Articles Posted in Government & Administrative Law

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In consolidated cases, two municipalities sought to provide electric service through municipal electric utilities. Central to both cases was the applicability Michigan Administrative Code Rule 411 (sometimes referred to as a utility’s right to first entitlement). Rule 460.3411 (Rule 411) was inapplicable when a municipal utility is involved and has not consented to the jurisdiction of the Michigan Public Service Commission (PSC). Additionally, under the circumstances of each case, the Michigan Supreme Court found there was not a customer already receiving service from another utility; accordingly, MCL 124.3 did not prevent either plaintiff from providing electric service. View "City of Holland v. Consumers Energy Co." on Justia Law

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The Tax Tribunal erred by concluding that MCL 211.7n, a statute specifically exempting from taxation the real or personal property owned and occupied by nonprofit educational institutions, controlled over the more general statute, MCL 211.9(1)(a), which authorized a tax exemption for educational institutions without regard to the institution’s nonprofit or for-profit status. SBC Health Midwest, Inc., challenged the city of Kentwood’s denial of its request for a personal property tax exemption in the Tax Tribunal. SBC Health, a Delaware for-profit corporation, had requested a tax exemption under MCL 211.9(1)(a) for personal property used to operate the Sanford-Brown College Grand Rapids. The Michigan Supreme Court held the nonprofit requirement in MCL 211.7n did not negate a for-profit educational institution like SBC Health from pursuing an exemption under MCL 211.9(1)(a). The tax exemption outlined in the unambiguous language in MCL 211.9(1)(a) applies to all educational institutions, for-profit or nonprofit, that meet the requirements specified in MCL 211.9(1)(a). View "SBC Health Midwest, Inc. v. City of Kentwood" on Justia Law

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Helen Yono brought an action in the Court of Claims against the Department of Transportation, seeking damages for injuries sustained when she stepped into a depression in a parallel-parking space and fell. The Department moved for summary judgment under MCR 2.116(C)(7), claiming that it was entitled to governmental immunity. The Department acknowledged its duty, set forth in MCL 691.1402(1), to maintain the “improved portion of” M-22 that was “designed for vehicular travel,” but argued that Yono’s injury had not occurred on that portion of the highway because the parking lane was not designed for vehicular travel. Plaintiff countered that the entire roadbed, from one curb to the other, was designed for vehicular travel. The trial court denied the Department's motion, and a divided Court of Appeals affirmed. The majority observed that “the highway - including that portion designated for parallel parking - is a contiguous whole; the portion where parallel parking is permitted is not physically separated from the center of the highway by a median, driveway, or other barrier.” Guided by precedent and by the admonition to narrowly construe exceptions to governmental immunity, the Supreme Court concluded the parallel-parking lane, designated exclusively as such by painted lines on the highway, was not “designed for vehicular travel” within the meaning of the highway exception. Accordingly, the Court reversed the Court of Appeals, which held otherwise, and remanded for entry of summary judgment on behalf of the Department. View "Yono v. Dept. of Transportation" on Justia Law

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Plaintiff was walking on a sidewalk in defendant city when she was injured after tripping on a 2.5-inch vertical discontinuity between adjacent sidewalk slabs. She sued defendant, alleging inter alia that the sidewalk’s hazardous condition had existed for more than 30 days before her fall. However, in her deposition, she stated that she did not know for how long the discontinuity had existed. The only relevant evidence she submitted was three photographs of the defect taken by plaintiff’s husband about 30 days after the accident. Defendant moved for summary disposition pursuant to MCR 2.116(C)(7), (C)(8), and (C)(10). The trial court found plaintiff’s photographs insufficient to establish the defect’s origin and duration and granted summary disposition without specifying under which rule it had granted the motion. On appeal, the Court of Appeals noted that the trial court had reviewed material outside of the pleadings and therefore concluded that the trial court could not have granted summary disposition under MCR 2.116(C)(8). The issue this case presented for the Michigan Supreme Court's resolution was whether for purposes of the “highway exception” to governmental immunity from tort claims, MCL 691.1402, plaintiff’s photographs of a sidewalk defect taken about 30 days after plaintiff’s accident were sufficient evidence to establish a genuine issue of material fact regarding whether the defect existed at least 30 days before the accident. The Court concluded that such evidence alone was not probative of a sidewalk’s past condition and was thus insufficient, without more, to avoid summary judgment. Consequently the Court reversed the Court of Appeals judgment and reinstated the trial court’s dismissal of plaintiff’s action. View "Bernardoni v. City of Saginaw" on Justia Law

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Plaintiff Barbara Kozak alleged she was injured while crossing Kings Highway in Lincoln Park when she tripped over a three-inch elevation differential between the two slabs of concrete that met at the centerline of the street. Kozak and her husband filed suit against defendant, the city of Lincoln Park, pursuant to the “highway exception,” alleging that defendant failed to “maintain the highway in reasonable repair so that it is reasonably safe and convenient for public travel.” Defendant moved for summary disposition under MCR 2.116(C)(7) (governmental immunity) and (C)(10) (no genuine issue of material fact). The trial court granted defendant’s motion, and the Court of Appeals, in a divided unpublished opinion, affirmed, concluding that plaintiffs did not provide evidence to counter defendant’s assertions that the road was reasonably safe and convenient for public travel. Because the Supreme Court concluded that plaintiffs presented sufficient evidence to avoid summary judgment, it reversed the judgment of the Court of Appeals and remanded this case back to the circuit court for further proceedings. View "Kozak v. City of Lincoln Park" on Justia Law

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Defendant city of Lansing enacted an ordinance requiring contractors working on city construction contracts to pay employees a prevailing wage. Plaintiff Associated Builders and Contractors, a trade association, filed suit against Lansing, arguing that the ordinance was unconstitutional because municipalities did not have the authority to adopt laws regulating the wages paid by third parties, even where the relevant work is done on municipal contracts paid for with municipal funds. The Court of Appeals majority disagreed, and ruled that subsequent changes to state law had caused the controlling caselaw precedent, Attorney General ex rel Lennane v Detroit, to be “superseded.” The Supreme Court reversed, finding that the Court of Appeals erred by exceeding its powers for refusing to follow a decision from the Michigan Supreme Court that both applied and had not been overruled. Even so, the Supreme Court took the opportunity to overrule Lennane because subsequent constitutional changes "undercut its viability." The Court therefore vacated the Court of Appeals’ decision but affirmed the result. View "Associated Builders & Contractors v. City of Lansing" on Justia Law

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The Michigan Coalition of State Employee Unions and others brought an action in the Court of Claims against the State and various state agencies and officers, alleging that portions of 2011 PA 264, which amended the State Employees’ Retirement Act (SERA, MCL 38.1 et seq.), were unconstitutional because the resulting changes to retirement benefits altered rates of compensation or conditions of employment, which were within the exclusive authority of the Civil Service Commission to regulate. The Court of Claims granted plaintiffs’ motion for summary judgment. The Court of Appeals affirmed in part, reversed in part, and remanded, holding that SERA retirement benefits were properly classified as both “rates of compensation” and “conditions of employment,” neither of which was subject to legislative alteration. The Supreme Court reversed. "While the [Civil Service Commission] has considerable constitutional powers to manage the civil service system and to preserve its sphere of constitutional authority, the commission has no legislative powers. It may neither enact legislation nor revise an enactment, nor may it dictate that the Legislature repeal or modify an enactment. Therefore, we hold that because the commission has acquiesced in the application of SERA to the employees of the civil service system, plaintiff’s objections fail to establish a basis for relief." View "Michigan Coalition of State Employee Unions v. Michigan" on Justia Law

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The International Union, United Automobile, Aerospace, and Agricultural Implement Workers of America and others brought an action in the Court of Appeals against Nino Green and other members of the Michigan Employment Relations Commission, the Governor, and the Attorney General, seeking a declaratory judgment that portions of 2012 PA 349 (which amended the public employment relations act (PERA, MCL 423.201 et seq.), to prohibit public employers from requiring their employees to join a union or pay union-related expenses) were unconstitutional with respect to employees in the classified state civil service. The Court of Appeals held that the challenged portions of 2012 PA 349 were constitutional. Although the Supreme Court concluded that public collective bargaining was a method by which the Civil Service Commission (could choose to exercise its constitutional duties, the Court held that the commission could not effectively require civil servants to fund the commission’s own administrative operations. Accordingly, the Supreme Court affirmed the Court of Appeals on different grounds. View "UAW v. Green" on Justia Law

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At issue in this case was whether and to what extent (if any) an electric utility was entitled to the industrial-processing tax exemption for tangible personal property located outside its generation plants. The Court of Appeals held that plaintiff was entitled to the full industrial-processing exemption for the property. Upon review, the Supreme Court held that the property subject to this suit was simultaneously used for exempt “industrial processing” activity under MCL 205.94o(7)(a) and nonexempt “distribution” and “shipping” activities under MCL 205.94o(6)(b). In these circumstances, the taxpayer was entitled to the industrial-processing exemption based on the “percentage of exempt use to total use determined by a reasonable formula or method approved by the department [of Treasury].” MCL 205.94o(2). Accordingly, the Court affirmed the judgment of the Court of Appeals in part, reversed in part, and remanded to the Court of Claims for further proceedings. View "Detroit Edison Co. v. Dept. of Treasury" on Justia Law

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n consolidated appeals, the issue central to all that was presented for the Supreme Court's review was whether petitioners, who sold their principal residences in arm’s-length transactions, were entitled to refunds of the real estate transfer tax under the real estate transfer tax exemption set forth in MCL 207.526(u) when the state equalized value of the properties at the time of sale was less than it was at the time of their original purchases. The Court held that petitioners were entitled to refunds under the real estate transfer tax exemption in these circumstances. The Court of Appeals was reversed and the cases remanded to the Tax Tribunal for further proceedings, including reinstatement of its judgments in favor of petitioners. View "Gardner v. Dept. of Treasury" on Justia Law