MARILYN FROLING REVOCABLE LIVING TRUST v BLOOMFIELD HILLS COUNTRY CLUB
Docket Nos. 275580, 277438, and 278383
Michigan Court of Appeals
Submitted December 9, 2008, at Detroit. Decided April 9, 2009, at 9:10 a.m.
283 MICH APP 264
The Marilyn Froling Revocable Living Trust brought an action in the Oakland Circuit Court against the Bloomfield Hills Country Club, Alan and Marilynne Kiriluk, Roger B. and Barbara Smith, Gregg and Cindi Williams, the city of Bloomfield Hills, and others, seeking damages arising out of the flooding of the plaintiff‘s residential property in Bloomfield Hills. The Kiriluks, Smiths, and Williamses made an offer to stipulate the entry of a judgment, to which the plaintiff did not respond. The court, Fred M. Mester, J., granted summary disposition in favor of the city, ruling that the doctrine of governmental immunity barred the claim against the city and that the plaintiff had failed to properly allege its inverse condemnation claim against the city. The court also granted summary disposition in favor of the Kiriluks, Smiths, and Williamses after determining that the three-year period of limitations had expired before the plaintiff brought its action. The court awarded attorney fees and costs to the Kiriluks, Williamses, and Smiths under the offer of judgment court rule,
The Court of Appeals held:
- The Michigan Supreme Court has completely and retroactively abrogated the common-law “continuing wrongs” doctrine in Michigan, including in nuisance and trespass cases. Therefore, the plaintiff cannot rely on the doctrine to save its claims.
- The facts show that the plaintiff‘s last claim first accrued in June 2001. The plaintiff‘s claims were time-barred because they were not filed by June 2004. The trial court properly granted summary disposition in favor of the Kiriluks, Williamses, and Smiths on the ground that the claim was not filed within the three-year period of limitation provided in
MCL 600.5805(10) . - The trial court did not err by granting the Williamses and the Smiths summary disposition. The plaintiff failed to support its claim that summary disposition was premature by identifying a disputed issue, supporting that issue with independent evidence, and offering an affidavit under
MCR 2.116(H) to support its contention. - The trial court did not err by granting summary disposition in favor of the city on the ground of governmental immunity. The plaintiff waived any argument that a sewage disposal system event exception to governmental immunity applied in this case.
- The plaintiff failed to allege any affirmative action by the city directed at the plaintiff‘s property. The trial court did not err by dismissing the inverse condemnation claim against the city.
- The offer of judgment made by the Kiriluks, Williamses, and Smiths was actually an attempt to enter a stipulated order of dismissal. The offer failed to meet the requirements for an offer of judgment under
MCL 2.405(A)(1) . The trial court erred by concluding that the Kiriluks, Williamses, and Smiths were entitled to an award of attorney fees and costs underMCL 2.405 . The parts of the trial court‘s orders awarding such costs and attorney fees must be reversed.
Affirmed in part and reversed in part.
MURPHY, P.J., concurring, wrote separately to state that there is no point in citing unpublished opinions in the majority‘s opinion when published opinions with precedential value exist.
1. NEGLIGENCE - LIMITATION OF ACTIONS - CONTINUING-WRONGS DOCTRINE.
The Supreme Court, in Garg v Macomb Co Community Mental Health Services, 472 Mich 263 (2005), and its progeny completely and retroactively abrogated the common-law “continuing wrongs” doctrine in Michigan jurisprudence, including in nuisance and trespass cases.
2. LIMITATION OF ACTIONS - ACCRUAL OF ACTIONS - NEGLIGENCE.
A plaintiff may not bring an action to recover damages for injury to property unless, after the claim first accrued, the action is commenced within three years after the time of the injury; a claim accrues at the time the “wrong” upon which the claim is based was done regardless of the time when damage results; the “wrong” is done when the plaintiff is harmed by the negligent act rather than when the defendant acted negligently (
3. MOTIONS AND ORDERS - SUMMARY DISPOSITION - DISCOVERY COMPLETION BEFORE SUMMARY DISPOSITION.
Summary disposition under
4. JUDGMENTS - OFFERS OF JUDGMENT - SETTLEMENT OFFERS - FINAL ADJUDICATION ON THE MERITS - RES JUDICATA.
A “judgment,” as contemplated by the court rule regarding offers to stipulate entry of a judgment, is one that has all the attributes of a judgment after full litigation, is considered a final adjudication on the merits, and implicates the doctrine of res judicata; an offer of settlement is not the same as an offer of judgment (
Secrest Wardle (by William P. Hampton and Shannon K. Ozga) and Marcelyn Stepanski for the city of Bloomfield Hills.
Potter, DeAgostino, O‘Dea & Patterson (by Steven M. Potter and Rick J. Patterson) for Alan and Marilynne Kiriluk.
Honigman Miller Schwartz and Cohn LLP (by Peter M. Alter and Michael P. Hindelang) for Roger B. and Barbara Smith and Gregg and Cindi Williams.
Before: MURPHY, P.J., and SAWYER and WHITBECK, JJ.
OPINION OF THE COURT
PER CURIAM. These consolidated appeals arise out of flooding on residential property located on Rathmor Road in the city of Bloomfield Hills. In Docket No. 275580, plaintiff Marilyn Froling Revocable Living Trust (the Froling Trust) appeals as of right the trial court‘s December 21, 2006, order granting the city of Bloomfield Hills (the city) and Alan and Marilynne Kiriluk, Roger and Barbara Smith, and Gregg and Cindi Williams (collectively, the neighbors) summary disposition and the trial court‘s ruling that the neighbors were entitled to attorney fees and costs under
I. BASIC FACTS AND PROCEDURAL HISTORY
A. THE FLOODING OF THE FROLINGS’ PROPERTY
In 1987, Harold Warner owned two adjacent lots on Rathmor Road in Bloomfield Hills, Michigan. Warner lived in a house on one of the lots, lot 6. The other lot, directly to the east, lot 5, was undeveloped. The Kiriluks purchased lot 5 in January 1987. And in June 1987, William and Marilyn Froling purchased lot 6. William Froling, an experienced real estate developer, met with Warner, walked around the property, and inspected the catch basins and water drainage system. The Frolings purchased the property “as is.”
In 1989, the Kiriluks began plans to build a house on their property. Before construction of the Kiriluks’ house, there had been a natural swale on the southwest corner of the Kiriluks’ lot. The swale served to move water away from the Frolings’ property. Engineers hired by the Kiriluks proposed a site plan that took into account the existing natural drainage system, and the city approved the plan. However, during construction, the Kiriluks brought in dirt to raise the height of their property, and during the re-grading of the lot, the Kiriluks filled in the swale, preventing the natural runoff of water from the southeast corner of the Frolings’ property. Despite this alleged deviation from the approved plan, the city issued an occupancy permit for the Kiriluks’ home.
In April 1989, the Frolings began experiencing significant flooding on their property. William Froling testified that during heavy rain that month he witnessed water surging through a culvert constructed under Rathmor Road and flowing onto the south side of the road. The flooding was so severe that the water levels reached the steps of the front and back porches of the Frolings’ home.
From then on, on numerous occasions following periods of heavy rain or spring thaw, substantial amounts of water would pool on the Frolings’ property, particularly on the west and south sides of their home. According to William Froling, the most significant periods of flooding occurred in June 1996, June 1997, June 2001, April and May 2004, and January 2005. During the June 1997 incident, the Frolings’ basement was completely flooded, causing over $20,000 in property damage. According to the Frolings, in addition to the Kiriluks’ construction, re-grading, construction, and re-direction of water flow on other neighboring properties, including those owned by the Williamses and the Smiths, also contributed to the flooding on their property.
In September 1989, William Froling wrote to the city, requesting that it take steps to alleviate any further flooding problems on his property, asserting that the city should have taken proper precautions when it approved the subdivision plan. Notably, despite claiming that Warner “said he never had any serious water problems while he lived there,” Froling indicated that he was put on notice of potential flooding problems at the time he bought the property:
When I bought the house from Mr. Harold Warner, I asked him why he didn‘t install lawn sprinklers and his remark was “Well, live there a year first and I think you will find out you won‘t need sprinklers!” Of course, I did not know what he meant.
In November 1989, the city wrote a letter to William Froling, stating that the city‘s policy was to not involve itself in storm water damage in existing subdivisions and that it was the various property owners’ responsibility to resolve any storm water drainage problems affecting their property. More specifically, the city explained as follows:
In 1923, when the Donnelly Farms Subdivision Plat was approved, drainage easements or other utility easements were not required by Bloomfield Township, which granted the plat approval. By today‘s standards, a retention basin with adequate holding capacity and regulated release of storm water would be required. The City of Bloomfield Hills does not involve itself in storm water drainage concerns, except where new subdivisions are being considered or the property being developed is in a floodplain....
Historically, as property developed, each developer was responsible for their storm water runoff. In the 1960‘s, the City‘s concern was to prevent any storm water from entering the sanitary sewer system and this is a continuing concern to the City of Bloomfield Hills and other governmental agencies today.
In addressing stormwater [sic] drainage, each property owner is responsible for their own specific problems—some involve trenching or berming, others with their own storm sewer and culverts, and some have installed retention ponds on their property. Any of these methods implemented, have been at the affected property owner‘s expense. In some instances, where the drainage solution of one property owner detrimentally affects another, civil action in court results in a workable solution.
In your subdivision, . . . your property is on the lowest elevation. My predecessor, who served the City of Bloomfield Hills for the past forty years, told me he had suggested to the Homeowners Association at one time, that they acquire the vacant lot as a retention pond for stormwater [sic] runoff. However, there was no interest in that proposal, as no one was having drainage problems and the value and location of the property warranted development.
I am not aware of any other stormwater [sic] runoff problems in your subdivision and the solution to your specific problem would appear to be best resolved by accommodating the existing flows of water around your property so as not to affect your home. You can accomplish this by one of the above mentioned methods without involving your neighbor‘s property; although, you could take this before your Homeowner Association to determine if sufficient interest exists to explore other engineering solutions.
In October 1990, the city wrote to the Frolings again, stating that the cost of installation of any storm drain system to alleviate storm water runoff on private land would be the property owners’ responsibility.
In 1995, the Smiths’ basement flooded with water. The Smiths blamed the flooding on water coming from the Bloomfield
In June 1997, the Frolings’ property was flooded again, causing a substantial amount of property damage. After that flood, William Froling wrote to the city commissioners, requesting that they consider construction of a storm water drainage system. In that letter, Froling stated that a neighbor had told him that Warner used a canoe to get off the property after a heavy rain. Froling claimed that the city erred in approving the Kiriluks’ construction and that the city had “confiscated” his property for a retention pond.
The city again hired engineers to study the drainage problems. And in October 1997, the engineers reported their findings to the city‘s manager, stating that “the existing drainage system is not of a size large enough to adequately handle the upstream drainage during larger storm events.” The engineers drew up a proposed storm drainage system to “be constructed by the home owner.” The engineers estimated that the cost of the project would be approximately $210,000. Residents of Rathmor Road then signed a petition, requesting that the city construct a storm sewer consistent with the engineers’ plan and proposing that the construction be paid through general tax revenues. The city rejected the proposal.
In March 2000, the Frolings retained a realtor to market their home. However, the realtor advised them that the flooding problems had to be resolved before the home could be sold. The realtor also advised them that, absent a permanent correction of the flooding problems, the property was ” ‘not saleable’ as is.”
In September 2000, after more flooding, William Froling wrote a letter to the city mayor, explaining that during this most recent incident, water was pouring onto their land from every direction, from the east and the Kiriluks’ lot, from the north through the culverts under Rathmor Road, and from the golf course to the south. Froling proposed the creation of a special assessment district to construct the storm water system that the city‘s engineers had proposed. The city responded that a special assessment would not be established without a petition signed by area residents.
In 2002, the Country Club added multiple pipes to its course for additional drainage. The pipes tied directly into the pipes that already extended to the Smith/Williams pond.
In May 2004, rain fell consistently over an 18-day period, and the Frolings’ property was flooded again. The Frolings had to hire workers to pump the floodwater away from their house.
In September 2004, the city‘s engineers submitted another report to the city, suggesting alternative proposals to remedy the storm water drainage problems. The engineers estimated that the updated cost of construction was approximately $350,000. The engineers explained, however, that “these options are to take water away from Mr. Froling‘s property at property
B. THE FROLING TRUST‘S COMPLAINT
On November 8, 2004, the Froling Trust1 filed the present suit, alleging that, among others,2 the city and the neighbors had taken actions that increased the flow of the water entering the Frolings’ property. More specifically, the Froling Trust asserted claims of nuisance and trespass against the neighbors. The Froling Trust also asserted a claim of intentional trespass against the Kiriluks. With respect to the city, the Froling Trust asserted claims of gross negligence and taking by inverse condemnation for not preventing the flooding.
C. THE NEIGHBORS’ OFFER TO STIPULATE
On January 7, 2005, the neighbors served on the Froling Trust an offer to stipulate the entry of a judgment, offering to resolve all the claims made against them for a total of $100. The offer stated that it was being made “to compromise and settle disputed claims and should not be construed as an admission of any allegation or liability on any claim” and that “no judgment entered pursuant to this offer shall operate as an adjudication of the merits of any allegation or claim.” The Froling Trust did not respond.
D. THE CITY‘S MOTION FOR SUMMARY DISPOSITION
In August 2005, the city moved for summary disposition under
After hearing oral arguments on the motion, the trial court granted the city‘s motion for summary disposition. The trial court ruled that the doctrine of governmental immunity barred the Froling Trust‘s claims against the city. The trial court also agreed with the city that the Froling Trust‘s inverse condemnation claim failed because the complaint did not allege any direct action that the city took against the Frolings’ property. Accordingly, the trial court dismissed the city from the action with prejudice.
E. THE NEIGHBORS’ MOTIONS FOR SUMMARY DISPOSITION
In March 2006, the neighbors moved for summary disposition under
After hearing oral arguments on the motion, the trial court first found that a claim for flooding, like the Froling Trust alleged, accrues at the time the land was first visibly damaged. The trial court explained that damages that accrue at a later date do not renew the limitations period or give rise to a new cause of action. Quoting this Court in Horvath v Delida,4 the trial court stated that ” ‘a continuing wrong is established by continual tortious acts, not by continual harmful effects from an original, completed act.’ ” The trial court then concluded that the evidence established that the Frolings knew that the land was first visibly damaged in 1989; thus, the court stated that it needed to address the evidence that supported a continuing act separately with regard to each defendant. The trial court ruled that the Froling Trust had failed to produce evidence that the Kiriluks and the Williamses made any recent changes to the land in the three years preceding the complaint that could give rise to a finding of a new tortious act. With respect to the Smiths, however, the trial court concluded that a genuine issue of material fact remained regarding whether the Smiths’ installation of a new outlet pipe on their property had contrib-
uted to flooding on the Frolings’ property. Accordingly, the trial court granted summary disposition to the Kiriluks and the Williamses, but denied summary disposition with regard to the Smiths.
The Smiths later renewed their motion for summary disposition under
F. THE NEIGHBORS’ MOTIONS FOR COSTS AND ATTORNEY FEES
The Kiriluks moved for partial costs and attorney fees in the amount of $35,861.27 with regard to their representation by Potter, DeAgostino, Campbell & O‘Dea (the Potter firm), the second of two law firms that represented the Kiriluks. The Kiriluks argued that the Froling Trust‘s claims were frivolous and that the Kiriluks were entitled to fees and costs under the offer of judgment rule.5 The Kiriluks also moved for costs in the amount of $146,793.44 with regard to their representation by Honigman Miller Schwartz and Cohn LLP (Honigman Miller), the law firm that initially represented the Kiriluks and also jointly represented the Williamses and the Smiths. The Kiriluks again asserted the offer of judgment rule in support of their motion. Also citing the offer of judgment rule, the Williamses moved for costs in the amount of $89,953.28 with regard to their representation by Honigman Miller.
The trial court held that the Kiriluks and the Williamses were entitled to an award of attorney fees and costs, but the trial court reserved its ruling on the amount of the award pending an evidentiary hearing. After holding an evidentiary
The Smiths, citing the offer of judgment rule, also moved for costs in the amount of $158,630.94 with regard to their representation by Honigman Miller. The trial court held that the Smiths were entitled to an award of attorney fees and costs, and after holding an evidentiary hearing, the trial court awarded $140,181.32 to the Smiths for Honigman Miller‘s representation.
G. THE PRESENT APPEALS
In January 2007, the Froling Trust appealed the trial court‘s orders granting the city and the neighbors summary disposition and the trial court‘s orders ruling that the neighbors were entitled to attorney fees and costs under
II. MOTIONS FOR SUMMARY DISPOSITION
A. STANDARD OF REVIEW
Under
Although review under
B. THE NEIGHBORS’ MOTIONS FOR SUMMARY DISPOSITION
1. STATUTE OF LIMITATIONS AND THE CONTINUING WRONGS DOCTRINE
Claims of property damage are subject to a three-year period of limitations. Specifically,
(1) A person shall not bring or maintain an action to recover damages for injuries to persons or property unless, after the claim first accrued to the plaintiff or to someone through whom the plaintiff claims, the action is commenced within the periods of time prescribed by this section.
* * *
(10) The period of limitations is 3 years after the time of the death or injury for all other actions to recover damages for the death of a person, or for injury to a person or property.
And, according the accrual statute, the period of limitations begins to run from the time the claim accrues, which is “the time the wrong upon which the claim is based was done regardless of the time when damage results.”13
The Michigan Supreme Court, however, has long recognized an exception to the application of a statutory period of limitations “[w]here there are continuing wrongful acts....”14 Under the doctrine, sometimes referred to as the “continuing wrongs doctrine,” when the nuisance is of a continuing nature, the period of limitations does not begin to run on the occurrence of the first wrongful act; rather, the period of limitations will not begin to run until the continuing wrong is abated.15 This Court later confirmed that the doctrine applied in nuisance and trespass cases.16
In light of this doctrine, the Froling Trust contends that when it filed this case in November 2004, it presumed that the continuing wrongs doctrine barred the application of the pertinent statute of limitations. The Froling Trust goes on to concede, however, that in May 2005, the Michigan Supreme Court issued its opinion in Garg v Macomb Co Community Mental Health Services.17
In Garg,18 the Michigan Supreme Court overruled Sumner v Goodyear Tire & Rubber Co19 with respect to its application of the “continuing violations” doctrine. In Sumner, the Court followed federal precedent and applied a “continuing violations”
Garg, the Court held that the doctrine was contrary to the statute of limitations in
Section 5805 does not say that a claim outside this three-year period can be revived if it is somehow “sufficiently related” to injuries occurring within the limitations period. Rather, the statute simply states that a plaintiff “shall not” bring a claim for injuries outside the limitations period. Nothing in these provisions permits a plaintiff to recover for injuries outside the limitations period when they are susceptible to being characterized as “continuing violations.” To allow recovery for such claims is simply to extend the limitations period beyond that which was expressly established by the Legislature.22
The neighbors argue that the holding in Garg completely abrogated the use of the continuing wrongs doctrine in Michigan. However, as the Froling Trust points out, Garg and Sumner dealt with employment discrimination claims. And, the Froling Trust notes, in Attorney General ex rel Dep‘t of Environmental Quality v Bulk Petroleum Corp,23 this Court appeared to suggest in a footnote that Garg‘s abrogation of the “continuing wrongs” doctrine was limited to the civil rights context. In Bulk Petroleum Corp, after stating that the continuing wrongs doctrine has only been applied in the limited context of nuisance, trespass, and civil rights cases, the Court then noted in a footnote that Garg abrogated the use of the doctrine in “claims filed under the Civil Rights Act,
Disabilities Civil Rights Act,
The law relating to the current viability of the continuing wrongs doctrine in the context of nuisance and trespass claims is hopelessly confused.25 Notably, this confusion might be due to the fact that several different terms have been used to refer to the same doctrine, including, for example, “continuing wrongs doctrine,” “continuing violations doctrine,” “continuing-wrongful-acts doctrine,” and “continuing tort doctrine.”
Since the issuance of Garg, numerous panels of this Court have had the opportunity to consider continuing wrongs arguments. However, most of these decisions have been unpublished,26 and unpublished
sions have no precedential value.27 Besides the Bulk Petroleum Corp panel, only three other panels of this Court have issued published opinions addressing the doctrine.
Six months before this Court released Bulk Petroleum Corp in September 2007, a panel of this Court decided and issued an unpublished decision in Schaendorf v Consumers Energy Co in March 2007. Schaendorf was approved for publication in May 2007.28 In that case, this Court cited Garg and concluded that “the continuing-wrongful-acts doctrine is no longer viable with respect to claims arising beyond the period of limitations.”29 Accordingly, the panel held that the trial court erred by not dismissing the plaintiffs’ nuisance claim.30
On April 15, 2008, a panel of this Court decided and issued an unpublished opinion in Dep‘t of Environmental Quality v Waterous Co. Waterous Co was approved for publication on June 24, 2008.31 In that case, the panel concluded that the continuing wrongs doctrine applied to an action alleging a recurrent nuisance.32
Meanwhile, on April 22, 2008, another panel of this Court issued a published
In considering the parties’ arguments, the Terlecki panel examined Garg and concluded that Garg was not limited to discrimination cases because in that case the Court was looking at the plain text of the limitations and accrual statutes when it held that the ” ‘the doctrine has no continued place in the jurisprudence of this state.’ ”39 Therefore, applying Garg, the Terlecki panel concluded that the continuing wrongs doctrine did not apply and that the timeliness of the plaintiffs’ claims needed to be determined under the plain text of
As can been seen from the line of recent published cases addressing the continuing wrongs doctrine, there is a clear conflict regarding its continued viability in cases alleging nuisance and trespass. Despite this conflict, we follow the holding and rationale of Schaendorf and Terlecki to the extent that they adopt Garg as applying beyond the context of civil rights claims to completely abrogate the continuing wrongs doctrine in trespass and nuisance actions as well. Under the “first out” rule of
However, the Michigan Supreme Court recently abolished another common-law modification of the Legislature‘s statutory scheme of periods of limitations and, in so doing, gave its decision retroactive application despite the language of
Even when a decision meets the threshold criterion for prospective application because it clearly establishes a new principle of law, we must consider: “(1) the purpose to be served by the new rule, (2) the extent of reliance on the old rule, and (3) the effect of retroactivity on the administration of justice.” Here, prospective-only application is inappropriate. First, the very purpose of our holding is to respect limits the Legislature has placed on plaintiffs’ abilities to revive suits relying on events occurring in the distant past; prospective application is therefore directly opposed to our resolve to honor the Legislature‘s policy choice. Moreover, as we already explained, the very nature of the
discovery rule defies any reliance on its operation.
Finally, the administration of justice is not significantly affected because the rights and interests of plaintiffs and defendants are opposed in these matters; although plaintiffs may be denied relief for stale claims, defendants and the judiciary are relieved from having to defend and decide cases based on deteriorated evidence.48
The same rationale applies with regard to the continuing wrongs doctrine. The purpose of the holdings in Garg and its progeny was to respect the limits the Legislature has placed on a plaintiff‘s ability to revive a suit by relying on events occurring in the distant past for which only the damaging effects remain. Further, the nature of the continuing wrongs doctrine, in direct conflict with the statute of limitations and the accrual statute, defies any reliance on its operation. Finally, just as with the discovery rule, the administration of justice is not significantly affected because the rights and interests of plaintiffs and defendants are opposed in these matters. Although plaintiffs may be denied relief for stale claims, defendants and the judiciary are relieved from having to defend and decide cases based on deteriorated evidence.
Accordingly, we conclude that Garg and its progeny completely and retroactively abrogated the common-law continuing wrongs doctrine in the jurisprudence of this state, including in nuisance and trespass cases. Therefore, the Froling Trust‘s arguments fail to the extent that it relies on that doctrine to save its claims.
2. APPLYING THE PLAIN LANGUAGE OF MCL 600.5805(10)
The Froling Trust nevertheless argues that, even in the event that we interpret Garg as requiring the application of the plain language of
As stated,
(1) A person shall not bring or maintain an action to recover damages for injuries to persons or property unless, after the claim first accrued to the plaintiff or to someone through whom the plaintiff claims, the action is commenced within the periods of time prescribed by this section.
* * *
(10) The period of limitations is 3 years after the time of the death or injury for all other actions to recover damages for the death of a person, or for injury to a person or property. [Emphasis added.]
And, according to the accrual statute, a period of limitations begins to run from the time the claim accrues, which is “the time the wrong upon which the claim is based was done regardless of the time when damage results.”49
In Trentadue, the Court explained that because under
[o]nce all of the elements of an action for... injury, including the element of damage, are present, the claim accrues and the statute of limitations begins to run. Later damages may result, but they give rise to no new cause of action, nor does the statute of limitations begin to run anew as each item of damage is incurred.52
The operation of these principles can be seen in a case with similar factual circumstances. In Terlecki, the defendants’ last negligent conduct was in 2001 when they capped a pipe running through a culvert near the plaintiffs’ property.53 That same year, the plaintiffs began experiencing flooding and tree damage on their property.54 Applying the plain language of
Here, William Froling‘s testimony revealed that the Kiriluks’ last action with regard to drainage of water on their lot was in November 1998. (Throughout their brief the Kiriluks claim that the last act was done in 1997; however, William Froling testified that, to his knowledge, the Kiriluks had not “done anything else with regard to [their] property... since November 18th of 1998.“) The Smiths’ last allegedly wrongful conduct occurred in 1995 or 1996, and the Williamses’ last allegedly wrongful conduct occurred in 1997. Therefore, William Froling‘s testimony established that the last act of any of the three neighboring defendants at issue occurred in 1998. And the Froling Trust alleged that the Frolings next experienced flooding in June 2001. Therefore, it was during this June 2001 flooding that the Froling Trust suffered its first harm from the neighbors’ last negligent act. In other words, after the last of the neighbors allegedly acted negligently in 1998, the harm first occurred, or accrued,56 in June 2001. Accordingly, the subsequent flooding in May 2004 could only have been the continued result of the neighbors’ completed conduct. Subsequent claims of additional harm caused by one act do not restart the claim previously accrued. For the purposes
Here, the Froling Trust‘s last claim first accrued with the flooding in June 2001. Thus, to be timely, the Froling Trust needed to file its claim by June 2004. But because it did not file its claim until November 2004, the Froling Trust‘s claims were time-barred. Accordingly, we conclude that, applying the plain language of
3. DISCOVERY NOT YET COMPLETE
The Froling Trust argues that the trial court erred by dismissing the Froling Trust‘s claims against the Smiths and the Williamses because it was not given the opportunity to depose them regarding whether they approved the Country Club‘s actions in 2001 and 2002 of tying its drainage pipes to the pipes that flowed into the Smith/Williams pond.
Generally, summary disposition under
Here, the Froling Trust argues that it should have been allowed to conduct further discovery so that it could determine whether the Smiths and the Williamses had any involvement in the Country Club‘s 2001 and 2002 conduct of tying in pipes to flow into the Smith/Williams pond. However, the Froling Trust has not shown that there was a fair chance that further discovery would have revealed any evidence of the Smiths’ or the Williamses’ involvement with the Country Club and its conduct. Significantly, the Froling Trust fails to offer an affidavit that supports the contention that any such evidence even exists. Indeed, to the contrary, the Smiths and the Williamses have provided affidavits in which they attest that they had no knowledge of the Country Club‘s conduct.
C. THE CITY‘S MOTION FOR SUMMARY DISPOSITION
1. GOVERNMENTAL IMMUNITY
The Froling Trust argues that the trial court erred by dismissing the Froling Trust‘s claims against the city on the basis of governmental immunity61 because the trial court failed to consider the “sewage disposal system event” exception to governmental immunity.62 However, as the city argues, and as counsel for the Froling Trust conceded at oral argument, the Froling Trust waived this argument regarding the sewage disposal system event exception by not properly preserving it in the lower court proceedings. Accordingly, we conclude that there is no merit to the Froling Trust‘s argument that the trial court erred by granting the city summary disposition on the ground of governmental immunity.
2. INVERSE CONDEMNATION
The Froling Trust argues that the trial court erred by dismissing the Froling Trust‘s inverse condemnation claim against the city because it erred by determining that the Froling Trust failed to allege any affirmative action by the city directed at the Frolings’ property.
A taking for purposes of inverse condemnation means that governmental action has permanently deprived the property owner of any possession or use of the property.63 When such a taking occurs, the Michigan Constitution entitles the property owner to compensa- tion for the value of the property taken.64 A plaintiff alleging inverse condemnation must prove a causal connection between the government‘s action and the alleged damages.65 For a taking to occur, “there must be some action by the government specifically directed toward the plaintiff‘s property that has the effect of limiting the use of property.”66 In other words, the plaintiff must prove that the government‘s actions were a substantial cause of the decline of the value of the plaintiff‘s property and must establish that the government abused its legitimate powers in affirmative actions directly aimed at the plaintiff‘s property.67 In determining whether a taking occurred, the form, intensity, and deliberateness of the governmental actions toward the injured party‘s property must be examined.68
Here, the Froling Trust argues that the city has taken the Frolings’ property for public use because the city has refused to construct a drainage system to cure their private water problems and because the city approved the Kiriluks’ construction plans. However, the Froling Trust‘s claim must fail because it has not alleged any affirmative action by the city directly aimed at the Frolings’ property. Further, because the Froling Trust‘s claim is without merit, the trial court did not err by not giving the Froling Trust another opportunity to amend its complaint.71
Accordingly, we conclude that the trial court did not err by dismissing the Froling Trust‘s inverse condemnation claim because there is no merit to its claim since it failed to allege any affirmative action by the city directed at the Frolings’ property.
III. ATTORNEY FEES AND COSTS
A. STANDARD OF REVIEW
We review for clear error the findings of fact underlying an award of attorney fees.72 “A finding is clearly erroneous when, although there is evidence to support it, the reviewing court on the entire record is left with a definite and firm conviction that a mistake was made.”73 We review de novo underlying questions of law,74 and we also review de novo the interpretation and application of the offer of judgment rule.75
B. THE NEIGHBORS’ ENTITLEMENT TO ATTORNEY FEES AND COSTS UNDER MCR 2.405
Generally, attorney fees are not recoverable as an element of costs or damages unless expressly allowed by statute, court rule, common-law exception, or contract.76 Under
The Froling Trust argues, in pertinent part, that
Pursuant to
MCR 2.405 , Defendants Alan Kiriluk and Marilynne Kiriluk, Roger B. Smith and Barbara Smith, and Gregg Williams and Cindi Williams offer to resolve all of the claims brought in Plaintiff‘s Complaint by entry of a judgment in the amount of $100.00 against Defendants Alan Kiriluk and Marilynne Kiriluk, Roger B. Smith and Barbara Smith, and Gregg Williams and Cindi Williams and in favor of Plaintiff. This offer is made to compromise and settle disputed claims and shall not be construed as an admission of any allegation or liability on any claim. Further, no judgment entered pursuant to this offer shall operate as an adjudication of the merits of any allegation or claim.
This Court has explained that an offer of settlement is not the same as an offer of judgment.82
An agreement to settle does not necessarily result in a judgment. Although it usually results in a stipulated order of dismissal with prejudice, such an order does not constitute an adjudication on the merits. It merely “signifies the final ending of a suit, not a final judgment on the controversy, but an end of that proceeding.” The plain language of
MCR 2.405(A)(1) clearly requires an offer of judgment, not just an offer to settle.83
“Unlike the traditional settlement process that involves negotiations between the parties as well as compromise, an offer of judgment is a unilateral attempt to conclude a lawsuit without necessarily exercising arms length negotiations.”84
[An]
[A]n offer of judgment more nearly emulates a judgment after a trial rather than a form of settlement. . . . [T]he key defining point is that private party settlement or mediation involve collective consideration of the facts favoring each
party, discussion of the issues, arms-length negotiation and compromise, and contemplation of both entry of judgment and dismissal of the action, whereas an offer of judgment is a unilateral act seeking final resolution of a controversy with sanction of a court by entry of an enforceable judgment. This unilateral act results from a party‘s independent evaluation of the merits of the case with an eye toward complete resolution of the matter.85
“[A] judgment entered pursuant to the acceptance of an offer of judgment under
Here, the record demonstrates that the neighbors’ offer was a unilateral attempt, based on their independent evaluation of the merits of the case, to conclude the lawsuit without the need for engaging in arms-length negotiation and compromise. And the neighbors clearly offered to resolve the pending claims for a sum certain “by entry of a judgment in the amount of $100.00 against” them.88 However, this was not the complete offer. Rather, the following conditions were attached: “This offer is made to compromise and settle disputed claims and shall not be construed as an admis- sion of any allegation or liability on any claim. Further, no judgment entered pursuant to this offer shall operate as an adjudication of the merits of any allegation or claim.”
The effect of these conditions leaves open the possibility of future lawsuits because the language effectively bars the application of res judicata in the future. What the neighbors were seeking was not truly entry of a “judgment” as contemplated by
Accordingly, we conclude that the trial court erred by concluding that the neighbors were entitled to an award of attorney fees and costs under
C. THE FROLING TRUST‘S REMAINING ARGUMENTS
Given our conclusion on the Froling Trust‘s argument raised in Docket No. 275580, that the trial court erred by awarding attorney fees and costs to the neighbors under
D. THE NEIGHBORS’ ARGUMENTS ON CROSS-APPEAL
Given our conclusion on the Froling Trust‘s argument raised in Docket No. 275580, that the trial court erred by awarding attorney fees and costs to the neighbors under
Affirmed in part and reversed in part. No taxable costs pursuant to
MURPHY, P.J. (concurring). I concur in affirming in part and reversing in part. Summary disposition in favor of defendants was appropriate because the period of limitations had expired, Garg v Macomb Co Community Mental Health Services, 472 Mich 263; 696 NW2d 646 (2005), amended 473 Mich 1205 (2005); Terlecki v Stewart, 278 Mich App 644; 754 NW2d 899 (2008), and the claim was untimely under
