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A Better Partnership
October 28, 2009

COA Opinion: A circuit court does not have jurisdiction to sustain a fact-based challenge to tax assesment raised in defense of a foreclosure action

On October 27, 2009, the Michigan Court of Appeals published its opinion in Prayer Temple of Love v. Wayne County Treasurer, No. 282995.' The case arises out of' a foreclosure action initiated by the Wayne County Treasurer against the Prayer Temple based upon an unpaid assessment of property taxes.' Prayer Temple defended the foreclosure action arguing that its property was used for religious purposes and therefore was statutorily exempt from property taxes.' The Wayne County Treasurer disagreed, arguing that Prayer Temple's outreach center was leased to a private party.' During the foreclosure proceedings the Wayne County Circuit Court agreed with Prayer Temple and ruled it was exempt from the assessed taxes.' The Court of Appeals, however, concluded that the Circuit Court did not have jurisdiction to make that ruling.' The Court of Appeals held that the Circuit Court can hear purely legal challenges to an assessment (i.e., that a tax assessment was made under the authority of an unconstitutional statute),' but that the relevant statutes invest the' Michigan Tax Tribunal with exclusive jurisdiction to hear arguments that factual circumstances render an assessment improper.' Thus, the Court of Appeals concluded that the Circuit' Court did not have the jurisdiction to conclude that Prayer Temple was entitled to the protection of the religious-purposes exception to property taxes.

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