Michigan Supreme Court: People vs March – Larceny Charges Dismissed After Fixtures Taken from Foreclosed Home

kitchen

“Hamood inspected the home on February 10, 2013, the day after the redemption period expired. Inside, he noticed various items missing, including kitchen cabinets, the kitchen countertop, a furnace, duct work, interior doors, a hot water tank, and an exterior air conditioner.”

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Michigan Supreme Court: People vs March – Larceny Charges Dismissed After Fixtures Taken from Foreclosed Home

Timothy P. March was charged with committing larceny in a dwelling house, MCL 750.360, and receiving, possessing, or concealing stolen goods worth more than $200 but less than $1,000, MCL 750.535(4)(a), for removing fixtures from a home that had been sold to John Hamood at a sheriff’s sale after a foreclosure proceeding. The home had been owned by defendant’s father, who had given defendant a power of attorney that included the right to possess and dispose of his father’s real property. Defendant took the fixtures from the home during the six-month period in which he could have redeemed the property under MCL 600.3240(8). Defendant moved to quash the information, arguing alternatively that a person could not commit larceny of a fixture and that he could not have wrongfully taken the property of another because he retained both legal title and the right of possession when the fixtures were removed. The court, Vera Massey Jones, J., initially denied defendant’s motion, but, after the prosecution conceded that defendant had the right to possess the house during the redemption period, granted defendant’s motion on reconsideration and dismissed the charges. The Court of Appeals, BORRELLO, P.J., and WILDER and STEPHENS, JJ., reversed and remanded in an unpublished opinion per curiam, issued December 4, 2014 (Docket No. 317697), holding that under People v Sheldon, 208 Mich App 331 (1995), an “owner” of property included not only the titleholder but also any person whose consent was necessary before property could be taken, and that therefore Hamood was also an owner of the property. Defendant applied for leave to appeal. The Supreme Court ordered and heard oral argument under MCR 7.302(H)(1) on whether to grant defendant’s application or take other peremptory action. 497 Mich 1041 (2015).

In a unanimous opinion by Justice MARKMAN, the Supreme Court held:

MCL 750.360 adopted the common law of larceny, which protects possessory rights. Because only defendant held possessory rights in the fixtures at the time he removed them, and Hamood held no such rights, defendant could not have committed larceny as charged. Absent a proper larceny charge, the fixtures were necessarily not stolen goods, and the charge of receiving or possessing stolen goods therefore failed as well. The Court of Appeals judgment was reversed and the trial court order dismissing the charges was reinstated.

1. Defendant was charged with larceny under MCL 750.360, which provides in part that any person who commits the crime of larceny by stealing in any dwelling house shall be guilty of a felony. The general crime of larceny is established in MCL 750.356, which provides in part that a person who commits larceny by stealing certain property of another, including money, goods, or chattels, is guilty of a crime. Michigan has no statutory definition of larceny, and all the statutes addressing larceny use the term’s common-law definition. That definition can be parsed into the following elements: (a) a trespassory taking and (b) the carrying away (c) of the personal property (d) of another (e) with intent to steal that property. To these elements, MCL 750.360 added element (f): the taking occurring within the confines of the building.

2. At common law, “property of another” for purposes of larceny referred to property that someone other than the defendant had the right to possess as against the defendant at the time of the taking. While the Michigan Supreme Court had not yet expressly defined “property of another” for purposes of the larceny statutes, its caselaw as well as caselaw from the Court of Appeals comported with the common-law proposition that property constitutes the “property of another” when someone holds the right to possess it as against the defendant at the time of the taking. To determine whether another held such rightful possession, courts must examine the respective rights of all relevant individuals to the property and decide whether any of them held a right to possess the property as against the defendant at the time of the taking. This assessment requires courts to consult the statutes, contracts, caselaw, and other sources that give rise to the individuals’ rights and define the relationship between those rights.

3. Defendant could not have committed larceny by taking the fixtures because, given that defendant had the right to possess the fixtures at the time of the alleged larceny, they did not constitute the “property of another.” “Possession” is defined as the fact of having or holding in one’s power, the exercise of dominion over property, the right under which one may exercise control over something to the exclusion of others, and the continuing exercise of a claim to the exclusive use of a material object. In general, possession is either actual or constructive. Fixtures intentionally annexed to real property become part of the mortgage security, and, upon foreclosure sale, title to them passes with the realty. Therefore, whatever rights Hamood had in the fixtures arose from his foreclosure purchase. A foreclosure-sale purchaser receives a deed at purchase that vests title at the end of the six-month redemption period if the mortgagor fails to redeem the property by paying the amount of the successful bid, interest on that amount, and various fees. The vesting of title confers on the purchaser those rights that existed at the time that the mortgage subject to foreclosure was executed, as well as those the mortgagor held at any time thereafter, under the relation-back doctrine. Because, in these circumstances, the purchaser is deemed to hold title retroactively, he or she can bring civil actions for damages done to the property during the redemption period; such actions may also be brought under MCL 600.3278. However, this interest is not a possessory right, let alone one that permits the purchaser to exclude the mortgagor from possession. Only after the mortgagor fails to redeem does the purchaser’s interest ripen into a legal title and endow the purchaser with the right of possession. Hamood, as the foreclosure-sale purchaser, thus held equitable title to the property during the redemption period, which gave him no possessory rights. Defendant, by contrast, held the sole right to possess the property. Therefore, defendant could not, by taking the property, have trespassed upon the “property of another,” because no one else had the right to possess it at that time. Consequently, defendant’s actions did not constitute a trespassory taking of the “property of another” and did not constitute larceny under MCL 750.360. And because the property was not stolen, defendant did not receive, possess, or conceal stolen goods under MCL 750.535(4)(a).

4. The Court of Appeals erred by assuming that Hamood was the “owner” of the fixtures for purposes of larceny, and thus that the fixtures were the “property of another” as against defendant, by virtue of Hamood’s supposed right to consent to their removal. An individual is not considered to “own” property because he or she may consent to its taking; rather, particular interests encompass the right to consent. Consent is an attribute or function of some property interests that is derived from a right to control the property, which in turn is an attribute or function of the right to possession of the property. The right to consent could not serve as a proxy for the right to possession, because neither of the sources of legal authority on which the court relied gives rise to the right to possession. MCL 600.3278 does not endow the purchaser with a possessory right, nor does the equitable title held by Hamood.

Court of Appeals judgment reversed; trial court order dismissing the criminal charges against defendant reinstated.

Full opinion below…

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4closureFraud.org

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People vs March

 

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