Amicus Brief

Nathan Klooster v City of Charlevoix

Case Year: 2010
Case Forum: Michigan Supreme Court
Keywords: conveyance, taxable value, Proposal A, uncapping, true cash value, General Property Tax Act (GPTA)
Amicus Counsel:

Steven D. Mann (P67785) | Don M. Schmidt (P20005) | Miller, Canfield, Paddock and Stone, P.L.C. | 150 W. Jefferson Ave., Suite 2500 | Detroit, MI 48226 | 313-496-7509

CoAmicus Parties:

1. Michigan Association of Equalization Directors
2. Michigan Assessors Association (MAA)
3. Michigan Townships Association (MTA)


This appeal involves issues of great significance to the jurisprudence of this State, to every governmental entity in Michigan and to the public. It is imperative, especially in
these trying economic times, that property valuation and uncapping be performed as the Legislature intended and not through a strained interpretation of the statute. The
legislative intent of the statute could not have been to allow a loophole permitting a safe haven from uncapping through continuous joint tenancy transfers. The deed creating the joint tenancy between appellee and his father qualifies as a written instrument affecting the title to the property. The death certificate also constitutes an instrument in writing affecting the
title to the property. MCL 211.27a(3) required appellant to uncap appellee’s property upon the transfer of ownership because the transfer was not exempt from uncapping
under the joint tenancy exception. Misinterpretation of a taxing statute has statewide implications and constitutes a miscarriage of justice.


Before the entire bench
This case involves the General Property Tax Act (GPTA) and two particular circumstances in which a conveyance of property may or may not permit a taxingauthority to “uncap” and reassess the value of that property. Specifically, we granted leave to appeal to address whether a “conveyance” as that term is used in MCL 211.27a(3) must be by means of a written instrument and whether, under MCL 211.27a(7)(h), petitioner’s property was uncapped for purposes of property-tax reassessment by either the death of the other joint tenant in January 2005 or the creation of a subsequent joint tenancy in September 2005. Klooster v Charlevoix, 486 Mich 932 (2010). We hold first that a “conveyance” for purposes of MCL 211.27a does not require a written instrument. Second, we hold that while the January 2005 termination of the joint tenancy caused by the death of a cotenant was within the joint-tenancy exception created by MCL 211.27a(7)(h) and was thus not a transfer of ownership that uncapped the property, the September 2005 conveyance from petitioner to himself and his brother as joint tenants did uncap the property, because the conveyance did not fall within the joint-tenancy exception. Therefore, we reverse the judgment of the Court of Appeals and hold that respondent, the city of Charlevoix, properly issued its 2006 notice of reassessment and that the Tax Tribunal reached the correct result, albeit for the wrong reason.

MSC requested LDF amicus brief? No

In 1959 petitioners’ parents, James and Dona Klooster, acquired title to property in Charlevoix as tenants by the entirety. On August 11, 2004 Dona quitclaimed her interest to James. On the same day James quitclaimed the property to himself and his son, Nathan Klooster, as joint tenants with rights of survivorship. In January 2005 James died and Nathan became sole owner of the property. In September 2005 Nathan executed a quitclaim deed creating a joint tenancy with
rights of survivorship with his brother, Charles Klooster. In 2006 Nathan received a notice of assessment from the City of Charlevoix, reassessing the property as a result of a transfer of
ownership of the property in 2005, the assessment was increased from $37,802 to $72,300. Nathan appealed to the Board of Review, which affirmed, then to the Tax Tribunal. The Tax Tribunal affirmed, finding that James’ death had caused a transfer of ownership. The Court of Appeals reversed, finding that there was no transfer of ownership under MCL 211.27a. The court determined that James’ death did not constitute a “conveyance.” A conveyance is every instrument in writing that affects the title of real estate. In order for there to be a “conveyance” under MCL 211.27a(7)(h) there must be some instrument in writing affecting the title of the real property. James’ death was not a conveyance. While it had a de facto effect on the property’s title, it did not create a conveyance because no instrument in writing was created.

Case Number: 2009-10
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