Salem Springs, LLC v. Salem Township
312 Mich. App. 210
| Mich. Ct. App. | 2015Background
- Salem Springs, LLC (plaintiff) previously owned ~91.61 acres in Salem Township; in 2009 it transferred the property to Salem Springs Owner, LLC, a separate LLC which it now manages.
- In May 2012 the Salem Township Board rezoned the property to General Commercial; statutory publication notices were made and a resident, Norman Klein, filed a valid petition to submit the rezoning to a voter referendum.
- The November 6, 2012 referendum reversed the board and restored Agricultural-Residential zoning; plaintiff then filed a quo warranto action under MCL 600.4545 within 30 days of the election challenging the petition’s timeliness.
- Intervening defendants moved for summary disposition asserting plaintiff lacked statutory standing under MCL 600.4545 because it was not a prosecuting attorney, attorney general, nor a “citizen of the county.”
- The trial court granted summary disposition for plaintiff, finding Klein’s petition untimely; the Court of Appeals reversed, holding plaintiff lacked statutory standing and could not cure that defect by adding the actual owner-LLC after the 30-day limitations period.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Salem Springs, LLC has statutory standing under MCL 600.4545 as a “citizen of the county” to bring a quo warranto challenge to the election | Salem Springs: a corporation can be a “citizen”; plaintiff previously owned the land and now manages the owner-LLC, so it qualifies as a county citizen | Intervenors: plaintiff is neither an attorney nor a county resident/citizen and thus lacks statutory standing | Held: Plaintiff is not a citizen of Washtenaw County and lacks standing under MCL 600.4545; summary disposition for intervenors required |
| Whether plaintiff may rely on its managerial role in the owner-LLC to sue in its own name | Plaintiff: management authority over Salem Springs Owner effectively allows plaintiff to litigate the owner-LLC’s rights | Intervenors: manager must sue in the LLC’s name; separate legal-entity rules prevent plaintiff from asserting the LLC’s standing | Held: Manager cannot sue in plaintiff’s own name to assert LLC’s rights; action must be in Salem Springs Owner’s name |
| Whether plaintiff can amend to add Salem Springs Owner after the 30-day filing period | Plaintiff: failure to name the owner-LLC is a technical defect; amendment should be permitted | Intervenors: relation-back and misnomer doctrines do not allow addition of a new party after the statutory deadline | Held: Amendment to add a new party after the 30-day statutory period is not allowed; relation-back and misnomer doctrines inapplicable |
| Whether intervenors waived standing by stipulation earlier in the case | Plaintiff: intervenors stipulated to plaintiff’s amended complaint, so standing challenge waived | Intervenors: standing is jurisdictional and may be raised at any time | Held: Standing challenge was timely and not waived; jurisdictional standing can be raised and resolved on summary disposition |
Key Cases Cited
- Maiden v. Rozwood, 461 Mich 109 (1999) (standard of review for summary disposition)
- Miller v. Allstate Ins. Co., 481 Mich 601 (2008) (statutory standing and expressio unius principle)
- Barrow v. Detroit Mayor, 290 Mich App 530 (2010) (purpose and proof required in quo warranto election challenges)
- Belle Isle Grill Corp. v. Detroit, 256 Mich App 463 (2003) (corporate entity is separate and must sue in its own name)
- Miller v. Chapman Contracting, 477 Mich 102 (2007) (relation-back and misnomer doctrines do not permit adding new parties after limitations period)
- Hills & Dales Gen. Hosp. v. Pantig, 295 Mich App 14 (2011) (application of corporate separateness principles to LLCs)
- In re Beatrice Rottenberg Living Trust, 300 Mich App 339 (2013) (summary disposition appropriate where plaintiff lacks standing)