author: Beasley, J.

text:
    WOLL v ATTORNEY GENERAL
    1. Constitutional Law — Criminal Law — Statutes—Regulation or Commercial Speech — Case in Controversy — Constitutionally Protected Rights.
    The standard to be used in a review of the constitutionality of a criminal statute prohibiting certain forms of commercial speech and conduct is whether the statute, as applied to the case in controversy, infringes on constitutionally protected rights.
    2. Constitutional Law — Criminal Law — Statutes—Solicitation of Personal Injury Claims — Facial Overbreadth — Limiting Construction — Protected Conduct.
    The criminal statute which prohibits the solicitation of personal injury claims is not a proper subject for facial overbreadth analysis; facial overbreadth should not be invoked when a limiting construction has been or could be placed on the challenged statute, and equally important, overbreadth claims, if entertained at all, should be curtailed when invoked against ordinary criminal laws that are sought to be applied to protected conduct.
    3. Constitutional Law — Criminal Law — Statutes—Solicitation of Personal Injury Claims — Ambulance Chasing — Group Legal Services — First Amendment.
    A criminal statute which prohibits the solicitation of personal injury claims was not applied in violation of an attorney’s constitutionally protected First Amendment rights where the attorney’s conduct constituted hard-core ambulance chasing; however, the anti-solicitation statute could not be lawfully applied to the kinds of group legal services that enjoy First Amendment protection under United States Supreme Court case precedent (MCLA 750.410; MSA 28.642).

      References for Points in Headnotes
    [1, 3] 16 Am Jur 2d, Constitutional Law §§ 341, 342, 345-347.
    The Supreme Court and the right of free speech and press. 2 L Ed 2d 1706, 16 L Ed 2d 1053.
    [2-4] 7 Am Jur 2d, Attorneys at Law §§ 40-42.
    73 Am Jur 2d, Statutes §§ 155-160, 346.
    "Ambulance chasing” or similar solicitation of personal injury cases as ground for disbarment, suspension, or other disciplinary action. 67 ALR2d 859.
    Indefiniteness of language as aifecting validity of criminal legislation or judicial definition of common-law crime — Supreme Court cases. 16 L Ed 2d 1231.

      4. Constitutional Law — Criminal Law — Statutes—Solicitation of Personal Injury Claims — Classification—Property Damages Claims — Ambulance Chasing — Pain and Suffering.
    The failure of the criminal statute which prohibits the solicitation of personal injury claims to include property damage claims is neither irrational nor an arbitrary classification and is an inadequate basis for a finding of an unconstitutional denial of due process because the possibility of big verdicts which is what gives rise to ambulance chasing is directed primarily to jury assessment of pain and suffering in personal injury situations and property damage claims are not significantly involved in the evil to which the statute is directed (MCLA 750.410; MSA 28.642).
    Appeal from Wayne, Horace W. Gilmore, J.
    Submitted October 4, 1977, at Detroit.
    (Docket Nos. 29914, 30051.)
    Decided January 23, 1978.
    Complaint by Arthur S. Woll against Frank J. Kelley, Attorney General of the State of Michigan, and William L. Cahalan, Prosecuting Attorney for the County of Wayne for a declaratory judgment that the Michigan statute prohibiting solicitation of personal injury claims is unconstitutional, and for an injunction restraining defendants and their employees from attempting to enforce the statute. Judgment for plaintiff. Defendants appeal.
    Reversed.

      Ivan E. Barris and Michael H. Golob, for plaintiff.

      Frank J. Kelley, Attorney General, Robert A. Derengoski, Solicitor General, and Thomas L. Casey, Assistant Attorney General, for defendant Kelley.

      William L. Cahalan, Prosecuting Attorney, Theodore Stephens, Deputy Chief, Civil Department, and Rheo C. Marchand, Assistant Prosecuting Attorney, for defendant Cahalan.
    Before: D. F. Walsh, P. J. and V. J. Brennan and Beasley, JJ.
   Beasley, J.

On April 1, 1976, plaintiff commenced an action for a declaratory judgment that the Michigan statute prohibiting solicitation of personal injury claims was unconstitutional. He claimed that since he and his law firm represent persons suffering injury by accident, including workmen’s compensation claims, an actual controversy existed between himself and defendants by reason of a grand jury investigation then in progress.

Defendants filed an answer and motion for accelerated and/or summary judgment, claiming that there was no "actual controversy”. However, this motion was rendered moot when, on April 29, 1976, plaintiff was indicted by a Wayne County Citizens Grand Jury in an indictment charging him and others with, among other things, conspiracy to solicit personal injury claims and solicitation of personal injury claims in violation of the above mentioned anti-solicitation statute.

Plaintiff then moved for summary judgment based on the allegation that no genuine issue of fact existed; this change in the form of the action was deemed appropriate in light of the entry of the indictment. The trial court ruled on the motion in an opinion determining that the anti-solicitation statute is unconstitutional on the grounds that it is overbroad and denies equal protection of the law. Defendants appeal as of right from the order entered in accordance with the opinion.

In his carefully prepared opinion, the trial judge concluded that the anti-solicitation statute was not inherently and impermissibly vague. We agree. While the outer boundaries of the anti-solicitation statute may be imprecise, there is no ambiguity concerning the proscribed hardrcore ambulance chasing with which plaintiff lawyers are charged. The statute affords adequate notice to lawyers, such as these plaintiffs, of what is prohibited.

The court then considered whether the statute, on its face, was so overbroad as to be an unconstitutional infringement upon First Amendment rights. The court held that the statute was unconstitutionally overbroad, that the possibility of a narrowing construction was limited, and that, based upon Virginia State Board of Pharmacy v Virginia Citizens Consumer Council, the commercial nature of the regulated activity did not change the applicable measure of constitutional protection.

For purposes of this opinion, the controlling question is whether the trial court applied the correct constitutional standard to the challenged criminal statute. We hold that the trial court erred when it held that the statute was unconstitutional under the standard of so-called "facial overbreadth”. We further hold that, in the context of review of a criminal statute prohibiting certain forms of commercial speech and conduct, the standard to be used is whether the statute, as applied in the case in controversy, infringes on constitutionally. protected rights.

Helpful perspective on the present issue is gained by a review of prior cases. In 1927, in Kelley v Judge of Recorder’s Court of Detroit, the Michigan Supreme Court found no problem in adjudicating the statute constitutional. That Court defined ambulance chasing in disparaging terms. In Hightower v Detroit Edison Co, the Supreme Court dealt at greater length with the evils of ambulance chasing, in denying attorney fees to an attorney who had been hired by a lay solicitor of personal injury claims.

In 1947, the anti-solicitation statute was amended to include organizations of any kind. The amendment did not alter the rulings in the two cited Michigan cases.

The anti-solicitation statute was involved in the long, drawn out litigation in United Transportation Union v State Bar of Michigan. Defendant, State Bar, had obtained an injunction in 1962 enjoining the union from, among other things, furnishing legal advice regarding potential claims, giving to selected attorneys the names and addresses of potential claimants, and advising members that a recommended lawyer will defray costs on the ground that these acts violate the Michigan anti-solicitation statute. After the decision in the Virginia case, the Michigan Supreme Court had, accordingly, remanded for modification of the injunction. Then the Michigan Supreme Court had heard further appeal. In none of these decisions did the constitutionality of the anti-solicitation statute come squarely in issue. Rather, the U. S. Supreme Court held that the particular acts of the union were entitled to First Amendment protection. The thrust was not to strike down the statute as unconstitutional. However, the Supreme Court decision made it unmistakably clear that with respect to the conduct described in the injunction, the anti-solicitation statute would be (or was) unenforceable and unconstitutional.

The trial judge, in reliance upon the preceding cases, stated:

"It is therefore clear that in the context of group legal practice, state regulations and statutes against solicitation must fall in the face of the First Amendment.”

Of Course, we are not here dealing with group legal services in the context of the cited Federal cases. Rather, we have a charge of ambulance chasing as defined in the Michigan cases. As a matter of fact, in Brotherhood of Railroad Trainmen v Virginia, Justice Hugo Black expressly distinguished ambulance chasing in the following language:

"Here what Virginia has sought to halt is not a commercialization of the legal profession which might threaten the moral and ethical fabric of the administration of justice. It is not 'ambulance chasing’. The railroad workers, by recommending competent lawyers to each other, obviously are not themselves engaging in the practice of law, nor are they or the lawyers whom they select parties to any soliciting of business.”

Under traditional procedure, the issue in this case would be, is the conduct here charged against plaintiff lawyers in the criminal information, constitutionally protected speech under the First Amendment to the U. S. Constitution? In Broa drick v Oklahoma, the U. S. Supreme Court, with Justice White writing, has articulated in clear, straight forward words, the very few classes of cases where the constitutionality of a statute may be reviewed on the ground of facial overbreadth:

"Embedded in the traditional rules governing constitutional adjudication is the principle that a person to whom a statute may constitutionally be applied will not be heard to challenge that statute on the ground that it may conceivably be applied unconstitutionally to others, in other situations not before the Court. * * * A closely related principle is that constitutional rights are personal and may not be asserted vicariously. * * * These principles rest on more than the fussiness of judges. They reflect the conviction that under our constitutional system courts are not roving commissions assigned to pass judgment on the validity of the Nation’s laws. * * * Constitutional judgments, as Mr. Chief Justice Marshall recognized, are justified only out of the necessity of adjudicating rights in particular cases between the litigants brought before the Court:
"In the past, the Court has recognized some limited exceptions to these principles, but only because of the most 'weighty countervailing policies’. * * * Another exception has been carved out in the area of the First Amendment.
"It has long been recognized that the First Amendment needs breathing space and that statutes attempting to restrict or burden the exercise of First Amendment rights must be narrowly drawn and represent a considered legislative judgment that a particular mode of expression has to give way to other compelling needs of society. * * * As a corollary, the Court has altered its traditional rules of standing to permit — in the First Amendment área— 'attacks on overly broad statutes with no requirement that the person making the attack demonstrate that his own conduct could not be regulated by a statute drawn with the requisite narrow specificity’. * * * Litigants, therefore, are permitted to challenge a statute not because their own rights of free expression are violated, but because of a judicial prediction or assumption that the statute’s very existence may cause others not before the court to refrain from constitutionally protected speech or expression.
"Such claims of facial overbreadth have been entertained in cases involving statutes which, by their terms, seek to regulate 'only spoken words’. * * * In such cases, it has been the judgment of this Court that the possible harm to society in permitting some unprotected speech to go unpunished is outweighed by the possibility that protected speech of others may be muted and perceived grievances left to fester because of the possible inhibitory effects of overly broad statutes. Over-breadth attacks have also been allowed where the Court thought rights of association were ensnared in statutes which, by their broad sweep, might result in burdening innocent associations. * * * Facial overbreadth claims have also been entertained where statutes, by their terms, purport to regulate the time, place, and manner of expressive or communicative conduct, * * * and where such conduct has required official approval under laws that delegated standardless discretionary power to local functionaries, resulting in virtually unreviewable prior restraints on First Amendment rights.
"The consequence of our departure from traditional rules of standing in the First Amendment area is that any enforcement of a statute thus placed at issue is totally forbidden until and unless a limiting construction or partial invalidation so narrows it as to remove the seeming threat or deterrence to constitutionally protected expression. Application of the overbreadth doctrine in this manner is, manifestly, strong medicine. It has been employed by the Court sparingly and only as a last resort. Facial overbreadth has not been invoked when a limiting construction has been or could be placed on the challenged statute. * * * Equally important, overbreadth claims, if entertained at all, have been curtailed when invoked against ordinary criminal laws that are sought to be applied to protected conduct. * * * The Court did not hold that the offense 'known as breach of the peace’ must fall in toto because it was capable of some unconstitutional applications, and, in fact, the Court seemingly envisioned its continued use against 'a great variety of conduct destroying or menacing public order and tranquility’. * * * Similarly, in reviewing the statutory breach-of-the-peace convictions involved in * * * the Court considered in detail the State’s evidence and in each case concluded that the conduct at issue could not itself be punished under a breach-of-the-peace statute. * * * Additionally, overbreadth scrutiny has generally been somewhat less rigid in the context of statutes regulating conduct in the shadow of the First Amendment, but doing so in a neutral, noncensorial manner.
"It remains a 'matter of no little difficulty’ to determine when a law may properly be held void on its face and when 'such summary action’ is inappropriate. * * * But the plain import of our cases is, at the very least, that facial overbreadth adjudication is an exception to our traditional rules of practice and that its function, a limited one at the outset, attenuates as the otherwise unprotected behavior that it forbids the State to sanction moves from 'pure speech’ towards conduct and that conduct — even if expressive — falls within the scope of otherwise valid criminal laws that reflect legitimate state interests in maintaining comprehensive controls over harmful, constitutionally unprotected conduct. Although such laws, if too broadly worded, may deter protected speech to some unknown extent, there comes a point where that effect — at best a prediction — cannot, with confidence, justify invalidating a statute on its face and so prohibiting a State from enforcing the statute against conduct that is admittedly within its power to proscribe. * * * To put the matter another way, particularly where conduct and not merely speech is involved, we believe that the overbreadth of a statute must not only be real, but substantial as well, judged in relation to the statute’s plainly legitimate sweep. It is our view that § 818 is not substantially overbroad and that whatever overbreadth may exist should be cured through case-by-case analysis of the fact situations to which its sanctions, assertedly, may not be applied.”

Thus, in Broadrick, the Court recognized a very limited exception in the First Amendment area, but went on to hold that the Oklahoma statute prohibiting partisan political activity by certain state employees did not come within the exception.

In spite of the quoted portions from Broadrick, the trial court concluded the anti-solicitation statute is unconstitutional as overbroad. In so ruling, the able trial judge concluded that Kelley and Hightower, supra, viewed in the light of the greatly expanded concepts of freedom of expression, cannot serve as narrowing interpretations that would limit the thrust of the statute to matters not constitutionally protected.

He says the broad sweep of the statute might prohibit possible plans for group legal services by "labor unions, consumer groups, [and] civic organizations”, (that is, if it were not for the cited Federal cases which hold such plans to be constitutionally protected speech under the First Amendment).

He concludes that the statute must be struck down as unconstitutional, whether or not it would be unconstitutional as applied to the conduct charged to plaintiff lawyers. In fact, he suggests that an amended statute could, perhaps, prohibit ambulance chasing if it were sufficiently limited, that is, not overbroad in the sense that he concludes.

Subsequent to the trial court’s decision, the U. S. Supreme Court decided Bates v State Bar of Arizona, holding that the blanket suppression of advertising by the organized bar violated the free speech clause of the First Amendment to the U. S. Constitution since lawyers may constitutionally advertise the prices at which certain routine legal services will be performed.

In so many words, the Bates Court declined to apply the overbreadth doctrine to professional advertising. The Court stated:

"In the usual case involving a restraint on speech, a showing that the challenged rule served unconstitutionally to suppress speech would end our analysis. In the First Amendment context, the Court has permitted attacks on overly broad statutes without requiring that the person making the attack demonstrate that in fact his specific conduct was protected. * * * Having shown that the disciplinary rule interferes with protected speech, appellants ordinarily could expect to benefit regardless of the nature of their acts.
"The First Amendment overbreadth doctrine, however, represents a departure from the traditional rule that a person may not challenge a statute on the ground that it might be applied unconstitutionally in circumstances other than those before the court. * * * The reason for the special rule in First Amendment cases is apparent: an overbroad statute might serve to chill protected speech. First Amendment interests are fragile interests, and a person who contemplates protected activity might be discouraged by the in terrorem effect of the statute. * * * Indeed, such a person might choose not to speak because of uncertainty whether his claim of privilege would prevail if challenged. The use of overbreadth analysis reflects the conclusion that the possible harm to society from allowing unprotected speech to go unpunished is outweighed by the possibility that protected speech will be muted.
"But the justification for the application of over-breadth analysis applies weakly, if at all, in the ordinary commercial context. As was acknowledged in * * * there are 'common sense differences’ between commercial speech and other varieties. * * * Since advertising is linked to commercial well-being, it seems unlikely that such speech is particularly susceptible to being crushed by overbroad regulation. * * * Moreover, concerns for uncertainty in determining the scope of protection are reduced; the advertiser seeks to disseminate information about a product or service that he provides, and presumably he can determine more readily than others whether his speech is truthful and protected. * * * Since overbreadth has been described by this Court as 'strong medicine’, which 'has been employed * * * sparingly and only as a last resort’, * * * we decline to apply it to professional advertising, a context where it is not necessary to further its intended objective.”

In reliance upon Broadrick and Bates, we hold that this criminal statute limiting certain commercial solicitation is not a proper subject for facial overbreadth analysis.

Having held that the statute is not subject to attack under a facial overbreadth standard, it remains to be answered whether the statute, in this case, is being applied in violation of plaintiffs constitutionally protected First Amendment rights. We hold that its application here is constitutional.

The trial court did not have the benefit of two decisions which greatly assist the consideration of this statute. First of all, in the very language in which it declined to decide the question, Bates gives guidance as to the types of activities which may be constitutionally restrained:

"Second, we also need not resolve the problems associated with in-person solicitation of clients — at the hospital room or the accident site, or in any other situation that breeds undue influence — by attorneys or their agents or "runners”. Activity of that kind might well pose dangers of over-reaching and misrepresentation not encountered in newspaper announcement advertising. Hence, this issue also is not before us.
"Similar objections might justify restraints on in-person solicitation.”

Second, the Michigan Supreme Court now has given further guidance regarding what type of conduct constitutes impermissible solicitation by an attorney. In State Bar Grievance Administrator v Jaques, it was alleged that defendant, four days after the tragic Port Huron tunnel explosion, had initiated an in-person meeting with potential claimants with whom defendant had no prior professional contact. Further, it was alleged that defendant had requested a union agent and others to recommend defendant to survivors of explosion victims. In applying their own disciplinary rules, the Court said:

"Conduct violating rules of ethics adopted by this Court and conduct exposing the profession to obloquy, contempt, censure or reproach are grounds for discipline. State Bar Rule 15, §§ 2(2), 2(3) and 2(4). The kind of solicitation involved in this case remains the classic example of the public conception of "ambulance chasing” which not only exposes the profession to public contempt, but unjustly exposes its thousands of innocent individual members to concomitant derision and contempt despite their steady allegiance to ethical norms and professional self-discipline.”

The type of activity charged in this case goes well beyond that found to be impermissible solicitation in Jaques. For example, one count of the indictment states, in part:

"* * * is and was at times relevant herein President of United * * * Union Local * * *. The said * * * invited retired Local * * * members to numerous meetings by letter, stating that they could make application for workmen’s compensation at the meeting. He further stated that the President’s Office (himself) was the only person in Local * * * who was authorized to assist them in making their claims. At the meetings he told the retired members that they had all worked for a number of years and had all probably suffered injuries and that they had workmen’s compensation awards coming to them. He had distributed and collected cards for the members to fill in their names and addresses. He introduced Attorney ARTHUR S. WOLL to them who spoke to them. After the meetings, the retired members were contacted by ARTHUR S. WOLL, ROBERT A. KOZLOW or a person from the law firm of KOZLOW, JASMER & WOLL, P. C. and asked to give information regarding their claim. * * * President of Local * * * , and * * * , Recording Secretary of Local * * * , then received lump sum checks from the law firm of KOZLOW, JASMER & WOLL, P. C. ranging from approximately $55.00 to $110.00 per claimant. The checks were in amounts between $110.00 to $1,750.00 and amounted to over $15,000.00 in one year’s time in the partial amount of checks that the Grand Jury looked at.”

We will not dignify this alleged conduct with an extensive discussion. Suffice it to say that we see no problem in the application of this statute to restrain the charged conduct.

In so ruling, we do not suggest that the anti-solicitation statute could be lawfully applied to the kinds of group legal services that enjoy First Amendment protection under National Association for the Advancement of Colored People v Button and its successors.

We also note that People v Posner was decided by another panel of this Court before release of Bates v State Bar of Arizona, supra.

The trial court also concluded that the anti-solicitation statute denied defendant equal protection of the laws because it proscribes solicitation of personal injury claims, but not property damage claims.

We disagree. As indicated in Kelley and Hightower, supra, the statute is directed at ambulance chasing. We do not find the classification irrational or arbitrary. Failure to include solicitation of property damage claims is an inadequate basis for a finding of an unconstitutional denial of due process. The possibility of big verdicts which is what gives rise to ambulance chasing is directed primarily to jury assessment of pain and suffering in personal injury situations; property damage claims are not significantly involved in the evil to which the statute is directed.

Reversed.

       OCR 1963, 521.

       MCLA 750.410; MSA 28.642.

       425 US 748; 96 S Ct 1817; 48 L Ed 2d 346 (1976).

       Much attention, both judicial and academic, has been devoted to the difference between measuring the constitutionality of a statute by examining its plain terms and by examining its application to the actual facts in question. For example, an excellent presentation of the history, purpose and utilization of both is set forth in The First Amendment Overbreadth Doctrine, 83 Harv L Rev 844 (1970).

       239 Mich 204; 214 NW 316 (1927).

       "Evidently 'ambulance-chaser’ is a recognized colloquial word of our English vocabulary. * * * [I]n later years as personal injury litigation increased and ethical restrictions on the legal profession decreased, that sinister compound word appears to have assumed in popular usage the following meaning, as defined by some lexicographers:
      " 'A person, either a lawyer or the agent of a lawyer, who follows up cases of accident in the streets and tries to induce the injured person to bring suit for damages.’ Cent. Diet, and Cyclop.
      "Though both are torts, there exists a marked difference between injuries inflicted on the person and injuries done to property, plainly recognizable in fact and reasonably distinguishable in law. Property, whether personal or real, has as a rule some fairly determinable market value susceptible of definite proof, within limits beyond which neither evidence nor expectation can range. Market value for personal injuries is unknown. The measure of damages and rules of proof are distinctly different in injury to property and personal injury cases. Pain and suffering, disfiguration, permanency, humiliation and other personal elements foreign to property which have no distinct standard of money measurement are permissible elements of damages in the latter. This may and often does in the minds of many give rise to great expectations and surrounds such claims with a tempting atmosphere of speculation unknown to property tort actions inviting to litigation and exploitation as generally known and so indicated by the proportion of such actions crowding our courts. These and other special attributes of personal injury claims fairly suggest a reasonable basis of distinction between them and other kinds of claims and even between the kinds of persons who might engage in soliciting them for collection. Extended discussion of the subject of classification is not necessary for the purposes of this case. The fundamental rule of classification is that it shall not be arbitrary, must be based on substantial distinctions and be germane to the purpose of the law.” 239 Mich 204, 210, 213-214; 214 NW 316 (1927).

       262 Mich 1; 247 NW 97 (1933).

       401 US 576; 91 S Ct 1076; 28 L Ed 2d 339 (1971), reversing 383 Mich 201; 174 NW2d 811 (1970), which grew out of 374 Mich 152; 132 NW2d 78 (1965); also see, United Mine Workers of America, District 12 v Illinois State Bar Association, 389 US 217; 88 S Ct 353; 10 L Ed 2d 426 (1967), and Brotherhood of Railroad Trainmen v Virginia ex rel Virginia State Bar, 377 US 1; 84 S Ct 1113; 12 L Ed 2d 89 (1964).

       It is interesting that the Supreme Court editor in State Bar of Michigan v Brotherhood of Railroad Trainmen, 374 Mich 152; 132 NW2d 78 (1965), described the injunction as enjoining the "channeling of liability claims of its members to its regional counsel”.

        Brotherhood of Railroad Trainmen v Virginia State Bar, supra.

        State Bar of Michigan v Brotherhood of Railroad Trainmen, 383 Mich 201; 174 NW2d 811 (1970).

        Brotherhood of Railroad Trainmen v Virginia State Bar, 377 US 1, 6-7; 84 S Ct 1113, 1117; 12 L Ed 2d 89, 93 (1964).

       413 US 601, 610-616; 93 S Ct 2908, 2915-2918; 37 L Ed 2d 830, 839-842 (1973). (Citations omitted; emphasis added.)

       413 US 601, 618; 93 S Ct 2908, 2919; 37 L Ed 2d 830, 843-844 (1973).

         433 US 350; 97 S Ct 2691; 53 L Ed 2d 810 (1977).

       433 US 350, 379-381; 97 S Ct 2691, 2707-2708; 53 L Ed 2d 810, 833-834 (1977). (Citations omitted; emphasis added.)

       The prior reported case involving plaintiff is of no assistance on the question of impermissible solicitation since that issue was not addressed. State Bar of Michigan v Woll, 387 Mich 154; 194 NW2d 835 (1972).

       433 US 350, 366, 384; 97 S Ct 2691, 2700, 2709; 53 L Ed 2d 810, 825, 836 (1977).

       401 Mich 516; 258 NW2d 443 (1977).

       401 Mich 516, 543-544; 258 NW2d 443 (1977). (Footnote omitted.)

       371 US 415; 83 S Ct 328; 9 L Ed 2d 405 (1963).

       79 Mich App 63; 261 NW2d 209 (1977). The one opinion decides the issues arising from both the indictment of Samuel Posner and that of Noel Keanne.

       See the last paragraph of n 6, supra.


source: Caselaw Access Project

author: J. H. Gillis, J.

license: Public Domain

text:
    PEOPLE v LEMON
    1. Criminal Law — Probation—Constitutional Law — Conditions of Probation — Restitution—Due Process.
    It is not a deprivation of due process of law to deny a defendant a hearing on the question of the amount of damages to be imposed as a condition of his probation; rather than being deprived of rights without due process of law, the defendant is given the privilege of avoiding the usual penalty for his crime by the payment of a sum of money and the observance of other conditions attached to his probation.
    2. Criminal Law — Probation—Judge’s Discretion — Appeal and Error — Noninterference.
    Probation is within the province of the sentencing judge, and appellate courts will not interfere in probation matters absent a showing of a violation or abuse of statutory authority or of some constitutional right of the defendant.
    3. Criminal Law — Probation—Restitution—Undue Hardship— Modification of Probation.
    The amount and manner of payment of reasonable restitution in granting probation is a matter for the judgment of the sentencing judge but if payment is impossible or would constitute an undue hardship the conditions of payment should be modified or withdrawn.

      References for Points in Headnotes
    [1-8] Payment: ability to pay as necessary consideration in conditioning probation or suspended sentence upon reparation or restitution. 73 ALR3d 1240.
    Violence: propriety of condition of probation which requires defendant convicted of crime of violence to make reparation to injured victim. 79 ALR3d 976.
    [1, 2, 5, 8] 16 Am Jur 2d, Constitutional Law §§ 542, 544.
    [1-5, 8] 21 Am Jur 2d, Criminal Law §§ 563-566.
    Construction of clause of Federal Probation Act (18 USCS § 3651) that, in placing defendant on probation upon terms and conditions, defendant may be required to make restitution. 97 ALR2d 798.
    [2-5, 7, 8] 21 Am Jur 2d, Criminal Law §§ 569, 571, 572.
    [6-8] 16 Am Jur 2d, Constitutional Law §§ 386-388, 492.
    21 Am Jur 2d, Criminal Law § 567.

      4. Criminal Law — Probation—Restitution—Ability to Pay — Modification of Probation — Judge’s Discretion — Abuse of Discretion.
    A trial court does not abuse its discretion by imposing a reimbursement condition of probation which fairly reflects a defendant’s ability to pay; however, where the reimbursement or restitution condition does not fairly reflect the defendant’s ability to pay, it is an abuse of discretion for the sentencing court to refuse to modify or withdraw the condition when notified of the defendant’s financial situation.
    5. Criminal Law — Sentences—Assumed Facts — Due Process — Probation — Judge’s Discretion — Invalid Order.
    A defendant’s sentence based upon unverified, unsupported or assumed facts is arbitrary, unreasonable and a denial of due process of law, and when a judge determines a condition of probation on the basis of unverified assumptions there is an abuse of discretion and the probation order is invalid.
    6. Criminal Law — Probation—Restitution—Revocation of Probation — Imprisonment—Equal Protection.
    Revocation of probation and imposition of imprisonment for failure to pay restitution is improper where the defendant is financially unable to do so; revocation on this basis is a denial of the defendant’s constitutional right to equal protection because his imprisonment constitutes discrimination on the basis of economic status.
    7. Constitutional Law — Criminal Law — Equal Protection — Probation— Restitution — Inability to Pay — Appeal and Error.
    A defendant is entitled to invoke the equal protection doctrine on appeal where he objected in the trial court to a probation restitution order on the basis that he had no assets and was financially unable to make the required payments from his employment earnings and the judge revoked his probation because of his failure to make restitution.
    8. Criminal Law — Probation—Restitution—Revocation of Probation — Verification of Assumptions.
    A sentencing judge may not base an order of restitution or revocation of probation on the assumed ability of the defendant to pay where such assumption was objected to by the defendant and the assumption was never verified.

      Appeal from Recorder’s Court of Detroit, Clarence Laster, Jr., J.
    Submitted December 8, 1977, at Detroit.
    (Docket No. 30369.)
    Decided January 23, 1978.
    Aaron Lemon, Jr., was convicted, on his plea of nolo contendere, of attempted larceny over $100 and was sentenced to probation. Defendant was found guilty of probation violation and probation was revoked and defendant sentenced to prison. Defendant appeals.
    Reversed and remanded.

      Frank J. Kelley, Attorney General, Robert A. Derengoski, Solicitor General, William L. Cahalan, Prosecuting Attorney, Edward R. Wilson, Principal Attorney, Appeals, and Timothy A. Baughman, Assistant Prosecuting Attorney, for the people.

      Goodman, Eden, Millender, Goodman & Bedrosian, for defendant.
    Before: M. F. Cavanagh, P. J., and J. H. Gillis and D. C. Riley, JJ.
   J. H. Gillis, J.

This is an appeal from the revocation of probation. Defendant was charged with embezzlement of more than $100, to-wit, $23,900, contrary to MCLA 750.174; MSA 28.371. On June 19, 1973, he pled nolo contendere to the charge of attempted larceny over $100, contrary to MCLA 750.92, 750.360; MSA 28.287, 28.592. Defendant was sentenced to five years probation by Judge Clarence Laster, Jr., on July 19, 1973. The order of probation required the defendant to serve the first six months in the Detroit House of Correction and included the condition "that probationer shall make restitution as follows: to be determined”.

On October 30, 1973, the court entered an amended order of probation which exonerated the defendant from serving any further time in jail, allowed the defendant to live in Windsor, Ontario, and restated the earlier condition of the restitution: "to be determined”.

Subsequently, a judgment following civil litigation was rendered against the defendant, and on May 20, 1976, an amended order of probation was entered. The order required the defendant, as a condition of probation, to make restitution in the amount of $23,900, payable at the rate of $1,000 per month.

Apparently, the defendant received no notice of the amended order until June 24, 1976, when he appeared before Judge Laster and the order was explained to him. At that time, the defendant advised the judge of his financial inability to comply with the terms of the order. The judge acknowledged the defendant’s financial inability to pay $1,000 per month from his employment earnings, but refused to amend the order in the belief that the defendant was still in possession of the embezzled funds. The defendant attempted to dispel that belief.

Subsequently, the defendant fulfilled all of the conditions of probation except payment of $1,000 per month restitution. In July and August, 1976, the defendant reported to the probation department as required and paid $5 on each occasion. A notice of probation violation charging the defendant with failure to pay $1,000 per month as ordered by the court was issued and a revocation hearing was held on September 27, 1976, before Judge Laster.

At the hearing, defendant, this time assisted by counsel, reasserted his financial inability to make the monthly $1,000 restitution payments. Defense counsel stated to the court:

"[The defendant] stated he did not have the money, has not got the money, and it is my position, equally, with respect to this matter before, that he can’t be found guilty of contempt, failing to comply with the order based upon the assumption that he has the money.”

The court convicted the defendant of probation violation on the basis of his failure to pay the $1,000 per month restitution as ordered, and sentenced the defendant to 20 months to 2-1/2 years imprisonment.

On appeal, the defendant contends that he was entitled to notice and opportunity to be heard prior to entry of the amended order of probation wherein specific terms of restitution payment were provided.

In People v Good, 287 Mich 110; 282 NW 920 (1938), the Court rejected a similar claim that the due process clause of both the Federal and State Constitutions requires that the defendant be afforded notice and an opportunity to be heard on the amount of restitution prior to its determination. The Court reasoned:

"A defendant [when ordered to pay restitution as a condition of probation] * * * is merely given the alternative of abiding by the conditions imposed or else suffering the imposition and execution of a sentence which ordinarily follows a verdict of guilty. This defendant was not deprived of any of his rights without due process; rather he was given the additional privilege of avoiding the usual penalty of his crime by the payment of a sum of money and the observance of the other conditions attached to his probation. Consequently it was not a deprivation of due process of law to deny defendant a hearing on the question of the amount of 'damages’ to be imposed as a condition of probation and the statute, section 17373, is ample notice of the possibility that such a condition might be imposed.” 287 Mich at 115, 116 (Emphasis supplied.)

The underlying reasoning of the Good Court that probation and its conditions thereof is a privilege has recently been reaffirmed in People v Rial, 399 Mich 431, 437; 249 NW2d 114 (1977). See also People v Jim Williams, 57 Mich App 439, 441-442; 225 NW2d 798 (1975), People v Terminelli, 68 Mich App 635, 637; 243 NW2d 703 (1976). Thus, Good, supra, is still a good law in this jurisdiction and is dispositive of the defendant’s procedural due process claim.

Defendant cites People v Gallagher, 55 Mich App 613; 223 NW2d 92 (1974), in support of his position. In dictum, the Gallagher Court suggested:

"It seems desirable to have the defendant and his lawyer participate in the restitution decision. The matter might be discussed at the time of a plea of guilty. The recommended amount of restitution or reparation and the manner of its payment should be included in the presentence report and disclosed. The court might tell the defendant at the time of conviction that if probation is granted, restitution may be required, and suggest that he and his lawyer propose a plan for restitution to the presentence investigator. In any event, the court could invite comment from defendant about the restitution the court is considering before it is imposed as a part of the sentence.” 55 Mich App at 620.

While the recommended procedure should be followed by sentencing judges, the Gallagher Court did not hold that it was a prerequisite to a valid order of probation, and we decline to do so at this time.

Probation is within the province of the sentencing judge, and the appellate courts will not interfere in probation matters absent a showing of a violation or abuse of statutory authority or violation of some constitutional right of the defendant. People v Sattler, 20 Mich App 665, 669-670; 174 NW2d 605 (1969).

"The amount and manner of payment of reasonable restitution is a matter for the judgment of the sentencing judge, as to him 'may be meet and proper’.” People v Gallagher, supra, at 620.

In People v LaPine, 63 Mich App 554, 558; 234 NW3d 700 (1975), this Court stated:

"However, we caution the trial court that if payment is impossible or would constitute an undue hardship, these conditions should be modified or withdrawn. See People v Gallagher, 55 Mich App 613, 619-620; 223 NW2d 92 (1974).”

There we dealt with a reimbursement condition of parole, and stated that so long as reimbursement fairly reflects the defendant’s ability to pay, the trial court does not abuse its discretion by imposing the requirement. It necessarily follows that where the reimbursement or restitution condition does not fairly reflect the defendant’s ability to pay, it is an abuse of discretion for the sentencing court to refuse to modify or withdraw the condition when notified of the defendant’s financial situation.

Here, the judge was informed of and recognized the defendant’s inability to make the $1,000 monthly restitution payments from his employment earnings. Nonetheless, the judge refused to modify or withdraw the probation condition solely on the basis of the judge’s unverified assumption that the defendant was in possession of the embezzled funds and therefore financially able to make the restitution as ordered. There is some indication in the record that the defendant was not, in fact, in possession of the funds. Defendant also attempted to convince the judge that he did not have the funds.

In People v Westerfield, 71 Mich App 618; 248 NW2d 641 (1976), the Court held that sentencing the defendant on the basis of unverified assumptions of fact was a denial of due process. The Court stated:

" * * * [I]t is apparent that, in effect, defendant’s sentence was increased because of the trial court’s belief that defendant was guilty of offenses which defendant denied. There was no proof to support this conclusion by the trial court. A sentence based on such considerations amounts to a denial of due process. People v Zachery Davis, 41 Mich App 683; 200 NW2d 779 (1972), People v Perine, 7 Mich App 292; 151 NW2d 876 (1967), People v Grimmett, 388 Mich 590; 202 NW2d 278 (1972). A sentencing judge has a duty to ascertain, upon objection by a defendant, that the defendant is not prejudiced in sentencing by false information. People v McIntosh, 62 Mich App 422; 234 NW2d 157 (1975). That duty is not fulfilled where, as here, a convicted defendant is sentenced on the basis of assumptions of fact based on no proof and inconsistent with defendant’s version of the facts.” 71 Mich App at 626. (Emphasis supplied.)

The implicit reasoning of Westerfield, supra, is that the judge’s action in sentencing the defendant on the basis of unsupported assumed facts is arbitrary and unreasonable. Without deciding whether the defendant is afforded the same constitutional protections when the judge determines a condition of probation on the basis of unverified assumptions, we hold that such action is an abuse of discretion and that the resulting probation order is invalid.

The sentencing court may not revoke the defendant’s probation and impose imprisonment on the basis that the defendant has failed to pay restitution as ordered where he is financially unable to do so. Revocation on this basis constitutes a denial of the defendant’s constitutional right to equal protection, as his imprisonment constitutes a discrimination on the basis of economic status. People v Gallagher, supra at 620, People v Terminelli, 68 Mich App 635, 637; 243 NW2d 703 (1976).

Here, where the defendant objected below to the required restitution payment of $1,000 per month, on the basis that he had no assets and was financially unable to make such payments from his employment earnings, which the judge acknowledged, he is entitled to invoke on appeal the protection of the equal protection doctrine. See People v Billy Williams, 66 Mich App 67; 238 NW2d 407 (1975).

The facts presented by the defendant to the sentencing judge showed that the defendant was financially unable to make monthly restitution payments of $1,000. The sentencing judge may not base his restitution order or revocation of probation on assumed ability to pay where such assumption is objected to by the defendant, and subsequently left unverified.

Therefore, we hold that the court’s revocation of defendant’s probation and sentence imposing imprisonment was improper and must be vacated and set aside. We remand the cause for redetermination of the restitution condition, and strongly urge that the procedures suggested in People v Gallagher, supra, be followed.


author: Allen, J.

text:
    PEOPLE v THORNTON
    1. Criminal Law — Error—False Testimony — Discovery.
    Error occurs in a criminal trial when (1) the prosecution knowingly presents false testimony, or (2) the prosecution refuses pertinent and specific defense requests for discovery after learning that a prosecution witness gave false testimony on a material point at the preliminary examination.
    2. Criminal Law — Evidence—Discovery—Fundamental Fairness.
    Generally, questions of whether discovery should be available to a criminal defendant should be determined according to whether fundamental fairness to the defendant in preparing his defense requires that he have access to the information.
    3. Witnesses — Criminal Law — Testimony of Witness — Material Change in Testifying — Discovery.
    Changes in a prosecution witness’s testimony between that given in a preliminary examination and that given at trial were material where the changes in the testimony would affect a jury’s perception of how and why a shooting incident occurred and where the jury’s knowledge that the witness had lied in prior testimony would affect his credibility; refusal of the trial judge to allow the defendant discovery of the details of the witness’s changes in testimony, so that the defense did not know which of the witness’s stories it would be called upon to attack at trial, was prejudicial and therefore reversible error.
    4. Witnesses — Criminal Law — Indigent Defendant — Subpoena of Witnesses — Judge’s Discretion — Statutes.
    An indigent criminal defendant may be entitled to the subpoena and transportation of witnesses in the defendant’s behalf at county expense; he must show to the satisfaction of the judge that he cannot safely proceed to trial without the proposed witnesses, and rulings on such requests are expressly left to the discretion of the trial court (MCLA 775.15; MSA 28.1252).

      References for Points In Headnotes
    [1] 21 Am Jur 2d, Criminal Law §§ 224, 228.
    [2] 23 Am Jur 2d, Depositions and Discovery §§ 307-314.
    [3] (No Reference)
    [4] 21 Am Jur 2d, Criminal Law § 348.
    [5] 75 Am Jur 2d, Trial §§ 760, 761.

      5. Criminal Law — Instructions to Jury — Inferences—Presumptions.
    A trial court may instruct a jury that they may draw an inference from certain facts but should not give instructions which create presumptions in favor of the prosecution.
    Appeal from Oakland, Robert L. Templin, J.
    Submitted December 8, 1977, at Lansing.
    (Docket No. 30374.)
    Decided January 23, 1978.
    James Thornton was convicted of first-degree murder. Defendant appeals.
    Reversed.

      Frank J. Kelley, Attorney General, Robert A. Derengoski, Solicitor General, L. Brooks Patterson, Prosecuting Attorney, Robert C. Williams, Chief Appellate Counsel, and James L. McCarthy, Assistant Appellate Counsel, for the people.
    James S. Thornton, in propria persona.

    Before: R. B. Burns, P. J., and Allen and R. M. Maher, JJ.
   Allen, J.

Defendant was convicted of first-degree murder by an Oakland County jury on August 24, 1975. MCLA 750.316; MSA 28.548. He was later sentenced to life in prison as required by the statute, and appeals as of right.

The killing occurred on May 11, 1974. On that day, Edward Rasen and William Day went to defendant’s home in Farmington Hills. Their encounter resulted in William Day’s death and left Edward Rasen severely wounded. The exact details of what occurred are, of course, disputed.

Rasen was the main prosecution witness. Testimony at trial showed that Rasen and the defendant were members of a nationwide marijuana syndicate. The shooting incident which led to these charges resulted from a dispute over proceeds from a syndicate shipment and defendant’s refusal to return a truck to Rasen.

When Rasen testified at the preliminary examination, in May of 1974, he lied about his reasons for being in the Detroit area and did not disclose the true nature of his argument with the defendant. Specifically, he said nothing about the marijuana syndicate in which both he and the defendant were principals. The prosecution knew, even before the preliminary examination, that major portions of Rasen’s story were fabricated. For example, they knew that he had flown into Detroit from California on the day before the shooting. At the preliminary examination, Rasen repeatedly testified that he had hitch-hiked from California and had arrived on the morning of the day the shooting occurred.

Rasen and his attorneys were continuously involved in negotiations with Federal and state prosecuting authorities. As part of an immunity bargain, Rasen eventually disclosed to the Michigan authorities the full details of his involvement with the defendant. These details were known to the prosecution not later than January of 1975. Despite repeated defense requests for discovery and specific inquiries as to whether Rasen had abandoned the testimony he gave at the preliminary examination, the prosecution refused to confirm that the preliminary examination testimony had been false. Consequently, the defense did not know how Rasen would testify until he actually took the stand at trial. Once it became apparent that his story had changed, the defense impeached him with excerpts from his preliminary examination testimony.

On the first day of the trial, the defendant asked the trial judge to authorize subpoena and witness fees for two out-of-state witnesses. The trial judge first questioned the defendant’s indigency since he was represented by retained counsel. However, the judge later seemed to concede that the defendant was indigent but nevertheless ruled that he would not authorize the expenditure of county funds unless the defense first revealed the names of the proposed witnesses and the nature of their testimony. The defendant’s attorney refused to do this in open court, but he did offer to submit affidavits for in camera inspection by the court. The judge rejected that offer and the defense refused to disclose the information in open court. One of the proposed witnesses was an orthopedic surgeon with ballistics expertise. The other witness was acquainted with Rasen from California and would have testified as an impeachment witness to attack Rasen’s credibility. Because of the adverse rulings, neither witness testified for the defense.

The defendant has raised 23 separate issues on appeal. We find one which clearly requires reversal. Two others deserve some comment. The remainder are without merit.

We reverse the defendant’s conviction because we are convinced that the prosecution knowingly presented false testimony at the preliminary examination. The extent of the prosecution’s knowledge at that point in time might be debated, but it is clear that the authorities knew that some portions of Rasen’s testimony were false.

Without more, there would be no reversible error. However, the situation changed when the immunity negotiations led to the change in Ra-sen’s story. At that point, the prosecution knew beyond any doubt that Rasen had lied at the preliminary examination. It also knew that he would tell a significantly different story at trial. But this information was withheld from the defense despite specific requests.

There are signs that we may be approaching a rule of complete discovery in criminal cases — at least discovery of materials held by the prosecution. See People v Dellabonda, 265 Mich 486; 251 NW 594 (1933), People v Maranian, 359 Mich 361; 102 NW2d 568 (1960), Brady v Maryland, 373 US 83; 83 S Ct 1194; 10 L Ed 2d 215 (1963), People v Aldridge, 47 Mich App 639; 209 NW2d 796 (1973), and People v Walton, 71 Mich App 478; 247 NW2d 378 (1976).

The present case does not require that we further expand the frontiers of criminal discovery. Based on existing authorities, we are convinced that error occurs when (1) the prosecution knowingly presents false testimony or (2) the prosecution refuses pertinent and specific defense requests for discovery after learning that a prosecution witness gave false testimony on a material point at the preliminary examination.

"The legal concept of a criminal trial has changed considerably in modern times. It is seen less as an arena where 2 lawyer gladiators duel with the accused’s fate hanging on the outcome and more as an inquiry primarily directed toward the fair ascertainment of truth.” People v Johnson, 356 Mich 619, 621; 97 NW2d 739 (1959).

The arguments of the prosecutor in the present case suggest an outdated adherence to the gladiator concept.

In People v Walton, supra, the Court cited People v Aldridge, supra, for the general rule that questions of criminal discovery should be determined according to whether fundamental fairness to the defendant, in preparing his defense, requires that he have access to the information. That test is met in the present case. The trial judge ruled and the prosecutor argued against disclosure on grounds that the changes in Rasen’s testimony were not material. By this they mean that Rasen’s version of the shooting incident remained unchanged. The major changes in Rasen’s testimony concerned his description of his trip from California to Detroit and his admission of his involvement in the marijuana syndicate. The theoretical basis for the prosecutor’s argument is sound. If the testimony changes are not material, nondisclosure might not be considered error or, at least, the error would be harmless. But we reject the contention that the changes in the present case are not material. Rasen’s admission of his involvement in the marijuana operation would materially affect a jury’s perception of how and why the shooting incident occurred. Further, jury knowledge of Rasen’s involvement and the fact that he lied about that involvement in prior testimony would adversely affect his credibility as a witness. Therefore, we believe that the changes were material even though Rasen’s testimony about the shooting incident itself was consistent.

Alternatively, the prosecution argues that the defendant was not prejudiced because his attorney was able to impeach Rasen at trial with evidence of his prior inconsistent testimony. We concede that defense counsel was effective in this regard, but his effectiveness was unavoidably limited by his uncertainty as to which story Rasen would present. This uncertainty limited opportunities for pre-trial investigation and required the defense to expend time and effort preparing to attack both of Rasen’s stories. Therefore, the nondisclosure was prejudicial even though the defense had an opportunity for cross-examination.

For the reasons stated, the defendant’s conviction is reversed. Given the possibility of another trial, we will briefly comment on two other issues raised on appeal.

The defendant’s efforts to subpoena and transport two out-of-state witnesses at county expense are detailed earlier in this opinion. The trial judge refused to consider that request unless the defendant would first disclose in open court the names of the proposed witnesses and the substance of their testimony. Existing authorities support that ruling. MCLA 775.15; MSA 28.1252 requires a defendant to show "to the satisfaction of the judge presiding over the court wherein such trial is to be had * * * [that] he cannot safely proceed to a trial [without the proposed witness]”. Rulings on such motions are expressly left to the discretion of the trial court. The cited statute is limited to witnesses "within the jurisdiction of the court”. But there is no reason to believe that a different rule should obtain where a defendant seeks the production of witnesses who live outside Michigan. Given the statute, it is apparent that the trial judge ruled correctly in the present case. See also People v Thomas, 1 Mich App 118; 134 NW2d 352 (1965).

However, there is some reason to doubt the continuing validity of the statute. The Federal Rules of Criminal Procedure, Rule 17(b), formerly contained a provision very similar to the Michigan statute as interpreted by the judge in this case. The rule was amended in 1966 to allow defendants to apply for witness fees ex parte, i.e., without revealing names and testimony to the prosecution. Cases commenting on the amendment indicate that the rule was changed because of the disturbing equal protection problem evident on the face of a rule which would require indigents to disclose their defense theory to the prosecution while not requiring similar disclosure from defendants who are able to pay their own fees. See United States v Meriwether, 486 F2d 498 (CA 5, 1973), United States v Barker, 553 F2d 1013 (CA 6, 1977). For a general discussion of the Federal rule and the impetus behind the 1966 changes, see 1 Wright, Federal Practice and Procedure (1969), Chapter 5, § 272, pp 539-544. These constitutional problems could be avoided on retrial in the present case if the trial judge accepts the defendant’s offer to submit the names of the witnesses and outlines of their testimony for in camera inspection. This procedure would be similar to the ex parte practice now followed in the Federal courts.

Defendant also contends that some of the instructions on intent were reversibly erroneous because they established presumptions in the prosecution’s favor and placed the burden of proof on the defendant to overcome those presumptions. These arguments have been rendered moot by our reversal of the defendant’s conviction. On retrial, the court would do well to avoid similar instructions. It is appropriate to tell the jury that they may draw an inference from certain facts. However, instructions which create presumptions in favor of the prosecution are disapproved. See People v Martin, 392 Mich 553; 221 NW2d 336 (1974), People v Wright, 78 Mich App 246; 259 NW2d 443 (1977).

Conclusion

We express no opinion as to whether the instruction on presumptions or the ruling on the witness fees question would require reversal. Our comments on those issues are intended solely for the guidance of the parties and the trial court on retrial. The defendant’s conviction is reversed because of the refusal to permit discovery of the complaining witness’s perjury.

Reversed.

       The prosecutor at the preliminary examination did question Rasen about his reasons for coming to Detroit and his mode of travel. Thus, it might be argued that an effort to bring out the truth was made. However, the questions also evidenced the prosecution’s doubts about their own witness’s veracity. These doubts were never shared with the defense.


author: Bashara, J.

text:
    ALMIRA TOWNSHIP v BENZIE COUNTY TAX ALLOCATION BOARD
    1. Taxation — Tax Tribunal Act — Rules op Procedure — Administrative Procedures Act — Secretary of State — Statutes.
    The Tax Tribunal Act authorizes the Tax Tribunal to promulgate its rules of procedure in accordance with the Administrative Procedures Act; the Administrative Procedures Act requires that the rules promulgated by the tribunal be filed with the Secretary of State (MCLA 24.201 et seq., 205.732[d]; MSA 3.560[101] et seq., 7.650[32] [d]).
    2. Administrative Law — Rules of Procedure — Uniform Process.
    Rules of procedure are intended to lend stability, order, and uniformity to a forum’s proceedings; therefore, the promulgation of rules of practice and procedure must itself conform to a uniform process so as to afford a degree of permanency to those rules.
    3. Taxation — Tax Tribunal — Preliminary Proceedings — Tax Tribunal Act — Secretary of State — Administrative Procedures Act — Statutes.
    The method by which the Tax Tribunal provided for preliminary proceedings in a property tax millage dispute was in contravention of the Tax Tribunal Act where the rules for the procedure followed were not filed with the Secretary of State as required by the Tax Tribunal Act in accordance with the Administrative Procedures Act, but were established by an ad hoc tribunal’s order to the litigants (MCLA 24.205[6], 205.732[d]; MSA 3.560[105] [6], 7.650[32] [d]).
    4. Taxation — Tax Tribunal — Decisions—Tax Tribunal Act — Findings of Fact — Conclusions of Law — Statutes.
    A decision by the Tax Tribunal does not conform to the requirements of the Tax Tribunal Act where it does not contain a concise statement of the findings of fact and conclusions of law used in reaching its decision; merely stating that the tribunal has reviewed the evidence and finds it to be insufficient as a basis for relief is not an adequate statement (MCLA 205.751; MSA 7.650[51]).

      References for Points in Headnotes
    [1, 2] 2 Am Jur 2d, Administrative Law § 278 et seq.

    [3] 72 Am Jur 2d, State and Local Taxation §§ 706, 794.
    [4] 72 Am Jur 2d, State and Local Taxation § 787.
    [5] 72 Am Jur 2d, State and Local Taxation §§ 787, 817-830.
    [6, 7] 2 Am Jur 2d, Administrative Law §§ 482, 522-524, 677, 756.

      5. Taxation — Tax Tribunal — Guidelines—Property Tax Limitation Act — County Tax Allocation Boards — Appeal and Error — Property Tax Millage — Statutes.
    The Tax Tribunal must conform to the guidelines provided in the Property Tax Limitation Act when reviewing a county tax allocation board’s determination regarding the allocation of property tax millage (MCLA 211.217; MSA 7.77).
    6. Taxation — Tax Tribunal — Proceedings—De Novo Proceedings —County Tax Allocation Boards — Mistake of Fact — Fraud —Error of Law — Statutes.
    The proceedings of the Tax Tribunal are de novo but a determination by a county tax allocation board should not be disturbed unless a review of all the evidence clearly establishes that a material mistake of fact, fraud or an error of law occurred incident to the board’s proceedings (MCLA 205.735, 211.217; MSA 7.650[35], 7.77).
    7. Taxation — Property Tax Millage Allocation — Local Concerns —Tax Tribunal — Local Decisions — Public Policy — Mistake of Fact — Fraud—Mistake of Law — Statutes.
    Considerations involved in the allocation of property tax millage are of peculiarly local concern; the Tax Tribunal must accord deference to local decisions concerning the distribution of financial resources among competing local governmental units rendering services to the community since it is a centralized state agency that is not in a position to weigh the relative importance of the competing services on the local community level; therefore, as a matter of public policy, a county tax allocation board’s determination should be disturbed by the Tax Tribunal only if a review of all the evidence clearly establishes that a material mistake of fact, fraud or an error of law occurred incident to the board’s proceedings (MCLA 211.217; MSA 7.77).
    Appeal from the Michigan Tax Tribunal.
    Submitted November 1, 1977, at Lansing.
    (Docket No. 31425.)
    Decided January 23, 1978.

      The townships of Almira, Blaine, Colfax, Crystal Lake, Gilmore, Homestead, Inland, Joyfield and Weldon appealed a property tax millage allocation by the Benzie County Tax Allocation Board to the Michigan Tax Tribunal. The Tax Tribunal affirmed. The townships appeal.
    Reversed and remanded.

      Bauckham, Reed, Lang, Schaefer & Travis, for petitioners.

      Berlin & VanThielen, for respondent.
    Before: J. H. Gillis, P. J., and Bashara and H. L. Heading, JJ.

       Detroit Recorder’s Court judge, sitting on the Court of Appeals by assignment.

   Bashara, J.

Petitioners appeal an order of the Michigan Tax Tribunal affirming an allocation of property tax millage made by respondent pursuant to § 11 of the Property Tax Limitation Act.

After petitioners’ initiation of review proceedings, the tribunal issued an order setting a date for a "preliminary” hearing. That order stated that the purpose of the hearing was "to take testimony, to examine the basis of Petitioner’s allegations and the nature of proofs pursuant to MCLA 211.217; MSA 7.77, tending to show 'a material mistake of fact, fraud or error of law’ in the division of the net limitation tax rate and thereby to determine the need for further proceedings in this matter(Emphasis added.)

At the conclusion of the hearing before three members of the tribunal a short recess was taken. When the tribunal reconvened the presiding member announced the following determination:

"As I indicated just before we recessed here to consider this matter, the Tribunal regards an allocation hearing as of the utmost priority for which reason we wanted to give this our consideration early. Having taken the testimony and examining the proofs submitted, it is the unanimous opinion of this Tribunal that there has been no showing of material mistake, fraud or error of law sufficient to justify proceedings further in this matter. Therefore, the cause is dismissed with prejudice, but without cost to either party, and a written order will be entered accordingly. We thank both sides very much for your patience. This hearing is concluded.”

Challenges to that decision are raised by petitioners on both procedural and substantive grounds. Petitioners argue that the tribunal was without authority to decide the merits of the controversy by preliminary proceedings.

Section 32(d) of the Tax Tribunal Act authorizes the tribunal to promulgate rules of procedure. MCLA 205.732(d); MSA 7.650(32)(d). However, that section also requires that the mode of promulgation be in accordance with the Administrative Procedures Act of 1969. MCLA 24.201 et seq.; MSA 3.560(101) et seq. That act requires, by definition in § 5(6), that the rules promulgated be filed with the Secretary of State. MCLA 24.205(6); MSA 3.560(105)(6). The procedure followed in this case was not by a rule so filed, but by an ad hoc procedure established in the tribunal’s order to the litigants. Accordingly, we must conclude that the method by which the tribunal provided for preliminary proceedings in this case was in contravention of the Tax Tribunal Act.

Rules of procedure are intended to lend stability, order, and uniformity to a forum’s proceedings. Therefore, the promulgation of rules of practice and procedure must itself conform to a uniform process so as to afford a degree of permanency to those rules. To permit a forum to alter its rules of practice by fiat would result in significant uncertainty for prospective litigants. They would be unable to ascertain the method by which to advocate their rights before the forum and left without standards by which they could anticipate the forum’s decision process.

The instant case is illustrative of the foregoing. By denominating the proceedings as "preliminary”, there was nothing in the administrative code of procedure to which reference could be made to guide the conduct of the hearing. See 1975 AACS, R 205.1101 et seq. In petitioners’ opening statement, counsel indicated that sufficient evidence would be presented to establish a prima facie case of error in the respondent’s determination. Reference was made in petitioners’ closing argument to the preliminary nature of the hearing. Apparently, petitioners anticipated that in deciding whether further proceedings were warranted, the tribunal would view the evidence in a light most favorable to their position. We are unable to discern from the record the standard of review ultimately used by the tribunal.

Respondent maintains that whatever the nature of the proceedings, the rights of petitioners were not thereby prejudiced, since there was no curtailment of petitioners’ ability to present evidence. We find this argument unpersuasive. It is not the extent of the allowable presentation that we deem to be material, but rather the extent of preparation that was indicated by the nature of the proceedings. The hearing was to be a preliminary proceeding. Petitioners’ counsel had a right to expect that a full evidentiary presentation of his clients’ position would not be anticipated by the tribunal. Consequently, only an abbreviated evidentiary description of the case would be prepared, omitting possibly significant portions of testimony and exhibits that would be presented in a full hearing on the merits.

We must therefore conclude that the petitioners’ right to a review of the respondent’s decision by the tribunal was prejudiced by the order for preliminary proceedings. This is not to deny that the tribunal may promulgate rules for preliminary proceedings in the interest of forum efficiency. We require only that the promulgation of those rules be in conformity with the Administrative Procedures Act and adequately alert those practicing before the tribunal as to the mode of conduct of such proceedings.

Petitioners also contend that the tribunal’s decision does not conform to the requirements of the Tax Tribunal Act, because it fails to state findings of fact and conclusions of law. We address this issue to guide the proceedings on remand.

Initially, we must note that the legislation creating the tribunal mandates that its decisions be rendered only upon "participation of the entire tribunal”. MCLA 205.734; MSA 7.650(34). Here, a decision was rendered with participation by only three members of the seven-member tribunal. It is also required by § 51 that the decisions include a concise statement of the findings of fact and conclusions of law. MCLA 205.751; MSA 7.650(51). This requirement is described with greater particularity in § 85 of the Administrative Procedures Act. MCLA 24.285; MSA 3.560(185). Tribunal hearings are made subject to that provision by § 26 of the Tax Tribunal Act. MCLA 205.726; MSA 7.650(26).

It is especially important that the latter requisite be satisfied. Only if the decisions of the tribunal contain the factual and legal basis of determination will appellate review be facilitated. Because that basis is absent from the decision in the instant case, we are unable to evaluate petitioners’ claim of substantive error. Merely stating that the tribunal has reviewed the evidence and finds it to be insufficient as a basis for relief is not adequate. Ann Arbor Township v State Tax Commission, 393 Mich 682; 227 NW2d 784 (1975).

Proceedings of the tribunal are de novo, according to § 35 of the Tax Tribunal Act. MCLA 205.735; MSA 7.650(35). However, when reviewing a determination, such as made by respondent in this case, the tribunal must conform to the guidelines provided in § 17 of the Property Tax Limitation Act. MCLA 211.217; MSA 7.77.

Considerations involved in the allocation of property tax millage are of peculiarly local concern. Deference must be accorded to local decisions concerning the distribution of financial resources among competing local governmental units rendering services to the community. The tribunal is a centralized state agency that is not in a position to ascertain and weigh the relative importance of competing services on the local community level. Therefore, as a matter of public policy, the county allocation board’s determination should be disturbed only if a review of all the evidence clearly establishes that a "material mistake of fact, fraud or an error of law” occurred incident to the board’s proceedings. MCLA 211.217; MSA 7.77. To that extent, the de novo proceedings of the tribunal are constrained.

Reversed and remanded for proceedings consistent with this opinion. No costs, a public question being involved.

       MCLA 211.201 et seq.; MSA 7.61 et seq.; specifically MCLA 211.211; MSA 7.71.

       MCLA 205.701 et seq.; MSA 7.650(1) et seq.

       Section 85 provides as follows:
      "A final decision or order of an agency in a contested case shall be made, within a reasonable period, in writing or stated in the record and shall include findings of fact and conclusions of law. Findings of fact shall be based exclusively on the evidence and on matters officially noticed. Findings of fact, if set forth in statutory language, shall be accompanied by a concise and explicit statement of the underlying facts supporting them. If a party submits proposed findings of fact which would control the decision or order, the decision or order shall include a ruling upon each proposed finding. Each conclusion of law shall be supported by authority or reasoned opinion. A decision or order shall not be made except upon consideration of the record as a whole or such portion thereof as may be cited by any party to the proceeding and as supported by and in accordance with the competent, material and substantial evidence. A copy of the decision or order shall be delivered or mailed forthwith to each party and to his attorney of record.”