Gregory D Groninger v. Department of Environmental Quality

STATE OF MICHIGAN
COURT OF APPEALS
GREGORY D. GRONINGER, CAROL J. UNPUBLISHED
GRONINGER, KENNETH THOMPSON, and January 29, 2015
THOMAS DUNN,
Plaintiffs-Appellants,
v No. 318380
Midland Circuit Court
DEPARTMENT OF ENVIRONMENTAL LC No. 12-009040-CZ
QUALITY,
Defendant-Appellee.
Before: SHAPIRO, P.J., and GLEICHER and RONAYNE KRAUSE, JJ.
PER CURIAM.
Plaintiffs sought declaratory relief to prevent defendant Department of Environment
Quality (DEQ) from entering their property to inspect for wetlands. They now appeal by right
the trial court order granting summary disposition to defendant under MCR 2.116(C)(5)
(standing), (C)(8) (failure to state a claim), and (C)(10) (no issue of material fact). We affirm.
Plaintiffs Greg and Carol Groninger’s chain of title to the property in issue stretches back
to a federal patent granted in 1855. Plaintiffs Kenneth Thompson and Thomas Dunn, on the
other hand, have only a verbal lease to use the property for hunting. When defendant was
prevented from entering the subject property, apparently to inspect a driveway that was being
built, it sought a warrant to conduct a wetlands inspection. In response, plaintiffs filed suit
seeking declaratory relief that defendant did not have authority to enter their private land,
arguing that defendant was operating outside its legislative authority.
Defendant sought and was granted summary disposition. The trial court ruled that
summary disposition was appropriate under either MCR 2.116(C)(8) or (C)(10) because there
was no legal basis to plaintiffs’ claims and no factual development could cure that defect. The
court also concluded that plaintiffs Dunn and Thompson did not have an actionable interest in
the land and had not suffered a particularized injury different than that suffered by the general
public. See MCR 2.116(C)(5).
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I. MCR 2.116(C)(5): PLAINTIFFS DUNN AND THOMPSON
We first address the trial court’s ruling that plaintiffs Dunn and Thompson lacked
standing in this action, a question of law subject to review de novo. Duncan v State, 300 Mich
App 176, 191; 832 NW2d 761 (2013). When reviewing a ruling under MCR 2.116(C)(5), we
must consider the pleadings, depositions, admissions, affidavits, and other documentary evidence
submitted by the parties. Szyszlo v Akowitz, 296 Mich. App. 40, 46; 818 NW2d 424 (2012).
Whether a party has standing in a suit seeks to “assess whether a litigant’s interest in the
issue is sufficient to ensure sincere and vigorous advocacy.” Lansing Sch Ed Ass’n v Lansing Bd
of Ed, 487 Mich. 349, 355; 792 NW2d 686 (2010) (quotation marks and citation omitted). In
cases involving private rights, “the litigant should have some real interest in the cause of action,
or a legal or equitable right, title, or interest in the subject matter of the controversy.” Id. at 359
(internal quotation marks and citation omitted). Where a party seeks declaratory relief,
“meeting the requirements of the court rule governing declaratory actions [is] sufficient to
establish standing.” Id. at 357. Thus, “whenever a litigant meets the requirements of MCR
2.605, it is sufficient to establish standing to seek a declaratory judgment.” Id. at 372. MCR
2.605(A)(1) provides, “In a case of actual controversy within its jurisdiction, a Michigan court of
record may declare the rights and other legal relations of an interested party seeking a
declaratory judgment, whether or not other relief is or could be sought or granted.”
A case of actual controversy is a “condition precedent to invocation of declaratory relief.”
Citizens for Common Sense in Gov’t v Attorney General, 243 Mich. App. 43, 55; 620 NW2d 546
(2000). It is essential that a plaintiff “pleads facts entitling him to the judgment he seeks and
proves each fact alleged,” and those facts “indicate an adverse interest necessitating a sharpening
of the issues raised.” Shavers v Attorney General, 402 Mich. 554, 589; 267 NW2d 72 (1978).
When the “injury sought to be prevented is merely hypothetical, a case of actual controversy
does not exist.” Citizens for Common Sense, 243 Mich. App. at 55.
In this case, defendant seeks only to enter the subject property to inspect for wetlands.
Although Dunn and Thompson allege that they have an oral lease to hunt on the property, they
have made no showing that their hunting interest would be affected by defendant entering the
land to determine its wetland status. Further, Dunn and Thompson have not pleaded facts
establishing that the underlying circumstance that brought the subject matter to defendant’s
attention (construction of a driveway) in any way affects their hunting interest. Their injury, as
presented to the trial court and on appeal, is merely hypothetical and they have not established an
actual controversy. Accordingly, the trial court properly concluded that Dunn and Thompson
lacked standing in this action for declaratory judgment under MCR 2.605 and, therefore, did not
err by granting summary disposition in favor of defendant under MCR 2.116(C)(5) with respect
to plaintiffs Dunn and Thompson.
B. MCR 2.116(C)(8) AND (C)(10): PLAINTIFFS GRONINGER
A trail court’s grant of summary disposition under MCR 2.116(C)(8) and/or (C)(10) is
reviewed de novo. Wilson v King, 298 Mich. App. 378, 381; 827 NW2d 203 (2012) (MCR
2.116(C)(8)); Ernsting v Ave Maria College, 274 Mich. App. 506, 509; 736 NW2d 574 (2007)
(MCR 2.116(C)(10)). A motion under MCR 2.116(C)(8) “tests the legal sufficiency of the claim
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on the basis of the pleadings alone.” Bailey v Schaaf, 494 Mich. 595, 603; 835 NW2d 413
(2013). Therefore, “the court must accept as true all factual allegations contained in the
complaint” and the “motion must be granted if no factual development could justify the
plaintiff’s claim for relief.” Id.
MCR 2.116(C)(10) provides that where, “[e]xcept as to the amount of damages, there is
no genuine issue as to any material fact, . . . the moving party is entitled to judgment or partial
judgment as a matter of law.” Because such a motion “tests the factual sufficiency of the
complaint,” it is proper to consider the “affidavits, pleadings, depositions, admissions, and other
evidence submitted by the parties, MCR 2.116(G)(5), [albeit] in the light most favorable to the
party opposing the motion.” Maiden v Rozwood, 461 Mich. 109, 119-120; 597 NW2d 817
(1999). If the nonmovant’s evidence “fails to establish a genuine issue regarding any material
fact, the moving party is entitled to judgment as a matter of law.” Id. at 120. Where the burden
of proof at trial rests on the nonmoving party, as is the case here, the nonmoving party may not
rely on mere allegations or denials in the pleadings, but must set forth specific facts showing that
a genuine issue of material fact exists. Quinto v Cross & Peters Co, 451 Mich. 358, 362; 547
NW2d 314 (1996). When giving the benefit of reasonable doubt to the opposing party, if an
issue upon which reasonable minds might differ is evident, a genuine issue of material fact
exists. Id.
Plaintiffs Groninger argue that the federal patent which forms the foundation of their
chain of title removes their property from the authority of defendant. They argue that any
regulation of their land impairs their patent, which violates both the U.S. and Michigan
constitutions. Further, they argue that defendant only has authority over property within the
public domain and thus not the subject property because it was removed from the public domain
by federal patent.
The Wetlands Protection Act (WPA), MCL 324.30301 et seq., protects wetlands and
allows the state to administer a federal counterpart, the Clean Water Act, 33 USC 1251, et seq.
Huggett v Dep’t of Natural Resources, 232 Mich. App. 188, 194-195; 590 NW2d 747 (1998).1
Under the WPA, defendant may enter premises upon either reasonable cause or by obtaining a
search warrant. MCL 324.30314(2).
Under the WPA, a wetland is specifically defined as follows:
(m) “Wetland” means land characterized by the presence of water at a
frequency and duration sufficient to support, and that under normal circumstances
does support, wetland vegetation or aquatic life, and is commonly referred to as a
bog, swamp, or marsh, and which is any of the following:
(i) Contiguous to the Great Lakes or Lake St. Clair, an inland lake or
pond, or a river or stream.
1
The WPA is part 303 of the Natural Resources and Environmental Protection Act (NREPA),
MCL 324.101 et seq.
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(ii) Not contiguous to the Great Lakes, an inland lake or pond, or a river
or stream; and more than 5 acres in size.
(iii) Not contiguous to the Great Lakes, an inland lake or pond, or a river
or stream; and 5 acres or less in size if the department determines that protection
of the area is essential to the preservation of the natural resources of the state from
pollution, impairment, or destruction and the department has so notified the
owner. [MCL 324.30301(m).]
This definition makes clear that the statute applies to any “land” bearing certain characteristics of
water or aquatic life. There is no limitation on the types of land affected by the WPA, nor is
there any distinction made between private, public, or federal lands. Further, not only does the
definition of “person” under the act include “an individual,” it also includes “an instrumentality
or agency of this state, the federal government, an instrumentality or agency of the federal
government, or other legal entity.” MCL 324.30301(i). This broad definition evidences the
intent for the WPA to apply to any land under the authority of the executive department, which
would be any land in Michigan, whether it is federal, state, public, or private land.
Under the Michigan Constitution, no law “impairing the obligation of contract shall be
enacted,” Const 1963, art 1, § 10, while the federal constitution prohibits any state from passing
any “Law impairing the Obligation of Contracts . . . ,” US Const, art I, § 10. The Contract
Clause protects “bargains reached by parties by prohibiting states from enacting laws that
interfere with preexisting contractual arrangements.” Health Care Ass’n Workers Compensation
Fund v Dir of the Bureau of Worker’s Compensation, 265 Mich. App. 236, 240; 694 NW2d 761
(2005). However, the clause is not absolute, but “must be accommodated to the inherent police
power of the State to safeguard the vital interests of its people.” Energy Reserves Group, Inc v
Kansas Power & Light Co, 459 U.S. 400, 410; 103 S. Ct. 697; 74 L. Ed. 2d 569 (1983). “[S]tate
regulation that restricts a party to gains it reasonably expected from the contract does not
necessarily constitute a substantial impairment.” Id. at 411.
In analyzing a Contract Clause issue, this court utilizes a three-pronged test.
The first prong considers whether the state law has operated as a substantial
impairment of a contractual relationship. The second prong requires that
legislative disruption of contractual expectancies be necessary to the public good.
The third prong requires that the means chosen by the Legislature to address the
public need be reasonable. In other words, if the impairment of a contract is only
minimal, there is no unconstitutional impairment of contract. However, if the
legislative impairment of a contract is severe, then to be upheld it must be
affirmatively shown that (1) there is a significant and legitimate public purpose
for the regulation and (2) that the means adopted to implement the legislation are
reasonably related to the public purpose. [Health Care Ass’n, 265 Mich. App. at
241 (citations omitted).]
Plaintiffs Groninger fail to satisfy this test. Foremost, any impairment by the WPA is
minimal. Plaintiffs Groninger hold their land in fee simple and the permit requirement that may
be necessary does not divest plaintiffs of any ownership interest in their land—they still hold title
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against all comers. If a permit were required for filling or other activity related to driveway
construction, plaintiffs Groninger could show a particularized injury sufficient to confer
standing, but the permitting process is not a “substantial impairment” of plaintiffs’ ownership
interest, which is the foundational contractual relationship.
Further, even if the impairment were severe, the WPA embodies a significant and
legitimate public purpose and permitting is reasonably related to that purpose. MCL
324.30302(1); K & K Const, Inc v Dept of Environmental Quality, 267 Mich. App. 523, 529-530,
553; 705 NW2d 365 (2005). Additionally, plaintiffs Groninger have not shown any reduction in
the value of their property because defendant may enter the land to inspect whether it is wetland
nor have they shown that any failure to issue a permit would reduce the value of their property.
Even if they did, “[a] reduction in the value of the regulated property is insufficient, standing
alone, to establish a compensable regulatory taking.” K & K Const, Inc, 267 Mich. App. at 553,
citing Penn Central Transp Co v City of New York, 438 U.S. 104, 131; 98 S. Ct. 2646; 57 L. Ed. 2d
631 (1978).
Plaintiffs respond that the entire NREPA is “a contiguous act” and does not have
“severable units” such that other areas of the act that differentiate between patented and
unpatented land apply to the WPA and thus remove the patented land from the jurisdiction of
defendant. Plaintiffs misconstrue the nature of the act. The overarching statutory scheme under
NREPA was put in place by 1994 PA 451, which references part 303 as wetlands protection, but
does not enact any provisions. See 1994 PA 451, Article III. NREPA was amended by 1995 PA
59 to add the provisions of the WPA. 1995 PA 59. The various enactments of the statutory parts
illustrates a legislative intent that the different parts are distinguishable from one another.
Further, although NREPA generally defines the “department” as the Department of
Natural Resources (DNR), MCL 324.301(b), control over implementation of the WPA was
transferred in 1995 to the DEQ by Executive Reorganization Order No. 1995-16 (codified at
MCL 324.99903). This authority was transferred out of the DEQ by Executive Order No. 2009-
452 in art IV, § (A)(1)(aa). Subsequently Executive Order No. 2011-13 abolished that
organizational structure and restored the DEQ with authority to administer the WPA. EO 2001-
1, art IV, § (C)(1)(aa). That various parts of NREPA were passed as separate statutes illustrates
that it functions as an umbrella statute for several distinct parts. The executive implementation
of the act by different bodies, namely the DNR and defendant reinforces this conclusion. Thus,
plaintiff’s reliance on part 325 is misplaced, because that part does not implement, limit, or affect
defendant’s authority under the WPA.
Plaintiffs also argue that the proper enforcing authority is the DNR, not defendant, and
that the power of the department is limited to land under the public domain. MCL 324.503(2).
However, as noted above, authority under the WPA rests with defendant. Executive Order Nos.
2
Also cited as Executive Reorganization Order No. 2009-31, and codified at MCL 324.99919.
3
Also cited as Executive Reorganization Order No. 2011-1, and codified at MCL 324.99921.
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1995-184; 2011-1. Further, even if the statute cited applied, it only provides the general powers
and duties of the department. It does not state that those are the only powers of the department.
This is especially relevant given that the WPA empowers defendant in several other ways,
including a permitting scheme, MCL 324.30312, and allowing entry onto private premises, MCL
324.30314(2). Also, as noted, the WPA defines wetlands in reference to any land the meets the
qualifications, without limit to its status as patented land or unpatented land. MCL
324.30301(m).
Plaintiffs next argue that the subject property was severed from the public domain and
public trust. Although Michigan has an interest in property in the public domain or held under
public trust, those doctrines are irrelevant. The state statute at issue does not depend upon the
public trust or the public domain for its authority. Rather, it extends to all land subject to the
general police powers of the State of Michigan. Const 1963, art IV, § 52; MCL 324.30301(m).
The WPA is a proper exercise of the police power and is explicitly recognized by Michigan’s
Constitution. Plaintiffs also argue that the proper enforcing authority is the DNR, not defendant,
and that the power of the department is limited to land under the public domain. MCL
324.503(2). However, as noted above, enforcement of the WPA rests with defendant, which is
not limited to land in the public domain. See MCL 324.30301(m).
Plaintiffs make a number of other arguments, which fail principally because defendant is
a state regulator empowered by a state statute. Plaintiffs argue that the Clean Water Act, 33 USC
1251 et seq., does not apply to the subject property, but whether it applies is irrelevant because
defendant has authority under state law, MCL 324.30314(2), and need not look to federal
authority. Additionally, the scope of congressional authority under the federal constitution is
irrelevant because defendant relies on state law. Plaintiffs additionally argue that defendant is
foreclosed from acting by the equal footing doctrine, but that doctrine only applies to land
patented to a state, not land patented to a private individual. United States v Alaska, 521 U.S. 1,
34-36; 117 S. Ct. 1888; 138 L. Ed. 2d 231 (1997); United States v Texas, 339 U.S. 707, 716-717; 70
S. Ct. 918; 94 L. Ed. 1221 (1950). Finally, plaintiffs cite the Northwest Ordinance of 1787 but do
not show how it is applicable to the matter at hand or why the Michigan Constitution of 1963 did
not supersede it. See Malcolm v City of East Detroit, 437 Mich. 132, 139; 468 NW2d 479
(1991); Parise v Detroit Entertainment, 295 Mich. App. 25, 28; 811 NW2d 98 (2011) (“[A] more
recently enacted law has precedence over the older statute.”).
In sum, plaintiffs many arguments do not create a legal claim on which relief can be
granted and the trial court properly granted summary disposition in favor of defendant under
MCR 2.116(C)(8) and (C)(10).
Affirmed.
/s/ Douglas B. Shapiro
/s/ Elizabeth L. Gleicher
/s/ Amy Ronayne Krause
4
Also cited as Executive Reorganization Order No. 1995-16 and codified at MCL 324.99903.
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