July 3 - Michigan Supreme Court Overturns Foreclosure, Rules Owner Not Given Proper Notice

In an important victory for consumers, the Michigan Supreme Court unanimously ruled that the Wayne County Treasurer violated a 75-year-old woman?s constitutional right to due process by foreclosing on her house without notifying her first.

In overturning a lower court ruling, the justices noted that the county treasurer did not send a notice to Stella Sidun?s Birmingham, Mich. home, despite having her address readily on hand on the deed to the property. Instead, the county sent notices to the old address of Sidun?s late mother, who had been a co-owner of the property. Public Citizen and local counsel John Hermann had argued that the return of the certified-mail notices should have been a red flag that the notice had failed.

?Especially during the current foreclosure crisis, consumers should be able to trust that government agencies and banks will make a good faith effort to contact them before attempting to foreclose on their property,? said Public Citizen attorney Deepak Gupta, who argued on Sidun?s behalf before the Michigan Supreme Court. ?The lack of effort to track down Ms. Sidun was appalling. We applaud the high court for sending a strong message to those who might take a homeowner?s right to due process lightly.?

Although the county also took other actions, such as publishing the notice in the newspaper and notifying the tenants, those steps did not excuse the county?s failure to attempt to contact Sidun at her last known address, which was listed on county records, the justices wrote.

After she lost the property, which had provided her retirement income, Sidun sued the county. The trial court ruled against her, as did the appellate court. In reversing the lower court decision, the Michigan Supreme Court found that the lower court?s ruling conflicted with the U.S. Supreme Court?s 2006 decision in Jones v. Flowers, another case in which Public Citizen lawyers successfully challenged the lack of notice of a home foreclosure. Sidun?s case now goes back to the circuit court, where she has the option of seeking compensation or reclaiming her home.

To read the documents in the case, click here.