Detroit Business Law » Supreme Court

Breaking: Saurman Reversed

David E. Nykanen — Wed, 16 Nov 2011 22:03:11 +0000

The Michigan Supreme Court this afternoon issued a short (two page) Order that reversed the Court of Appeals opinion in Residential Funding Co. v Saurman, which I discussed previously. The Saurman opinion in the Court of Appeals had ruled that Mortgage Electronic Registration Systems, Inc. (“MERS”) could not foreclose by advertisement in the State of Michigan unless it owned the note.

The Supreme Court decided the case on Application for Leave to Appeal. Rather than grant leave to appeal, the Court instead ordered that oral argument be held upon the application for leave to appeal, and reversed the Court of Appeals.

The Supreme Court essentially adopted the dissenting opinion from the Court of Appeals, ruling that although MERS did not own the mortgage note itself, MERS was “recordholder of the mortgage,” which was a sufficient “interest in the indebtedness” to satisfy the statutory requirement that the foreclosing entity be an “owner of an interest in the indebtedness.” Essentially, the Supreme Court determined that the Court of Appeals improperly interpreted the meaning of the language of the foreclosure by advertisement statute.

This Supreme Court Order appears to definitively resolve the issue of whether MERS can foreclose a mortgage by advertisement in MERS’ name, rather than the name of the owner of the note, in the State of Michigan.

Important Supreme Court Decision on Corporate Free Speech

Mark Demorest — Tue, 26 Jan 2010 13:02:53 +0000

Last week, the Supreme Court issued an important decision on the free speech rights of corporations. The law has long recognized that, just like individuals, corporations are protected by the First Amendment to the Constitution. However, in 1990 (Austin v Michigan Chamber of Commerce) and in subsequent decisions, the Supreme Court had ruled that the government may restrict corporate expenditures to support or oppose political candidates. The Supreme Court overruled those earlier decisions in Citizens United v Federal Election Commission. Justice Kennedy wrote: “The Government may regulate corporate political speech through disclaimer requirements, but it may not suppress that speech altogether.” In other words, the government may require that the sponsor of the advertisement be disclosed, and whether it was approved by a particular candidate. However, the government may not prohibit or limit the amount of money spent by a corporation to support or oppose a particular candidate or issue.

Corporations previously used political action committees (PAC’s) to get involved in political activities. Based on the Supreme Court’s decision, the use of PAC’s may no longer be necessary.

Click here to download a PDF copy of the Supreme Court Decision.

This article was written by Mark S. Demorest, Managing Member of Demorest Law Firm.