a claim against
[appellant], not a claim against the mortgage on the property. The covenant to collect the proceeds
against [appellant] through subrogation of its rights to [appellee] remains and gives [appellee]
standing to intervene.” Petitioner similarly argues that the trial court properly granted appellee’s
motion to intervene, reasoning that appellant “is obligated to use the [surplus] proceeds to pay
[appellee] pursuant to the terms of the mortgage.” Petitioner emphasizes that appellant “falsely
stat[ed] under oath there were no other interests in the property prior to the foreclosure,” which
seemingly led to the instant dispute. While we acknowledge the concerns raised by appellee and
petitioner, we ultimately agree with appellant.7
In 2020, our Supreme Court held that under Const 1963, art 10, § 2, “former property
owners whose properties were foreclosed and sold to satisfy delinquent real-property taxes, have
a cognizable, vested property right to the surplus proceeds resulting from the tax-foreclosure sale
of their properties.” Rafaeli, LLC v Oakland Co, 505 Mich 429, 484; 952 NW2d 434 (2020). See
also Tyler v Hennepin Co, Minnesota, 598 US 631, 647; 143 S Ct 1369; 215 L Ed 2d 564 (2023)
(holding that the county’s retention of surplus proceeds violated the federal Takings Clause). In
response to Rafaeli, our Legislature enacted 2020 PA 256, which added MCL 211.78t to the
7
As noted, appellee cited both MCR 2.209(A) and (B) in its motion to intervene. However, the
trial court simply stated that it would grant the motion at the August 21, 2023 motion hearing, and
its written order did not specify a subrule. Therefore, we will address both subrules in our opinion.
-5-
GPTA. “MCL 211.78t creates a controlling and structured system for adjudication of tax-
foreclosure disputes as the exclusive means of obtaining surplus proceeds.” Schafer v Kent Co,
___ Mich __, _; __ NW3d ___ (2024) (Docket Nos. 164975 and 165219), slip op at 35. In
In re Kent Co Treasurer for Foreclosure, ___ Mich App __, _; __ NW3d ___ (2025) (Docket
Nos. 363463, 363766, 363808, and 364114), slip op at 4, this Court summarized the operation of
MCL 211.78t as follows:
Property owners whose properties sold at tax-foreclosure sales after July 17,
2020, the date the Rafaeli decision was issued, and who intend to recover any
surplus proceeds from the sale are required to notify the FGU of their intent by
submitting a “Notice of Intention to Claim Interest in Foreclosure Sales Proceeds”
(Treasury Department Form 5743) by the July 1 immediately following the
effective date of the foreclosure of their properties. Form 5743 must be notarized
and filed with the FGU by personal service acknowledged by the FGU or by
certified mail, return receipt requested. Property owners who satisfy these
requirements are “claimants.”[8]
In the January immediately following the sale or transfer of foreclosed
properties, the FGU notifies claimants about the total amount of remaining
proceeds or the amount of shortfall in proceeds, among other things. The notice
also instructs claimants that they must file a motion in the circuit court in the
foreclosure proceeding to recover any remaining proceeds payable to them. This
motion must be filed between February 1 and May 15 of the year immediately
following the tax-foreclosure sale.
At the end of this claim period, the FGU responds by verifying that
claimants timely filed Form 5743 and identifying any remaining proceeds. The
circuit court then holds a hearing to determine the relative priority and value of the
claimants’ interests in any remaining proceeds. After requiring the payment of a
sales commission to the FGU of 5% of the amount for which the property was sold,
the trial court then allocates any remaining proceeds based on its determination of
priority, and orders the FGU to pay the remaining proceeds to claimants in
accordance with the trial court’s determination. The FGU has 21 days to pay the
amounts ordered by the trial court. [Cleaned up.]
Moreover, “[u]nder MCL 211.78k(6), fee simple title vest[s] absolutely in the Treasurer at
the time of foreclosure, extinguishing all liens and existing interests in the property except as
8
MCL 211.78t(12)(a) provides that “ ‘[c]laimant’ means a person with a legal interest in property
immediately before the effectiveness of a judgment of foreclosure of the property under [MCL
211.78k] who seeks pursuant to this section recognition of its interest in any remaining proceeds
associated with the property.” In this case, as explained infra, appellee was not a “claimant” under
MCL 211.78t because, although it had a legal interest in the subject property before foreclosure, it
did not comply with the provisions of that statute to actually claim the surplus proceeds. Thus,
appellee might best be characterized as a “putative claimant.”
-6-
provided in MCL 211.78k(5)(c) and (e).” Petersen Fin, LLC v City of Kentwood, 337 Mich App
460, 471-472; 976 NW2d 691 (2021).
With regard to intervention, MCR 2.209 provides, in relevant part:
(A) Intervention of Right. On timely application a person has a right to
intervene in an action:
(3) when the applicant claims an interest relating to the property or
transaction which is the subject of the action and is so situated that the disposition
of the action may as a practical matter impair or impede the applicant’s ability to
protect that interest, unless the applicant’s interest is adequately represented by
existing parties.
(B) Permissive Intervention. On timely application a person may
intervene in an action
(2) when an applicant’s claim or defense and the main action have a
question of law or fact in common.
In exercising its discretion, the court shall consider whether the intervention
will unduly delay or prejudice the adjudication of the rights of the original parties.
“[I]ntervention may not be proper where it will have the effect of delaying the action or
producing a multifariousness of parties and causes of action.” Precision Pipe & Supply, Inc v
Meram Constr, Inc, 195 Mich App 153, 157; 489 NW2d 166 (1992). In addition, “[a]s a general
rule, the right to intervene should be asserted within a reasonable time. Laches or unreasonable
delay by the intervenor is a proper reason to deny intervention.” American States Ins Co v Albin,
118 Mich App 201, 209; 324 NW2d 574 (1982). Further, a proposed intervenor must have
standing. See In re Anjoski, 283 Mich App 41, 52 n 4; 770 NW2d 1 (2009); Karrip v Cannon
Twp, 115 Mich App 726, 732; 321 NW2d 690 (1982). “[A] litigant has standing whenever there
is a legal cause of action.” Lansing Sch Ed Ass’n v Lansing Bd of Ed, 487 Mich 349, 372; 972
NW2d 686 (2010).
In this case, as noted, a “claimant” in the context of MCL 211.78t is not limited to property
owners. Rather, a claimant is instead defined as “a person with a legal interest in property
immediately before the effectiveness of a judgment of foreclosure of the property under [MCL
211.78k] who seeks pursuant to [MCL 211.78t] recognition of its interest in any remaining
proceeds associated with the property.” MCL 211.78t(12)(a). A mortgage constitutes a lien on
the property, Prime Fin Servs LLC v Vinton, 279 Mich App 245, 256; 761 NW2d 694 (2008), and
a lien is definitionally a “legal right or interest that a creditor has in another’s property . . . .”
Black’s Law Dictionary (11th ed.). Consequently, a mortgagee may qualify as a person with a
legal interest in the property immediately before the foreclosure, meaning that a mortgagee can be
a claimant of surplus proceeds under the GPTA. However, contrary to appellee’s suggestion that
-7-
it is a claimant through appellant by virtue of a contractual assignment in the mortgage document
itself, a party’s status as a claimant is a personal right that generally is not transferable. MCL
211.78t(11) (“A right to claim remaining proceeds under this section is not transferable except by
testate or intestate succession.”). Therefore, appellee’s potential status as a claimant arose from
its interest in the subject property immediately before foreclosure under the GPTA, not from any
purported assignment by appellant in the mortgage.
Appellee has not, however, attempted to pursue its status as a claimant under the GPTA.
Indeed, appellee failed to comply with MCL 211.78t in two respects. First, as explained, MCL
211.78t requires a claimant to submit a Form 5743 to the FGU by the July 1st immediately
following the effective date of the foreclosure, which in this case was July 1, 2022. See MCL
211.78t(2). Here, appellant timely filed her Form 5743 before that date. Appellee did not file a
Form 5743. Second, although the deadline for a motion to claim proceeds was May 15th, 2023,
see MCL 211.78t(4), appellee did not file such a motion. Instead, appellee attempted to intervene
on July 21, 2023. As written, MCL 211.78t sets forth the exclusive mechanism for claiming some
or all of the surplus proceeds when the trial court divides those proceeds under MCL 211.78t(10).
See MCL 211.78t(11) (“This section is the exclusive mechanism for a claimant to claim and
receive any applicable remaining proceeds under the laws of this state.”); Schafer, ___ Mich at
___; slip op at 35 (“MCL 211.78t creates a controlling and structured system for adjudication of
tax-foreclosure disputes as the exclusive means of obtaining surplus proceeds.”). MCL 211.78t
makes no provision for, essentially, a third-party claim against a claimant who has followed the
procedures in MCL 211.78t. In other words, the only issue before the trial court is the distribution
of the surplus proceeds, and the exclusive means for distributing those proceeds is detailed in MCL
211.78t. Therefore, claims such as equitable subrogation are not a permissible means to obtain a
share of surplus proceeds being distributed under MCL 211.78t. See MCL 211.78l(1) (“An action
to recover any proceeds from the sale or transfer of property foreclosed for nonpayment of real
property taxes under this act must be brought as provided under [MCL 211.78t.]”).9
9
We acknowledge the competing concerns in this matter and respectfully encourage the
Legislature to consider amending the GPTA if it finds that the current version of the GPTA is
insufficient to address these concerns.
On one hand, the foreclosure process and the distribution of surplus proceeds is intended to be an
efficient and streamlined process. That is, the foreclosure process in the GPTA is intended to
encourage “the efficient and expeditious return to productive use of property returned for
delinquent taxes.” MCL 211.78(1). More relevant to the issues in this case, in response to due-
process challenges to the procedures and timeframes in MCL 211.78t, this Court has recognized
that there is a government interest “in having taxes paid in full as well as clarifying within a
reasonable time period who has the right to any surplus from forfeited properties.” In re Muskegon
Co Treasurer for Foreclosure, 348 Mich App 678, 696; 20 NW3d 337 (2023). In other words, the
procedures in MCL 211.78t are designed to allow for the efficient resolution of claims to surplus
proceeds. Allowing intervention after the time for filing a motion to claim proceeds has passed
and allowing third-party claims not contemplated by MCL 211.78t does not appear to aid in the
expeditious resolution of the FGU’s obligation to distribute surplus proceeds to claimants.
-8-
For these reasons, we conclude that appellee was not entitled to intervene by right under
MCR 2.209(A)(3), as it did not have “an interest relating to the property or transaction which is
the subject of the action.” In other words, appellee does not have a legally protected interest in the
surplus proceeds. See United States v Union Electric Co, 64 F3d 1152, 1161 (CA 8, 1995)
(explaining that for intervention by right, “that interest must be recognized, i.e., both substantial
and legally protectable”) (quotation marks and citations omitted). Again, appellee’s lien interest
was extinguished by the foreclosure in February 2022 pursuant to MCL 211.78k(6), see Petersen,
337 Mich App at 471-472, and appellee failed to comply with the provisions of MCL 211.78t for
claiming surplus proceeds. Moreover, because the only issue remaining before the trial court was
simply the distribution of surplus proceeds to appellant under MCL 211.78t(10), appellee’s legal
claims against appellant, such as equitable subrogation, did not have “a question of law or fact in
common” with the instant proceedings for the purposes of MCR 2.209(B)(2).
Simply put, the surplus-funds claims process is a unique process with specific procedures.
It is not intended for resolution of third-party claims by parties not entitled to proceeds under MCL
211.78t. Compare Bences, 318 Mich App at 153 (concluding that an ordinary creditor could not
intervene in a lawsuit involving the State Correctional Facility Reimbursement Act because
ordinary creditors were not entitled to the benefit of “the unique statutory tools” available to the
state under the act).
With that said, we note the possibility that appellee may attempt, if it chooses, to sue
appellant to collect an outstanding debt. As a lien against the subject property, appellee’s mortgage
was extinguished by the foreclosure. See MCL 211.78k(5)(c). However, the note evincing
appellant’s debt was not extinguished and, depending on the terms of the note, appellee could
potentially pursue a judgment against appellant based on the note. See Wells Fargo Bank, NA v
Cherryland Mall Ltd Partnership, 295 Mich App 99, 109; 812 NW2d 799 (2011). See also Tyler,
598 US at 637 (noting that the taxpayer’s debts were not extinguished by a tax sale and that the
borrower remained personally liable for debts). Nonetheless, any dispute regarding the note and
appellant’s debt to appellee is between those two parties. It does not involve petitioner, and it does
not directly entitle appellee to the surplus proceeds at issue here under MCL 211.78t. In other
words, given that the mortgage has been extinguished, appellee is, at best, an unsecured creditor,
but the fact that appellant may be indebted to appellee does not provide appellee grounds to
intervene in a post-foreclosure action involving the distribution of surplus proceeds under MCL
211.78t when appellant has no claim to those proceeds because it failed to abide by MCL 211.78t.
See 59 Am Jur 2d, Parties, § 181 (“It is well settled that a mere creditor of one of the parties has
no right to intervene although that party may have an indirect interest in the result of the action.”);
67A CJS, Parties, § 105 (“The mere fact that a party, for or against whom a judgment may go, may
become more or less able to satisfy some obligations will not entitle its creditor to intervene in the
On the other hand, apparently appellant falsely represented in her Form 5743 that there were no
other interests in the subject property. This representation was either mistaken or fraudulent.
While the record is unclear about whether this false representation ultimately resulted in
petitioner’s potential failure to timely notify appellee about these proceedings, that is a possibility.
If so, it strikes us as an incongruent outcome that appellee would be unable to avail itself of the
surplus proceeds, and that appellant would be rewarded for her false representation.
-9-
action.”); McBride v Wayne Circuit Judge, 250 Mich 1, 4; 229 NW 493 (1930) (finding no
provision to allow intervention by nonjudgment creditors).
IV. CONCLUSION
Because MCL 211.78t sets forth the exclusive mechanism for recovering surplus proceeds,
and because appellee failed to comply with that statute, it does not have a cognizable interest in
the instant proceedings. Therefore, the trial court legally erred by allowing appellee to intervene
in these proceedings. Accordingly, we reverse the trial court and remand to that court for further
proceedings consistent with our opinion.10 We do not retain jurisdiction.11
/s/ Michael J. Riordan
/s/ Randy J. Wallace
/s/ Christopher M. Trebilcock
10
Our opinion should not be understood as having any preclusive effect, such as res judicata,
regarding a possible contract action by appellee in the future.
11
In addition to her arguments regarding intervention, appellant briefly argues that the trial court
lacked jurisdiction over appellee’s legal claim. However, the order granting the application for
leave to appeal was “limited to the issues raised in the application and supporting brief,” see In re
Petition of Macomb Co Treasurer for Foreclosure, unpublished order of the Court of Appeals,
entered February 16, 2024 (Docket No. 367856), and appellant did not raise the jurisdictional issue
in her application. In any event, we briefly note that the trial court likely had jurisdiction to
entertain appellee’s motion to intervene before disbursing the surplus proceeds. See MCL 600.611
(“Circuit courts have jurisdiction and power to make any order proper to fully effectuate the circuit
courts’ jurisdiction and judgments.”).
-10-
Related changes
Source
Classification
Who this affects
Taxonomy
Browse Categories
Get Courts & Legal alerts
Weekly digest. AI-summarized, no noise.
Free. Unsubscribe anytime.
Get alerts for this source
We'll email you when Michigan Court of Appeals publishes new changes.