A Michigan retiree who says he mistakenly underpaid his property taxes by $8.41 has revealed that the county government seized a house he owned and sold it for a $24,500 profit.

Uri Rafaeli, 83, says he owed $8.41 in taxes on a rental property in Southfield after calculating the interest wrong on his 2011 taxes. The bill grew to $285 with penalties and interest.

Oakland County seized the house in 2014 and sold it for $24,500 but kept the balance, although the sale greatly exceeded the amount of overdue taxes.

His case is one of two that was brought before the Michigan Supreme Court on Thursday, where a lawyer for the plaintiffs argued that such seizures are illegal under the takings clause in the U.S. and Michigan constitutions.

Uri Rafaeli, 83, says he owed $8.41 in taxes on a rental property in Southfield after calculating the interest wrong on his 2011 taxes

'This is unjust and it is unconstitutional. ... The government can take the property and sell it, but it can only keep what it's rightfully entitled to,' said Christina Martin, an attorney for former property owners in Oakland County.

She called it 'stealing.'

The other plaintiff, Andre Ohanessian, owed about $6,000. Oakland County sold his 2.7 acres for $82,000 and kept the windfall. There are similar stories in other Michigan counties.

There is no dispute that state law allows county treasurers to keep money left over after overdue property taxes finally are paid from a sale. The issue for the court is whether the practice is illegal under the takings clause in the U.S. and Michigan constitutions.

John Bursch, arguing on behalf of Oakland County, told the Supreme Court that property owners have more than two years to avoid foreclosure because of unpaid taxes. But after foreclosure, he added, property rights are extinguished along with any other claims.

'This is not unjust enrichment' by local governments, Bursch said. 'When you're on notice and you fail to do something, you lose your rights.'

Oakland County seized Rafaeli's house (above) in 2014 and sold it for $24,500 but kept the balance, although the sale greatly exceeded the amount of overdue taxes

He urged the justices to rely on the Legislature to change the law if the public thinks it's unfair.

Bursch said more than $2 billion is at stake if the court declares the law unconstitutional.

'A ruling for the plaintiffs will ruin local governments,' Bursch said. 'There are currently class actions pending in all 83 county circuit courts and in our federal courts. ... That will come right out of schools, roads police, firefighters and other basic services.'

In a court filing, a coalition of counties, townships and other local governments acknowledged that the facts of the Rafaeli case 'could stir the indignation of any decent citizen.'

But the group said it wasn't a case of government 'taking the first opportunity to snatch property away from unsuspecting taxpayers.'

Oakland County said that it had sent repeated notices demanding payment to the homeowners before initiating foreclosure.

The county argued in a court filing that returning the proceeds from the sale of tax delinquent properties 'allows delinquent taxpayers to sit on their rights, conscript the county as real estate agent, then decide whether to reenter the picture depending on the sale’s success.'

The county argued that such a policy would allow tax cheats 'to privatize any gains while socializing all losses' and would inevitably result in rampant unpaid property taxes.

A spokesman for Oakland County Treasurer Andy Meisner declined to comment when reached by DailyMail.com on Friday.