Geaniece D Carter v. City of Detroit
335100
| Mich. Ct. App. | Nov 14, 2017Background
- Plaintiff (in propria persona) sued City of Detroit and Detroit Finance Department claiming the city withheld her 2015 income tax refund by offsetting it against an asserted unpaid 2011 local tax liability.
- Plaintiff spoke with city employees who told her the 2011 employer failed to pay taxes and that her 2015 refund was seized; she requested a written explanation and was refused.
- Plaintiff filed a circuit-court complaint seeking her 2015 refund (and a 2011 refund), punitive damages, fees, costs, and either an explanation or payment.
- Defendant moved for summary disposition arguing lack of subject-matter jurisdiction: the Michigan Tax Tribunal (MTT) has exclusive jurisdiction over tax refund disputes and plaintiff failed to exhaust administrative remedies (City Income Tax Board of Review then MTT); defendant also argued the amount in controversy was insufficient for circuit court.
- The circuit court dismissed the case for lack of subject-matter jurisdiction; plaintiff appealed, asserting denial of due process for lack of notice. The Court of Appeals affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether circuit court had jurisdiction over refund dispute | Carter argued the circuit court could hear her claim and that she was deprived of due process notice | City argued MTT has exclusive, original jurisdiction over refund/redetermination and plaintiff must exhaust administrative remedies | Held: MTT has exclusive jurisdiction; circuit court lacked subject-matter jurisdiction; dismissal affirmed |
| Whether plaintiff’s due-process claim (lack of advance notice) removes MTT exclusivity | Carter claimed withholding without adequate notice violated due process and thereby required circuit-court review | City argued plaintiff received offset notice and could seek postdeprivation review before the Board and MTT | Held: Notice was adequate for due process purposes; plaintiff’s claim amounts to a challenge that the withholding was arbitrary — which falls within MTT jurisdiction and does not convert into a statute-validity constitutional claim |
| Whether plaintiff failed to exhaust administrative remedies | Carter said she would have used administrative process if given proper notice/explanation | City argued she needed to appeal first to the City Income Tax Board of Review and then to the MTT | Held: Plaintiff failed to pursue the administrative route; available City Board and MTT procedures would have provided the requested relief |
| Whether circuit court could address other merits while lacking jurisdiction | Carter raised additional arguments on appeal and below | City argued court must dismiss for lack of jurisdiction and not reach merits | Held: When a court lacks subject-matter jurisdiction, actions other than dismissal are void; trial court properly declined to address merits |
Key Cases Cited
- WPW Acquisition Co v City of Troy, 254 Mich. App. 6 (MTT exclusivity and circuit court jurisdiction principles)
- Hillsdale Co Sr Servs., Inc. v Hillsdale Co, 494 Mich. 46 (scope of Tax Tribunal jurisdiction over refunds/redeterminations)
- Wikman v Novi, 413 Mich. 617 (MTT exclusivity; constitutional labels insufficient to defeat jurisdiction when claim contests assessment as arbitrary)
- Ammex, Inc. v Treasury Dep’t, 272 Mich. App. 486 (appeal routes from MTT decisions to appellate court)
- Sidun v Wayne Co Treasurer, 481 Mich. 503 (due-process notice standard for tax collection actions)
- McKesson Corp. v Div. of Alcoholic Beverages & Tobacco, 496 U.S. 18 (postdeprivation process can satisfy due process for certain tax collections)
- DaimlerChrysler Corp. v Dep’t of Treasury, 268 Mich. App. 528 (Michigan application of McKesson re: no predeprivation hearing required if adequate postdeprivation remedies exist)
- Todd v Dep’t of Corrections, 232 Mich. App. 623 (actions other than dismissal are void where court lacks subject-matter jurisdiction)
- Fast Air, Inc. v Knight, 235 Mich. App. 541 (issues not raised below are generally not preserved on appeal)