Terrien v. Zwit

467 Mich 56 v ZWIT TERRIEN 1). (Calendar Decided Argued No. November 115924. Docket No. July 25, 2002. property in a residential subdivision owners Temen and other Janice against Muskegon Laurel Circuit Court brought in the an action “family day for-profit operators in care homes” of Zwit and other expressly subdivision, seeking of a covenant enforcement properties prohibiting uses of within or business” “commercial Jr., J., court, Graves, found that a James M. The circuit subdivision. “family day operation precluding care home” of covenant summary disposition policy, granted contrary thus and P.J., Appeals, and Kelly The Court of the defendants. McDonald, operation Cavanagh, JJ., affirmed, “fam- found that the of a but and App ily day did not violate the covenant. care home” appeal. plaintiffs (Docket 212015). (1999) The No. by joined opinion Justice Chief In an Justice Markman, Supreme Court held: and Taylor and Justices Young, Corrigan, “family day for-profit operation home” is a “com- care property, and, therefore, is violative or use of mercial business” property. prohibiting uses “commercial or business” a covenant “public policy,” Michigan not violate Such a covenant does thus is enforceable. for-profit “family day is a “com- care home” 1. The of a and, therefore, property, is violative of use of mercial or business” property. uses of “commercial or business” a covenant policy” from “definite indications” 2. must be derived “Public “public policy” words, as a an assertion of the law itself. other must, fact, grounded nullifying in an a contract basis for “public policy.” case, “definite indications” in the In this no actual justify Michigan found to the invalidation cove- law of were “family day upon precluding homes” cer- care nant properties. private tain permitted care homes” are or if it is true that 3. Even barring by law, encouraged it does not follow covenants even contrary “public policy.” sig- There is a such business permitted something being or even between nificant distinction prohibited by being required law, something encouraged “pub- specific finding basis for them law. Absent some Terrien Zwit policy,” disregard private lie courts cannot contracts and covenants they may perceive particular order to advance what as a social good. Further, “public policy” 4. is a there “definite indication” of a right supporting owners to create and cove- enforce affecting property. nants their own Reversed and remanded. joined dissenting, Justice Justice stated that Cavanagh, Kelly, majority’s analysis operation family characterizing day-

the the conclusory, providing care homes a use as commercial an determining unworkable standard for are whether future uses resi- family day-care dential or commercial. The homes in case are this nature, prohibit- residential do not violate restrictive covenants ing use, or commercial business and covenants their public policy and, therefore, are to unen- forceable. activity according Land use should be characterized to how an general plan case, involved affects the of an In no area this show- ing family day-care has been made that the homes had any neighborhood. overall effect on the residential character the any compensation support Nor is there evidence other than to a family day-care the conclusion that were homes commercial or business activities. compel plaintiffs. ruling The do not restrictive covenants a for Interpretations “commercial, industrial, of the terms or business enterprises” display disagreement regarding considerable their meanings. ambiguity opens That absence leaves unresolved and judicial interpretation. majority’s prohibi- the terms to The absolute compensation generating pre- tion of all forms of would normally clude that activities have no effect visible on a commu- nity, babysitting writing. such as services and It freelance is an unnecessarily extreme construction and one that constrains the use property. of residential majority’s public policy strong The dismissal of the indications of statute, law, baffling disturbing. case and executive order is approach determining Its narrow to the constrains judiciary by prohibiting invalidating it from covenants absent express statutory sharply contrary long It is mandates. estab- Supreme practice. lished family day-care dissenting, Justice stated homes are Weaver, incompatible inherently with the restrictive covenants determining disputed case. In whether the the activities violated covenants, factors, pur- a court should the consider other such as pose neighborhood. of the restriction and the effect on the deter- mining neighborhood, the effect on court the should consider 467 Mich Opinion of the Court only land, applies or to one tract of to an the covenant whether necessary to neighborhood It is also consider or subdivision. entire pri- surrounding neighborhood, it is whether a the character neighborhood, neighborhood area, single-family resort vate apartment houses, containing one more or mixed-use or neighborhood. case, designed preserve was residen- In this the covenant disruption to avoid to the nature of the subdivision and tial commercial, industrial, enterprises or neighborhood business day-care homes, special Family absent feature cause. some would disruption. signs lighting, do not such a such as intrusive cause they children, Rather, which are limited to seven or fewer limits neighborhoods. are on Their essential characteristics the effect they compatible neighborhood, do not with a residential neces- any neighborhood large sarily effect on a than fam- have more family day-care ily. Further, Legislature has concluded that favored, neighborhoods evidenced homes within township zoning majority county zoning fails act and the act. point give this sufficient consideration. P.L.C. M. Eklund, (by Rosé), Rose & James plaintiffs-appellants. Even

Culver, Sheridan, Knowlton, & Franks (by Even) defendants-appellees. Kevin B.

Amicus Curiae: R. Story, (by Toy

Farhat & P.C. Charles and David E. for the Association for the Rudgers), Michigan Children. Young Education of J. in this case to granted We leave con- Markman, permitting only sider whether covenants residential uses, expressly prohibiting commercial, indus- preclude the trial, uses, operation or business “family day care home.” We also leave to con- granted opera- precluding sider whether covenant “public of Michigan tion unenforceable as violative is summary policy.” disposi- The circuit court granted defendants, holding tion in favor of that a covenant “family day care operation home” precluding Terrien V Zwit Opinion of the Court is Michigan. to the of the state of Appeals

The Court of affirmed, but for a different reason. It held that the of a “fam- ily day precluded by care home” such cove- nants. It that, concluded because the aof “family day care home” ais residential use, it could not also be a or commercial business use because the mutually App two uses are exclusive. 238 Mich 412; respectfully disagree 605 NW2d 681 We with any barring both lower courts. A covenant commer- enterprises scope cial or business broader than a permitting only covenant residential uses. Further- more, covenants such as these do not violate Michigan public policy and are enforceable. Accord- ingly, Appeals we reverse the decision of the Court of entry and remand this case to the circuit court for summary granting disposition an order in favor of plaintiffs.

I. FACTS AND PROCEDURAL HISTORY parties All in this case Own homes within the Valley Spring Estates subdivision in Fruitland Town- ship.1 operate Defendants each licensed pursuant seq. care homes” to MCL722.111et in their homes within the subdivision.2The subdivision is sub- ject following to the covenants: part premises 1. No may of the above described private

shall be used purposes. for other than residential court, stipulated parties In the circuit the essential facts. It is also undisputed profit. that defendants ran thé care homes” for 2 “Family day “private care home” means a home which 1 but fewer supervision periods than 7 minor children are received for care and for day less than 24 . 722.111(f)(iii).] hours . . .” [MCL 467 Mich

Opinion Court of the

[*] ^{[*] [*]} purposes. except for residential No lot shall be used 3. :]-. ^{[*] [*]} premises part parcel shall of the above-described 14. No commercial, any industrial, or business enter for be used any equipment prises storing used in com nor the enterprise.[3] mercial or industrial injunction prohibiting sought the con- Plaintiffs day “family care of defendants’ tinued parties agreed for to file cross-motions homes.” discovery. summary engaging disposition before summary pur- disposition partial for Plaintiffs moved 2.116(C)(9), for defendants moved MCR and suant to summary disposition pursuant 2.116(C)(8) MCR plaintiffs’ court denied motion The circuit finding granted motion, a “cove- defendants’ family day precluding the care nant setting home in residential policy Appeals Michigan.” The Court of the State of However, instead of invalidat- affirmed this decision. ing being against public policy, the covenants as “family operation that defendants’ Court concluded day This not violate the covenants. care homes” did plaintiffs’ application granted leave to appeal.

II. STANDARD OF REVIEW stipulated parties have the essential Because only specifi- facts, with the law: our concern here only cally, permitting residential whether covenants plat form that attached covenants are restrictions These parties’ property by operation reciprocal negative of the doctrine of easement. 61 Terrien v Zwit Opinion of the Court expressly prohibiting uses, commercial, indus- preclude operation trial, uses, or business the of a “family day home,” and, so, care if whether such a “public policy.” against restriction is unenforceable as questions These are of law that are de novo, reviewed Kelly Square, Inc, Builders 465 29, 34; Mich 632 (2001), NW2d 912 which standard identical the grants summary standard of review for or denials of disposition. PKT, Inc, MacDonald v 322, Mich 332; 628 NW2d 33

m. ANALYSIS A. COVENANTS granted We leave in this case to consider whether operation aof care home” violates permitting only covenants residential uses and prohibiting commercial, industrial, or business uses. assuming arguendo Further, that such activities do question covenant, violate the becomes whether the covenant is unenforceable because it violates “public policy” day some in favor of care facilities. In Beverly Zinger, App Island Ass’n v 322; (1982), Appeals NW2d 611 Court addressed somewhat similar There, Court, issue. faced with permitted only a narrower covenant that residential “family day uses, concluded that the Stressing care home” did not violate that covenant.4 relatively particular day small scale of the care only and that “[t]he observable factor which would indicate to an observer that defendants Beverly Island, supra 324, provided The covenant at issue in rel part building plot except evant lot or shall be used “[n]o residen purposes.” tial 467 Mich

Opinion family simply large traf- is the vehicular not have do morning when the children and afternoon fic in the depart,” found id. at the Court arrive and day nature, use to be residential sort of care covenant. violation thus a use Beverly upon the Court was relied Island day Appeals to conclude that the instant matter in the of the covenants at use here was not violative care misplaced, in our However, reliance was issue. Beverly judgment, in because, the covenant issue merely prohibited uses, where- nonresidential Island only prohibit non- here as covenants at issue industrial, uses, commercial, also residential but significant well. a distinc- or business uses as There is prohibited restrictions, as more is tion between such prohibited Beverly was Island. in our case then only not to defendants in this case covenant Not did they property uses, for but use their nonresidential com- not to use their also covenanted mercial, industrial, or business uses. recog

Interestingly, Beverly Island Court itself permitting covenant nized the distinction between a expressly pro only also residential uses and one that or uses. Before commercial, industrial, hibits business analysis, Beverly began it its Island Court even “permits residential noted that the covenant at issue prohibiting or commercial uses rather than business recognized Id. “restric uses.” at 326. It further variety permits allowing wider tion residential uses prohibiting than a commercial or uses restriction proscribes activi Id. While the former business uses.” pro nature, the latter ties that are nonresidential although perhaps that, residential in scribes activities industrial, business in nature, commercial, are also covenants nature as well. The distinction between the V Terrien Zwit Opinion Beverly at issue here and the one at issue in Island persuasive by Appeals was not viewed the Court of in this case. Appeals The Court of that, this case reasoned operation “family day because the aof care home” permitting only does not violate a covenant residen- operation “family day uses,6 tial aof care home” prohibiting also does not violate covenant commer- disagree cial, industrial, or business uses. We with reasoning. separate Because these are and dis- activity complies tinct covenants, that an with one necessarily does not mean that the same com- plies activity may with the other. other words, be both residential in commercial, nature and indus- trial, or business in nature. Beverly simply

Therefore, Island does not answer question raised here. We must determine whether “family day care home” violates covenants both nonresidentia! uses and commercial, industrial, or business uses. We find that it does. aof care home” for

profit pro- a commercial or business use of one’s perty. We find this to be in accord with both the com- legal meanings mon and the of the terms “commer- commonly cial” and “business.” “Commercial” is by Beverly The Court referenced the statement made Island Court recognized covenants, the difference between such but stated that dicta,” this statement was “mere and thus it. refused to follow 238 Mich App 416-417. only operation issue raised case whether the of a “fam ily day permitting only care home” violates covenants residential uses prohibiting commercial, industrial, Accordingly, or business uses. that is only particular, issue we address. In we do not address whether the a single of permit care home” violates the covenant only ting uses, i.e., Appeals residential the issue addressed the Court of Beverly Island. 467 Mich

Opinion yield profit.” likely a Random “able or defined as Dictionary (1991). College “Commer- Webster’s House parlance legal “use in con- as is defined cial use” profit-making of a or for furtherance with nection Dictionary (6th ed). enterprise.” “Com- Law Black’s “any parlance activity” legal as is defined mercial type activity a on for which is carried or business per- commonly profit.” defined “a “Business” is Id. engaged House . . . in ... a service.” Random son Dictionary College “Business” Webster’s parlance “[a]ctivity legal or enter- as an defined in prise advantage gain, or livelihood.” benefit, for Dictionary ed). (6th Black’s Law meaning previously This Court has discussed activity In Lanski in a related context. “commercial” Montealegre, (1960), 44; 104 NW2d 772 operation of a nurs- this Court addressed whether reciprocal negative ing was in violation of a home activity upon cer- easement commercial observing property. was, determined that it tain We “general of a that the circumstances were indicative plan private suggested and that this resort area” activity was “commercial” broad definition of (emphasis original). in the There- intended. Id. activity in- fore, its broad sense commercial “[i]n any type activity car- which is cludes of business profit.” opera- Id. We concluded that the ried on for a nursing use home was a commercial because tion profit charged, made, the services a fee was was open public, sub- were to the private, “general plan noncom- tracted from the originally Id. at 50. mercial resort area intended.” that a similar definition The facts here indicate only was intended. Not does commercial prohibit or business activi- covenant here commercial Terrien v Zwit Opinion prohibits “storing equip- it ties, also the mere strong ment” used in a such activities. This is and emphatic pro- statement of the restrictions’ intent to any type hibit of commercial or business use of the properties. through operation here, Defendants “familyday providing care homes” are a service to the they making profit.7 Clearly, in which are a properties use of their is a commercial or busi- commonly legally use, ness as those terms understood.

It is of that, no moment assert, defendants disruption care homes” no cause more large family neigh- than a would or that harm to the may tangible. bors not be As we noted in Austin v (1929), Horn, Van 344, 347; Mich 222 NW 721 “the plaintiffs right to maintain the restrictions is not damages might affected the extent of the he suffer for their violation.” This all comes down to the well- proposition understood breach of a covenant, no matter how minor and no matter how de minimis damages, subject can be of enforcement. As this Court said in Oosterhouse v Brummel, “ (1955), 283, 289; 72 NW2d ‘If the construction of the instrument be clear and the breach clear, then it question damage, but the mere circum- stance of the breach of the covenant affords suffi- ground injunc- cient for the Court to interfere ” (Citations omitted.) tion.’

B. PUBLIC POLICY Defendants further contend that, even if the cove- prohibit day nant here does of these day “family requires noteWe that the aof care home” regulated by license the state. 467 Mich 56

Opinion of the Court unenforce- facilities, a restriction should be care policy.” “public against The circuit court able as agreed, Appeals find it nec- while Court of did not the essary reach this issue.8 runs whether the covenant at issue

To determine public policy it first state,9 the is nec- of the of afoul public essary how a ascertains the to discuss court “public defining policy,” policy is it the state. In of be more than a differ- that this term must clear to us prefer- describing personal for the ent nomenclature proper judges, the exercise of ences of individual objective judicial power from the legal is determine public policy simply and not to is, what sources policy ought to be on the basis of assert what such subjective judges. This is views of individual the grounded injunc- famous

in Chief Justice Marshall’s Marbury (1 Madison, v tion to the bench in US duty 5 Cranch) (1803), 137, 177; 2 L Ed that the of 60 judiciary “is,” the not what it the is to assert what law “ought” to be. public policy, identifying the we boundaries ultimately judiciary focus of the must

believe upon adopted policies that, fact, in have been be 8 public policy does, Appeals Michigan in The Court indicated that that, light fact, It favor care homes.” then concluded “family operation day policy, public of a care as the fact that the well nature, use not violate the home” residential defendants’ did public policy However, relying rather on to conclude that covenants. than day “family was of a care home” a covenant Appeals unenforceable, did, relied on as the circuit court the Court policy prohibit did to conclude that the covenants here not day “family home.” of a care against “public policy” are “The Covenants that are unenforceable. public policy principle are not enforce that contracts contravention of only plainly applied with in cases within the able should be caution and Pipe Harding City v doctrine rests.” Twin Line Co which reasons on 353, 356-357; Co, 476; (1931); US Skutt Glass 51 S 75 L Ed 1112 Ct Rapids, 264; 258, (1936). Grand 266 NW Terrien v Zwit

Opinion of the Court public through legal processes, various our in our constitutions, are reflected state and federal City statutes, our and the common law.10 Twin See Pipe Harding Co v Co, 357; Line Glass 283 US 476; 51 S Ct 75 L Ed 1112 merely equivalent Michigan personal of the majority preferences Court; of this rather, such policy ultimately clearly must in the law. rooted proper ascertaining There is no other means of what public policy. constitutes our As this Court has said previously: rule, policy job general making

“As a social is a for the Legislature, especially not the courts. This is true when requires placing premium determination resolution on expense respon- one societal interest at the of another: ‘The sibility drawing society complex for lines in a as as ours— identifying priorities, weighing of the relevant considera- choosing competing tions and between alternatives —is the ” Zahorik, judiciary’s.’ Legislature’s, v not the [Van 320, 327; (1999) (citations omitted).] 597 NW2d 15 inquiry regarding Instructive to the when courts enforcing should refrain from a covenant on the basis public policy of is W R Grace & Co v Local Union 461 759, 757, 766; US 103 Ct 2177; S 76 L Ed 2d 298 (1983), Supreme in which the United States Court only said that such a must not 10 instance, clearly For a racial covenant would be unenforceable on Kraemer, Shelley 1; 836; this basis. See v 334 US S Ct L 68 92 Ed 1161 Equal (1948) (interpreting Clause, Const, XIV); the Protection US Am 24; Hodge, 847; (1948) (interpreting Hurd 334 Ct v US 68 S 92 L Ed 1187 Rights 1866); Act, Housing the Civil Act of Fair 42 federal USC 3601 seq.; Michigan’s Rights Act, seq.; housing et Civil et MCL 37.2101 and the provisions Michigan’s Rights Act, seq. of Civil MCL 37.2501 et 11 that, statutes, constitutions, law, We note besides and common regulations, public professional administrative rules and and rules of con may policy. duct also constitute definitive indicators of 467 Mich

Opinion of the Court well defined and it also “must be but that “explicit,” Supreme Court . . As the United States dominant. .”12 explained: further has policy reference to the Public is to be ascertained precedents general legal and from considera laws and “public pol supposed public term interests. As the

tions of icy” in the vague, must be found definite indications is there justify of sovereign invalidation a contract law of the States, policy. [Muschany United to that as 66; 49, 442; (1945).[13] L Ct 89 Ed 744 US 65 S in the found no “definite indications This has justify invalidation of a cove- law” of Michigan “family day care nant of precluding cited, our nothing has been nor does Indeed, homes.” statutes, yield constitutions, anything, research our Dist ity, tive law.” [Citation omitted.] is no illustration right regular processes mine what contracts are lic “community only would sciousness nition of agreement 266 NW 344 able. own and its defined observed courts since this Court washed its hands inadvertent.” policy in which we have refused “The personal preferences in the way between man However, have not Eastern Associated effectively representatives. by 531 US public in a meaning reference customs and conventions of (1936). knowing common sense and common conscience” goes beyond concurring opinion did not policy Id. we 57, 68; conviction defined allow individual of the law. Justice and man.” Skutt v vagueness, of the disagree with to the laws whether the 121 S Ct violate, it, repugnant to concluding for those Kelly’s Coal phrase ‘public policy’ the actual of what and there “The Instead, “public policy” or 462; Corp actually problem provide apparent dissenting such a nebulous definition enforce on that “[t]here judges 148 L Ed 2d 354 is that the general common-lawmaking v United prohibitions it.” Twin Grand naturally the we believe no fixed rule enacted with gaps discretion public opinion covenant people Rapids, the violation has been ‘public policy’ Mine Workers judicial City, supra in the is not into expressed —in that (2000), relies vague policy by inherently just to ^[275] law here intuition of a and described law is that then clear con which to deter substitute single 258, 264;. Mich are intentional upon of, Justice and is unenforce through the grounds some because it 356. As an the “abid[ing] America, decision, this defi variable; author as the Sc.alia there posi their pub and is Terrien v Zwit 69 Opinion

or common law that supports defendants’ view that a “family prohibiting day covenant care homes” is con- to trary public policy Michigan. “family day

Defendants contend that care homes” are a “favored use” of a property, and restriction a against use, therefore, public policy.14 such violates Amoiphous may be, that claim even if is it true “family day may that permitted care homes” be encouraged by even law, it does not follow that such “family use a favored Additionally, day one. permitted by care homes” are law does not indicate private barring covenants business public policy.15 to missing What is from defendants’ argument is some “definitive indication” “family day that to exclude care homes” from an area by incompatible contract with the law.16There is a significant something per- distinction between being mitted or even law and encouraged something required or being prohibited by law.

To fail recognize this distinction would accord judiciary power to examine pri- the wisdom of county zoning act, 125.216g(2), township zoning MCL and the act, 125.286g(2), “family day MCL state that a care home” “shall be consid purposes zoning ered a residential use of for the . . . favoring This Court has held that the aof use does not mean that regard particular parcel such a use cannot be a denied with of land. Kropf Hts, Sterling 156-157; (1973). v 215 NW2d 179 Kropf, municipality can, way this Court concluded that a of a local zoning ordinance, prohibit particular parcel a use” a “favored on of land. private Similarly, parties can, by way covenant, agree prohibit a particular parcel Therefore, opera use” “favored on of land. even if homes,” use,” tion of care ais “favored this is an insufficient disregarding prohibiting “family reason for a covenant day subject property. Detroit, on care homes” See Johnstone G H & Co, 65, 73-74; M R Mich NW 325 example, requiring “y” incompatible For covenant “x” or would be provision prohibiting “y”; with a law or constitutional “x” or and a cove “y” incompatible nant “x” or would with law or constitu provision “y.” requiring tional “x” or 467 Mich 56 70 Opinion of the Court only those con contracts in order enforce vate not However, it is “the func prudent. it deems tracts private property to strike down tion of courts in readjust property rights and to those agreements upon what seems reasonable accordance with Oosterhouse, supra 289- judicial view.” at detached finding basis Rather, specific absent some for 290. private con disregard cannot unlawful, them courts a particular and covenants order to advance tracts Co, G H Detroit, & M R See Johnstone v good. social As 65, 222 NW we said 73-74; (1928).17 Oosterhouse, supra 288, not do substitute “[w]e particularly parties, that of the judgment our for instant restrictive covenants where, case, as in the secure them adopted are the means them to unto of and desirable development selves the a uniform Instead, that, if cove residential area.” we conclude prohibit “family day should nants that care homes” public policy grounds, on not be enforced not the Legislature, should come from the decision that it wise to judiciary.18 may think is Legislature but it does we can covenants, so, bar such until say they public policy. See Muschany, supra at 65. of

Further, although the circuit court the Court they what Appeals this case considered viewed homes,” in favor care strong competing they neglected to even mention the property Johnstone, in a this Court concluded that the owners of subject property restricting use of residence subdivision to a covenant just compensation upon part purposes taking were entitled to such subdivision use in violation of such restriction. California, Jersey example, Minnesota, Legislatures New For provisions prohibit “family day voiding have enacted covenants Safety 1597.40; 245A.11(2); See Minn care homes.” Cal Health & Code Stat 40:55D-66.5b(a). NJ Stat Terrien v Zwit

Opinion of the Court public policy, which in the well-grounded common Michigan, supporting law right affecting owners to create and enforce covenants Wood v Blancke, property.19 their own Mich 287-288; 8 NW2d 67 It princi fundamental ple, both with to our regard expectations citizens’ and in our jurisprudence, property are holders free improve property. their We have said property attempt free owners are to enhance the of value “property by their lawful way, physical improvement, psychological contract, inducement, Johnstone, supra otherwise.” at (emphasis 74-75 added). running Covenants with the land are legal instruments utilized to assist in that enhancement. A covenant contract created with of the intention the value of enhancing property, and, such, as it is right.” City Dep’t v “valuable Livonia of of Services, Social 423 Mich 466, 525; NW2d 378 402 general “The (1985).20 rule is that com [of contracts] petent persons shall liberty have the utmost of con tracting and that their agreements voluntarily and fairly made shall held valid and enforced supra courts.” Twin City, Port Huron 356; see also 19 importance Indeed, enforcing deeply of covenants is entrenched early 1928, expressly in our law. common As it has been held to be the Johnstone, supra Undergirding law this right common of state. at 74. this property is, course, to restrict of uses of the central vehicle for that contract, deeply restriction: the freedom of which is more even Michigan. in the law See McMillan v Mich entrenched common Kelly’s Co, & N I R dissenting opinion S 16 Mich 79 Justice dis policies misses these in a short footnote. Further, although implicates public policy, this case several claims to require competing pub- resolution our case does not us to balance policies because, above, pre- lic as discussed the claim that covenant “family cluding day care homes” violates flawed. purposes particularly by pub “Restrictions residence are favored property rights.” City Livonia, supra policy and lic are valuable at 525. 467 Mich

Opinion of the Court Dist, School 452 Mich v Port Huron Area Ed Ass’n Dep’t Navy quoting (1996), NW2d228 309, 319; 550 App DC Auth, Relations 295 US v Federal Labor (1992) (discussing “fundamental 248; 962 F2d 48 “parties policy which of contract” under of freedom specific generally agree rules free to to whatever they like”). purposes, if for residence

Moreover, “[restrictions by clearly proper instruments, are favored established public policy. long The courts have definite by specific vigorously mandate.” John enforced them supra at The covenants at issue here are of stone, 74. They expressly prohibit uses, nonresidential this sort. uses. commercial, industrial, or business as well as prop Clearly, limit the use of the the intention was to neighborhood erty in maintain a residential order to Signaigo specific said in character. As we (1926), Begun, NW 246, 250; “[t]he acquired, right, if has been to live a district it apartment garages, stores, uninvaded business right.” Court “has Further, houses is a valuable by injunction proper not hesitated in cases to restrain property rights.” at invasion of these valuable Id. Moreover, [such] the “nullification of restrictions 251. prop injustice great of to the owners [would be] supra right pri erty,” because “the Wood, vacy right.” supra Johnstone, for homes is a valuable protect the courts to at 74. It is the function of rights through Wood, the enforcement of covenants. supra at 287-288. precluding

Here, we conclude that a covenant day operation “family of a care home” is not violative no of our state because there are any public policy “definite indications” in our law of against Indeed, such a covenant. there is considerable Zwrr Terrien Opinion public policy regarding the freedom of contract that affirmatively supports the enforcement of such a covenant.

IV. TO RESPONSE DISSENTS A. KELLYS JUSTICE DISSENT

1. COVENANTS “family Justice first dissent concludes that Kelly’s day care homes” are “residential nature.” Post at already pointed However, 83. as we have out, the operation “family issue here is not whether the day Rather, care home” is a residential use. the issue operation whether such is a commercial or busi- explained ness use. As we above, residential and or commercial business uses of are not mutually activity may exclusive; an be both residen- tial in nature and or commercial business in nature. “family day Therefore, dissent’s assertion that simply care homes” are residential nature is irrele- vant here, where the issue whether the “familyday prohibit- care home” violates covenant ing commercial business uses.21

The dissent next concludes care prohibit- homes” “do not violate restrictive covenants ing commercial and business use.” Post at 83. Inher- ent in this conclusion is that the of a “fam- ily day care home” is anot commercial or business later day-care ‘use for residential The dissent that “it is homes impossible do again purposes.’ not conform fails to ” conclude Post recognize at 85-86. ordinary from this distinction when it states the record that and common meaning the family

Opinion of the Court The dissent disagree. we above, As discussed use.22 compensa- on “great weight placing for criticizes us of operation determining that 84, in tion,” post at or business is a commercial “family day care home” a why as to explanation no provides it However, use. Lanski, In consideration. inappropriate an this is a operation of that determining supra 49, at use, this Court a commercial home was nursing profit is charged fee is that observed “[a] to make a The intent is true here. made.” The same in iden- important element obviously an quite profit or business a commercial what constitutes tifying enterprise.23 “land use should asserts that

The dissent next activity involved to how the according characterized rather than of the area” plan the general there affects 84, Post at 85. majority.” of the approach narrow “the majority adopted has approach that this However, the contracts to enter into that, parties when simply “family day that, although interesting the dissent states find it We they “do not violate and that are “residential nature” care homes” use,” post prohibiting and business covenants commercial restrictive operation right and states that the never comes out the dissent Perhaps, “family day use. or business home” is not a commercial care straightforward the dissent’s ultimate conclusion statement of such a underlying such a conclusion. attention to the flaws would call downplay attempt City in an on Livonia The dissent relies of However, profit. rec the dissent fails to to make a relevance of an intent present City case. ognize Livonia and the distinction between a critical operation Livonia, of an adult foster City was whether the the issue use, prohibiting while the nonresidential a covenant care home violated care in the instant case is whether issue uses. The or business a covenant commercial home” violates City of an adult foster that the Livonia concluded patients use, despite that its the fact not a nonresidential care home was agree pay goods required there. We and services obtained were activity necessarily receipt compensation an non make does not plays compensation However, is received whether in nature. residential is a com of whether role in the determination far more critical use. mercial or business Terrien Zwit V

Opinion the of Court prohibit commercial or business uses on their proper- or ties, properties commercial business uses on their will prohibited. be

Further, issue, lest the dissent obscure this we point out once more that the covenant before this the parties’ properties states that are not to “be any enterprises.” used for or It commercial, business state, does not as the dissent would us have under- stand, parties’ properties that the are not to be used any commercial, or business enterprises that general plan affect the the area or has a visible adverse effect on the residential character of the post neighborhood. plain See at 87. Under the lan- the guage Court, covenant before this the not cove- nant apparently preferred by the dissent, parties’ the properties may not be used to operate a commercial enterprise. business Period.24 an appar- effort ently “improve” upon to the actual contract created by parties, the the dissent reads words into the cove- nant simply that are not there.25 justifies

The dissent its amending from the bench by asserting that absence of a definition in the “[t]he

24The dissent’s statement that the land use here is not commercial or showing business in nature because “no has been made that the family day-care of defendants’ had homes effect on the overall resi post neighborhood,” 85, is, therefore, dential character of their at a non sequitur. Further, explained, plaintiffs’ right as we have to enforce the covenant, written, depend as not does on whether defendants’ violations plaintiffs, although plaintiffs of the covenant have harmed the fact that pursued suggests have initiated this lawsuit and it to this Court that the impact plaintiffs upon benignly of defendants’ activities are not as viewed they latter the dissent. imposing The dissent characterizes effect of our decision as an upon “family prohibition” day parties’ “absolute care homes” on the properties, “majority’s prohi and further characterizes this as the absolute impelled, point however, bition.” 87. We feel to Post to the out dissent parties’, “majority’s,” prohibition. parties, not this is not Court, regard are the lawmakers with to terms their own contracts. Mich 56 Opinion the Court “commercial, covenants” of terms restrictive enterprises” leaves these terms business industrial, or judicial “opens the terms and thus ambiguous, interpretation.” Post at 87. We find this law, namely, that the lack proposition of remarkable a term somehow explicit internal definition of apparently, ambiguity that equates ambiguity —an free to conclude that case, in this allows court rein wants it to means whatever court a contract any word approach, dissent’s mean. Under the specifically defined within contract becomes If were the test for deter- ambiguous.26 that magically virtually ambiguous, a term is then all mining whether and, therefore, be rife with ambiguity contracts would in mean whatever subject what the dissent “words to “judicial inter- say they I mean” fashion describes ability fortunately mil- pretation.” However, for the per- to structure their own Michigan lions citizens this is the test. As this affairs, business not sonal and a stated, the fact that contract repeatedly Court has a relevant term does render does not define v Farm Fire & Henderson State contract ambiguous. Co, 190 Cas 354; Mich 596 NW2d 348, (1999).27 460 contract, is we will Rather, if a term not defined “commonly its interpret term in accordance with 26 approach Presumably, apply this novel to the the dissent would same interpretation contrary that this would be to MCL of statutes. We note phrases 8.3a, provides be which that words and shall construed “[a]ll approved usage according language of the understood common 27 respect contracts, This further with to insurance Court has observed usage “[ojmitting has does not the definition a word that a common Group Czopek, policy.” ambiguity Mich create an within the Ins Co 596; “[SJimply policy 590, (1992). because a does not define 489 NW2d Group policy ambiguous.” Club Ins Co v a term does not render Auto 631; “Instead, pol Marzonie, 624, (1994). Mich 527 NW2d absent meaning icy definition, ‘given with accordance their com terms are ” omitted). usage.’ (citation mon Id. Terrien v Zwit

Opinion of the Court meaning.” Id.] used Frankenmuth Mut Ins Co v Mas- ters, 113-114;595 NW2d 832 clearly prohibits contract this case commer- properties. cial on business uses the covered Equally clearly, “family day care profit providing home” that makes a a service to public is a commercial or business use. That interpretations appear these should to the dissent to overly “conclusory” only, perhaps, they be is because simple propositions involve such and unremarkable of law.

2. PUBLIC POLICY The dissent also that, concludes even if the cove- preclude nant here does preclusion public homes,”

care such a policy, and thus unenforceable. Post at 88. As we already respectfully disagree. have clear, made we suggests unnecessarily The dissent we limit understanding “express our statu- tory mandates.” Post at However, 90. as we have already explained, view, our as well as that of the Supreme simply United Court, States policy must derived from “definite indications” in the law. Whilethe dissent would refuse to enforce the instant covenant absent “definite indication” in any “express statutory law, the much less mandate,” any public policy, that such a covenant contravenes we view it as our obligation to a enforce covenant under these circumstances. acknowledges, public policy

As the dissent itself is the “foundation” of constitutions, our statutes, and precisely common law. Post at 89. It is because of this public policy truth that a contract that does violate is 56 Mich Opinion of the Court of this However, is also because it unenforceable. policy public exists, rather where an actual that, truth personal policy preference judge, simply a than public policy actual indications” “definite .will in our laws. be found majority’s opinion the

The asserts that dissent public policy and is the doctrine” “con- “eviscerates trary practice.” long at established Post to this Court’s merely opinion disagree. we This more, 92. Once unexceptional proposition that an asser- the sets forth nullifying policy public a a con- as basis tion policy. grounded in a If must, fact, tract grounded statutes, or the constitution, in the as state, law of we are curious common truly policy asserting a is a dissent’s basis for “public” opposed merely judge’s policy a own policy. proposition preferred think It hard to compatible law” and more com- less patible with “rule of may judge

with the “rule of men” than that “public policies” cloth, rather concoct from whole law.28 than actual sources of the from Finally, the concludes that “restrictive cove- dissent family day-care are homes nants are to our state’s unenforceable.” only that the dis- However, Post at 90. evidence day points “family establishes, most, sent encouraged, supported, are even care homes” majority remarkably opinion will because it dissent criticizes the land,” post implications regarding “negative free at 92. have use say, we rather view of what Needless to have a different than dissent respectfully suggest legal promotes “free land.” that a use of We respected regime property rights are more in which contract and one regime rights this end in which contract and conducive to than subject arbitrary “public policies” judges deriving vetoes of new to the from their own consciences. 79 Terrien V Zwit Opinion of

public policy,29 not that “family covenants which limit day upon care homes” private properties are to public policy. certainly Such evidence does not provide any “definite that a indication” covenant, freely by private parties, entered into prohibiting the “family day of care homes” on their proper- ties, public policy.30 violates

In summary, “public policy” in the name of —a “public policy” to in nowhere be found the actual laws of Michigan impose dissent would its own —the preferences for ought place how contract to read in preferences of parties of the themselves.31 29 principal The evidence that the for dissent marshals its conclusion Legislature that this covenant violates has chosen “family regulate day homes,” to care that the executive branch has estab advisory day children, lished committee on care for and that the Court Appeals “family day of has said in dictum that care homes” are favored public policy. our See also note 30. It is not how of clear this evidence “definitely public policy against prohibit indicates” a covenants that “fam ily day Again, policy homes, care homes.” even if does favor such considerably proposition private parties this is different from one that prohibited freely entering agreements are from into not to use their properties for the of such homes. zoning on dissent also relies its statutes reach conclusion that public policy. However, ques this covenant violates Post at 89-90. we also First, merely provide tion the relevance of factor. these statutes “family day prop care homes” purposes “be considered a residential use erty zoning 125.216g(2), for the . .” 125.286g(2) . . MCL MCL (emphasis added). They do not state that care homes” are not Second, zoning a commercial or use. well business it is settled that stat purport regulate private City utes do “not restrictive covenants.” “ Livonia, supra ‘Zoning obliga at 525. laws determine owners’ rights community large, tions to the at do but not determine the and obli ” gations parties private Id., quoting Robinson, to a contract.’ vRofe 345, 351; Therefore, adopted 415 Mich 329 NW2d 704 “definitions legislative purposes housing zoning in codes and ordinances [cannot] employed interpreting Oosterhouse, supra restrictive covenants.” at 290. majority Concerning “engrafts the dissent’s accusation that this its be,” opinion own version of what law our should and that is the judge-made law,” post amazement, “embodiment of we do can lit repeat DaimlerChrysler Corp, tle than more what we said Robertson 732, 762; (2002), inviting “reader, 641 NW2d 567 and the citi- Mich

Opinion the Court B. JUSTICE WEAVER’S DISSENT arguments two sets forth Justice Weaver’s dissent in this elsewhere been addressed that have not opinion: suggests that, in order to deter-

First, the dissent in business mine an is commercial or whether inquire type neigh- of nature, Court must into the this applies. We do not which the covenant borhood to inquiry. cove- the relevance of this understand prohibits This here commercial or business uses. nant language straightforward. be

could not more direct or example, a how, do for commer- We not understand dry into is from a “business” cial cleaner transformed surrounding neighbor- a non-“business” because the middle-income, is or lower hood middle-income larger smaller, or because its because its lots predominantly younger older, or or residents are shrubbery Rather, or is not well-tended. because its is quite a reference to business, a business is without type neighborhood in is If which it situated. the all some be derived from is, fact, there in relevance to defining comprise neighborhood things in these a “business,” does tell us what this the dissent might no or be. The dissent offers factors criteria guidance no evaluate, a court to it offers as to by particular circumstances that should reviewed analysis, regard- in it offers direction court its no ing store, that a 7-11 when a court should conclude Michigan, evaluating reflect which zens of in these to upon” opinions, judging to in is more conducive these results —an approach approach is on the basis of policies actually which determined “public policy” into or enacted law representatives public, approach judges and used to which is fashioned out of thin air by “public policy” entered into freely defeat contracts covenants people state. Terrien Zwit Opinion beauty body facility shop, or an auto has been trans- formed into non-“business” because itsof location. inquiry Indeed, the irrelevance of the dissent’s by the underscored obvious fact that the covenant only applied specifically single “neigh- here was to a scope borhood”—what was within the cove- neighbor- nant. There are not one hundred different hoods here which “business,” least in the dis- might something sent’s mean view, different in each neighborhood instance. Rather, there a one applies, which the covenant and there is not the slightest indication the covenant that this alto- ordinary gether term, “business,” was intended to anything every person mean other than what in Fruit- Township, anywhere land else in the state of Michigan, would understand it mean. One would suppose type neighborhood that, had the of been rele- understanding parties to “business,” vant an of the joined might who into this covenant have offered guidance only regard, some in this since there is one “type neighborhood” guidance of to which such required. would been have no However, evidence parties any exists that these intended of their words meanings, to have secret or to communicate some- thing ordinary meanings. other than their persuaded by

Further, we are not the case cited support proposition the dissent in of its that whether activity depends an constitutes a “business” on the type neighborhood applies. to which the covenant Hojnacki, The dissent cites Brown v 270 Mich 557, (1935), 561; 259 NW 152 in which this Court con- plain argument” cluded that it was “too that the massage parlor, at there, issue constituted a any thereby “business house of kind,” and violated a reaching covenant the latter. In this con- 56Mich

Opinion Court it was asserted that nonetheless elusion, Court “ appropriate character location and consider the ” light Id. In of land.’ at 560-561. of the entire tract actually rely upon any that the Court did fact opinion, must be this statement in its such factor apparently has not as dictum—dictum viewed in this Court. been reasserted since opinion will that our Second, dissent contends working “prohibit home on from from a stockbroker writing computer, from at his home his an author attorney writing billable time at from on office, mowing neighborhood from his even child home, or pay.” family’s neighbors’ Post 94. lawns for presented say, with we have not been Needless appeals before await their cases, of these deciding will agreements where that have However, them. they freely prove can be undone flawed, been reached process.32Regardless through the same modified “improve upon” agree- can whether by construing unprepared to so ments, we are do plainly they not mean. to mean what do words simply issue in this case is this: “Is The essential ” day-care judg- for-profit In our center a ‘business?’ parties judgment, it is. our con- ment, that “business” would tract in' this case intended approach of the dissent would mean “business.” stability property law as well as undermine the Michigan by construing words of a law in contract give sufficient considera The dissent contends we have failed to day family Legislature has that tion the fact that “the concluded care assuming . .” Post neighborhoods . . Even within are favored 96. homes day “family permitted, dissent does that care homes” are “favored” or the dissent, explain significance the Unlike the other not this observation. observation, that the which makes this same and concludes a result implicated, “public policy” the dissent makes no refer doctrine instant “public policy” doctrine. ence whatsoever to the V Zwit Terrien Dissenting Opinion Kelly, J. something other than mean contract

real estate clearly they mean.33 what

V. CONCLUSION operation aof We conclude prohibiting commer- a covenant violates care home” a covenant and that such uses, or business cial Accordingly, the decision we reverse enforceable. Appeals court to the circuit and remand Court of summary disposition entry granting of an order plaintiffs. favor of JJ., con- C.J., and Taylor Young, Corrigan, J. with

curred Markman, majority’s disagree respectfully with the J. I Kelly, analysis characterizing the conclusions. day-care family use is con- as a commercial homes of clusory, providing for deter- standard unworkable com- mining are residential future uses whether Additionally, opinion eviscerates all but mercial. recognized long policy in this doctrine law. state’s case family day-care homes hold that

I would vio- and do not in nature are residential involved here commercial covenants late restrictive that the covenants hold also I would business use. prohibiting family day-care homes perplexed “business,” as to how arewe not mean If “business” does particular uses of parties can ever ensure future contracts to similar parties more clear or such future will occur. How can Perhaps, present agreement? the dissent parties to the direct than specific required lengthy enumerations to set forth them be would have by courts, ignored However, prohibited. words are once to be businesses only parties can by contracting of words precision in the use greater certainty con words will be degree how such promise as to limited in the future. these same courts strued 84 467 Mich 56 Dissenting Opinion by J. Kelly, are and, therefore, unenforceable.

I. RESTRICTIVE COVENANTS day-care determining family that a home property, commercial or business use of real places majority great weight compensation. on It single relies on sentence contained in Lanski v broadly Montealegre1 activity defines commercial any activity by profit. motivated majority’s However, as evidenced discussion profit case, of that was not the determinative factor concluding nursing that the defendant’s activity. home was a commercial Instead, the Court consid- also activity general ered the effect of the home’s on the plan originally area, which was intended as a private resort area. Id. at 49-50. respect approach

The Court used a similar with City Dep’t adult foster homes in Livonia v (1985). Social Services, 466; 423 Mich 378 NW2d402 There it held that such homes do not violate restric- limiting pur- tive covenants land use to residential poses and noxious offensive trade, manufacturing, merchandising, secondhand wrecking living businesses. The mere fact that adults payments there made for certain items and services did not transform residential activities to commercial Id. activities. at 529.

These cases illustrate that land use should char- according acterized how involved there general plan approach affects the of the area. This prevalent involving in cases residential use covenants.

[1] 361 Mich 44; 104 NW2d ^[772] (1960). Terrien v Zwit Dissenting Opinion by Kelly, J. e.g., NW2d 67 Blancke, 283; v See, Wood (1943); Builders, Inc, 459 Custom v Resort O’Connor Beverly (1999); Island Ass’n NW2d 216 335; Mich App Zinger, NW2d 611 322; Mich ordinary, and incidental use usual, While use not violate a residential does as a residence extraordinary might. use restriction, unusual particular facts of the on the focuses determination supra logical reason has been at 289. No Wood, case. why approach should not be a similar shown employed involving and business commercial

in cases restrictions. use parties approach the also honors the intent of

This entirety by considering and in restrictions in their use produces particular light facts of the case. It of the characterizing proper use, for the standard majority, approach which narrow of the not the single consideration. focuses on a analysis showing Applying no has been here, that family day- operation of defendants’ made that the any the overall residential care homes had effect on any neighborhood. evi- Nor is there character of their compensation supports a con- other than that dence family day-care homes were commer- clusion that the important note that or business activities. It is cial stipulated result, As a was decided on facts. this case the contains limited information about the record family day-care homes. It includes of the parties’ stipulations restrictions, to the deed the day-care family home defendants’ ownership private parties’ residences, and the their There is no evidence land within the subdivision. pedestrian regarding and vehicular traffic associ- day-care the sub- homes or its effect on ated with the impossible from the to conclude Thus, division. it is 467 Mich Dissenting Opinion Kelly, J. family day-care record that do not homes con- ordinary form to meaning and common of “use purposes.” for residential of these light facts, restrictive covenants do T compel plaintiffs.2 ruling hey address the protect

residential nature of the neighborhood. To it, they prohibit activity might annoy become an neighborhood. ance to the restriction commercial busi-

ness enterprises echoes the intent prevent activity. prohibits It also equipment storing used in a commercial or industrial enterprise, activity visibly changes neighborhood. It is this visible adverse effect on the residential character of the neighborhood that to pre- restrictions seek vent, not a discrete such as that involved here. I would conclude that the restriction prohibiting

2 The restrictive covenants are: part premises may 1. No above described or shall be private purposes.

used for than other residential except purposes. 3. No lot be used shall for residential activity upon any 12. No or noxious offensive shall on be carried lot, anything may may nor shall be done thereon which be or annoyance neighborhood. become an or to the nuisance part parcel premises 14. No or of the above described shall be any commercial, industrial, enterprises used for or business nor the storing any equipment any used in or commercial industrial enterprise. parties hereto, any them, heirs, assigns, 23. If the or or their or successors, may be, attempt case shall violate or to violate any herein, person any of the covenants it be lawful other shall persons owning any or real situated within bounds premises prosecute any proceedings the above described to at law equity person against persons attempting violating or in or or covenant, prevent violate and either to them him or from doing so, damages arising resulting or to recover from such violation. V Zwit Terrien Dissenting Opinion Kelly, J. enterprises limits those and business commercial visibly affecting nature of the the residential activities neighborhood. interpretations apparent terms from the of the

It is enterprises” that industrial, or business “commercial, that there is con- advanced this Court have been disagreement meanings. The about their siderable covenants of a definition the restrictive absence opens ambiguity the terms unresolved leaves Bossenbery, judicial interpretation. Craig See v App 548; 351 NW2d 596 Restrictive Mich reasonably Boston- must be construed. covenants Fathers, Inc, 306 Edison Protective Ass’n v Paulist they (1943).3 And 253, 257; Mich 10 NW2d strictly party against seeking to enforce construed regarding being restrictions them, all doubts property. City in favor of the free use of resolved supra Livonia, at 525. Applying agree construction, these rules of I cannot majority’s the restrictive cov- with the conclusion that majority’s prohibit family day-care homes. The enants activity prohibition generating absolute compensation of all forms of normally preclude would activities community, such as have no visible effect on a writing. babysitting services and freelance where the The effect of the is relevant question meaning and the of the restrictive covenants Brummel, of breach is uncertain. See Oosterhouse (1955). When consid- 283, 289; 72 NW2d 6 restrictions, in the context of the other it is ered unlikely majority’s interpretation of the that the broad interpret Ass’n, Protective this Court refused Boston-Edison “single dwelling requiring limited to those who are house” as use terms family. single members of a 467 Mich Dissenting Opinion by Kelly, J. was covenants what intended. Accordingly, effect on the is relevant to a neighborhood decision day-care whether family home vio- lates covenant prohibiting commercial or business The majority’s use. is an extreme construction and unnecessarily one use constrains the of residen- property. tial I

Therefore, would hold that family the defendants’ day-care homes do violate the restrictive cove- nants commercial or business uses.

H. PUBLIC POLICY Even if day-care of family homes were plaintiffs’ violative of restrictive covenants, covenants are policy and cannot be enforced. policy by Public was defined v Rapids4 Sipes Skutt Grand McGhee, v 316 Mich 614, 623-624; 25 NW2d 638 (1947):5 “ meaning “public ‘What policy?” is the A correct defi- nition, comprehensive, at once concise and of the words “public policy,” yet by has not been formulated our courts. Indeed, the as accuracy term is difficult to define with “public the word substance, “fraud” term or the welfare.” In may community it said to be common sense and conscience, applied common throughout extended and public morals, State to public health, public matters of safety, public welfare, general and the like. It is public opinion relating plain, palpable

well-settled to man’s duty men, having to his fellow regard due to all the circum- particular stances of each relation and situation. “ ‘Sometimes such is declared Constitu- tion; by statute; judicial sometimes sometimes decision. L92 Ed 1161 Rev’d on other 258, 264-265; grounds 266 NW 344 Shelley Kraemer, (1936). 334 US 1; 68 S Ct 836; Terrien V Zwit Opinion by Dissenting Kelly, J. often, however, only

More it abides in the customs and con- people, ventions of the their clear consciousness and —in naturally inherently just is right conviction of what and and principles regards primary man. between man and It equity justice expressed and and is sometimes under the justice, title of social and industrial as it is conceived our body politic. shocking course of is cruel or When conduct average conception justice, to the man’s such course of obviously contrary public conduct must held to be be policy policy, though has so such never been written bond, Constitution, whether it or statute decree of court. frequently public policy It has said that been is a com posite provisions, judicial of constitutional statutes and decisions, gone and some courts have far as to so hold that fallacy it is limited to The obvious of such a these. conclu quite superficial apparent sion is from the most examina contrary provision tion. When a contract is to some of the say Constitution, prohibited by Constitution, it we not by public policy. contrary statute, When a contract is we say prohibited by statute, by public policy. it is When contrary judicial decisions, a contract is to a settled line of say prohibited by land, we it is the law of the but we do not say public policy. policy it is is the Public cor constitutions, statutes, nerstone —the foundation —of all judicial decisions, longitude, and and its latitude its height depth, greater and its than all of them. If true, judicial be not whence came the first decision on mat public policy? precedent it, ter of There was no for else it ” supra [Skutt, 264, quot would not have been the first.’ ing Pittsburgh, C, L Ry Kinney, 64; C & St Co v 95 Ohio St (1916).] 115 NE 505 policy just,

Public is what is right, reasonable, and equitable society McNeal, as a whole. Judicially public policy: unruly determined Is “the horse” loose in Michigan?, Cooley TM L R 149 (1996).

Contrary majority’s conclusion, to the policy day-care supports family this state homes. This fact over evidenced the actions time of various state entities. The has defined Legislature 467 Mich

Dissenting Opinion by Kelly, J. family day-care zoning homes as residential uses 125.216g 125.286g.6 statutes. See MCL It has seen family day-care regulate fit to homes in the context of licensing protection the child care act for the of chil seq.7 dren. See MCL722.111et The executive branch has addressed the issue of Michigan child care. Executive Order No. 1995-21 advisory day established an on committee care for children. The committee later issued recommenda- strengthen system tions intended to the child care Making this state. See DSS Child Care: Work, It Pub (February, 1996). No. 714 Finally, judiciary proclaimed in case law has Michigan family day-care favors example, Beverly supra homes. For in Island, at 330- Appeals policy. 331, the Court of articulated that light express of these indications, it follows that family day-care restrictive covenants public policy homes are to our state’s majority’s are unenforceable.8 dismissal of these strong public policy baffling indications of and dis- turbing. approach public determining Its narrow to policy judiciary by prohibiting constrains the it from invalidating express statutory covenants absent mandates. zoning determining public policy. Earlier cases examined statutes in Craig, supra; Iserman, McMillan v App 785; See 120 Mich 327 NW2d 559 (1982). approach. We know of no reason to discard this Craig, supra. supported by reasoning This reliance is in That case part Facility Licensing relied in on the Adult Foster Care Act in determin public policy. ing acknowledge supports property that Wood We owners’ contractual

rights However, to enforce restrictive covenants. such restrictions cannot public policy. Livonia, supra they be enforced 525; when violate sound Oosterhouse, supra Thus, rights at 286. the contractual own public policy. ers cannot contravene v Zwit Terrien Kelly, J. Dissenting Opinion component important judicial are an

But decisions they occurring policy gaps fill because Constitutions, which are and statutes. constitutions necessarily scope, are not intended to broad every controversy might arise. Statutes resolve scope, providing governing soci rules are narrower ety. Legislature cannot foresee But it is clear that controversy. likely every McNeal, result in situation supra at 143-144. judici- controversy arises, it is the role of

When ary applies the facts of the law as it to determine judi- requires particular case. This sometimes ciary Thus, determinations. if to make presented in novel fac- the courts are to decide issues they contemplated by statute, must tual situations pub- necessarily power existing determine have the Id, policy. lic at 146. early acknowledged sig

As this Court public policy. Gargett, nificance of See McNamara adopted 454; 36 NW 218 McNamara public policy that considered the morals definition of society. of the time and the established interest of Id. promissory at 460. It held that a note was not reasoning enforceable, that the interests of the indi public welfare. Id. at vidual must be subservient to policy 461-462. Public was also considered v Wittmer Oil & Court in decisions as old as Fetters Properties,9 Banking Co,10 Brown v Union Gas Sellars v Lamb. majority’s weigh, appro- refusal to as is Hence, public policy priate not codified in the law of here, ^{[9] [10]} 258 Mich 310; 274 Mich 499; 604; 242 NW 301 NW2d NW ^[447] (1932). (1936). 467 Mich 56

Dissenting Opinion by Weaver, J. sharply contrary long state to this Court’s estab- practice. majority provide persua- lished The fails to doing. engrafts sive reason for so Instead, it its own discarding version of what the law be, should knowledge and wisdom of those who came before the judge-made current Court. This is the embodiment of law.

in. CONCLUSION majority’s reasoning The contravenes established principles unreasonably of law. It characterizes land only employing monetary use criterion, one whether compensation is involved, without consideration of the restrictions as a whole or the effect of the use community. on the This creates an unworkable stan- far-reaching implications negative regarding dard with the free use of land.

Additionally, majority turns its back on policy developed applied by that was and has been this Court for decades. This too has extensive adverse implications jurisprudence for the of the state. family day-care homes is residen- tial in nature and does not violate restrictive cove- nants tionally, commercial or business use. Addi- barring

restrictive covenants their and, therefore, are unen- Appeals forceable. I would affirm the Court of decision.

Cavanagh, J., concurred with Kelly, J. respectfully majority Weaver, J. I dissent from the opinion. family day-care I would hold that homes are inherently incompatible with the restrictive cove- case, nants in this and, on the basis of the facts to Terrien v Zwrr Dissenting Opinion by Weaver, J. parties stipulated, grant which the have affirm the summary disposition in favor of defendants.

The issue in this case is whether the restrictive cov- proper- enants that are recorded for the defendants’ prohibit operating ties the defendants from licensed family day-care homes1 at their residences.

Restrictive covenants in deeds will be construed strictly against grantors claiming and those right to enforce them. All doubts will be resolved in property. favor of the free use of James v Irvine, 141 (1905). 376, 380; Mich 104 NW 631 Deed restrictions property rights. protect The courts will those rights they if are of value to the owner asserting estopped them and if the owner is not from seeking enforcement. v Robinson, 415 Mich 345, Rofe 349; 329 NW2d 704 provide, pertinent

The restrictions in this case part: part any premises 1. No may of the above described or private

shall be purposes. used for other than residential

[*] ^{[*] [*]} except 3. No lot shall purposes. be used for residential ^{[*] [*] [*]} 12. No noxious or offensive shall be carried on upon any lot, anything nor may shall be done thereon which 722.111(f)(iii) provides: MCL “Family day private care home” means home in which 1 but supervision fewer than 7 minor children are received for care and periods day, parent of less than 24 hours a unattended or legal guardian, except children related to an adult member of the family by blood, marriage, adoption. Family day or care home gives includes a home that care to an unrelated minor child for during year. more than weeks a calendar 467 Mich

Dissenting Opinion Weaver, J. may annoyance be or become an or nuisance to the neighborhood.

[*] ^{[*] [*]} part parcel premises 14. No of the above described any commercial, industrial, shall be used for or business enterprises storing any equipment nor the used enterprise. commercial or industrial majority narrowly The focuses on restriction 14 and any activity profit prohib- holds that that creates a ited the disagree restrictive covenant. I with the majority’s analysis, because it fails to consider the covenant as a whole and neighborhood to which applies. it Montealegre, See Lanski v 361 44; Mich 104 NW2d majority The conclusion pro- would hibit a stockbroker from from home working on his computer, an author from at his writing office, home attorney an from writing on billable time at home, or neighborhood even a family’s child from his mowing and neighbors’ pay. lawns for I do not believe that this was the intent of parties they when entered into the covenant.2

This Court should consider more than whether the designed produce profit. As this Court previously has said: rights parties of the are not to be determined [T]he interpretation

literal of the restriction. It is to be construed surrounding circumstances, connection with the which majority agreements freely asserts that “where that have been prove flawed, they through reached can be undone or modified the same process.” Ante at 82. It is indeed the case that if all the interested parties- subdivision-agree modify covenant, in this case the entire or revoke the CJS, Covenants, 33, pp Nevertheless, that could be done. See 21 § 322-323. key issue, determining it is not relevant to the whether the defendants’ family day-care prohibited by homes are the restrictive covenant issue here. Terrien v Zwit Dissenting Opinion by J. Weaver, parties supposed to have had mind at the time

they it, made the location and character of the entire tract purpose land, restriction, of the whether it was for grantor the sole benefit of the or for the benefit of the grantee subsequent purchasers, and whether it was in pursuance general building plan development for the improvement property. Hojnacki, of the [Brown 557, 560-561; (1935) (citations omitted).] Mich NW259 Thus, the Court should consider other factors, such purpose as the of the restriction and the effect on the neighborhood, determining disputed whether the activities violated the restrictive covenant at issue. Montealegre, supra3 determining See Lanski v neighborhood, effect on the the court should consider applies only whether the covenant to one individual neighborhood land, tract of entire or subdivi necessary sion. It is also to consider the character of surrounding neighborhood example, whether —for private single-family neighbor it is a area, resort neighborhood containing apart hood, a one or more neighborhood. houses, ment or a mixed-use designed preserve Here the covenant was to residential nature of the subdivision and to avoid the disruption neighborhood to the that “commercial, enterprises” industrial, or business would cause. Fam- ily day-care special homes, absent some feature such Montealegre providing In Lanski v the Court a considered covenant premises any enterprise that owners “shall not use said for commercial or any engage undertaking commercial thereon ....” Id. at 46. Defendants formerly building established a convalescent home in a used as a resi general plan private dence. The Court said that the for a resort area indi cated that a broad definition of “commerce” was intended. “In its broad any type activity sense commercial includes of business or which profit.” Nevertheless, is carried on a for Id. at 49. the Court went on to neighborhood: patients, examine the effect of the home on the “The visitors, nurses, atmosphere general and the over-all detract from the plan private, originally of the noncommercial resort area intended.” Id. at 49-50. Mich 56

Dissenting Opinion by J. Weaver, as or do not cause such a signs lighting, intrusive dis- ruption. Family day-care limited homes are to seven fewer which on children, or limits the effect neighbor- hoods. MCL 722.111(f)(iii). Their essential character- compatible neighborhood, istics are with a residential they necessarily any do not have more effect on a neighborhood Further, large family. than the Leg- day-care has family islature concluded that homes within neighborhoods favored, evidenced county act township and the zoning zoning act.4 majority point fails to give this sufficient consideration.

I family day-care conclude a operating that home inherently does not affect the residential character of that neighborhood the covenant was designed to protect. This was stipulated case submitted on facts, and there is no lights, indication of or signs, other on neighborhood effects would cause the zoning acts, specified day-care family In both isit homes shall be property, permitted considered a residential use and a use all resi 125.216g(2) county zoning provides: zones. dential MCL of the act family day-care registered A home licensed or under Act No. 116 1973, being of the Public Acts of sections 722.111to 722.128 of the

Michigan Compiled Laws, shall be a residential considered use of property purposes zoning permitted for the and a use in all resi- zones, including family single dential dwellings, those zoned for subject special permit and shall not use or conditional use procedure required or dwellings from different those other density similar in the same zone. 125.286g(2) township zoning provides: MCL of the act family day-care registered A home licensed or under Act No. 116 1973, being of the Public Acts of sections 722.111 722.128 of the Michigan Compiled Laws, shall be considered residential use of purposes zoning permitted for the and a use in all resi- zones, including family single dwellings, dential those zoned for special subject permit and shall not be use or conditional use procedure required dwellings different from those for other density similar in the same zone. Terrien VZwit Dissenting Opinion Weaver, J. family day-care homes to be in violation of the Accordingly, restrictive covenant. I would affirm the summary disposition grant favor of the defendants.

Case Details

Case Name: Terrien v. Zwit

Court Name: Michigan Supreme Court

Date Published: Jul 25, 2002

Citation: 648 N.W.2d 602

Docket Number: Docket 115924

Court Abbreviation: Mich.