The Paletz Law Blog

Michigan Supreme Court Still Exercising Superintending Control of Local Courts to the Detriment of Private Property Rights

No doubt, the pandemic has taken its toll on everyone. In the business arena, the two groups that have been affected the most are restaurants and landlords. In the beginning of Covid, they were literally prevented from making a living. As it has progressed, my clients have seen their rights abrogated without due process of law. Private contract rights have been annihilated and I have seen clients who have received $0 payments in 24 months. I’ve seen balances of $10K, $25K, even $50K of rents still owing.

This is not just multi-family and Real Estate Investment Trusts (REITs), these are mom and pop landlords who put their life savings into these rental properties. Despite all the rental assistance, they will never be made whole. And quite frankly it shouldn’t matter what size the landlord is, they are all Americans and their private property rights are at the core of our nation’s founding.

Without legislative oversight, the Michigan Supreme Court issued Administrative Order AO 2020-17 without a sunset provision, and it is continuing to wreak havoc. It has taken 60 years’ worth of well-founded landlord-tenant law and wiped it away. Many local trial court Judges are fatigued, dare I say miserable and veteran clerks have opted for early retirement with either no replacement, or green recruits without enough time for training. The dockets have exploded into a cacophony of endless adjournments after adjournments which are exasperated by the multiple housing agencies, also struggling with labor shortages to process the rental assistance applications.

Everyone agrees pre-pandemic there was an affordable housing crisis. Now, the aftermath of illegal eviction moratoriums, the mass court docket causing delays in obtaining repossession of the rental units, and the over $50 billion dollars of bad debt that is now at the doorstep of my clients have magnified this crisis and have jeopardized many more individuals’ ability to obtain rental housing.

Let’s be honest, pre-pandemic the overwhelming majority of eviction cases had no issue of triable fact, it was just about ability to pay as agreed to pursuant to the lease that the tenants signed. The reduction in these cases has more to do with the massive infusion of government monies that have flooded the market than taxpayer funded legal counsel. So, the fashionable new statistics that are touted in favor of continuing this mandate for tenant representation as it relates to lesser evictions are illusory.

The original eviction moratoriums and the constructive one that still exists under the cloud of AO 2020-17 have hurt tenants in the long term and will not help them. Those that think they have been helped are going to be deemed un-rentable as landlords are going to view them as too much of a credit risk, especially with the waiting list that now exists. Likewise, paying tenants have seen their rents increased. Further, urban areas where evictions have ground to a virtual halt will deter investment only exacerbating the supply of affordable housing.

The Bottom Line: The Michigan Supreme Court needs to rescind AO 2020-17 immediately. We have turned too many renters into squatters and have normalized chronic nonpayment to our inevitable collective detriment.