Mary Glenn v. Huron-Clinton Metropolitan Authority
333940
| Mich. Ct. App. | Nov 21, 2017Background
- Plaintiff slipped exiting a waterslide at Turtle Cove Family Aquatic Center (TC) inside the Lower Huron Metropark and sued Huron-Clinton Metropolitan Authority (defendant) for negligence.
- Parties agreed that the only possible exception to governmental immunity was the proprietary-function exception (MCL 691.1413).
- Defendant moved for summary disposition arguing TC is not operated primarily to produce pecuniary profit and is normally supported by taxes/fees; it submitted financial records and deposition testimony (controller Franchock, operations manager Schuman).
- Plaintiff argued TC generates and funnels revenue (admissions, food, lockers, entry tolls) into defendant’s general fund and operated like a ‘‘cash cow,’’ pointing to 15-day revenue reports and defendant’s overall fund balance.
- The trial court denied summary disposition, finding genuine factual disputes over profit motive and the nature of the function; defendant appealed.
- The Court of Appeals reviewed de novo, applied the two-prong Coleman test (primary pecuniary purpose; not normally supported by taxes/fees), and reversed the trial court, holding TC is not operated primarily to produce a pecuniary profit and is supported by taxes/fees.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether TC was operated primarily to produce a pecuniary profit (Coleman prong 1) | TC generates surplus revenue (admissions, food, lockers, entry tolls), revenue goes into general fund, and deficits are rare — so TC is run for profit | TC aims to break even, accounts show indirect/ depreciation costs reduce any apparent profit, any surplus supports park operations, not unrelated projects | Held: No genuine issue — TC is not operated primarily for pecuniary profit; depreciation and indirect costs reduce profit and surpluses fund related park activities |
| Whether TC is an activity not normally supported by taxes or fees (Coleman prong 2) | Large fund balance and admission fees show commercial operation akin to private enterprise | TC is supported by a mix of taxes and fees and similar park activities are commonly tax/fee supported | Held: Also supports defendant — operation of a waterpark is normally supported by taxes and fees; court did not need to reach this prong but noted it favors defendant |
| Whether plaintiff raised a factual dispute sufficient to survive MCR 2.116(C)(10) | Plaintiff submitted disputed revenue reports and argued depreciation should be excluded from profit calculation | Defendant submitted affidavits, depositions, and adjusted revenue/expense figures including depreciation and indirect costs | Held: No genuine issue of material fact — defendant entitled to judgment as a matter of law under governmental immunity |
| Whether revenue placed in a general fund indicates proprietary purpose | Plaintiff: depositing revenue into general fund shows revenue used for unrelated functions and signals profit motive | Defendant: revenues used for related park functions; no diversion to unrelated municipal projects; fund balance partly from deferred capital spending | Held: Court found use of funds for related park activities and deferred expenditures weighs against proprietary-purpose finding |
Key Cases Cited
- Joseph v. Auto Club Ins. Ass'n, 491 Mich 200 (de novo review of summary-disposition ruling and standards for MCR 2.116(C)(10))
- Coleman v. Kootsillas, 456 Mich 615 (defines proprietary-function test: primary pecuniary purpose and not normally supported by taxes/fees)
- Dextrom v. Wexford County, 287 Mich App 406 (profits, transfers to unrelated projects, and official statements can create factual issue on pecuniary purpose)
- Smith v. Globe Life Ins. Co., 460 Mich 446 (standard for genuine issue of material fact on summary disposition)