Ground rent confiscation law is stricken by the Maryland Court of Appeals.

The long awaited ground rent decision is here!  On October 25, 2011, the Maryland Court of Appeals published Muskin v. State Department of Assessments and Taxation, declaring a significant portion of the ground rent registration statute unconstitutional.

The short and sweet is this:  The legislature went beyond its authority to implement a “register or forfeit” system that transferred a ground rent owner’s reversionary interest to the lessee.  The Court recognized the vested ownership rights of ground rent owners, echoing my own thoughts from a previous post  about this appeal.  That post has links to the webcast of oral argument, if you like that sort of thing. Read about the important parts of this opinion, after the jump.

Last minute rush to register ground rents.

I love this article's reference to someone dropping off a disk containing hundreds of registration forms. These folks had three years to register. I bet many delayed to the last minute intentionally to punish the State for requiring registration.

But if you are dealing with a ground rent issue, don't count on the registry to be accurate or up-to-date for many months. The better practice is to continue to collect three years of ground rent and hold in escrow.