Workers' Compensation Agency Director v. MacDonald's Industrial Products, Inc.
305 Mich. App. 460
| Mich. Ct. App. | 2014Background
- MacDonald’s had an industrial facilities exemption certificate for its Kentwood facility; exemption conditioned on job creation and were revocable.
- The Commission revoked the exemption certificates in late 2006; MacDonald’s did not request a hearing, and the revocation became effective December 30, 2006.
- Woods, as receiver, paid property taxes on MacDonald’s properties from sale proceeds; tax liens included interest and penalties.
- Woods challenged (a) tax liens including interest/penalties and (b) retroactive revocation of exemption certificates.
- Circuit court denied relief on two grounds: (i) liens attached before Woods possessed the property; (ii) retroactive revocation of exemptions; this Court affirms in part and reverses in part.
- Court holds: lien interpretation includes interest/charges; retroactive revocation not valid but collateral attack unavailable; consent of jurisdiction preserved; equities not favored; overall affirmance with limits.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Effect of liens on penalties and interest | Woods argues penalties/interest not part of lien | Kentwood/Kent County argue liens include interest/charges | Lien includes amounts, interest, and charges |
| Whether 2006–2007 liens attach prior to receiver appointment | Woods claims no bite on pre-appointment liens | Lien priority supports pre-existing liens | Woods took property subject to 2006 and summer 2007 liens |
| Retroactive revocation of exemption certificates | Commission retroactively revoked certificates to affect 2006/2007 taxes | Certificate revocation may be retroactive under statutes | Revocation cannot be retroactive; effective date controlled by statute; not voidable collateral attack except direct appeal |
| Collateral attack and subject-matter jurisdiction | Woods may attack Commission decision outside direct appeal | Collateral attack improper; Commission had jurisdiction | Collateral attack not permitted; decision subject to direct appeal; jurisdiction exists |
| Equitable relief regarding penalties/interest | Wagner Estate invites waiving penalties as equity | Statutory priority requires payment of taxes first | Equity does not override statutory priority; penalties/interest not forgivable |
Key Cases Cited
- In re Dissolution of Ever Krisp Food Prods Co, 307 Mich 182 (1943) (pre-receiver taxation rules; taxes assessed against owner before appointment apply)
- In re Rite-Way Tool & Mfg Co, 333 Mich 551 (1952) (taxes assessed during administration treated as administration expenses; distinguishes Ever Krisp)
- Lake Twp v Millar, 257 Mich 135 (1932) (collateral attack allowed for want of jurisdiction; void orders voidable matters)
- Bowie v Arder, 441 Mich 23 (1992) (distinguishes void vs voidable; lack of jurisdiction renders void)
- Topps of Warren, Inc v City of Warren, Inc, 27 Mich App 59 (1970) (strict construction of tax statutes; limits on agency power)