11/06/2006

Appeals Court dissolves receivership of Thompson Building

(November 6, 2006) In a major turn of events for the City of Ypsilanti, the receivership of the much maligned Thompson Building in Ypsilanti's Depot Town has been ordered removed. In a ruling handed down on November 2, 2006, by the Michigan State Court of Appeals, a three judge panel has ordered the receivership to be terminated.

The Court affirms that ownership of the building transfered to Barnes and Barnes in 2005 so no further receivership exists. It is unclear as to who has current ownership of the building. The City Assessor still lists David Kircher as the owner, however the building was sold on April 28, 2005 to Barnes. Stewart Beal has filed paper work with the City for tax credits under the state's obsolete property rehabilitation act (OPRA). Neither Barnes or Beal have disclosed the terms of their deal or who has current ownership of the property.

The court has also ordered that Judge Shelton account for expenses for the remediation for state fire code violations and the city building code violations under separate accounts and return any money not spent on remediating these two nuisances to Kircher.

Judge Shelton also came under fire from the Appeals Court for not properly supervising the expenditure of funds and for delaying action on the previous remand to Judge Shelton's court. The Appeals Court also found that the amount of the lien for the Sheriff's sale was not correct. However, the court did not invalidate the sale of the property to Barnes.

While it is unlikely the building will be returned to Kircher, Kircher has indicated that he has several other appeals are in process so final ownership is still in question. The biggest loser under this recent decision may be Stewart Beal as he had been spending money over the past year as the current receiver. The Appeals Court stated that no such receivership exists because of the sale to Barnes in April 2005, so Beal is not entitled to any money or a lien on the property.

[Editors Note: The city has responded to this posting by giving their own legal review of the Appeals Court decision.]

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