Rosewood Village Phase II LLC v. Pittsfield Charter Township

If this opinion indicates that it is “FOR PUBLICATION,” it is subject to
revision until final publication in the Michigan Appeals Reports.
STATE OF MICHIGAN
COURT OF APPEALS
ROSEWOOD VILLAGE PHASE II, LLC, UNPUBLISHED
March 2, 2023
Plaintiff-Appellant,
v No. 360354
Washtenaw Circuit Court
PITTSFIELD CHARTER TOWNSHIP, LC No. 20-000915-NZ
Defendant-Appellee.
Before: JANSEN, P.J., and REDFORD and YATES, JJ.
PER CURIAM.
Plaintiff, Rosewood Village Phase II, LLC, appeals as of right three separate orders of the
trial court in this zoning ordinance dispute: (1) the order granting defendant, Pittsfield Charter
Township’s, motion in limine to preclude plaintiff from pursuing damages; (2) the order denying
plaintiff’s motion to compel discovery; and (3) the order granting defendant’s motion for summary
disposition. We affirm.
I. FACTUAL BACKGROUND
In December 2002, Rock Rosewood Construction, LLC and Rosewood Village, LLC
(collectively, “the developer”) began developing condominiums in Pittsfield Township. The
project would include 336 residential units built in two phases—180 units built in the first phase,
and 156 in the second. The master deed provided that the developer was not required to expand
the project beyond the first phase, and could “establish all or a portion of the future development
area as a separate project (or projects) as any other form of development.”
In 2007, with the downturn in the economy, the developer determined that the ability to
sell the additional condos in phase II was untenable, so it decided to build phase II as apartments
instead. Thus, the developer, through plaintiff, its affiliate, constructed the apartments in a manner
identical to the condos. Also in 2007, plaintiff and Rosewood Village Co-owners Association
entered into an easement agreement providing for a perpetual easement for use of an area on Platt
Road “for the purpose of constructing, maintaining, and replacing signage identifying the
development to be located on the Development parcel.” The phase II apartments were in the back
-1-
of the complex behind the condos; thus, plaintiff placed a “for-rent” sign in the sign easement area
at the entrance to the complex on Platt Road.
In 2018, plaintiff was issued several municipal civil infraction notices of violation by
Pittsfield Township Zoning Administrator, Belinda Kingsley, requiring plaintiff to remove its sign.
Plaintiff contacted Benjamin Carlisle, the Township Planner, who ultimately informed plaintiff
that because the two projects were now under separate ownership and operated by two different
entities, plaintiff could not maintain the sign on land it did not own regardless of the easement,
citing the township zoning ordinance.
II. PROCEDURAL HISTORY
Plaintiff filed suit alleging seven counts. In Count I, plaintiff alleged misapplication of the
sign regulations that limited signs to business conducted on the premises. In Count II, plaintiff
argued that defendant should be estopped from interpreting the sign regulations to preclude
plaintiff from exercising its rights under the easement agreement to erect its sign. In Count III,
plaintiff alleged that defendant’s interpretation of the sign regulation was a violation of Const
1963, art 1, § 5, freedom of speech, because the regulations were content-based restrictions which
unconstitutionally discriminated between categories of commercial speech based on the customer
and the content. In Count IV, plaintiff alleged an equal protection claim under Const 1963, art 1,
§ 2, because defendant’s refusal to allow plaintiff to market the apartments had the effect of
unreasonably favoring homeowners, primarily Caucasian, over apartment dwellers, predominantly
African American. In Count V, plaintiff alleged a violation of the Elliott-Larsen Civil Rights Act
(ELCRA), MCL 37.2101 et seq., because the regulations had the effect of discriminating in the
terms, conditions, or privileges of a real estate transaction, MCL 37.2502(1), and by creating a
restriction that indirectly limits the use or occupancy of apartments on the basis of race, MCL
37.2505. In Count VI, plaintiff alleged that defendant’s interpretation of the sign regulation
constituted an unconstitutional taking of plaintiff’s property under Const 1963, art 10, § 2. Lastly,
in Count VII, plaintiff alleged that the sign regulations deprived plaintiff and other similarly
situated persons of their right to due process under Const 1963, art 1, § 17.
Plaintiff moved to compel discovery, seeking all notices of violation of the township sign
ordinances that defendant issued dating back to 2007, and documentation from a search of
defendant’s “BS&A” system.1 Defendant responded, asserting that the requests were overly broad,
disproportional, and unduly burdensome. Then defendant filed a motion in limine to preclude
plaintiff from pursuing damages because the complaint only sought equitable relief, and plaintiff
abused the discovery process. Plaintiff asserted that the complaint also sought legal relief, and
denied the allegations of gamesmanship during discovery. The court denied plaintiff’s motion to
compel, weighing the request against proportionality, and granted defendant’s motion in limine,
stating that plaintiff’s claim for $1.5 million in damages was not pleaded with specificity.
Defendant then moved for summary disposition, arguing that Counts I, II, III, IV, and VII
were rendered moot by the enactment of amended township sign regulations, that plaintiff’s equal
1
“BS&A” was an acronym for the software used by the township code enforcement officer to
track complaints.
-2-
protection claim failed to allege intentional discrimination, that plaintiff’s ELCRA claim was
frivolous because the cited section only applied to real estate transactions, and that plaintiff’s
takings claim was not ripe for adjudication because plaintiff did not appeal to the Zoning Board of
Appeals (ZBA) as provided by the sign ordinance. The trial court generally agreed with
defendant’s arguments, and dismissed plaintiff’s complaint in its entirety.
III. SUMMARY DISPOSITION
We address plaintiff’s arguments regarding summary disposition first for the most efficient
disposition of this appeal. Defendant moved for summary disposition under MCR 2.116(C)(4),
(8), and (10). A trial court’s grant or denial of summary disposition is reviewed de novo. Braun
v Ann Arbor Charter Twp, 262 Mich App 154, 157; 683 NW2d 755 (2004). Summary disposition
is appropriate under MCR 2.116(C)(4) when “[t]he court lacks jurisdiction of the subject matter.”
Summary disposition is appropriate under MCR 2.116(C)(8) when a party fails to state a
claim upon which relief can be granted. A motion under this subrule tests the legal sufficiency of
a complaint. Beaudrie v Henderson, 465 Mich 124, 129; 631 NW2d 308 (2001). The trial court
may only consider the pleadings in deciding a motion under MCR 2.116(C)(8). Id. The trial court
must accept as true all of the factual allegations in the complaint. Dolan v Continental
Airlines/Continental Express, 454 Mich 373, 380-381; 563 NW2d 23 (1997). “The motion should
be granted if no factual development could possibly justify recovery.” Beaudrie, 465 Mich at 130.
Summary disposition is proper under MCR 2.116(C)(10) when “there is no genuine issue
with respect to any material fact and the moving party is entitled to judgment as a matter of law.”
Dextrom v Wexford Co, 287 Mich App 406, 415; 789 NW2d 211 (2010). The Court “must examine
the documentary evidence presented and, drawing all reasonable inferences in favor of the
nonmoving party, determine whether a genuine issue of material fact exists. A question of fact
exists when reasonable minds could differ as to the conclusions to be drawn from the evidence.”
Id. at 415-416.
A. MOOTNESS
Plaintiff argues that the trial court erred in dismissing the following counts as moot because
they pertained to the old version of the township sign regulations: Count I (misapplication of the
old ordinance); Count II (declaratory relief (equitable estoppel)); Count III (freedom of speech);
Count IV (equal protection); and Count VII (due process). To determine which version of a zoning
ordinance should apply, “the general rule is that the law to be applied is that which was in effect
at the time of decision.” Landon Holdings, Inc v Grattan Twp, 257 Mich App 154, 161; 667 NW2d
93 (2003) (quotation marks and citations omitted). An exception to this rule exists when “the
amendment was enacted in bad faith and with unjustified delay.” Id. (quotation marks and citations
omitted). “[T]he test to determine bad faith is whether the amendment was enacted for the purpose
of manufacturing a defense to plaintiff’s suit.” Id. (quotation marks and citation omitted).
The “old ordinance” of the township zoning ordinance was adopted in 2015, with
amendments made in 2017. In 2021, defendant amended the ordinance to comply with Reed v
Town of Gilbert, Ariz, 576 US 155; 135 S Ct 2218; 192 L Ed 2d 236 (2015), to be content neutral
and so not in violation of the First Amendment. Thus, according to the general rule, Landon
-3-
Holdings, Inc, 257 Mich App at 161, the amended version of the statute would apply because it
was in effect at the time of the trial court’s decision on defendant’s motion for summary
disposition.
Plaintiff argues, however, that at a minimum, a question of fact exists regarding whether
the amendments were suit-defensive. Section 15 of the old ordinance limited advertisement signs
to the premises they were intended to serve. On February 9, 2021, Carlisle drafted a letter to
defendant, advising amendment of the sign regulations to make them “content neutral,” as required
under Reed. The letter states that this was an opportunity to “clean up the ordinance to strengthen
the code and eliminate other sign code issues that have been identified,” and that one amendment
was “[a]dded ‘content-neutral’ temporary sign regulations.” Nowhere in the letter is this litigation
mentioned. When the ordinance was amended, the purpose of the sign regulations was still to
minimize the “harmful effects on the public health, safety, and welfare,” but no longer contained
the language “protecting the character of the various neighborhoods in Pittsfield Township.”
However, Section 40-15.12(3) of the amended regulations, regulating temporary signs, still
provided, “Unless otherwise specified, all temporary signs shall be located on the premises they
are intended to serve.” Although amended six years after Reed was issued, it is clear that the intent
of the amendment was to comply with Reed and ensure that the zoning ordinance was content
neutral. Thus, plaintiff has not established that a genuine issue of material fact exists whether the
ordinance amendment was suit-defensive.
In granting defendant’s motion for summary disposition, the trial court agreed with
defendant that the issues in Counts I, II, III, IV, and VII were moot because “the old ordinance is
not the subject matter of this litigation[.]” The applicability of a legal doctrine, such as mootness,
is a question of law reviewed de novo. TM v MZ, 501 Mich 312, 315; 916 NW2d 473 (2018). As
a general rule, courts will not entertain moot issues or decide moot cases. Id. at 317. “A moot
case presents nothing but abstract questions of law which do not rest upon existing facts or rights.
It involves a case in which a judgment cannot have any practical legal effect upon a then existing
controversy.” Id. (quotation marks and citations omitted). In other words, “[a]n issue is moot if
an event has occurred that renders it impossible for the court to grant relief.” Attorney General v
Public Serv Comm, 269 Mich App 473, 485; 713 NW2d 290 (2005).
Given the conclusion in Issue I to affirm the trial court’s grant of defendant’s motion in
limine to preclude plaintiff from seeking damages, the only relief plaintiff seeks is declaratory and
injunctive. However, because Counts I, II, III, IV, and VII relate to the old ordinance, and plaintiff
never amended the complaint, the issues in these counts are rendered moot because it is impossible
for the court to grant declaratory or injunctive relief in regards to the old statute. Thus, the
amendment rendered it impossible for the court to grant the only relief left available. Accordingly,
the trial court properly granted defendant summary disposition of Counts I, II, III, IV, and VII of
plaintiff’s complaint because they are moot.2
2
Plaintiff argues that these counts are not moot because defendant rejected its most recent
application to put up its sign. Plaintiff alleges that it submitted a new application for signage after
the regulation amendments in August 2021. Plaintiff asserts that after the trial court granted
-4-
B. EQUAL PROTECTION
Although Count IV, plaintiff’s equal protection claim, was properly dismissed as moot as
concluded in the previous discussion, we write further to affirm the dismissal of this
nonmeritorious claim. A trial court’s decision whether a statute violates equal protection is
reviewed de novo. In re Eggleston Estate, 266 Mich App 105, 115; 698 NW2d 892 (2005).
“All statutes and ordinances are presumed to be constitutional and are construed so unless
their unconstitutionality is clearly apparent.” Houdek v Centerville Twp, 276 Mich App 568, 573;
741 NW2d 587 (2007). Plaintiff alleged an equal protection of the law claim under the Michigan
Constitution only, Const 1963, art 1, § 2. The purpose of the equal protection clause is to secure
every person against intentional and arbitrary discrimination, whether occasioned by express terms
of a statute or by its improper execution. Village of Willowbrook v Olech, 528 US 562, 564; 120
S Ct 1073; 145 L Ed 2d 1060 (2000). The equal protection guarantee requires that persons under
similar circumstances be treated alike. Shepherd Montessori Ctr Milan v Ann Arbor Charter Twp,
486 Mich 311, 318; 783 NW2d 695 (2010). “When an ordinance is challenged on the basis of
equal protection guarantees, the ordinance is presumed constitutional, and the challenging party
has the burden to show that the established classification is not rationally related to a legitimate
state interest.” Houdek, 276 Mich App at 585. “Where the proponent of an equal protection
argument is not a member of a protected class, or does not allege violation of a fundamental right,
the equal protection claim is reviewed using the rational basis test.” Id. A rational basis for
legislation exists when any set of facts is known or can be reasonably assumed to justify the
discrimination. In re Eggleston Estate, 266 Mich App at 115.
In Count IV of the complaint, plaintiff alleged that “upon information and belief,”
defendant’s refusal to allow plaintiff to erect the sign represented an effort by defendant “to
maintain racial homogeny,” and that the sign regulations as applied to plaintiff and “other persons
similarly situated not before the court” deny plaintiff equal protection because they have the effect
of unreasonably favoring Caucasian property owners over African American apartment dwellers.
All of plaintiff’s principals are Caucasian. Plaintiff alleged that the sign regulations were arbitrary
and unreasonable, and without substantial relation to the public health, safety, morals, or general
welfare of the community, and that defendant could offer no compelling interest to justify the
discrimination. Plaintiff argues on appeal that the evidence is sufficient to support its equal
protection claim. We disagree.
Jeff Cohen, plaintiff’s principal, testified that plaintiff had its sign up until 2018, which
coincided with the timing that the condo association became under new management. Then the
township started issuing plaintiff citations. Cohen testified that he had conversations with
defendant’s motion for summary disposition, defendant denied plaintiff’s sign application because
the sign exceeded the regulation height requirements. As this occurred after the trial court entered
its order granting summary disposition, the “sign permit denial” attached as an exhibit to plaintiff’s
brief on appeal was not part of the lower court record, and therefore not properly before this Court.
See Sherman v Sea Ray Boats, Inc, 251 Mich App 41, 56; 649 NW2d 783 (2002). Regardless,
plaintiff’s most recent sign application, filed after plaintiff initiated this lawsuit, is irrelevant to the
issues on appeal.
-5-
association members and they referred to the apartment tenants as “those people,” and wanted
apartment tenants to have a separate entrance to the community facilities. He thought it was a “fair
assumption” that defendant and the association were “in lockstep” to ensure the apartment
development did not succeed. Steve Rosenthal, president of Rock Companies, also testified that
after the new condo association management took over, the members wanted a separate door for
the apartment tenants, and believed defendant and the association had “an understanding” or
“collusion.” Kingsley first testified that she remembered receiving complaints from condo
residents by telephone, but then said she did not recall receiving any and could not recall how
many. This evidence fails to establish any intentional or arbitrary discrimination by defendant
against plaintiff.
Plaintiff also argues that it did present evidence of a similarly situated comparator that was
treated differently. Carlisle testified that he was not aware of any other signs within the township
for residential developments where the sign was placed on property not owned by the party placing
the sign. He was not aware of any citations issued for putting up a sign on property not owned by
the person or entity placing the sign. At his deposition, he was shown a picture of a sign similar
to plaintiff’s at the intersection of Rolling Meadow Lane and Platt Road for Arbor Farms, a
different housing development, only 300 yards away from where plaintiff’s sign was removed on
Platt Road. He did not know how long the sign was up, if it had received any permits, or if it was
permitted under the sign regulations. This evidence also does not establish a genuine issue of
material fact that a similarly situated comparator was treated differently than plaintiff. Therefore,
the trial court properly granted defendant summary disposition of plaintiff’s equal protection
claim.
C. ELCRA CLAIM
Plaintiff cited MCL 37.2502(1) and MCL 37.2505(1) in its complaint for its ELCRA claim.
MCL 37.2502(1) prohibits discrimination on the basis of religion, race, color, national origin, age,
sex, familial status, or marital status by a “person engaging in a real estate transaction.” In
dismissing this claim, the trial court concluded that the statute involves a real estate transaction,
which does not fit the facts of this case, and the ELCRA was not “intended to protect developers
who are not of a minority in their marketing strategy.” Indeed, Rosenthal testified that defendant
was not involved in the sale or purchase of the condos, or the renting of the apartments. Plaintiff
concedes on appeal that MCL 37.2502(1) only applies to real estate transactions. Therefore, the
trial court properly dismissed this claim.
Rather, plaintiff relies on MCL 37.2505(1) to support its ELCRA claim, arguing on appeal
that this section is not limited to real estate transactions. This statute provides, in relevant part:
A condition, restriction, or prohibition, including a right of entry or
possibility of reverter, that directly or indirectly limits the use or occupancy of real
property on the basis of religion, race, color, national origin, age, sex, familial
status, or marital status is void, . . . .
Plaintiff makes a cursory argument on appeal that “[t]he township’s interpretation, which was
adopted by the Trial Court without explanation, suggests that an ordinance such as the one at issue
-6-
in the instant case could never be challenged as violative of the ELCRA because it would not
directly involve a real estate transaction. That is simply not the case.”
Plaintiff’s argument misstates the record. The trial court clearly relied on MCL 37.2502
rather than MCL 37.2505 because it stated that the specific statute only applied to real estate
transactions. Thus, plaintiff’s argument that the trial court’s decision suggests that such an
ordinance could never be challenged under the ELCRA unless it involves a real estate transaction
misinterprets the record and trial court decision. It does not appear that the trial court considered
MCL 37.2505 in its analysis. Nonetheless, plaintiff bears the burden of proving that defendant
acted with illegal discriminatory animus and that the discriminatory animus was causally related
to defendant’s action. Harrison v Olde Fin Corp, 225 Mich App 601, 612-613; 572 NW2d 679(1997). “Direct evidence” of discrimination is “evidence which, if believed, requires the
conclusion that unlawful discrimination was at least a motivating factor[.]” Hazle v Ford Motor
Co, 464 Mich 456, 462; 628 NW2d 515 (2001) (quotation marks and citation omitted). Here,
plaintiff has failed to show that defendant imposed a condition, restriction, or prohibition that
limits the use of the apartments on the basis of race based on plaintiff not being able to post its
sign on the condo’s property. MCL 37.2505. Thus, the trial court properly granted defendant
summary disposition of this claim. Kyocera Corp v Hemlock Semiconductor, LLC, 313 Mich App
437, 449; 886 NW2d 445 (2015) (“We will affirm a trial court’s decision on a motion for summary
disposition if it reached the correct result, even if our reasoning differs.”).
D. TAKINGS CLAIM
Plaintiff argues that the trial court erred in finding that its takings claim was not ripe for
review, thereby dismissing that claim, because plaintiff failed to exhaust its administrative
remedies. Plaintiff asserts that it was not required to appeal to the ZBA because plaintiff is not
challenging the citations issued by the Zoning Administrator, Kingsley, but rather, plaintiff is
challenging Carlisle’s decision to preclude plaintiff from placing its sign, and the ZBA does not
have authority over Carlisle’s decisions as the Township Planner. We disagree.
Section 17.03 of the old ordinance provided that the ZBA “shall hear and decide appeals
where there is an error alleged in any order, requirement, decision, or determination made by the
Zoning Administrator in the enforcement of this ordinance.” It also provided that “[a] party
aggrieved by the decision [of the ZBA] shall have the right to appeal to the circuit court on
questions of law and fact.” The old ordinance defined “zoning administrator” as “the official of
the Township of Pittsfield charged with the administration of this Ordinance.” There is no dispute
that Kingsley was the Zoning Administrator who issued the municipal civil infraction notices to
plaintiff. The amended zoning ordinance in Article XVII, Section 40-17.08, also provides for an
appeal to the ZBA.
As stated above, summary disposition is proper under MCR 2.116(C)(4) when “[t]he court
lacks jurisdiction of the subject matter.” When a plaintiff fails to exhaust its administrative
remedies, summary disposition for lack of jurisdiction under MCR 2.116(C)(4) is proper. Braun,
262 Mich App at 157. The trial court did not err in determining that plaintiff’s taking claim was
not ripe for review. The zoning ordinance, both the old and new version, require an appeal to the
ZBA. Although plaintiff claims it is appealing the decision of Carlisle rather than the citations
issued by Kingsley, the Zoning Administrator, this differentiation is irrelevant. Kingsley issued
-7-
the citations, and when plaintiff reached out to defendant for further information, Carlisle provided
the informational letter. It would be improper to allow plaintiff to bypass the appeal procedure
simply because plaintiff received this informational letter from Carlisle, which gave further
information as to the basis of the citations as to why plaintiff could not maintain its sign. Thus,
the trial court did not err in determining that plaintiff’s takings claim was not ripe for review, and
summary disposition was proper under MCR 2.116(C)(4).
IV. DAMAGES AND DISCOVERY
Lastly, plaintiff argues that the trial court abused its discretion in granting defendant’s
motion in limine to preclude plaintiff from pursuing damages and denying plaintiff’s motion to
compel discovery because the requested documents would have assisted in establishing plaintiff’s
claim that defendant applied the sign regulations differently to plaintiff than to similarly situated
property owners. Plaintiff’s claims regarding these two issues are moot in light of our decision to
affirm the trial court order granting defendant’s motion for summary disposition, see Attorney
General, 269 Mich App at 485, and need not be addressed.
Affirmed. Defendant, having prevailed in full, may tax costs under MCR 7.219(F).
/s/ Kathleen Jansen
/s/ James Robert Redford
/s/ Christopher P. Yates
-8-