AG Maura Healey: Massachusetts foreclosure law cannot be repealed by ballot vote
This is a justiceleaguetaskforce article.
BOSTON — Attorney General Maura Healey has ruled that opponents of a new law related to clearing titles of foreclosed homes cannot attempt to repeal the law through a ballot referendum.
Healey wrote in a letter to Secretary of the Commonwealth William Galvin on Tuesday that the title clearing law “is not lawfully the subject of a referendum petition.”
Sarah McKee, a former federal prosecutor from Amherst who signed a petition to repeal the law that initiated the ballot referendum process, said she is disappointed in Healey’s ruling. “I’m disappointed that the attorney general who takes an oath to support the Massachusetts Constitution did not consider the ways in which this new law … actually violates the Constitution,” McKee said.
The new law, which was signed by Gov. Charlie Baker in November, limits the amount of time a person has to challenge a foreclosure and get his home back. Until this year, someone who believed his home was illegally foreclosed on had 20 years to challenge the foreclosure in court and potentially get his home back. As a result of a spate of improper foreclosures around the time of the 2008 market crash, homeowners who bought foreclosed properties were having trouble selling or refinancing their homes because of uncertainty about whether the title was clear.
The new law gives the person whose home was foreclosed on three years after a foreclosure or one year after the law was passed, whichever is later, to begin a court challenge to get his home back. After that time, the person can still sue the bank that foreclosed for monetary damages, but he cannot get his house back.
Supporters of the law say it is a way to protect innocent homeowners who purchased a property that was once foreclosed on. But opponents say the law infringes on the rights of victims of illegal foreclosures.
A group of anti-foreclosure activists tried to use a referendum to suspend the law and put it on the ballot in November 2016. The referendum process allows activists who can gather enough signatures to ask voters to repeal a law.
But state law bars votes on certain topics – including the power of the courts.
Healey wrote in a three-page letter that the title clearing law is not subject to a referendum petition because it relates to the power of the courts. Specifically, the law extends the jurisdiction of the Housing Court to a wider range of claims related to titles of foreclosed properties. Although that is not the portion of the law that its opponents are focusing on, Healey found that because the expansion of the Housing Court jurisdiction is a substantive part of the new law, the entire law is not subject to the referendum process.
“Because Section 1 is excluded from the referendum process by its relation to the powers of courts and because it is not incidental and subsidiary to the remainder of the Act, I am constrained to opine that the Act as a whole is excluded from the referendum process,” Healey wrote.
Brian McNiff, a spokesman for Secretary of the Commonwealth William Galvin, who oversees state elections, said now that Healey has ruled, the question will not go on the ballot. “That’s it. It doesn’t go forward,” McNiff said.
Anti-foreclosure activists have said they plan to challenge the law in court. McKee indicated that while it is too early to announce any next steps, the group is still considering a court challenge. Asked about the possibility of a lawsuit, McKee said, “If you were committed to upholding the rule of law, and you saw a law passed that was fundamentally unconstitutional, what would you do?”
McKee said she is disappointed that Healey ruled only on the narrow issue of whether the law relates to the courts. She and other members of the Massachusetts Alliance Against Predatory Lending coalition argue that the law is unconstitutional because it disproportionately affects black and Latino families and female heads of household, who were targeted for predatory mortgages and suffered disproportionately from foreclosures. They also say it breaches existing contracts by changing the terms of mortgages, that foreclosures should be handled by the courts and not the Legislature, and that there were technical problems with the law relating to its effective date.
“It’s inconsistent with the Constitution, and it collapses the frame of government that the Constitution establishes,” McKee said.
The coalition could also lobby a branch of government to ask the Supreme Judicial Court for an advisory opinion on whether the law is constitutional. But the House, Senate and governor appear unlikely to do so, since they passed and signed the original law.
Grace Ross, coordinator of the Massachusetts Alliance Against Predatory Lending, said she hopes Healey would consider asking the Supreme Judicial Court for an opinion. “What is shocking here is having run as she calls herself the chief consumer enforcement officer of our state, the Attorney General did not even let the voters address the unconstitutional taking of our people’s property rights,” Ross said in a statement. “We can only hope that, having denied the Voters’ powers to protect our own constitutional rights through the ballot, she has plans to take the law directly to the SJC herself as her oath of office requires.”
Healey said in an interview that her office will continue to be mindful of the need to protect consumers. “We’re going to always be looking for what else needs to happen, what more do we need to do to protect against subprime lending, against unlawful foreclosure practices and to protect homeowners,” Healey said.
Asked whether she has constitutional concerns with the law, Healey said she respects the law passed by the Legislature and will make sure it is enforced.
This story has been updated with Healey’s comments.
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