Amicus Brief

City of Monroe v MBT Financial Corp

Case Year: 2003
Case Forum: Michigan Court of Appeals
Keywords: General Property Tax Act (GPTA), lien, precedence, city charter
Amicus Counsel:

Kester K. So | Dickinson Wright PLLC | 215 S Washington Square, Suite 200 | Lansing, MI 48933 | 517-371-1730


A plain reading of Section 40 of the General Property Tax Act gives priority to a personal property tax lien arising thereunder over any other competing liens. This is true no matter when the competing lien arose. Appellants apparently argue that certain amendments to Section 40 made by the Michigan Legislature in 1994 somehow drastically changed and altered the priority of liens rights that have been in existence since the late 1920s and early 1930s. However, a careful reading of the legislation and the amendments thereto demonstrates that Appellants’ arguments are totally without merit. Section 40 controls priority of liens, not the city charter. Appellants claim that under the City’s Charter, the City’s tax lien has priority over subsequent liens. See, Section 146 of the City of Monroe Charter. The City’s Charter was initially adopted in 1913 and remains essentially unchanged today. The language included in Section 146 of the Charter mirrored the priority-in-time element then embodied in the 1897 version of Section 40. The 1929 and 1934 amendments, as seen above marked a radical change in the parties’ priority rights. The City’s Charter was never amended to reflect this change. As a matter of law, it did not need to be changed. Unless the Circuit Court Opinion is upheld, this Court’s decision would have a major adverse impact on the financial condition of many municipalities and their ability to collect on delinquent taxes owed to them and would result in a significant departure from long-standing legal precedent (at least since 1929) and commonly accepted practice. The wording of Section 40 of the General Property Tax Act since at least 1929 is clear and unambiguous. Section 40 gives priority to municipal Tax Liens over all competing liens or encumbrances. No other reasonable interpretation can be given it. State and federal courts have universally agreed. The changes to Section 40 made in the 1994 and 1995 amendments did not add any new restrictions or limitations to it, nor more importantly, did it change the priority rights afforded municipal lienholders. Under Section 40, Municipal Tax Liens continue to have priority over all other competing liens or encumbrances.


Defendants appeal as of right the trial court order granting summary disposition and awarding a judgment in the amount of $36,318.90 plus interest and costs in favor of plaintiff. We affirm.

MSC requested LDF amicus brief? No
Case Number: 2002-16
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