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Michigan Appeals Court Hears Arguments in Lawsuit Challenging Racially Discriminatory Tax Foreclosures in Detroit

8/01/17

NAACP Legal Defense Fund Present Arguments in Wayne County, MI Tax Foreclosure Case (Morningside v. Sabree)

Read the PDF verison of our statement

Michigan Appeals Court Hears Arguments in Lawsuit Challenging
Racially Discriminatory Tax Foreclosures in Detroit

Wayne County’s tax foreclosures disproportionately impact African-American homeowners

DETROIT, Mich. – Detroit residents at risk of losing their homes due to tax foreclosure had their stories heard in the Court of Appeals today in a lawsuit that alleges that Wayne County’s foreclosure practice has discriminated against African-American homeowners in violation of the Fair Housing Act. 

Attorneys from the ACLU of Michigan, NAACP Legal Defense & Educational Fund, Inc., and the law firm of Covington & Burling argued that the lawsuit must be heard in state court, as opposed to the Michigan Tax Tribunal, an administrative agency. Plaintiffs contend that the Fair Housing Act entitles them to have their claim heard in a state judicial forum.

The Court of Appeals heard the oral arguments and will issue its written opinion at a later date.

In the lawsuit, Plaintiffs allege that Wayne County and the Wayne County Treasurer have foreclosed on homes without regard to the accuracy of underlying property assessments. They contend that it is well known that Detroit and other cities in Wayne County failed to comply with their duty to assess properties on an annual basis, particularly during and after the Great Recession, when property values in Detroit plummeted.

“Wayne County’s practice of seizing and foreclosing on homes without regard to the accuracy of the underlying property assessments disparately impacts African Americans and violates the Fair Housing Act. It also destroys neighborhoods, breaks apart families, and undermines the area’s economic recovery,” said Coty Montag, Deputy Director of Litigation of the NAACP Legal Defense and Educational Fund, Inc., who argued the appeal. “Unfortunately, this is just the latest in a pattern of government-sponsored housing discrimination against African Americans in Wayne County and Detroit that goes back nearly 100 years.”

Without relief, the lawsuit says, thousands of home owners in Wayne County, mostly people of color in Detroit, will lose their homes. The Fair Housing Act bars not only intentional housing discrimination, but also neutral practices that have an adverse, disparate impact on people of color. The complaint alleges that the tax foreclosure rate in predominantly African-American neighborhoods in Wayne County is 10 to 15 times higher than the rate of foreclosures in predominantly non-African-American areas.

“Detroit’s tax foreclosure crises is a government-created catastrophe that is destroying neighborhoods and undermining the city’s economic recovery,” said Michael J. Steinberg, legal director of the American Civil Liberties Union of Michigan. “Nobody should lose their home for inability to pay taxes they never should have had to pay in the first place.”

Named plaintiffs in the suit are Detroit homeowners Walter Hicks, Julia Aikens, Dewhannea Fox, Edward Knapp, Robert Lewis, DeAunna Black and Spirlin Moore and a coalition of neighborhood associations:  Historic Russell Woods-Sullivan Area Association, the MorningSide Community Organization, the Oakman Boulevard Community Association and Neighbors Building Brightmoor. The lawsuit was also filed as a proposed class action on behalf of all African-American homeowners in Wayne County who are at risk of losing their homes through tax foreclosure. 

Walter Hicks says almost every homeowner in his neighborhood is facing the same situation. “The city claims that I owe thousands of dollars for property taxes from before 2013. I’m in a payment plan that required me to pay a portion of those back taxes every month plus fees and interest at a very high rate – even though the taxes were over-inflated in the first place,” Hicks said. “This lawsuit is not just important to me and my family. It’s bigger than us; it’s about the future of the City of Detroit and its commitment to its residents who have stuck through good times and bad.”

More details are available at http://www.aclumich.org/TaxForeclosures.

Press

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Founded in 1940, the NAACP Legal Defense and Educational Fund, Inc. (LDF) is the nation’s first civil and human rights law organization and has been completely separate from the National Association for the Advancement of Colored People (NAACP) since 1957—although LDF was originally founded by the NAACP and shares its commitment to equal rights. LDF’s Thurgood Marshall Institute is a multi-disciplinary and collaborative hub within LDF that launches targeted campaigns and undertakes innovative research to shape the civil rights narrative. In media attributions, please refer to us as the NAACP Legal Defense Fund or LDF.