Property Law Developments—Joseph William Singer

A recent Alabama immigration statute was held preempted by the Fair Housing Act because it required many mobile home owners to pay for a government-issued decal while prohibiting undocumented residents from making payments to government officials. In Central Alabama Fair Housing Center v. Magee, 2011 U.S. Dist. LEXIS 142788 (D. Ala. 2011), the federal District Court judge found a violation of the federal fair housing law because there was sufficient evidence of discriminatory intent by legislators against Latino residents (including legal residents) and because the law had a disparate impact on the Latino population without any legitimate government justification. Because the law made it illegal to drive or possess a mobile home without a decal and registration and because it was illegal for undocumented residents to obtain the decal, the law effectively made such persons homeless. The court found the law preempted by federal immigration laws but also found a fair housing violation because the judge interpreted the FHA to protects any person without regard to immigration status. Because a greater percentage of Latinos would be affected by the statute than others, a disparate impact was present and because the Constitution gives the federal government (and not the states) the power to regulate immigration, the state could not demonstrate a legitimate government interest that could justify the disparate impact.

Contrary to the ruling of some other courts, the Michigan Supreme Court held that MERS (Mortgage Electronic Registration Systems) has standing to foreclose on properties for which it is the record holder of the mortgage even if it does not “own’ the note or the right to moneys under the note. The court held that because MERS is the “holder of the mortgage, MERS owned a security lien on the properties, the continued existence of which was contingent upon the satisfaction of the indebtedness.” The court concluded that the legislature would want the record mortgage holder to have the right to foreclose on the property. The case is Residential Funding Co. v. Saurman, 805 N.W.2d 183 (Mich. 2011).