*1
Silver Creek Drain v
Extrusions
DIVISION,
SILVER
CREEK DRAIN DISTRICT EXTRUSIONS
INC
Argued
(Calendar
8).
No. 119721.
Docket
November
No. Decided
Rehearing
June
2003.
denied
nation on the difficult to and sus- ceptible approaches, it is to different remediation calculation proceed- appropriate to leave to finder of fact in condemnation ings just-compensation spe- awards each the determination cific case. — — Uniform Procedures Act Environmen- Eminent Domain Condemnation tal Contamination. Procedures courts Uniform Condemnation Act vests authority determining consider contamination in environmental (cid:127) just establishing in a fair market value condemna- proceeding (MCL seq.). 213.51 et tion & LLP Howlett Varnum, Riddering, (by Schmidt Zimmerman) Mark S. and Matthew for the Allard plaintiff-appellant. Douglas LLP A. (by Norcross & Judd
Warner E. for the defen- Meyer) Doseman and Christian dants-appellees. Silver Creek Drain v
Amici Curiae: (by
Miller, Canfield, Paddock Stone, & PLC James Lancaster, R. Jr., T. Flood, and C. Thomas Clifford Phillips), Michigan Municipal League. Attorney A. Cox, General,
Michael Thomas L. Casey, General, Solicitor Isom, and Patrick F. Assis- Attorney Department Michigan tant General, for the Transportation. (by Ackerman & Ackerman, P.C. Alan T. Acker man), Ypsilanti. owners in granted appeal J. We leave in this case to Taylor, consider whether environmental-contamination condi- tions are factors considered when a court is determining fair market value to establish com- pensation in a condemnation action under the Uni- *3 form Condemnation Procedures Act (ucpa), MCL seq. they 213.51et We hold that are to be considered. Accordingly, judgment we reverse the Appeals regard in this and remand this matter the to proceedings trial for court further consistent with this opinion.
1. FACTUAL AND PROCEDURAL BACKGROUND
(Extrusions),
Division,
Defendant Extrusions
Inc.
operates
plastics extruding
business and owned
eight-acre parcel
adjacent
opera-
of vacant land
to its
complex
Rapids.
tions
1992,
Grand
Extrusions
applied
city
Rapids
permit
to the
of Grand
for a
to
application
eight
build a warehouse on the
acres. The
denied,
was
and Extrusions was
Sil-
informed that the
(Drain District),
ver Creek Drain
District
had
On good-faith tendered a the ucpa, $211,300 the to Extrusions for in the amount offer1 213.55(1) parcel. under MCL offer, This as allowed right to the Drain District’s ucpa, also reserved the proceed against state in a federal or recovery.2 Cost-recov- action for contamination-cost ery give governmental are authori- actions intended ability from those to seek reimbursement ties damage responsible done to land At the time of this substances. release hazardous right bring procedure litigation, to reserve the cost-recovery against new, was action the condemnee having the UCPA been established amendments of purpose amendments was in 1993. merely right to allow condemnor to reserve the if costs, that, but also ensure demand remediation ten offer to hensive agency MCL (cercla), “Before Cost-recovery Environmental Protection 213.55(1). shall 42 USC 9601 et Environmental acquire initiating negotiations establish an amount that it believes proceedings promptly seq., Response Compensation shall submit to the or under Act *4 may for the full amount (nrepa), for the brought part MCL 324.20101 el 201 of purchase under to be owner a the so the Natural Resources established federal good property, Liability seq. faith writ Compre . . . Act .” Silver Creek Drain v Extrusions Div a reservation of rights occurred, the funds for con- demnation would satisfy any be escrowed to judg- ment the eventually сondemnor might secure against condemnee.3 May
On 26, 1994, the executed, Drain District required MCL a 213.55(4)(e), “declaration tak- ing,” which private indicated that property was taken for being purposes necessary of a public improvement. June, $211,300 “just good-faith compensa-
tion” was placed amount in escrow. The Drain Dis- trict then filed its condemnation action and again reserved the a right to federal or bring state cost- recovery action. February
On 20, 1995, parties stipulated, and the trial ordered, parcel court conveyed the Drain District and that the Drain District pay $211,300 for the taking. Following this, the Drain District, notwithstanding the stipulation and above, (MCL requires 213.55) As discussed 5 of the amended ucpa a condemning аgency deposit just-compensation its estimated amount complaint; escrow when it files the condemnation this escrowed amount pay upon is to 213.55(5); condemnee order court. MCL MCL 213.58(4). However, in the 1993 amendments of the in order to facili ucpa, contamination, tate the collection remediation costs environmental Legislature agency, “good allowed the it when submits a faith” written n offer, right to reserve the to seek contaminatio costs from the con done, demnee. If this is the escrowed funds remain in escrow “as security for remediation . costs environmental contamination . . .” MCL 213.58(2). However, governmental agency cost-recovery even if the reserves the option against condemnee, (MCL 213.56a) under subsection 6a a court agency pursue right cost-recovery can order to waive its action predicate seeking under certain circumstances. The this reversal of the agency’s that, part election is under 201 of the the condemnee has nrepa, liability 213.58(3). no because did not cause If the contamination. MCL rights, agency required orders court the waiver of the to submit good-faith parties 6a(3) a revised offer. Subsection also allows the ato stipulate condemnation action the reversal of the reservation. *5 468
Opinion the Court sought hold the funds order that would an order, security as remediation costs as escrow response, Extrusions, in cit- under the аllowed ing part UCPA. Resources and Environ- the Natural seq., et Act MCL324.20101 Protection mental (nrepa), cause of contamina- that it was not the claimed and, thus, was in the amendments tion as identified Accordingly, it remediation costs. liable for authority 213.55(5) argued, and MCL MCL 213.58(4), released. On funds should be by stipulation, the court ordered 3, 1995, November paid to sums, interest, well as the escrowed Extrusions. concerning valuation, the trial
In a bench parcel, eight-acre if court found that the value ignored, $278,800. were was environmental concerns parcel “was an that the The court then determined respect environmentally site, contaminated purchaser reasonably prudent have which a Type-C required, from at a a fоrmal Closure minimum, [Department as a Resources] condition the precedent Natural closing.” cost of found that the reasonable Because the court Type-C $237,768, it concluded that closure was was The court $41,032. fair market value the net reiterated in the to that effect and entered order awarded $211,300was order that the once-escrowed to Extrusions. part Appeals appeal, Court of reversed
On the trial court.4 The and remanded the case to authority gave Appeals for a no held that the ucpa any in the contamination factor court to consider App 556, 557-558; NW2d 347 Silver Creek Drain fair establishment of market Rather, value. contami- only proceed- seрarate nation could be considered in ings position for remediation costs. It was the Court’s appropriate that this outcome was because 5 of the ucpa provided guidance regarding “little the factors a court should consider when called on to determine just compensation.”5 guidance, Given the minimal plain language Court concluded that the of the UCPA *6 addressing amendments ery federal and state cost-recov- only separate pro- actions meant that in those ceedings could such factors considered. granted appeal
We leave to to consider the Drain may parcel’s District’s claim that a court consider a affecting environmental condition as a factor fair mar- just compensation ket value in a determination of may under the UCPA. We conclude that a court con- establishing sider such conditions in fair market value judgment and, thus, reverse the Appeals only. on this issue
n. standard of review presents statutory interpreta- This case an issue of ucpa provisions. Statutory interpretation tion of is a question of law that we review de novo. Cruz v State Farm Mut Auto Ins Co, 588, 594; 648 NW2d analysis
III. power “Eminent domain” or “condemnation” is the government private property. power of a to take power sovereign arises from the of the state and is of 5 Id. at 563. 468 Mich power government’s provenance. The federal
ancient regard Amendment of the found the Fifth in which it stated Constitution, United States private property government unless not take compensa public for a use and it is done Every Michigan has had similar constitution tion. just compensation requiring circums in these clause that: states Our current Constitution tances.7 public “[p]rivate use shall be taken just compensation . . . .”8 without Michigan, in furtherance of this constitutional In pro- regulated power, have exercise statutes Legislature uni- cedure of condemnation. Under the all statutes in the UCPA. fied condemnation echoing MCL Constitution, it stated at was act, 213.55(1) “. . . ascertain deter-
that a court was acquisi- be made for the mine property.” [condemned] tion of the requirement evident, As is requirement in our the identical in the statute mirrors lan- Constitution. This reiteration of constitutional significant degree guage is to the the Consti- because *7 nature of construed to outline the tution has been similarly “just compensation,” must be the statute Legislature of the can take construed because no act Sharp given. City away has v what the Constitution Lansing, 792, 810; 629 NW2d873 of meaning Thus, we must determine the compensation” phrase “just in our Constitution. As . . . § 1. [6] unless See Const See Const Magna 1963, 1835, Carta, art lawful 10, § art Grant 39 1, 19; judgment 2. Const (1215): of his 1850, “No peers, freeman shall be art 18, or § the law of Const . . . 1908, the disseised art land.” 13, Silver Creek Drain in Michigan Coalition State recently
we outlined of Employee Comm, Unions v Civil Service 222-223; 634 NW2d in (2001), analyzing con- inquiry stitutional is to if language, first determine plain meaning words have a or are obvious on they are, their face. If plain meaning is the mean- If, ing given however, them. the constitutional lan- plain has guage meaning, technical, no but is a legal term, we are construe those in words their techni- cal, legal Moreover, sense. in that we undertaking, are rely on the understanding of the terms those sophisticated in the law of at time the constitu- tional drafting is, and ratification. The rule as we said in Michigan Coalition, “if phrase a constitutional is a technical legal phrase term or in law, art phrase will be given the meaning that those sophisticated in the law understood at the time of enactment unless is clear from the constitutional language that some other meaning was intended.”9 be cannot dis- merely by cerned reading careful of the phrase. The words as themselves, the Court Appeals found, just do not inform a potential complexity court about the variety of factors to be considered in determining value.10 This circumstance is not unusual realm ruption much should some other income-capitalization approach sentimental factors such as applies to the that the same contrary. considered? is, perhaps, [10] It as Mich 223. be considered in establishing Or in the partial construction rule, pursuant We correctness of the useful to illustrate the concurrence and dissent approach, also case value for residentiаl establishing pointed long-time ownership a statute. commercial such considered out Legislature’s value cost-less-depreciation Michigan Coalition, properties, properties, and, asserts the Justice Weaver or historic a business if directive at MCL so, can business inter how? importance example, valuation, point, or sales Should id. at n inas 8.3a, can *8 Mich
Opinion the Court of example, statutory be seen For it can construction. occasionally they do, use statutes, as when also process,” “negligence,” “due such as words meanings “equity.” that are not These are words reading generally of the a from mere self-evident in a dic- of their definitions assessment words or an They respеct, tionary. unlike self-evident are, in this “building,” “bridge,” or “horse.” “road,” such as words category they we that fall into that Rather, are words phrases legal technical terms or have described as they given to the mean- law, and thus are art in the sophisticated gave ing in law them at that those necessary, is if We it believe the time enactment. applied uniformly state, is across the law to be freighted that are of words—words that this class legal meaning given mean- the same with historic —be allowing ing court each all courts rather than in our meaning. impose would To hold otherwise its own outcomes in in similar cases different all but ensure drawing from her courts, as Justice different Weaver, opinion apparently allow. This be content to would appropriate to review case, is that, means this understanding those skilled the consensus “just meaning law, in this area of compensation.” obvious, comparable properties fixing value? As is one be used to assist “just” “compensa- merely dictionary review the definitions cannot phrase. produce for this coherent
tion” and combine them custom, legal practice longstanding Rather, as revealed result centuries, phrase judicial opinions means through over the countless juries parts. something That than the sum of discrete more law, being issues, on the after instructed make decisions these always contradictory point process we whether raise. That analysis susceptible plain-meaning or is inter- at the statute issue is statutory explication. using preted some other method Silver Creek Drain *9 history clearly by Throughout our 1960s, “just was uncontroversial that a determination of compensation” required the consideration of all the multiplicity go making up of factors that into In value. century, summarizing the nineteenth while com- pensation and its in American constitutional Michigan Supreme law, Court Justice Thomas M. Principles in his treatise The General Con- Cooley, stitutional Law in the America, United States of said: by compensation
The rule which shall be is measured cases, largely by the same in all but is affected the circum stances. If what is taken whole of what the owner lying togethеr, have it is clear that he is entitled its value, judged such standards as the markets and the opinions afford, this, except of witnesses can and that in extraordinary cases, must be the full measure of his injury.[11] Supreme
The United States
Court has had a similar
unvarying
holding
view of this matter,
in
Searl
Co
Lake
2,
School Dist No
553,
133 US
564; 10 S Ct
(1890),
33 L
374;
Ed 740
that the
value
land must
“every
entering
include
. . . element
into its cash or
capacity
any
value,
market
as tested
and all
again,
Supreme
. .
Then,
uses
. .”
1933,
requirement
‘just compensation’
“[t]he
held that
that
paid
comprehensive
shall be
and includes all ele-
.
.”
ments
. . Seaboard ALR Co v
States,
United
261
(1923);
299,
US
306; 43 S
354;
Ct
Opinion
the Court
have
reason
might
[property]
of value
element
Clark’s
particular uses.”
adaptation to
special
227,
Comm, 291 US
Pub
Ferry Bridge Co v
Service
Yet
again
427;
78 L Ed
238;
S Ct
“[j]ust
held that
court
high
prop-
of value that inhere
all
includes
elements
City
Co,
Power
.”
v Twin
erty . . . United States
(1956).12
L Ed 240
250-251;
S Ct
US
just compensation has
understanding
Michigan’s
In
re
particulars.13
in all
identical
relevant
been
569, 574-575;
Avenue, 294 Mich
Widening
Gratiot
“
determi
we
explained
755 (1940),
293 NW
‘[t]he
*10
formulas
artificial
is not a matter of
nation of value
based
and discretion
but
sound
rules,
judgment
par
a
relevant facts in
of all the
upon a consideration
”
factors, we have
In
various
considering
case.’
ticular
may
an award
compensation
held
include
that
In
id.,
fixtures, see
re
leasehоld, see
for
taking
485;
(1952);
meant, means, and still that the amount of takes into all account fac- meaning tors relevant to market It is value.14 the constitutional drafters and ratifiers are held they adopting have understood when were the Michi- gan understanding Constitution a and similar legislators, is attributed to the who also used the phrase “just compensation” they when enacted the in 1980. ucpa legislators
That the who amended the UCPA in 1993 provided procedures securing and means for just- remediation costs and dovetailed those with the compensation determination indicates no intent abrogate estab- jurisprudence. lished in our Indeed, to attribute such an intent, i.e., the intent to diminish constitutional place legislators standard statute, is to in the posture acting unconstitutionally. This we avoid possible15 unless no other construction is and, as such possible, adopt an alternate construction is we it. Appeals plain- The Court of error was to utilize language inapplica- doctrine in a context where it was phrase “just compensation” ble. The cannot be ana- lyzed plain understanding on the basis of the each conveys, phrase imports word but of art that *11 understandings sophisticated it all those in the give law it.
would tend to affect the market value of the
VanElslander,
described what
condemnation
We reiterated the
See Gora
. .
460 Mich
Ferndale,
is relevant
.
general
127, 129-130;
rule
recently
As the General governed proceeding an in rem tion action is agency to take to allow a state It is instituted ucpa. agency property; privately thus, the title to owned part parties. An essential the owner are proceeding fair market determination of the is the proceeding property. not value of the Because assign liability designed contam- for environmental property is unaffected ination, the value of the for the contami- would be liable whether owner property. The estimated costs of nated state they only pertain to the remediation are relevant property fair market value of the cost-recovery Michigan’s action under contrast, pro- environmental-cleanup personam laws is an liability specifically designed assign ceeding typically sought are remediation costs. Those costs and the fair market value under cercla or the nrepa proceedings. Further, relevant in such agency cost-recovery action, to the in a in addition any person entity, or such as owner, other and the adjacent prior owners, lessees, owners, may parties have contributed to the other third who parties. Finally, that the dam- contamination, cost-recovery ages different, are in a action awarded *12 Drain Silver Creek dramatically so, from the amount sometimes value,16 reduced fair market contamination which proceedings are. manifest different these makes how primary grasped, then, is that the con- to be What is proceeding and а condemnation between a nection cost-recovery the escrow that be cre- action provide proceeding during the condemnation ated potential security payment the of cost-recov- for ery award. believe, this matter court,
The trial we understood merely properly considered contamination one establishing significant one, a fair factor, albeit judge’s value. was the trial conclusion that market It any purchaser have on a minimal insisted cleanup closure) (the Type-C have that would made Type-C The cost of this closure useable. far different from the amount remediation would cost.17 we conclude the trial court Thus, have just-compensаtion not on made its determination liability cleanup costs, but basis of Extrusions’ par- on the the basis the effect contamination appropriate way fair This was cel’s market value. pro- just-compensation in a to consider contamination ceeding under the ucpa. portion judgment
We reverse that Appeals holding that the UCPA does not vest authority with courts consider contamination and how it fair market value when determin- affects proceeding. ing in a condemnation respects, judgment we affirm In all other million, the trial court The actual cost of remediation See while the n 16. to be loss of $237,768. value caused in this case was contamination approximately $2.3 was found 468 Mich
Opinion by Weaver, J. Appeals proceed- Court and remand this case for ings opinion. consistent
Corrigan, C.J., and JJ., con- Young Markman, *13 curred with J. Taylor, (concurring). Although majority J. Cavanagh, unnecessarily result,
arrives at the correct reaches previously, a constitutional issue. We have stated general presumption by “there exists that we will reach not constitutional issues that are not necessary Newspapers, to resolve a case.” Booth Inc Michigan Regents, v Univ Bd 211, 234; (1993); Taylor 507 NW2d422 see also Gen Auditor eral, 146, NW2d 769 statutory grounds Because resolution on alone would suffice, I not reach the constitutional issue.
Additionally,
separately
I write
to note that I am
majority’s
original
concerned about
focus on
my
Acqui-
intent. As I noted in
cоncurrence in WPW
City
Troy,
sition Co v
Kelly, J., concurred J. with Cavanagh, part (concurring dissenting J. Weaver, part). only majority. I concur in the result of the I separately my express disagreement write majority’s with the concept,
construction of the constitutional “just compensation.”1 majority “just suggests The that Article 2 of the Michigan Constitution provides: public Private shall not be taken for use without being therefor first made or secured in a manner v Extrusions Creek Drain Silver Opinion Weaver, J. phrase legal
compensation”
or
term
a “technical
“sophisti-
grasped
those
that cannot
art”
sugges-
This incorrect
Ante at 375.
in the law.”
cated
majority
to conclude
leads the
tion
compensation”
“just
the “con-
restricted to
must be
understanding
in this
skilled
those
sensus
compensa-
‘just
meaning of
law,
area of
” Ante at 376.
tion.’
“just
understanding
may
that the
While it
sophisticated
compensation”
in the law of
those
significantly
not differ
in 1963
condemnation
pres
past
person,
either
common
from that of the
engage
of con
in a method
should not
ent, this Court
unnecessarily sidesteps
construction
stitutional
primary
long-established
constitutional
rule of
primary
con
rule of constitutional
construction.
language
inter
is to be
is that constitutional
struction
understanding”
preted according
“common
*14
by Justice
described
Cooley:
by
people.
people
is made for
“A constitution
given
which rea-
interpretation
it is that
that should
The
themselves,
people
minds,
great mass of the
sonable
that of the
be arrived at is
give it. ‘. . . the intent to
they
supposed
have looked
people,
and it is not to be
employed,
any
meaning in the words
dark or abstruse
proceed-
Compensation
prescribed
be determined
law.
shall
ings in a court of record.
This case was
MCL
tion is “first
purpose sought
stances
whenever
invalidity
derkloot,
[2]
If the
213.51 et
surrounding
392 Mich
is
possible,
plain meaning
made or secured”
preferred
seq.,
brought
159, 179;
which
to one that does.”
under the Uniform
interpretation
accomplished may
adoption
prescribes
is
but rather that have them in the sense most ” understanding . . obvious the common . [Traverse General, City Attorney School Dist v 390, 405; 384 Mich (1971).] NW2d Supreme primary has reiterated this rule provision
constitutional construction: “Each
of a State
people
word
Constitution is the direct
of the
State, not that of the scriveners thereof.”
v
Lockwood
Revenue,
Comm’r
(1959).
NW2d 753
attempting
interpret
Thus, when
a constitu-
“
primary
provision,
ascertaining
tionаl
‘the
source for
meaning
plain meaning
its
is
its
to examine
as
adop-
understood
its
at
the time
ratifiers
” People Bulger,
tion.’
v
495, 507;
462 Mich
614 NW2d
(2000), quoting
Charles
v Winiemko,
Reinhart Co
taking
before the tak-
owner
as
“just compensation”
prop-
ing.4
is “the
The measure
government’s gain.”5
erty
rather than
owner’s loss
determining
figure
Though
that most
dollar
accurately
loss
be
owner’s
can
describes
complication
complicated
not
task,
does
a
such
legal
or
a “technical
term
rеnder
complicated,
phrase
though
Indeed,
that task
of art.”
by
expressly
and 1908consti-
the 1850
was
dedicated
jury
Michigan
freeholders,
a
“twelve
tutions of
vicinity
property,
by
residing
in the
of such
appointed
commissioners,
a court
than three
less
prescribed
. . . .”
as
law
Const
record,
shall
§
§13, 2.
18, 2;
1908,
Further,
Const
art
1850,art
proceedings, “the
has said of condemnation
Court
jury
judge
Its
law and fact.
conclusions need
is the
entirely
testimony
but it
use
based
not be
knowledge
judgment and
from a view of the
its own
premises
experience
Dep’t
and its
freeholders.”
593; 25
Connor,
565,
316 Mich
NW2d
Conservation v
quantifying
(1947).6 While the task of
com-
619
pensation
complicated
light
task,
can
a
of this
In re Edward J
unambiguous holdings in our cases.” See also Boston Chamber
merce v
pensation
proceedings
NW2d 272
“[t]he
1406, 1419;
each
[4]
provides
Brown
Under
Wayne
(1929).
parcel.”
jury
reiterated that
Boston,
award is determined
the current constitutional
(1943);
or the
Co v Britton
155 L
in a court of record.” MCL
Legal
pertinent part
Jefferies
217 US
Ed
court
In re
Foundation of
2d 376
“[t]his
189,
shall award in its verdict
Widening
Trust,
Homes
(2003),
conclusion
Housing
“[cjompensation
Washington,
jury
S Ct
in which the United States
Bagley
213.63
statutory
or the
459;
608,
Project,
supported by
Ave,
for the . . . full amount so established. offer The faith agency shall rights state whether the reserves or waives its recovery bring against federal or state cost actions present proрerty arising owner of the out of a release agency’s hazardous substances at and the appraisal for the shall reflect such reservation or waiver. amount The shall not be less agency’s just appraisal than the property. . . 213.55(1).] . [MCL express compen- The statute’s consideration of what sation is under the constitution does necessa- rily Legislature intended, mean that the consti- was tutionally obligated require, good-faith that a offer payment ture created nation demnation existence of intended that the cost proceeding during majority proceedings. the condemnation potential cost-recovery escrow notes that “the and a mechanism does not answеr whether the cost-recovery remediation should be considered primary proceeding award.” action is the escrow that connection between a condem Ante provide security at 381. However, Legisla con Creek Drain Silver Opinion Weaver, J. of remediation order the cost
be reduced Though “just compensation.” market value constitute just compensation, typically as a measure of serves recognized the United As criterion. is not sole Supreme value is “too where the market Court, States “payment value of market find” or the difficult to injustice’ to owner or in ‘manifest result public,” the mea- value should not be the market just compensation. Kirby Industries, Forest sure *17 L 10; 2187; US 104 Ct States, S Inс v United (1984). Ed 2d contamination on the value
Because the effect of susceptible is difficult to determine and a approaches, remediation and calculation to different appropriate perhaps leave fact-laden more it is jury judge case-specific or to the determination majority’s formula or than the one-size-fits-all rather jury judge a A determination artificial rule. just- holdings prior Court’s consistent with this proceedings in condemnation awards “[T]he a basis. be decided on case case should proceedings of value condemnation determination artificial rules but is not matter formula or upon judgment based consid- sound and discretion particular case.” In re of all relevant facts in a eration Hwy, 20, 28-29; Mich 97 NW2d748 Grand Haven Widening (1959), citing Avenue, re Gratiot NW 755