MICHIGAN'S ADVENTURE INC V TOWNSHIP OF DALTON

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STATE OF MICHIGAN COURT OF APPEALS MICHIGAN'S ADVENTURE, INC., FOR PUBLICATION October 21, 2010 9:00 a.m. Petitioner-Appellee, V No. 292148 Michigan Tax Tribunal LC No. 00-328574 DALTON TOWNSHIP, Respondent-Appellant, and MUSKEGON COUNTY, Respondent. Before: SAWYER, P.J., and FITZGERALD and SAAD, JJ. SAAD, J. Respondent, Dalton Township,1 appeals an order of the Michigan Tax Tribunal that vacated respondent’s special assessment regarding petitioner. Respondent also appeals the tribunal’s order that denied its motion for summary disposition. For the reasons set forth below, we affirm. I. Motion for Summary Disposition Respondent argues that the tribunal should have granted it summary disposition pursuant to MCR 2.116(C)(4). Respondent maintains that petitioner failed to file a written protest of a special assessment as required by MCL 123.754, and failed to file a timely appeal to the tribunal.2 We review de novo the tax tribunal’s decision regarding a motion for summary 1 Muskegon County intervened as amicus curiae below, but is not a party on appeal. Accordingly, we use the term “respondent” to refer to Dalton Township only. 2 Petitioner incorrectly claims that this issue is not preserved. This issue is preserved because it was raised before, addressed, and decided by the tribunal. Polkton Twp v Pellegrom, 265 Mich App 88, 95; 693 NW2d 170 (2005). Petitioner also incorrectly asserts that respondent’s appeal is moot on the ground that respondent satisfied the judgment ordered by the tribunal. However, (continued…) -1- disposition. Signature Villas, LLC v Ann Arbor, 269 Mich App 694, 698; 714 NW2d 392 (2006). A. Written Protest Here, three townships entered into an agreement with Muskegon County to facilitate various sewer projects. See MCL 123.731 et seq. In such an undertaking, a municipality may raise funds through any of the following methods: imposing service charges, imposing special assessments, exacting charges, setting aside state funds, or setting aside other available money. MCL 123.742(2). “The governing body shall cause a special assessment roll to be prepared and the proceedings of the special assessment roll and the making and collection of the special assessments shall be in accordance with the provisions of the statute or charter governing special assessments in the municipality . . .” MCL 123.743(3). (Pursuant to MCL 123.731(k), a “governing body” includes, among other things, “the township board.”) With respect to special assessments under MCL 123.743(2), our Supreme Court has stated that one hearing is required. Gaut v Southfield, 388 Mich 189, 200; 200 NW2d 76 (1972). As noted, respondent complains that petitioner failed to file a written objection to the special assessment under MCL 123.754. Respondent is mistaken because the procedures under MCL 123.751 et seq. are applicable only if the board of public works imposes an assessment under MCL 123.743(1). That was not the case here because Dalton Township imposed a special assessment under MCL 123.743, which provides, in part: (2) If a municipality other than a county operating under this act elects to raise moneys to pay all or any portion of its share of the cost of a project by assessing the cost upon benefited lands, its governing body shall do so by resolution and fix the district for assessment. (3) The governing body shall cause a special assessment roll to be prepared and the proceedings of the special assessment roll and the making and collection of the special assessments . . . . Under MCL 123.743(4), any person assessed has the right to raise an objection to the special assessment district. Unlike MCL 123.754, MCL 123.743(4) does not state that an objector must submit a written objection in writing, or file an appeal before the tribunal within 30 days. We construe the Legislature’s omissions as intentional. GMAC LLC v Treasury Dep’t, 286 Mich App 365, 372; 781 NW2d 310 (2009). MCL 123.754 is not applicable, and therefore petitioner was obliged only to protest at the hearing held for the purpose of confirming the special assessment roll. MCL 205.735(2) (“For a special assessment dispute, the special assessment must be protested at the hearing held for the purpose of confirming the special assessment roll before the tribunal acquires jurisdiction of the dispute.”). Respondent set a meeting for May 30, 2006, to provide a forum for residents, property owners, and interested persons regarding the (…continued) because neither the tribunal nor the Court of Appeals granted a stay, respondent was obligated to comply with the tribunal’s judgment. MCR 7.209(A)(1). The fact of compliance does not render moot an appeal of the substantive issue. -2- improvement, the special assessment district, and special assessment roll. The record demonstrates that petitioner’s representative attended the meeting on May 30, 2006, and, according to both the meeting minutes and the representative’s affidavit, petitioner’s representative objected to the special assessment district and special assessment. Because petitioner raised an objection to the special assessment district and its inclusion in the special assessment roll in order to invoke the tribunal’s jurisdiction in this matter, respondent was not entitled to summary disposition as a matter of law. MCL 123.743(4); 205.735(2). B. Timing of Petitioner’s Appeal With respect to respondent’s claim that petitioner’s appeal to the tribunal was untimely, we hold that respondent’s claim lacks merit. MCL 123.743(4) does not contain a deadline for filing an appeal before the tribunal. The filing deadline in MCL 123.754 is inapplicable, because as discussed, there was no hearing before the board of public works. Under MCL 205.735(3), a party must file an appeal with the tribunal within 35 days of the final decision. “Final decision” has not been defined by our courts in cases involving a township board’s final decision on a special assessment. Black’s Law Dictionary (7th ed) equates “final decision” with “final judgment,” which has the following relevant definition: “A court’s last action that settles the rights of the parties and disposes of all issues in controversy, except for the award of costs (and, sometimes, attorney’s fees) and enforcement of the judgment.” Additionally, under the Administrative Procedures Act, a decision without further proceedings shall become the final decision. MCL 24.281(3). Thus, the final decision on the assessment is the applicable date to trigger the timing for filing an appeal. The record reflects that Dalton Township’s board did not render a final decision at the May 30, 2006 special meeting. Rather, as of May 30th, the record shows that respondent’s board continued to consider corrections to the special assessment roll. While respondent’s board ordered and directed its treasurer to collect the special assessments in the special assessment roll, respondent’s supervisor later informed certain business owners that respondent’s board would be reconfirming the special assessment roll at its next regular meeting. There is little indication of what occurred at the subsequent hearing, other than a discussion of the sewer line projects. However, respondent’s supervisor subsequently informed business owners, including petitioner, that their assessment amounts had been recalculated, and that respondent’s board would be reconfirming the special assessment roll at its next meeting, on July 10, 2006. Later, respondent’s counsel sent an undated letter to business owners, including petitioner, stating that “it was the recommendation and final determination not to make any adjustments in the proposed assessments.” Petitioner’s representative claimed that petitioner received this letter on July 26, 2006, and no evidence contradicts this assertion. Thus, it appears from the record that respondent did not confirm the special assessment roll until some time after the July 10, 2006 regular board meeting of respondent’s board. Accordingly, respondent did not render a final decision regarding petitioner’s special assessment until some time after the July 10, 2006 regular meeting. Therefore, petitioner’s August 8, 2006 petition was timely filed with the 35-day period under MCL 205.735(3). Respondent was not entitled to summary disposition for failure of petitioner to file a timely appeal to the tribunal. In so ruling, we note that the tribunal improperly held that MCL 123.752 and MCL 123.754 applied here. The tribunal, nonetheless, denied respondent’s motion for summary -3- disposition. Because the tribunal reached the right result, we will not disturb the ruling. See Gleason v Dep't of Transportation, 256 Mich App 1, 3; 662 NW2d 822 (2003). II. Tribunal’s Decision to Vacate the Special Assessment Respondent claims that the tribunal’s ruling that vacated the special assessment is not supported by competent, material, and substantial evidence. Absent fraud, we review a decision by the tribunal to determine whether it erred in applying the law or adopted a wrong legal principle. Ford Motor Co v Woodhaven, 475 Mich 425, 438; 716 NW2d 247 (2006). “All factual findings are final if supported by competent, material, and substantial evidence.” Wayne Co v State Tax Comm, 261 Mich App 174, 194; 682 NW2d 100 (2004). “[S]pecial assessments are presumed to be valid.” Kadzban v City of Grandville, 442 Mich 495, 505; 502 NW2d 299 (1993). Accordingly, a municipality’s decision regarding a special assessment will be upheld, unless “there is a substantial or unreasonable disproportionality between the amount assessed and the value which accrues to the land as a result of the improvements.” Dixon Rd Group v City of Novi, 426 Mich 390, 403; 395 NW2d 211 (1986). A special assessment will be deemed valid if it meets two requirements: (1) the improvement subject to the special assessment must confer a benefit on the assessed property and not just the community as a whole, and (2) the amount of the special assessment must be reasonably proportionate to the benefit derived from the improvement. Kadzban, 442 Mich at 500. A key question is whether the market value of the subject property was increased as a result of the improvement. See id. at 501. Common sense dictates that in order to determine whether the market value of an assessed property has been increased as a result of an improvement, the relevant comparison is not between the market value of the assessed property after the improvement and the market value of the assessed property before the improvement, but rather it is between the market value of the assessed property with the improvement and the market value of the assessed property without the improvement. [Ahearn v Bloomfield Charter Twp, 235 Mich App 486, 496; 597 NW2d 858 (1999).] The testimony and valuation report of petitioner’s expert constitutes competent, material and substantial evidence on which the tribunal properly based its decision. Petitioner’s expert opined that the installation of a sewer line in a rural setting would not increase a property’s value and respondent’s expert did not refute the findings or conclusions of petitioner’s expert. Further, the sewer line would not benefit petitioner’s property because the property does not require a sewer line―petitioner disposes of its sewage via operational sewage lagoons.3 Moreover, connecting to the sewer line would constitute a substantial expense to petitioner, while its 3 A sewage lagoon, also called a wastewater stabilization lagoon, is “a type of treatment system constructed of ponds or basins designed to receive, hold, and treat sanitary wastewater for a predetermined amount of time through a combination of physical, biological, and chemical processes.” MCL 324.3120(11)(o). -4- continued maintenance of the sewage lagoons is relatively simple, and petitioner’s costs associated with operating the sewage lagoons appear to be relatively modest. Evidence also showed that petitioner’s property would not benefit from the sewer line in the future. Development of the property is not necessarily limited because of petitioner’s use of sewage lagoons, but is constricted due to the Department of Environmental Quality’s wetlands protections, and because the soil on the property is not well-suited for development. And, although the sewer line may somehow benefit the property, in the future, this is not a valid basis to find a “benefit” to the property to justify an assessment imposed by the township upon the property owner at this time. Oneida Twp v Eaton Co Drain Comm’r, 198 Mich App 523, 528; 499 NW2d 390 (1993). Importantly, to protect private property rights, Michigan law also requires that the total amount of the assessment must be no greater than what was reasonably necessary to cover the cost of the work. Id. at 528 n 5. Here, this is not the case because it is undisputed that the total cost of the sewer line in front of petitioner’s property would be $60,000 to $80,000, whereas petitioner’s special assessment was $600,000. We hold that a reasonable person would accept the foregoing record evidence as sufficient to support the tribunal’s ruling. Ultimately, the tribunal’s key finding that the subject property’s value was not enhanced by the sewer line improvement was supported by competent, material, and substantial evidence. The sewer line at issue conferred little or no benefit on petitioner, resulted in no increase in the value of the land assessed, and consequently furnished no basis for this special assessment. See Kadzban, 442 Mich at 500-502.4 Affirmed. /s/ David H. Sawyer /s/ E. Thomas Fitzgerald /s/ Henry William Saad 4 Respondent also claims that the tribunal failed to set forth “a viable rendition of factual findings and conclusions of law” necessary for this Court to engage in appellate review. Respondent failed to include this argument in its statement of questions presented and, therefore, this argument is not properly presented for appellate consideration. MCR 7.212(C)(5). Nonetheless, the record reflects that the tribunal complied with the requirements of MCL 205.731(1) and MCL 24.285, though it did not separately identify the “findings of fact” and “conclusions of law.” The tribunal provided a concise statement of facts and conclusions of law on the record, based its decision on the evidence, and correctly applied the law. -5-

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