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Michigan Ass'n of Home Builders v. City of Troy

Supreme Court of Michigan

June 4, 2015

MICHIGAN ASSOCIATION OF HOME BUILDERS, ASSOCIATED BUILDERS AND CONTRACTORS OF MICHIGAN, and MICHIGAN PLUMBING AND MECHANICAL CONTRACTORS ASSOCIATION, Plaintiffs-Appellants,
v.
CITY OF TROY, Defendant-Appellee

Argued March 11, 2015.

For MICHIGAN ASSOCIATION OF HOME BUILDERS, ASSOCIATED BUILDERS AND CONTRACTORS OF MICHIGAN, MICHIGAN PLUMBING AND MECHANICAL CONTRACTOR ASSOCIATION, Plaintiffs-Appellants: GREGORY L. MCCLELLAND, LANSING, MI.

For CITY OF TROY, Defendant-Appellee: ALLAN T. MOTZNY, TROY, MI.

Chief Justice: Robert P. Young, Jr. Justices: Stephen J. Markman, Mary Beth Kelly, Brian K. Zahra, Bridget M. McCormack, David F. Viviano, Richard H. Bernstein.

[497 Mich. 282] BEFORE THE ENTIRE BENCH

MEMORANDUM OPINION

Robert P. Young, Jr., Chief Justice.

Plaintiffs, a group of associations representing builders, contractors, and plumbers, filed suit against defendant, the city of Troy, claiming that defendant's building department fees violated § 22 of the Single State Construction Code Act (CCA), MCL 125.1522, as well as a provision of the Headlee Amendment, Const 1963, art 9, § 31. The circuit court granted summary disposition to defendant, holding that the court lacked jurisdiction over the matter because plaintiffs [497 Mich. 283] had failed to exhaust the administrative procedure outlined in § 9b of the CCA, MCL 125.1509b.

The plain language of MCL 125.1509b, however, provides that the director[1] may conduct performance evaluations of defendant's " enforcing agency" and does not

Page 2

provide any administrative procedure relative to the entity responsible for establishing fees pursuant to MCL 125.1522(1): " [t]he legislative body of a governmental subdivision." Because the administrative proceedings in § 9b do not purport to provide the director with the authority to evaluate defendant's legislative body, the circuit court erred by granting summary disposition to defendant on the basis of plaintiffs' failure to exhaust their administrative remedies.

We reverse the judgment of the Court of Appeals and remand this case to the circuit court for further proceedings consistent with this opinion.

I. FACTS AND PROCEDURAL HISTORY

After several years of operating its building department at a deficit, defendant--which is a " governmental subdivision" within the meaning of the CCA[2]--privatized the building department in July 2010. It entered into a contract with SafeBuilt Michigan, Inc.,[3] [497 Mich. 284] under which SafeBuilt assumed the duties of defendant's building inspection department, which is the " enforcing agency" within the meaning of the CCA.[4]

On December 15, 2010, plaintiffs filed the instant complaint, seeking declaratory and injunctive relief. Plaintiffs claimed that the fees generated under the contractual arrangement with SafeBuilt produced " significant monthly surpluses" [5] that were used to augment defendant's general fund in violation of MCL 125.1522 and ...


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