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SUPCO Upholds Foreclosures That Don't Compensate Owners Or Taxpayers

Jun 26, 2020

The Ohio Supreme Court has ruled a foreclosure process that sells homes without compensating owners for their equity is legal. 

At issue was a process known as administrative foreclosures. Elliot Feltner, a Cleveland landowner, sued the Cuyahoga County Board of Revision in 2018 arguing the process was an unconstitutional government seizure. The court rejected Feltner's argument "because the board of revision did not patently and unambiguously lack jurisdiction when it proceeded in the foreclosure action at issue." Former Ohio Attorney General Marc Dann represented Feltner: 

Dann says he is litigating similar issues in Montgomery and Cuyahoga counties. Administrative foreclosures send abandoned properties to a county’s board of revision. The board can then give foreclosed properties to a local land bank, which can clear any debts and give the property to local businesses to resell. Opposing counsel Gus Frangos says it's a way to prevent blight:

Feltner's property was estimated to be worth 144 thousand dollars. In a sheriff's sale, the state would have recovered the 68 thousand dollars owed to taxpayers, and Feltner would have received the rest.