PRESERVE THE DUNES INC V DEPT OF ENVIRONMENTAL QUALITY
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STATE OF MICHIGAN
COURT OF APPEALS
PRESERVE THE DUNES, INC.,
FOR PUBLICATION
October 4, 2002
9:00 a.m.
Plaintiff-Appellant,
v
No. 231728
Berrien Circuit Court
LC No. 98-003789-CE
DEPARTMENT OF ENVIRONMENTAL
QUALITY and TECHNISAND, INC.,
Defendants-Appellees.
Updated Copy
December 20, 2002
Before: Owens, P.J., and Markey and Murray, JJ.
MARKEY, J.
Plaintiff, Preserve the Dunes, Inc., appeals by right the trial court's order granting partial
summary disposition in favor of defendants Department of Environmental Quality and
TechniSand, Inc., and the court's order of no cause of action in favor of defendants following a
bench trial. In this lawsuit, plaintiff challenges the DEQ's issuance of an amended permit that
allows TechniSand to expand noncritical sand dune mining into a critical dune area adjacent to
its noncritical sand mining operation. We reverse and remand.
I. FACTS AND PROCEDURAL HISTORY
Plaintiff, an ad hoc group of local citizens organized for the purpose of this lawsuit, filed
this lawsuit in July 1998, under the Michigan Environmental Protection Act (MEPA), MCL
324.1701 et seq., challenging an amended permit issued by the DEQ in November 1996, which
allowed TechniSand to expand a mining operation in a noncritical dune area into an adjacent
critical dune area. The land at issue is a sand dune area in Berrien County. That area consists of
seventy-one acres of a critical dune area within 126.5 acres of a sand dune. The critical dune
area, containing two to three million tons of sand, is on private property approximately one mile
inland from Lake Michigan. It is the only critical sand dune area containing elevated dunes east
of Interstate Highway 196, which runs along the area's western border. TechniSand is a major
supplier of industrial sand and the largest supplier of industrial sand to the foundries of the
automobile industry.
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Defendant TechniSand incorporated in the state of Delaware on July 12, 1991. On July
31, 1991, TechniSand purchased the "Nadeau Site" property from Manley Brothers of Indiana,
Inc. The land deeded to TechniSand from Manley Brothers was part of a much larger transaction
in which Fairmont Minerals, Ltd., of Chardon, Ohio, acquired most of the assets belonging to
Hepworth Minerals and Chemicals, Inc., of Chesterton, Indiana—a subsidiary of Hepworth PLC
of Sheffield, England. TechniSand is a wholly owned subsidiary of Fairmont Minerals, formed
in order to acquire some of Hepworth's mining assets. In 1992, Manley's sand mining permit,
number TS-NS-107, was transferred to TechniSand as the new owner of the Nadeau Site.
TechniSand's original permit allowed the company to mine only noncritical dunes in the eastern
parcel of the Nadeau Site.
In 1994, TechniSand applied to the Department of Natural Resources for an amendment
of the permit. TechniSand sought permission to mine about 126.5 acres in the western parcel of
the Nadeau Site. The proposal to amend the original permit was referred to in various
documents as the "Taube Road Expansion" or the "Nadeau Site Expansion." TechniSand sought
to extend the mining from the noncritical dune area on the eastern parcel of the site to the critical
dune area, and to remove seven million tons of sand from surface operations and 950,000 tons of
sand from subsurface operations on 70.45 acres of the 126.5-acre site, and proposed to create two
lakes of 9.8 and 13.7 acres respectively and to relocate threatened species of flora.
The record indicates that when TechniSand first sought the amended permit to mine the
adjacent Nadeau Site, it did so on the theory that it qualified under MCL 324.63702(1)(b), an
exception to the prohibition against issuing permits for mining in critical dune areas.
TechniSand's theory was that it was a permit holder seeking to expand mining operations onto
adjacent property, which is essentially the description of who is entitled to the statutory
exception. According to that provision, in order to qualify for the exception, the operator
seeking the amended permit must have owned before July 5, 1989, the land or the rights to mine
dune sand in the land for which the permit is sought. On April 20, 1995, the DNR denied
TechniSand's application for an amended permit, explaining that TechniSand was not eligible
under the exception from the statutory prohibition against mining in critical sand dune areas
because it acquired the property it sought to mine after July 5, 1989.
In October 1995, the Governor issued Executive Order No. 1995-18 creating the DEQ
and transferring environmental regulatory authority from the DNR to the DEQ. In April 1996,
the DEQ sent TechniSand a letter indicating that since 1995 there had been "many changes in
State government" and that those changes, coupled with "additional information that TechniSand
has apparently supplied to the Michigan Attorney General's office," were instrumental in the
government's ability to proceed to review the amendment request. The DEQ letter requested that
TechniSand submit modifications to its environmental impact statement (EIS) and its progressive
cell-unit mining and reclamation plan in order to "expedite" the processing of the amended
mining permit application. The record does not indicate what specific changes in government
prompted the DEQ to invite TechniSand to amend and resubmit its application, nor does it
indicate what "additional information" TechniSand had "apparently" supplied.
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TechniSand amended its application and resubmitted the documents to the DEQ in May
1996. The EIS that was submitted contained a list of "unavoidable adverse impacts" and
acknowledged that the proposed expansion of mining operations would significantly impair the
environment and would permanently destroy a critical dune. Without explanation regarding
under which exception of MCL 324.63702 TechniSand qualified, the DEQ issued to TechniSand
an amended permit to mine in the critical dune area in the Nadeau Site in November 1996.
Several underlying facts are undisputed. Those include the fact that critical dune areas
are a natural resource, that sand is a natural resource, and that the critical dune area that is the
subject of this litigation has been designated for protection under various environmental statutes
since 1978. It was first designated as such under the sand dune protection and management act
(SDPMA) by Administrative Rule 281.402 adopted by the DNR on August 17, 1978, as one of
thirteen sand dune areas designated. The area was designated a barrier dune under the SDPMA
in the DNR publication of Barrier Dune Formation Areas, 1979-1981. The DNR's Land and
Water Management Division identified the critical dune area in the Atlas of Critical Dunes. The
Legislature adopted the Atlas of Critical Dunes. The DEQ Geological Survey Division also
identified the critical dune area in its publication of Designated and Critical Sand Dune Areas in
April 1996. It remains a critical dune area today.
The critical dune area at issue is seventy-five feet in height, has a steep inland east-facing
slope, and is part of a larger critical dune area. Interstate 196, which does not affect the status of
the critical dune area, sits atop the dunes, separating two portions of the critical dune area. There
are about two to three million tons of sand in the critical dune area. The amended permit issued
to TechniSand allows it to obliterate almost all the critical dune area; only a small portion of the
critical dune area will remain if the mining proceeds as planned, and that remaining portion is
part of the northeast end of the critical dune area within a conservation easement.
Plaintiff, in its first amended complaint for declaratory and injunctive relief, alleged that
under MCL 324.1701 et seq. (MEPA), MCL 324.63701 et seq. (the sand dune mining act
[SDMA]), and MCL 324.35301 et seq. (the SDPMA), the DEQ violated the MEPA by issuing
the amended permit to TechniSand because mining in the critical Taube Road Expansion area of
the Nadeau Site will destroy a unique, irreplaceable, and fragile natural resource of this state.
The mining will alter the physical, biological, and geological characteristics of the site, a critical
dune will be lost, and topsoil and vegetation will be removed. The dune's flora and fauna
habitat, including the habitat of two species listed as threatened by the state of Michigan, and the
aesthetic quality of the property will be affected because a large percentage of the critical dune
will be removed, forever changing the most dominant physical attribute of this site. In addition,
plaintiff alleged that the DEQ violated the MEPA by issuing the amended permit in
contravention of the legislative mandate within MCL 324.35302(c) that states that the benefits
from alteration or use of a critical dune area "shall occur only when the protection of the
environment and the ecology of the critical dune areas for the benefit of the present and future
generations is assured." Plaintiff further alleged that the DEQ was without legal authority to
issue the amended permit because the exceptions contained in MCL 324.63702(1) of the SDMA
to the otherwise total prohibition against mining in critical dune areas do not apply. Plaintiff
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asked the court to enjoin the DEQ, to require the DEQ to rescind the amended permit, and to
enjoin TechniSand from mining the critical dune area in the Nadeau Site.
Both defendants subsequently moved for summary disposition, asserting that plaintiff had
failed to state a claim for relief under the MEPA and that plaintiff 's lawsuit was untimely
because it was required to challenge the disputed amendment of the permit within twenty-one
days as required by the Revised Judicature Act (RJA), MCL 600.631, and MCR 7.104(A). At a
hearing on defendants' summary disposition motions, Berrien Circuit Judge David Peterson
denied defendants' motion, finding that plaintiff 's lawsuit was not time-barred and that the
MEPA provided an independent cause of action.
Subsequently, plaintiff moved for summary disposition, asserting that the DEQ lacked
the legal authority to issue the amended mining permit to TechniSand and that TechniSand did
not qualify under either of the two exceptions to the prohibition of mining in critical dune areas
found in MCL 324.63702(1) of the SDMA. At a hearing on plaintiff 's motion, Berrien Circuit
Judge Scott Schofield presided, replacing Judge David Peterson, who had retired. Judge
Schofield ruled, contrary to Judge Peterson's ruling, that the portion of plaintiff 's lawsuit that
challenged the issuance of the permit was time-barred. On "issues involving the administrative
proceedings involving the granting of the permit," Judge Schofield held that the MEPA does not
allow for an "unlimited time period" for procedural challenges to administrative actions that
affect the environment and that it was
too late now to argue about whether the [DEQ] had authority under the statute to
allow an operator to extend mining from a noncritical dune area to an adjacent
critical dune area or whether the [DEQ] had authority under the statute to grant a
permit to Defendant even though it was not the operator with a permit to mine an
adjacent site on July 5, 1989.
In addition, Judge Schofield found that even if plaintiff 's suit were timely, plaintiff 's
challenges to the administrative action were not well founded. Judge Schofield stated that it was
important that the exception "uses the word operator instead of the word person in phrasing the
exception" and held that MCL 324.63702(1)(b) was meant to "grandfather in operations, not
operators." Judge Schofield further found that plaintiff nonetheless had successfully stated a
cause of action under the MEPA and that plaintiff 's surviving cause of action was independent
from "any administrative appeal rights." Alternatively, Judge Schofield ruled that defendant
TechniSand qualified for the amended permit to mine in the critical dune area pursuant to MCL
324.63702(1)(b), but not under 1(a); thus, the DEQ was authorized to issue TechniSand the
amended permit. This Court denied plaintiff 's application for leave for an interlocutory appeal
of Judge Schofield's order.
Berrien Circuit Judge Paul Maloney presided over the six-day trial on plaintiff 's claim
that issuance of the permit was an administrative action that would damage the environment as
prohibited by the MEPA. On November 30, 2000, Judge Maloney issued a decision in which he
concluded that plaintiff had established a prima facie case under the MEPA, but that defendants
had rebutted plaintiff 's prima facie showing. Judge Maloney detailed findings of fact and
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summarized the applicable law, including the MEPA, the SDPMA, and the SDMA. In its
lengthy decision, the court found that the Legislature contemplated sand dune mining in critical
dune areas. In addition, the court applied the factors set forth in Portage v Kalamazoo Co Rd
Comm, 136 Mich App 276; 355 NW2d 913 (1984), to determine what "natural resources" would
be affected. Ultimately, the court found that defendants had "established that any adverse impact
on the natural resources which will result from the sand mining will not rise to the level of
impairment or destruction of natural resources within the meaning of MEPA." In reaching that
conclusion, the trial court noted that the testimony established that the subject seventy-one acres
make up only one tenth of one percent of the entire state's 70,000 acres of critical sand dune area.
The court validated the DEQ sand mining permit, effectively denying plaintiff 's request for
injunctive relief. A judgment of no cause of action was entered on December 13, 2000. Plaintiff
now appeals by right.
II. APPLICABLE STANDARD TO BE USED TO RESOLVE THIS MATTER
Judge Schofield granted partial summary disposition to defendants on the issue whether
plaintiff could challenge the DEQ's authority to allow TechniSand to mine in the critical dune
area under MCL 324.63702 (operating in conjunction with the MEPA, MCL 324.1701 et seq.),
ruling that such a challenge was time-barred. Alternatively, Judge Schofield ruled that defendant
TechniSand qualified for the amended permit to mine in the critical dune area pursuant to MCL
324.63702(1)(b), but not under 1(a), and thus, the DEQ was authorized to issue TechniSand the
amended permit.
We must first determine the appropriate standard by which to evaluate plaintiff 's claim.
The statutory acts that are relevant to the resolution of plaintiff 's issues are the MEPA, MCL
324.1701 et seq., the SDMA, MCL 324.63701 et seq., and the SDPMA, MCL 324.35301 et seq.
An understanding of the MEPA's unique relationship to other environmental statutes is necessary
for the resolution of this matter. The MEPA does not act alone, but rather calls for individual
courts to determine what the applicable environmental standard or procedure is in light of the
particular circumstances of the case and in light of the nature of the natural resource to be
protected. It also requires courts to determine which existing environmental laws and standards
apply, and whether they are sufficient to protect the natural resource at stake from potential
destruction or impairment. In a sense, the MEPA provides an umbrella of environmental
protection to be superimposed over more specific environmental statutes—a template that allows
private citizens to bring causes of action based on statutes that do not, in and of themselves,
provide avenues of relief in civil lawsuits.
The MEPA is part 17 of the Natural Resources and Environmental Protection Act
(NREPA), MCL 324.1701 et seq. MCL 324.1701 provides:
(1) The attorney general or any person may maintain an action in the
circuit court having jurisdiction where the alleged violation occurred or is likely
to occur for declaratory and equitable relief against any person for the protection
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of the air, water, and other natural resources and the public trust in these resources
from pollution, impairment, or destruction.
(2) In granting relief provided by subsection (1), if there is a standard for
pollution or for an antipollution device or procedure, fixed by rule or otherwise,
by the state or an instrumentality, agency, or political subdivision of the state, the
court may:
(a)
standard.
Determine the validity, applicability, and reasonableness of the
(b) If a court finds a standard to be deficient, direct the adoption of a
standard approved and specified by the court. [Emphasis added.]
Recently, this Court explained the MEPA's role and purpose in Genesco, Inc v Michigan
Dep't of Environmental Quality, 250 Mich App 45; 645 NW2d 319 (2002). In the context of
deciding whether a circuit court has subject-matter jurisdiction to conduct preenforcement
review of a "response activity selected or approved" by the DEQ within the ambit of part 201,
MCL 324.20101 et seq., the state's version of the federal Comprehensive Environmental
Response, Compensation, and Liability Act, 42 USC 9601 et seq. (CERCLA), this Court
explained that the "approach of part 17 is to preserve the environment through the obtaining of
declaratory and injunctive relief in court." Genesco, supra at 49. Citing City of Jackson v
Thompson-McCully Co, LLC, 239 Mich App 482, 487; 608 NW2d 531 (2000), and MCL
324.1703(1), this Court explained that
Part 17 permits any person to seek declaratory and injunctive relief, MCL
324.1701(1), on "a prima facie showing that the conduct of the defendant has
polluted, impaired, or destroyed or is likely to pollute, impair, or destroy the air,
water, or other natural resources or the public trust in these resources . . . ."
[Genesco, supra at 49-50.]
In addition, this Court reiterated the rule that the MEPA "provides a direct method for enforcing
environmental regulations and challenging an administrative agency's decision without
exhausting administrative remedies." Id. at 50 (emphasis added.). Further, this Court stated that
the MEPA is "expressly supplementary to other administrative and regulatory procedures
provided by law." Id. Thus, an administrative agency's decision may be challenged directly
under the MEPA. It is unnecessary for a party to exhaust administrative remedies before seeking
relief under the MEPA.
Plaintiff argues that the appropriate standard to be applied in the present case is found in
MCL 324.63702 of the SDMA, which provides:
(1) Notwithstanding any other provision of this part, the department shall
not issue a sand dune mining permit within a critical dune area as defined in
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[MCL 324.35301] after July 5, 1989, except under either of the following
circumstances:
(a) The operator seeks to renew or amend a sand dune mining permit that
was issued prior to July 5, 1989, subject to the criteria and standards applicable to
a renewal or amendatory application.
(b) The operator holds a sand dune mining permit issued pursuant to
[MCL 324.63704] and is seeking to amend the mining permit to include land that
is adjacent to property the operator is permitted to mine, and prior to July 5, 1989
the operator owned the land or owned rights to mine dune sand in the land for
which the operator seeks an amended permit.
(2) As used in this section, "adjacent" means land that is contiguous with
the land for which the operator holds a sand dune mining permit issued pursuant
to [MCL 324.63704], provided no land or space, including a highway or road
right-of-way, exists between the property on which sand dune mining is
authorized and the adjacent land. [Emphasis added.]
In addition, MCL 324.63704 of the SDMA provides:
(1) After July 1, 1977, a person or operator shall not engage in sand dune
mining within Great Lakes sand dune areas without first obtaining a permit for
that purpose from the department.
(2) Prior to receiving a permit from the department, a person or operator
shall submit all of the following:
(a) A permit application on a form provided by the department.
(b) An environmental impact statement of the proposed mining activity as
prescribed by section 63705.
(c) A progressive cell-unit mining and reclamation plan for the proposed
mining activity as prescribed by section 63706.
(d) A 15-year mining plan as prescribed by section 63707.
Plaintiff interprets these portions of the SDMA together to mean that while mining in
noncritical dune areas is permitted, mining in critical dune areas is absolutely prohibited unless
the party seeking the permit falls within an exception under MCL 324.63702. Plaintiff argues
that, in contrast, under ordinary circumstances where no critical dune areas are involved, a party
is only required to meet the requirements of MCL 324.63704 and the general "umbrella"
standard for the issuance of a mining permit pursuant to MCL 324.63709, which provides:
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The department shall deny a sand dune mining permit if, upon review of
the environmental impact statement, it determines that the proposed sand dune
mining activity is likely to pollute, impair, or destroy the air, water, or other
natural resources or the public trust in those resources, as provided by part 17.
We agree with plaintiff that MCL 324.63702 is most logically interpreted as a prohibition
of mining in critical dune areas with two exceptions. MCL 324.63702 specifically and solely
addresses mining permits in critical dune areas; it provides a higher standard and a procedure for
issuance of a permit to mine in critical dune areas. Defendant DEQ agrees that MCL 324.63702
provides a stricter standard, but argues that it simply does not apply because it is "in excess of"
the requirements of the MEPA. TechniSand argues that plaintiff is time-barred from relying on
MCL 324.63702 and then argues that TechniSand nevertheless qualifies under MCL 324.63702.
We believe that the standard to be used as a basis for determining a violation of the
MEPA under the present circumstances involving critical dune area mining is found within the
SDMA. We conclude that when a party seeks to mine in a critical dune area, it must first fall
within one of the exceptions set forth in MCL 324.63702. It is only after MCL 324.63702 is
satisfied that the party seeking to mine in a critical dune area must also satisfy the general
requirements of MCL 324.63704 and MCL 324.63709. If MCL 324.63702 is not satisfied, then
mining in a critical dune area is prohibited, and further analysis of MCL 324.63704 and MCL
324.63709 is unnecessary. In contrast, when a party seeks to mine in a noncritical dune area, it
must comply only with the general requirements of MCL 324.63704 and with the umbrella
standard for impairment or destruction under MCL 324.63709.
The relationship between the MEPA and other environmental statutes was recently
explained in Nemeth v Abonmarche Development, Inc, 457 Mich 16; 576 NW2d 641 (1998).
The Nemeth case provides an example of the MEPA working in conjunction with another, more
specific environmental statute. Therein, our Supreme Court held that the appropriate pollution
control standard (applied pursuant to the MEPA, MCL 324.1701) that was to be used as a basis
for finding a violation of the MEPA was found within the soil conservation, erosion, and
sedimentation control act (SESCA), MCL 324.9101 et seq. Nemeth, supra at 29. Our Supreme
Court stated that the "MEPA does not impose specific requirements or standards." Id. at 30. The
Supreme Court concluded that this Court had erred by failing to recognize that a violation of the
SESCA established a prima facie violation of the MEPA. Id. at 36.
In Nemeth, id. at 19, the defendant developers had begun construction of a marina,
condominium, and hotel project on the shore of Lake Michigan. The development involved
stripping vegetation and topsoil from thirty acres of barrier dunes, digging a basin, and moving
thousands of cubic yards of earth to the edges of the construction site. Id. at 19-20. After
completion of this phase of construction, a storm struck, and "wind and water on the exposed
dunes carried sand, snow, fly ash, and other sediments" from the construction site to the
surrounding area, burying parcels, destroying window casings, damaging siding, and blowing
into the interiors of homes. Id. at 20. Nine months later, the plaintiffs sued. The plaintiffs
argued that the developers' violations of the SESCA provided evidence sufficient to form a
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MEPA violation, by polluting, impairing, or destroying air, water, or other natural resources, or
by being likely to do so, in contravention of subsection 1703(1). Nemeth, supra at 20. The trial
court issued a preliminary injunction, and the city employed a soil erosion control officer, who
issued a cease and desist order. Id. at 20-21. The trial court ruled that the injunction would last
until the agency sought the proper permits. The previously issued permits were not valid
because they were not supported by an adequate soil erosion control plan; the trial court also
granted a permanent injunction. Id. at 22-23.
This Court reversed, holding that an injunction based on a violation of the MEPA was not
warranted because the defendants' activities did not "'rise to such a level of impairment or
destruction of a natural resource so as to constitute an environmental risk.'" Id. at 23. This Court
also held that the sand in question, and its location, was not rare, unique, endangered, or of
historical significance, was easily replaceable, and its movement would not have any significant
consequential effect on other natural resources. Id.
In turn, our Supreme Court reversed, finding that the purpose of the SESCA was to
prevent environmental harm caused by sedimentation and erosion, and holding that the SESCA
provided the appropriate pollution control standard applicable to the MEPA case. Id. at 29.
In explaining how the SESCA provided the applicable standard, the Supreme Court
examined the SESCA's definition of "earth change" as "a human-made change in the natural
cover or topography of land, including cut and fill activities, which may result in or contribute to
soil erosion or sedimentation of the waters of the state. [MCL 324.9101(5); MSA
13A.9101(5).]" Nemeth, supra at 25. The Supreme Court also noted that the SESCA prohibited
anyone from maintaining a land use of earth change, with one exception that "except in
accordance with this part and the rules or with the applicable local ordinance and pursuant to a
permit approved by the appropriate county or local enforcing agency. [MCL 324.9112(1); MSA
13A.9112(1).] "Nemeth, supra at 26. In addition, the Supreme Court observed that the DNR had
promulgated rules governing a unified soil erosion and sedimentation control program, including
provisions for review and approval of site plans, land use plans, or permits relating to erosion
control and sedimentation control. Id.
The Supreme Court opined that landowners and developers who engage in earth changes
are required to obtain a permit from the agency and shall submit a soil erosion and sedimentation
control plan to be reviewed and approved before applying for a permit. The Supreme Court also
observed that "the enforcing agency shall issue a permit for the proposed earth change" only after
these requirements and rules were met. Id. This Court decided that the defendants in Nemeth
had the violated the SESCA, but failed to apply the SESCA as the appropriate standard; instead,
this Court simply applied the so-called Portage1 factors. Nemeth, supra at 26, 31. Our Supreme
1
In Portage, supra at 282, this Court considered the following factors when determining whether
the effect of the proposed activity rose to the level of a MEPA violation:
(continued…)
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Court explained that, while the Portage factors may have constituted the appropriate standard for
review under the MEPA in the context of determining whether the removal of trees (the natural
resource in that case) was sufficient to constitute an environmental risk and require judicial
intervention under the MEPA, those same factors did not constitute the "standard" under the
MEPA, MCL 324.1701, applicable under the circumstances in Nemeth (development of a
marina, condominiums, and hotel project at the mouth of the Manistee River on the shore of
Lake Michigan). Nemeth, supra at 35.
In our opinion, the most significant clarification that the Nemeth opinion provides is
which standard to apply in a MEPA action:
[E]ach alleged MEPA violation must be evaluated by the trial court using
the pollution control standard [this may be a standard for pollution control, a
standard for an antipollution device, or a standard for a certain procedure, MCL
324.1701(2)] appropriate to the particular alleged violation. Assuming that the
Portage factors were proper for assessing whether the activity in that case
violated the MEPA, it does not follow that the Portage factors, like the factors
used in [West Michigan Environmental Action Council v Natural Resources
Comm, 405 Mich 741; 275 NW2d 538 (1979)], are the proper pollution control
standard here. A pollution control standard indeed has been articulated by the
Legislature, through the [SESCA], and by the DNR, through the rules
promulgated by it pursuant to the [SESCA]. [Nemeth, supra at 35.]
We quote this portion of Nemeth to show that a MEPA violation must be evaluated using the
appropriate standard or procedure. In this case, as previously stated, MCL 324.63702, which
specifically describes the exclusive circumstances under which mining in critical sand dune areas
may be granted, provides the appropriate standard to be applied in the instant matter. MCL
324.1701(2) provides that if there is a standard for pollution, for an antipollution device, or a
"procedure" fixed by rule or otherwise, the court must determine whether it applies and if it is
"deficient" may apply one that is not deficient. It is unclear how MCL 324.63702, which
expressly provides the procedure for the DEQ to regulate mining specifically in critical dune
areas, could be construed as anything but the appropriate "procedure" for allowing mining in
(…continued)
In determining whether the impact of a proposed action on wildlife is so
significant as to constitute an environmental risk and require judicial intervention,
the court should evaluate the environmental situation prior to the proposed action
and compare it with the probable condition of the particular environment
afterwards. The factors the court should consider include: (1) whether the natural
resource involved is rare, unique, endangered, or has historical significance, (2)
whether the resource is easily replaceable . . . , (3) whether the proposed action
will have any significant consequential effect on other natural resources . . . , and
(4) whether the direct or consequential impact on animals or vegetation will affect
a critical number, considering the nature and location of the wildlife affected.
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critical dune areas. In fact, the requirements of MCL 324.63702 are more akin to a "standard or
procedure" than the requirements of the SESCA that were applied as the "standard" in Nemeth.
If there is an existing rule, standard, or procedure regulating such pollution, impairment, or
destruction, the MEPA calls for its application unless the court views the existing rule as
deficient to protect the natural resource, in which case the court may apply a stricter standard.
The Supreme Court in Nemeth, supra at 29-30, explained this Court's failure to recognize
that the SESCA provided the applicable standard:
At the heart of the Court of Appeals error in this case was its failure to
consider subsection 1701(2) [of the MEPA], which provides:
"In granting relief provided by subsection (1), if there is a standard for
pollution or for an antipollution device or procedure, fixed by rule or otherwise,
by the state or an instrumentality, agency, or political subdivision of the state, the
court may:
(a)
standard.
Determine the validity, applicability, and reasonableness of the
(b) If a court finds a standard to be deficient, direct the adoption of a
standard approved and specified by the court."
This is a vital part of our courts' development of the "common law of
environmental quality." However, the development of the common law in this
area certainly does not preclude the Legislature or the DNR from further entering
the arena of environmental law. To the contrary, that is expressly contemplated
by subsection 1701(2). Nonetheless, the courts must still determine whether such
legislative and administrative enactments are the appropriate "pollution control"
standards to be applied to a claim under the MEPA, as the trial court properly
determined in this case.
This function of the Michigan courts was discussed by the United States
Court of Appeals for the Sixth Circuit in Her Majesty the Queen v Detroit, 874
F2d 332 (CA 6, 1989). Noting that the MEPA is supplementary to other
administrative and regulatory procedures provided by law, the court correctly
stated that the MEPA specifically authorizes a court to determine the validity,
reasonableness, and applicability of any standard for pollution or pollution control
"and to specify a new or different pollution control standard if the agency's
standard falls short of the substantive requirements of MEPA."5 Id. at 337
(emphasis in original).
Furthermore, the MEPA does not impose specific requirements or
standards; instead, it provides for de novo review in Michigan courts, allowing
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those courts to determine any adverse environmental effect and to take
appropriate measures. Id. at 341.
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Thus, if the trial court in this case had determined that the [SESCA] did
not provide sufficient environmental protection, that is, did not prevent likely or
actual environmental harm, it could have specified a different pollution control
standard that would have satisfied the MEPA. [Nemeth, supra at 30 n 5.]
__________________________________________________________________
Thus, when a plaintiff brings a cause of action under the MEPA, the court must identify
the appropriateness and applicability of a standard that meets the substantive requirements of the
MEPA. Moreover, if the court finds the appropriate standard deficient—that is, it does "not
provide sufficient environmental protection" and does "not prevent likely or actual
environmental harm" or if the agency's standard "falls short" of the MEPA's substantive
requirements—the court may specify a different, stricter standard. The MEPA allows a court to
determine the validity, applicability, and reasonableness of the standard. However, only if the
applicable standard is deficient may the court adopt a different, higher standard. MCL
324.1701(2)(b); Nemeth, supra at 30, n 5. The court may not substitute a lesser standard and
certainly may not completely ignore an appropriate standard or procedure. By its own terms, the
MEPA incorporates the standards and procedures set forth in other environmental laws that are
specifically tailored to the circumstances and natural resource at issue—in this case, mining in
critical dune areas.
In the present case, rather than addressing MCL 324.63702, Judge Schofield simply
addressed whether TechniSand's proposed mining was likely to "pollute, impair, or destroy" the
natural resource in this case—the critical dune area. In essence, Judge Schofield applied MCL
324.63709, the general standard of permitting for mining in any dune area, which mirrors the
standard set forth in the MEPA under MCL 324.1703. Judge Schofield's reasoning effectively
eliminated MCL 324.63702, which deals specifically with mining in critical dune areas. Judge
Schofield erred in disallowing plaintiff to proceed by applying the MEPA to the SDMA and the
SDPMA.
Although defendants focus on the fact that Nemeth involved the SESCA and a "pollution
standard" and makes the obvious observation that this case involves mining and not "pollution"
per se, we find that distinction insignificant in light of the language of the statute (MEPA, MCL
324.1701[2]). The MEPA deals with pollution, impairment, and destruction of natural resources.
Obviously, pollution, impairment, and destruction may stem from a multitude of causes, whether
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the dumping of chemicals, the drilling of wells, or the removal of earth or sand. The MEPA
encompasses many scenarios.2
In fact, in its brief, the DEQ concedes that part 637 (the SDMA) contains environmental
standards similar to the SESCA standards in Nemeth. The DEQ argues, however, that the only
standards in part 637 are found at MCL 324.63705, 324.63706, and 324.63707. These sections
require an applicant to submit an EIS, a progressive cell-mining unit and reclamation plan, as
well as a fifteen-year mining plan. The DEQ contends that simply by following these general
procedures, the "standard" for mining in a critical dune area has been met. In doing so, the DEQ
ignores MCL 324.63702. The DEQ, in essence, contends that once a permit is issued, it is
beyond substantive challenge and that a MEPA challenge may only be procedural. The DEQ's
interpretation of part 637 renders the requirements of MCL 324.63702 nugatory. "When
construing a statute, the court should presume that every word has some meaning and should
avoid any construction that would render the statute, or any part of it, surplusage or nugatory."
Karpinski v St John Hosp-Macomb Center Corp, 238 Mich App 539, 543; 606 NW2d 45 (1999).
Further, the DEQ interprets part 637 as allowing authorization to mine in critical dune
areas "unless the mining will violate MEPA." This interpretation conflicts with the clear
language of § 63702 that the DEQ shall not issue a permit "unless" the applicant falls within one
of the exceptions found in MCL 324.63702. The DEQ contends that § 63702 is not a "pollution
standard, or even an analogous standard protecting the environment." However, it is clear that
the MEPA is not limited to "pollution" cases, because by its own language it applies to actual or
potential pollution, impairment, or destruction, thereby covering a much wider range of
environmental concerns than literal pollution. Furthermore, a commonsense interpretation of
MCL 324.63702 dictates that it serves to protect the environment by limiting those who may
mine in critical dune areas. Thus, the DEQ's attempt to distinguish Nemeth on these bases is
specious.
TechniSand argues that Nemeth is distinguishable from this case because the plaintiffs in
Nemeth exhausted their administrative remedies before seeking relief under the MEPA.
However, the SESCA, which was the environmental standard applied under the MEPA in
Nemeth, specifically requires parties to seek review in accordance with the Administrative
Procedures Act (APA), MCL 24.201 et seq. MCL 324.9112. No similar requirement exists in
MCL 324.63701 et seq.
2
We further note that although subsection 1701(2) speaks in terms of whether a "standard for
pollution or antipollution device or procedure" exists, but does not specifically include whether a
standard for impairment or destruction of a natural resource exists, our Supreme Court in Nemeth
did not seem to find that to be an important point in that case in which soil erosion, rather than
what is commonly thought of as pollution, was at issue. That is, the Court's discussion of how to
determine the appropriate standard is not restricted only to pollution of the environment and may
also extend to impairment or destruction of a natural resource.
-13-
TechniSand also argues that Nemeth is distinguishable because it involved "construction
activities which actually violated [SESCA]" rather than "review of the procedure by which the
permit was granted." The MEPA does not require that actual activity be occurring, however,
because it contemplates the prevention of impairment, destruction, and pollution before they
begin. MCL 324.1703(1).
Thus, we find defendants' attempts to distinguish Nemeth unpersuasive. Just as our
Supreme Court in Nemeth, supra at 27, 29, relied on the purpose of the SESCA, explaining that
it is "to protect Michigan waters from pollution, the greatest source of which is sedimentation,"
and just as it pointed out that "the Legislature has clearly provided that the protection of the soil
and water of this state through the prevention of sedimentation and erosion is of the utmost
importance," this Court must acknowledge the purpose of the SDMA, MCL 324.63701 et seq.,
and the related purpose of the SDPMA, MCL 324.35301 et seq., to which the SDMA refers.
In the SDMA, MCL 324.63702(1) incorporates by reference the definition of "critical
dune area" as defined in "part 353," which is MCL 324.35301 of the SDPMA: "(c) 'Critical
dune area' means a geographic area designated in the 'atlas of critical dune areas' dated February
1989 that was prepared by the department."
In turn, the SDPMA includes significant legislative findings. MCL 324.35302 provides:
(a) The critical dune areas of this state are a unique, irreplaceable, and
fragile resource that provide significant recreational, economic, scientific,
geological, scenic, botanical, educational, agricultural, and ecological benefits to
the people of this state and to people from other states and countries who visit this
resource.
(b) Local units of government should have the opportunity to exercise the
primary role in protecting and managing critical dune areas in accordance with
this part.
(c)
The benefits derived from alteration, industrial, residential,
commercial, agricultural, silvicultural, and the recreational use of critical dune
areas shall occur only when the protection of the environment and the ecology of
the critical dune areas for the benefit of the present and future generations is
assured.
Although the SDMA refers to the SDPMA for certain definitions and grew out of the SDPMA,
currently the SDMA specifically addresses mining in sand dune areas (both noncritical dune
areas and critical dune areas), while the SDPMA deals with all other permitted uses of the sand
dune areas. This division of purpose is illustrated by MCL 324.35301, which defines "use" by
the exclusion of mining:
(j) "Use" means a developmental, silvicultural, or recreational activity
done or caused to be done by a person that significantly alters the physical
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characteristic of a critical dune area or a contour change done or caused to be
done by a person. Use does not include sand dune mining as defined in part 637.
MCL 324.35303 specifically addresses notification to local governments and property owners of
designated critical dune areas as included in the Atlas of Critical Dunes of February 1989.
Significantly, MCL 324.35304 spells out detailed and specific procedures dictating those "uses"
not including mining in critical dune areas, while MCL 324.35305 provides a specific procedure
for persons aggrieved by an issuance or denial of a permit for those "uses" not including mining
and expressly requires aggrieved parties to seek relief in accordance with the APA. No similar
requirement exists for sand dune mining permits issued under part 637.
Despite part 353's focus on nonmining uses of sand dune areas, it still provides the
definition section for its offshoot companion, the SDMA and part 637. Therefore, the
Legislature's findings regarding the "unique, irreplaceable, and fragile" critical dune areas of the
state at the very least indicate the value it assigns to such critical dune areas and explains the
restrictions placed on utilization of critical dune areas.
In summary, when a statute exists that regulates an activity through particular standards
and procedures, including those involving eligibility for permits, that statute "fills in the blank"
to provide the standard for review under the MEPA. As our Supreme Court explained in
Nemeth, supra at 30, although the MEPA calls for the courts to develop the "common law of
environmental quality," that fact "certainly does not preclude the Legislature . . . from further
entering the arena of environmental law. To the contrary, that is expressly contemplated by
subsection 1701(2)." There will not always be an existing, applicable standard, in which case the
court may simply apply the general "umbrella" standard under the MEPA prohibiting the
impairment, destruction, or pollution of a natural resource. However, in this case, as in Nemeth,
the Legislature entered the arena and prohibited mining in critical dune areas except under two
specific circumstances. The Legislature's prohibition is not merely a "nicety," nor is it merely
"procedural." Accordingly, part 637, the SDMA, provides the standard and procedure for
mining in critical dune areas in this MEPA action.
III. TIMELINESS OF PLAINTIFF'S CLAIM REGARDING THE PERMIT
Plaintiff asserts that the trial court incorrectly determined that its challenge to the DEQ's
granting of the amended permit was merely one seeking judicial review of the decision of an
administrative agency. Therefore, in order for it to be timely, it must have been brought within
ninety days of the granting of the permit. We agree. "Issues of statutory interpretation are
reviewed de novo as issues of law." McClellan v Collar (On Remand), 240 Mich App 403, 409;
613 NW2d 729 (2000).
MCL 324.1704 contains permissive language that suggests that a court may, but is not
required to, remit parties to existing or available administrative procedures before inquiring
directly into an environmental claim. Further, when the Legislature requires parties to exhaust
administrative remedies, it says so. The MEPA does not require parties to exhaust administrative
remedies. In addition, the issuance of a permit can be the subject of a MEPA claim, and no
-15-
actual activity is required to trigger its protection. For these reasons, we conclude that plaintiff 's
contention that the requirement for issuance of an amended permit set forth in MCL 324.63702
as being the proper standard for determining a violation of the MEPA is not time-barred.
Both defendants characterize plaintiff 's arguments as two-fold: one, as an attempt to
make out a prima facie case of a MEPA violation and, two, as a "purely procedural"
administrative challenge to the issuance of the amended mining permit. Defendants allege that
plaintiff has failed to establish the former and is time-barred from asserting the latter.
Specifically, defendants contend that plaintiff was required to challenge the issuance of the
permit in some other, earlier procedural administrative review forum and failed to do so.
Although the crux of both defendants' arguments is the same (i.e., a party can never challenge the
issuance of a permit except within administrative proceedings), we note that only TechniSand
specifically relies on the APA procedure in its brief. The DEQ makes only vague references to
an unspecified administrative procedure. By agreeing, Judge Schofield rendered nugatory the
language found in the MEPA, MCL 324.1701, and eliminated from consideration the
requirements for amending a mining permit set forth for the DEQ in the SDMA, MCL
324.63702. Judge Schofield allowed plaintiff to go forward to trial using only the standard set
forth in MCL 324.63709 for evaluation of its MEPA claim. Thus, Judge Schofield's ruling
resulted in consideration only of whether the proposed mining is likely to impair or destroy the
natural resource and did not consider whether the DEQ properly granted the amended permit.
Initially, it must be understood that the APA was appropriately followed. Administrative
proceedings were held and the proper procedure was followed for those proceedings under the
APA. Nonetheless, the agency failed to comply with the proper standard or procedure because it
issued the amended permit without regard for the requirements of MCL 324.63702. We view
plaintiff 's challenge under the MEPA and the SDMA as a substantive challenge, appropriately
brought eighteen months after the issuance of the permit and before the mining began. This
distinction is important because it is one that the trial court failed to recognize.
Plaintiff 's cause of action relies on the MEPA, the SDMA, and the SDPMA. None of the
relevant portions of these statutes contain time limitations. Nonetheless, in contrast to Judge
Peterson, who noted that if the Legislature had intended there to be a statute of limitations in the
MEPA it would have added one, both defendants as well as Judge Schofield assumed without
citing authority3 that plaintiff 's challenge based on the MEPA and MCL 324.63702 was a purely
"administrative" or "procedural" challenge and that plaintiff 's claim was time-barred.
In support of its contention that a MEPA claim can be based on improperly issued
permits, plaintiff relies on West Michigan Environmental Action Council v Natural Resources
3
On appeal, however, TechniSand contends that MCL 24.304(1) provides that a petition for
judicial review of an agency's final order must be brought within sixty days after the mailing of
notice of that order, and that because plaintiff 's complaint was filed approximately seventeen
months after the amended permit was issued, it was untimely.
-16-
Comm (WMEAC), supra, and Nemeth, supra, in which our Supreme Court inquired directly into
an environmental controversy and invalidated already issued permits. In WMEAC, the plaintiffs
brought a MEPA claim against the Natural Resources Commission (NRC), contending that the
drilling of ten exploratory wells for oil and gas would likely impair or destroy natural resources,
specifically wildlife in the affected area. WMEAC, supra at 749-750. Pursuant to negotiations
between the drilling companies and the NRC, those entities entered into a consent order adopting
a limited development plan. The plaintiffs then sought to intervene and moved for a hearing on
the consent order. The NRC denied the motion on the ground that it was premature because it
preceded the application for permits. Id. at 749. One of the oil companies subsequently applied
for the permits to drill the ten wells, and the Supervisor of Wells granted the permits. Id. The
plaintiffs then brought the MEPA suit claiming that the consent order was unlawful and was
likely to lead to the impairment of wildlife in the area. On that basis, the plaintiffs sought an
order restraining the issuance of the permits. Id. at 750. The trial court decided against the
plaintiffs.
On appeal, our Supreme Court noted that the record below was unclear regarding whether
the act of granting the permits was part of the conduct alleged as being likely to impair or destroy
the natural resource. The Court then stated:
Nonetheless, all parties presented evidence on the likely effect of the
drilling of the ten wells. Furthermore, the trial court chose to address the issue of
the likelihood of pollution, impairment or destruction from the drilling activities
contemplated by the ten permits.
We conclude that the issuance of the permits to drill ten exploratory wells
was properly before the circuit court as conduct alleged to be likely to pollute,
impair and destroy the air, water or other natural resources or the public trust
therein. The effects of these permits were comprehensively treated at the trial
level, both by the parties and by the circuit judge. . . .
Therefore, plaintiffs' allegation that the consent order is likely to lead to
pollution, impairment or destruction of the natural resources . . . can fairly be said
to include within it an allegation that the issuance of permits for drilling test wells
will have such result, the issuance of these permits being an inevitable
consequence of the adoption of the consent order. [Id. at 751.]
The Court went on to note that subsection 1204(4) of the MEPA [then MCL 694.1204, now
MCL 324.1704]
specifically indicates that the usual standards for review of administrative actions
under the Administrative Procedures Act . . . are inapplicable once an
environmental protection act case has been filed in a circuit court. The
environmental protection act would not accomplish its purpose if the courts were
-17-
to exempt administrative agencies from the strict scrutiny which the protection of
the environment demands. [WMEAC, supra at 754.]
We acknowledge that the last quotation from WMEAC addresses the question whether the
trial court improperly deferred to the DNR's conclusion that the proposed drilling would not
impair or destroy the natural resource. Nonetheless, we conclude that the quoted language from
that opinion indicates that the question whether an agency's issuance of permits was proper may
form the basis for a MEPA claim. Further, in that opinion, the Court expressly stated that "the
usual standards for review of administrative actions under the Administrative Procedures Act . . .
are inapplicable once an environmental protection act case has been filed in a circuit court."
Therefore, we conclude that the trial court in the present case should have considered whether
the DEQ properly granted the amended permit and the court erred in concluding that the time
requirement for judicial review of administrative agency decisions was controlling.
In addition, it is significant that the only reference the MEPA makes to any
administrative proceedings is found in MCL 324.1704, and that reference is permissive. MCL
324.1704 provides:
(1) The court may grant temporary and permanent equitable relief or may
impose conditions on the defendant that are required to protect the air, water, and
other natural resources or the public trust in these resources from pollution,
impairment, or destruction.
(2) If administrative, licensing, or other proceedings are required or
available to determine the legality of the defendant's conduct, the court may direct
the parties to seek relief in such proceedings. Proceedings described in this
subsection shall be conducted in accordance with and subject to the administrative
procedures act of 1969, Act No. 306 of the Public Acts of 1969, being sections
24.201 to 24.328 of the Michigan Compiled Laws. If the court directs parties to
seek relief as provided in this section, the court may grant temporary equitable
relief if necessary for the protection of the air, water, and other natural resources
or the public trust in these resources from pollution, impairment, or destruction.
In addition, the court retains jurisdiction of the action pending completion of the
action to determine whether adequate protection from pollution, impairment, or
destruction is afforded.
(3) Upon completion of proceedings described in this section, the court
shall adjudicate the impact of the defendant's conduct on the air, water, or other
natural resources, and on the public trust in these resources, in accordance with
this part. In adjudicating an action, the court may order that additional evidence
be taken to the extent necessary to protect the rights recognized in this part.
(4) If judicial review of an administrative, licensing, or other proceeding
is available, notwithstanding the contrary provisions of Act No. 306 of the Public
-18-
Acts of 1969 pertaining to judicial review, the court originally taking jurisdiction
shall maintain jurisdiction for purposes of judicial review. [Emphasis added.][4]
The word "may" designates discretion. Jordan v Jarvis, 200 Mich App 445, 451; 505
NW2d 279 (1993). Thus, although the statute provides that "[p]roceedings described in this
subsection shall be conducted in accordance with and subject to the administrative procedures
act of 1969, Act No. 306 of the Public Acts of 1969, being sections 24.201 to 24.328 of the
Michigan Compiled Laws," it does so conditioned on the court's discretion. The court "may"
direct the parties to seek relief in such proceedings if those proceedings are "required" or
"available." The permissive language within MCL 324.1704 indicates that other "proceedings"
may not be required or available and that the court may choose not to direct the parties to seek
relief in such proceedings.
The permissive nature of MCL 324.1704 is demonstrated in WMEAC, supra at 753. In
the context of explaining that the trial judge erred "in failing to exercise his own totally
independent judgment" under the MEPA, our Supreme Court averred that a trial court in which a
MEPA suit is filed retains original jurisdiction of the matter, "even if it chooses to remit parties
to administrative proceedings." Id. at 753-754 (emphasis added).
TechniSand argues that MCL 324.1704 empowers courts to direct the parties to seek
administrative proceedings if required or "available" and to retain jurisdiction to review the
results of those proceedings. TechniSand emphasizes that plaintiff 's action was commenced
more than a year after the availability of the administrative proceedings. By failing to quote the
full context and language of the statute however, TechniSand glosses over the discretion with
which the court is "empowered" under the MEPA. The language of MCL 324.1704 is
permissive. The language within WMEAC, in which our Supreme Court has provided a thorough
review of MCL 324.1704, also emphasizes that the court may send the parties to existing
administrative proceedings "if it chooses." WMEAC, supra at 753. Further, MCL 324.1704
provides that the court may direct the parties to seek relief in administrative proceedings if they
are required or available. The administrative proceedings were no longer available at the time
that plaintiff filed this MEPA lawsuit.
Moreover, although TechniSand contends that the DEQ's determination is, of course,
entitled to a presumption of regularity, this contention contradicts our Supreme Court's strong
message in WMEAC that the "usual standards for review of administrative actions . . . are
inapplicable once an environmental protection act case has been filed in a circuit court" and that
the "environmental protection act would not accomplish its purpose if the courts were to exempt
administrative agencies from the strict scrutiny which the protection of the environment
demands." Id. at 754. Indeed, a trial court must exercise totally independent judgment in MEPA
cases, lest it commit error requiring reversal. Id. Given the strong language of WMEAC, a case
4
The Court in WMEAC, supra at 752-753, relied on these provisions for its conclusions.
-19-
decided in the context of MCL 324.1704, TechniSand's assertions that deference to the agency is
required are unfounded.
Additionally, TechniSand implies that the significant difference between this case and
WMEAC and Nemeth, in which permits were invalidated, is that in those cases, the defendants
"conducted activities which impaired the environment in violation of the MEPA and the SESCA,
not because they weren't eligible for permits they had and abused." The implication is that the
MEPA may only be used to stop the entities actually doing the damage to the environment rather
than an agency that merely issues a permit and may only be used after actual activity has had an
effect. Both contentions are inaccurate. The MEPA contemplates the prevention of impairment,
destruction, or pollution before it begins. See MCL 324.1703 ("[w]hen the plaintiff in the action
has made a prima facie showing that the conduct of the defendant . . . is likely to pollute, impair,
or destroy . . ."). Further, the Court in Genesco expressly provides that the actions of agencies
may be challenged in a MEPA action, and this fact is evident within the reasoning of WMEAC,
Nemeth, and City of Jackson. As plaintiff points out in its reply brief, "[w]hether the applicant
gets the permit determines whether the activity will take place at all." A claim under the MEPA
may be founded on probable damage to the environment. City of Jackson, supra at 490. Thus, a
MEPA violation is not restricted to activity that is already occurring. Issuance of a permit in and
of itself, which is an agency action, can invoke the MEPA, as long as it is "the last hurdle in
moving from the paperwork to the outdoors." Wortelboer v Benzie Co, 212 Mich App 208, 221;
537 NW2d 603 (1995). In any case, the validity of permits has been the subject of various direct
circuit court actions brought pursuant to the MEPA. See WMEAC, supra; Holly Twp v DNR, 189
Mich App 581; 473 NW2d 778 (1991), on reh 194 Mich App 213; 486 NW2d 307 (1992),
vacated on other grounds 440 Mich 891 (1992); Addison Twp v Gout, 171 Mich App 122; 429
NW2d 612 (1988), rev'd in part on other grounds 435 Mich 809 (1990). The MEPA allows for
"direct" review of an "administrative agency's decision." Genesco, supra at 50. Actual activity
need not have already begun for the MEPA to become operational. Nowhere is this clearer than
in the language of the MEPA itself, which provides that "any person may maintain an action in
the circuit court having jurisdiction where the alleged violation occurred or is likely to occur . . .
." MCL 324.1701(1) (emphasis added).
Further, the Legislature included statutes of limitation in certain other portions of the
NREPA, e.g., in MCL 324.35305 of the SDPMA. This indicates that if the Legislature intended
there to be one under MCL 324.63702, it would have included one. MCL 324.35303 of the
SDPMA specifically addresses notification to local governments and property owners of
designated critical dune areas as included in the Atlas of Critical Dune Areas of February 1989.
Significantly, MCL 324.35304 spells out detailed and specific procedures dictating those "uses"
not including mining in critical dune areas, while MCL 324.35305 provides a specific procedure
for persons aggrieved by an issuance or denial of a permit for those "uses" not including mining
and expressly requires aggrieved parties to seek relief in accordance with the APA.
Significantly, MCL 324.35305(1) and (2) of the SDPMA provide for a formal hearing and
review process, in accordance with the APA, for persons aggrieved "by a decision of the
department in this regard to the issuance or denial of a permit or special exception under this
part." (Emphasis added). Thus, the review process imposed on applicants seeking permits for
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uses other than mining in critical sand dune areas does not apply to those aggrieved by a permit
decision under part 637. Similarly, the SESCA statute that provided the standard in Nemeth
specifically required parties to comply with the APA. No similar requirement exists for sand
dune mining permits issued under any portion of part 637.
Further, defendants' proposition also runs contrary to the fact that a MEPA litigant is not
required to exhaust administrative remedies before seeking judicial review. Genesco, supra;
Holly Twp, supra (the MEPA and the Solid Waste Management Act do not mandate that the
plaintiff exhaust administrative remedies before filing suit); see, also, Ray v Mason Co Drain
Comm'r, 393 Mich 294, 305-306; 224 NW2d 883 (1975).
The general rule is that a litigant seeking judicial review of a decision by an
administrative agency has three potential avenues of relief: (1) the review prescribed in the
statute applicable to the particular agency, (2) an appeal pursuant to the RJA and Const 1963, art
6, § 28, or (3) the method of review provided by the APA. See Hopkins v Parole Bd, 237 Mich
App 629, 637-638; 604 NW2d 686 (1999), Attorney General v Public Service Comm No 1, 237
Mich App 27, 40; 602 NW2d 207 (1999), and Palo Group Foster Care, Inc v Dep't of Social
Services, 228 Mich App 140, 145; 577 NW2d 200 (1998).
While there is a "review" procedure described in part 353, which governs all other
commercial uses of critical dune areas and specifically excludes sand dune mining, no review
procedure is designated under part 637, which deals particularly with mining. This is where the
MEPA comes into play because it uniquely provides for independent, direct review of an agency
decision in environmental cases. Genesco, supra at 50; see, also, MCL 324.1704 (a court may
direct parties to administrative and other proceedings if they are "required or available"). Under
part 637, the SDMA, they are not required; under the MEPA, a court may, therefore, directly
review the agency action.
In City of Jackson, supra at 491, this Court clearly opined that the trial court had erred in
treating the plaintiffs' action as a petition for review of the administrative decision to issue the air
use permit (also called a "permit to install") for the defendant's asphalt plant. In so doing, the
Court relied on the fact that the trial court had ruled against the plaintiffs on all counts alleged in
their complaint, but had nevertheless placed conditions on the permit. Therefore, this Court
reasoned that the plaintiffs were not entitled to relief under MCR 2.601(A) and stated that the
"[p]laintiffs' action did not encompass a review of the permit, which is provided for by statute."
City of Jackson, supra at 492. In the air pollution context, MCL 324.5505(8) provides that any
appeal of the issuance or denial of a permit in that section must be taken within ninety days after
the final permit action and exclusively pursuant to the RJA.
The implication of the Court's reasoning in City of Jackson and the language in the Air
Pollution Control section of the NREPA (MCL ch 324) is that when the Legislature intends to
limit an appellant's right of appeal to a particular process and time frame, it does so explicitly.
The City of Jackson case also implies that although under the circumstances of that case the issue
was moot because the asphalt plant was being operated under a new permit, the Court would
have considered whether the original conditional use permit for operation of the plant was void
-21-
because the allowed time for completing construction had expired. Id. at 493. Further, there is
no time limit in the MEPA. Therefore, the agency's authority to issue a permit may be
challenged under the MEPA as long as impairment or destruction of a natural resource is likely
or actually occurring without reference to when an agency issued the permit through which the
impairment or destruction is occurring.
Further, although judicial review under the APA is not de novo, Michigan Waste Systems
v DNR, 147 Mich App 729, 735; 383 NW2d 112 (1985), review under the MEPA is de novo,
Nemeth, supra at 30. In addition, although an agency decision reviewed under the APA is
entitled to deference, THM, Ltd v Comm'r of Ins, 176 Mich App 772, 776; 440 NW2d 85 (1989),
"it is error requiring reversal for the trial court to defer to an administrative agency's conclusion
that no pollution, impairment, or destruction of a natural resource will occur" in a MEPA action,
City of Jackson, supra at 489; see, also, WMEAC, supra at 752. The factors used to make this
determination "necessarily depend on the facts of the case, the natural resources involved, and
the evidence presented." City of Jackson, supra at 489. Thus, there would be no point in
requiring parties to exhaust their administrative remedies because no deference is allowed.
In summary, it appears that there is no statute of limitations in a MEPA action and there
is no time limitation within the SDMA, part 637 of the NREPA, which we conclude provides the
standard or procedure to be applied in this MEPA action. Thus, plaintiff 's claim challenging the
DEQ's authority to allow TechniSand to mine in a critical dune area and challenging
TechniSand's qualifications under MCL 324.63702 is not time-barred.
IV. MCL 324.63702 AND THE ISSUANCE OF THE PERMIT
Plaintiff argues that the DEQ lacked the authority to issue the permit to TechniSand to
mine in the critical dune area because TechniSand did not qualify under either exception to the
prohibition set forth under MCL 324.63702(1)(a) or (b). We agree. Because MCL 324.63702
cannot reasonably be interpreted to "grandfather in" parties who did not own a permit to mine in
a critical dune area before July 5, 1989, and who did not own land adjacent to a critical dune area
and a permit to mine in the noncritical dune area before July 5, 1989, the trial court erred in
concluding that the DEQ had statutory authority to issue the amended permit and erred in
denying plaintiff 's summary disposition motion.
Although Judge Schofield decided that plaintiff was time-barred from arguing that the
DEQ lacked the authority to issue the amended permit to TechniSand under MCL 324.63702, he
decided this issue, stating that TechniSand fell within the exception of MCL 324.63702(1)(b).
The court concluded that MCL 324.63702(1)(a) did not apply. Similarly, both the DEQ and
TechniSand argue that TechniSand qualified under one of the exceptions to the prohibition on
sand dune mining in critical dune areas provided by MCL 324.63702. Interestingly, on appeal,
the DEQ argues that TechniSand qualifies for the exception allowing it to mine in the critical
dune area under MCL 324.63702(1)(a), while TechniSand argues that it qualifies under MCL
324.63702(1)(b).
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Specifically, the DEQ argues that "the important date [under subsection 1(a)] is when the
permit governing the site first issued" and that "[t]he Legislature did not say that the operator had
to own the permit qualifying for amendment under § 63702(1)(a) on a certain date or that the
permit had to be held by the original permittee." Defendants are essentially arguing that § 63702
allows an amended permit to be granted to the operator who held the original permit before July
5, 1989 (i.e., Manley Brothers) or to its successor (TechniSand). In other words, it is not
dispositive that TechniSand did not own the "adjacent land" before July 5, 1989, because the
original permit that TechniSand apparently received when it was deeded the land and sought to
amend was issued to its predecessor before July 5, 1989.
The DEQ contends that the "entire Nadeau site [including both the eastern, noncritical
dune area for which it had a permit to mine and the western, critical dune area, which the original
permit did not cover] became subject to the mining plan approved in 1979 when Manley
Brothers purchased the 100 acres contiguous to the original 26 acre holding and then obtained
the permit." The DEQ's argument is based on the fact that the bonding and progressive cell-unit
provisions of the SDMA treat the owner's entire contiguous tract as a "unit" for purposes of the
restrictions on the number of "cells" that may be mined at one time. The reason is that the
Geological Survey Division will not grant a permit for a new sand dune mining operation that is
adjacent to an existing operation. This policy "ensures that a company does not apply for several
permits on all the acreage it holds in an attempt to mine, and retain as active, more than the three
(3) cell units allowed" by the SDMA. The DEQ takes this policy, which exists solely for
purposes of preventing companies from mining more than three cell units at a time, and argues
that "TechniSand held a permit issued before the effective date of the act [the SDMA] that
covered its entire Nadeau site." We find this argument disingenuous. The policy of treating an
owner's property as one "cell unit" simply for the purpose indicated above is, as plaintiff
contends, "a far cry from showing that the 1979 permit that TechniSand acquired from Manley
Brothers authorized mining of the Nadeau Expansion critical dune area. . . . It did not." Manley
Brothers had only a permit for the noncritical dune area, and that was the permit TechniSand
purchased. Manley Brothers could not have expanded its mining operation into the adjacent area
without obtaining an amendment of the existing permit. Manley Brothers would not be entitled
to a permit to mine in the critical dune area of the Nadeau Expansion if it had not acquired the
critical dune area until 1991; thus, it is unclear how TechniSand, which did not acquire the
critical dune area until 1991, would be entitled.
Further, if, as the DEQ contends, TechniSand qualified under subsection 1(a) because the
important date is when the original permit issued, then subsection 1(b) would be rendered
meaningless. MCL 324.63702(1)(b) deals specifically with proposed amendments seeking to
include adjacent land in a critical dune area, and thus, if either exception covered this situation, b
would. Subsection a addresses situations where either a renewal or an amendment of a permit is
sought, while subsection b, more specifically, deals with the situation where an amendment is
sought to include adjacent land that the operator owned before July 5, 1989, but for which the
operator had not yet obtained a permit to mine. It would be illogical to say that an application
for amendment that seeks to include "adjacent land" could be granted under subsection a. To do
so would be to ignore the limitation within subsection b that requires the operator to have owned
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the adjacent land before July 5, 1989, and would render subsection b superfluous. "When
construing a statute, the court should presume that every word has some meaning and should
avoid any construction that would render the statute, or any part of it, surplusage or nugatory."
Karpinski, supra at 543.
We agree with Judge Schofield's conclusion that if defendants relied on 1(a), such
reliance would be misplaced. Subsections a and b must be read together because of their
juxtaposition. Provisions must be read in the context of the entire statute so as to produce an
harmonious whole. Macomb Co Prosecutor v Murphy, 464 Mich 149, 159; 627 NW2d 247
(2001). A reasonable reading of MCL 324.63702 is that subsection a applies to the amendment
or renewal of a permit that already permits mining in a particular already-defined area, while
subsection b applies when the permit holder seeks to expand the permit to include adjacent land
that contains a critical dune area and that it owned before July 5, 1989. Thus, subsection 1(a) is
applicable where the amendment sought is for some purpose other than to mine adjacent land.
Further, to interpret subsection a as broadly as the DEQ suggests would mean that the
DEQ could grant an amended permit regardless of whether the additional land was adjacent and
regardless of when the additional land was acquired. The absurd result of this interpretation
would be that the DEQ could "amend" any permit that existed before July 5, 1989, to include any
critical dune area, no matter where it was located, and no matter when acquired, and, thus, the
amending power of the DEQ would entirely consume the prohibition on mining in critical dune
areas. Statutes should be construed to avoid absurd consequences, injustice, or prejudice to the
public interest. McAuley v General Motors Corp, 457 Mich 513, 518; 578 NW2d 282 (1998).
The DEQ's interpretation would also mean that any applicant who purchased a permit from
someone who owned it before July 5, 1989, would be entitled to an amended permit to mine sand
in adjacent critical dune areas. As plaintiff points out, this is in essence what the DEQ has done
for TechniSand.
In contrast to the DEQ's argument, TechniSand argues that it qualified for the amended
permit under MCL 324.63702(1)(b). Specifically, TechniSand argues that MCL 324.63701 does
not treat the word "person" as synonymous with the word "operator." TechniSand also argues
that the word "operator" was meant to be construed broadly. Citing the former SDPA,
TechniSand also argues that the former definition of "person" was "an individual, partnership,
firm, corporation, association, local unit of government, or other political subdivision of the
state, or a state or state agency."
TechniSand's point is not clear. Apparently, TechniSand concludes that the term
"operator" that is used in MCL 324.63702 should be interpreted as meaning "operations." That
is, TechniSand seems to be arguing that as long as a particular sand mining operation existed
before July 5, 1989, whether the land on which the operation is occurring is owned by the
"person" to whom the original permit was granted or to any successor is immaterial for the
purpose of application of the exceptions described in § 63702. We disagree.
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MCL 324.63701(j), defines "operator" as "an owner or lessee of mineral rights or any
other person engaged in or preparing to engage in sand dune mining activities with respect to
mineral rights within a sand dune area."
The term "operator" is the term used in MCL 324.63702, the statute at issue. TechniSand
does not explain why the term "operator" was used in MCL 324.63702, while the term
"operation" appears in other sections of the statute where it makes contextual sense (e.g., MCL
324.63706[2], 324.63701[e]). We believe that the distinction indicates that the Legislature
meant to "grandfather in" operators, not operations; otherwise, it would have used the term
"operations." The Legislature is presumed to be familiar with the rules of statutory construction,
and, when promulgating new laws, is presumed to be aware of the consequences of its use or
omission of statutory language. Stokes v Millen Roofing Co, 245 Mich App 44, 60; 627 NW2d
16 (2001), rev'd on other grounds 466 Mich 660 (2002); Lumley v Univ of Michigan Bd of
Regents, 215 Mich App 125, 129-131; 544 NW2d 692 (1996). If the statute provides its own
glossary, the terms must be applied as explicitly defined. Tryc v Michigan Veterans' Facility,
451 Mich 129, 136; 545 NW2d 642 (1996); Barrett v Kirtland Community College, 245 Mich
App 306, 314; 628 NW2d 63 (2001). Indeed, the statute does not define the term "operation." In
any event, common sense dictates that the new owner of a permit who seeks expansion of a
permit covering mining in noncritical dune areas to cover mining in critical dune areas 160 times
greater than that covered initially would not be running the same "operation."
TechniSand also argues that other portions of the SDMA focus on activities, not owners.
TechniSand minimizes the import of the specific language of MCL 324.63702 by arguing that
other portions of the SDMA "concern themselves with existing operations, without regard to the
formalities of enterprise." We find this contention misleading. Even assuming that TechniSand's
characterization of the focus of other portions of the SDMA is accurate, it is clear that MCL
324.63702, which deals specifically with who may be authorized to mine in critical dune areas,
focuses not on activities, but rather on ownership, location, and timing. As previously stated the
Legislature is presumed to be aware of the consequences of its use of language. Stokes, supra.
Next, TechniSand argues that the Legislature's intent in drafting MCL 324.63702 was to
balance competing interests. TechniSand asserts that "the legislature did not focus on technical
legal rules related to ownership issues." First, we fail to see the "balancing [of] competing
interests" as the impetus for the enactment of MCL 324.63702, and TechniSand offers no
persuasive authority for its assertion. For reasons previously discussed, we believe that MCL
324.63702 can only be reasonably interpreted as a prohibition on mining in critical dune areas,
with two exceptions, which narrowly "grandfather in" existing operators. Second, TechniSand's
assertion that the Legislature did not focus on "technical legal rules" relating to ownership issues
contradicts the plain and specific ownership requirements of MCL 324.63702(1)(a) and (b).
TechniSand also argues that the manner in which it acquired the "operation" is not
determinative and that it would be "absurd" to interpret MCL 324.63702 as limiting the
exceptions to operators who made investments in reliance on the situation existing before the
passage of § 63702, when mining in critical dune areas was not prohibited. These contentions
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are also unpersuasive. Moreover, this "absurd result" argument carries questionable, if any,
weight. People v McIntire, 461 Mich 147, 155-156, n 2; 599 NW2d 102 (1999).
In support of its first contention, TechniSand provides various hypothetical examples
regarding corporate acquisitions and structuring and argues that interpreting "operator" within
MCL 324.63702 to mean anything other than "operation" would produce results that hinge on
what it refers to as the "mere corporate structure of the acquiring entity." The gist of
TechniSand's argument is akin to Judge Schofield's reasoning that if TechniSand's acquisition
had been something other than what it was, i.e., if TechniSand had merely acquired the stock
belonging to Manley Brothers rather than the actual assets, the "operation" could have continued.
Therefore, it should be allowed to "continue" into the expanded critical dune area despite the
"corporate structure" of the transaction. We find this argument unpersuasive. It is based on a
hypothetical example rather than on what actually occurred. The change of ownership and
operating control of what formerly belonged to Manley Brothers should not be reduced to a
"nicety[] of corporate law," as TechniSand contends, just to allow TechniSand to qualify under
an exception to MCL 324.63702.
TechniSand fails to distinguish between its reliance as purchaser in 1991 and the Manley
Brothers' presumed reliance as owners before July 5, 1989. Instead, TechniSand argues that the
intent of the Legislature was to "preserve ongoing businesses and property rights and
expectations, while affording some relief to over-utilization of important natural resources."
TechniSand was not an "ongoing business," had no "property rights," and had no "expectations"
before July 5, 1989. Therefore, it could not have reasonably relied on being able to mine in the
Nadeau expansion area before MCL 324.67302 was created. In essence, TechniSand argues that
because Manley Brothers may have relied on its ability to someday mine in the critical dune area
for which it did not have a permit, TechniSand, the new owner, should be deemed to have
acquired that "reliance" years later. TechniSand's argument is unfounded. The transaction that
TechniSand would have this Court regard as mere "corporate formalities" is the very transaction
that disqualifies TechniSand from obtaining the amended permit to mine in the critical dune area
that it acquired in 1991.
Notably, the DEQ interprets subsection b as we do, asserting that "the date of the
acquisition of land adjacent to the land covered by a permit, whenever issued, becomes
significant." The arguments posed by both the DEQ and TechniSand are unpersuasive. Under
the facts of this case, TechniSand did not qualify for exception under MCL 324.63702(1)(a) or
(b). It did not qualify under subsection a because the permit for the Nadeau Site did not include
the extension into a critical dune area (the Nadeau expansion). Nor does it qualify under
subsection b, because TechniSand did not own the critical dune area on July 5, 1989.
TechniSand, which incorporated on July 12, 1991, purchased the property on July 31, 1991,
when it acquired a deed conveying the land from Manley Brothers to TechniSand. Therefore,
MCL 324.63702 had been in effect for two years before TechniSand invested in the property.
Judge Schofield's explanation for why he concluded that TechniSand qualified under
subsection b is also unpersuasive. Judge Schofield found that subsection b was intended to allow
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permitted operations that were in existence on July 5, 1989, to be extended into adjacent areas if
those adjacent areas were owned by the operator on that date. Despite this conclusion, he found
that TechniSand was entitled to the amended permit even though it was not the operator with the
permit to mine on July 5, 1989, and even though TechniSand did not own the adjacent site on
July 5, 1989. One conclusion does not logically flow from the other. The statute could not have
intended to protect a pre-July 5, 1989, owner of an adjacent site who was not also the operator at
the time because such a nonoperator owner would presumably not have acquired the property for
mining and would not fall within the category of those placing reliance on the ability to mine—
the category of owners the Legislature sought to protect.
The trial court's reasoning closely mirrors TechniSand's reasoning and involves the
assumption that the purpose of the statute was to grandfather in operations, not operators. For
the reasons discussed, we disagree. More probably, the purpose was to allow existing operations
to continue, but to restrict the expansion of existing operations into critical dune areas. The
limitation within subsection b limited expansion to existing operators with existing ownership of
adjacent properties. If the Legislature had not intended to tie such expansions to ownership, it
would have used the term "operations"; instead, it used the word "operators" in MCL 324.63702
and expressly defined the term "operator." We believe that the Legislature's choice of language
was intentional.
Perhaps most significantly, if the privilege of expansion into critical dune areas were tied
to "operations" as opposed to "operators," there would be no limit to who could obtain
amendments to mine in critical dune areas. The trial court interprets MCL 324.63702 to mean
that any operation that existed on July 5, 1989, should continue to exist and be allowed to expand
indefinitely, regardless of changes of ownership and regardless of major changes in the scope of
the operation, even when those changes involve critical dune areas. In other words, MCL
324.63702 would be rendered meaningless because each new permit owner could point back to
the date on which the first operation at the site commenced and could successfully argue that
theirs was simply a continuance. This approach completely overlooks the ownership focus of the
definition of "operator" and disregards the idea that existing owners were "grandfathered in" on
the bases of their reliance on the state of the old law and the right to mine in critical dune areas.
Further, the amended permit TechniSand sought from the DEQ allows mining in a critical
dune area and removal of eight million tons of sand altogether. By contrast, the original permit
that TechniSand purchased as an asset from Manley Brothers allowed mining in a noncritical
dune area and allowed the removal of only fifty thousand tons of sand. Construing TechniSand's
proposed operation as a mere continuance of the original, permitted operation necessitates a
strained reading of MCL 324.63702. Yet, this incredible result would be allowed under the trial
court's interpretation that would allow "operations," rather than "operators," to qualify for
exceptions to the prohibition on mining in critical dune areas.
We conclude that the trial court erred in denying plaintiff 's motion for summary
disposition. Summary disposition of all or part of a claim or defense may be granted when
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"[e]xcept as to the amount of damages, there is no genuine issue as to any material fact, and the
moving party is entitled to judgment or partial judgment as a matter of law." MCR 2.116(C)(10).
There are no factual disputes. Regarding the land for which the amended permit was
granted, it is established that TechniSand did not own the land or the rights to mine the sand on
the land before July 5, 1989. Therefore, we conclude that plaintiff was entitled to judgment as a
matter of law on the question whether the DEQ should have granted the amended permit.
In light of our resolution of the above issues, we need not address plaintiff 's other
arguments.
V. CONCLUSION
In summary, we conclude that plaintiff 's MEPA action, which incorporates the standard
set forth in MCL 324.63702, is not time-barred. We also conclude that TechniSand did not
qualify for an exception to the prohibition on sand dune mining in critical dune areas under MCL
324.63702. Accordingly, the DEQ was not authorized to amend the permit to allow TechniSand
to mine in critical dune areas. We reverse the trial court's order granting partial summary
disposition to defendants and the judgment of no cause of action, and remand for entry of an
order granting summary disposition in favor of plaintiff. We do not retain jurisdiction. Plaintiff
may tax costs.
/s/ Jane E. Markey
/s/ Donald S. Owens
/s/ Christopher M. Murray
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