Bauserman v. Unemployment Ins. Agency
931 N.W.2d 539
Mich.2019Background
- Plaintiffs (Bauserman, Broe, Williams) are former unemployment-benefit recipients who allege the Michigan Unemployment Insurance Agency seized tax refunds or garnished wages without adequate procedural due process.
- Agency issued redeterminations finding overpayments and fraud, sent notices of intent to intercept tax refunds or garnish wages, then later intercepted refunds or garnished wages for each plaintiff at different dates (Bauserman and Broe: refund interceptions in 2015; Williams: wage garnishment by May 16, 2014 and ongoing refund interceptions).
- Plaintiffs filed a putative class action in the Court of Claims alleging deprivation of property without due process and unlawful collection practices; Bauserman filed Sept. 9, 2015; amended complaint adding Broe and Williams filed Oct. 19, 2015.
- Agency moved for summary disposition arguing plaintiffs failed to comply with the six-month notice requirement of MCL 600.6431(3) (notice must be filed within 6 months "following the happening of the event giving rise to the cause of action").
- The Court of Appeals held accrual occurred at the time of the original redetermination (denial of process); the Michigan Supreme Court granted review to resolve whether the triggering event is the notice/redetermination or the actual seizure/garnishment.
- Supreme Court held that for monetary due-process claims the six-month period is triggered when the claim accrues, and a procedural-due-process claim accrues when the deprivation of property occurs (i.e., actual seizure or garnishment). Bauserman and Broe timely filed; Williams did not.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| When does the six-month notice period under MCL 600.6431(3) begin for claims seeking monetary relief? | It begins when plaintiffs received the Agency's later redeterminations reversing earlier findings (i.e., date of notice of wrongful redetermination). | It begins when the Agency sent redetermination or notices of intent (denial of process), before actual seizure. | The six-month period aligns with claim accrual; for monetary relief accrual occurs when the deprivation of property happens. |
| For a procedural-due-process claim, is the "actionable harm" the denial of process itself or the deprivation of property? | Plaintiffs: actionable harm is deprivation of property (actual seizure/garnishment). | Agency: actionable harm is the lack of process ( Carey v. Piphus allows nominal damages for denial of process). | The Court: no due-process harm occurs until a deprivation of life, liberty, or property; Carey does not alter accrual timing. |
| Do notices of redetermination or notices of intent to seize/garnish trigger the accrual/6-month clock? | Plaintiffs: those notices are notifications only and do not trigger accrual. | Agency: notices put plaintiffs on notice and thus start the clock. | Court: mere notices or intentions do not constitute deprivation; accrual is triggered by actual seizure/garnishment. |
Key Cases Cited
- Frank v. Linkner, 500 Mich. 133 (Mich. 2017) (defines "actionable harm" for accrual in non-monetary member-oppression claims)
- McCahan v. Brennan, 492 Mich. 730 (Mich. 2012) (statutory notice requirement under MCL 600.6431 and strict-enforcement principles)
- Carey v. Piphus, 435 U.S. 247 (U.S. 1978) (procedural-due-process claim may recover nominal damages for denial of process)
- Bonner v. City of Brighton, 495 Mich. 209 (Mich. 2014) (Due Process Clause requires an actual deprivation of life, liberty, or property to trigger protections)
- Williams v. Hofley Mfg. Co., 430 Mich. 603 (Mich. 1988) (procedural due process protections attach only where protected property or liberty interest exists)
- Rowland v. Washtenaw Co. Rd. Comm., 477 Mich. 197 (Mich. 2007) (upholds strict compliance with statutory notice requirements as a condition of governmental waiver of immunity)