author: Per Curiam.

text:
    CHARTER TOWNSHIP OF CANTON v KAUFMAN
    Docket No. 77-4284.
    Submitted November 7, 1978, at Detroit.
    Decided January 3, 1979.
    Leave to appeal applied for.
    The Charter Township of Canton brought a condemnation action in an attempt to acquire property owned by Joseph Kaufman, Marvin Canvasser, Donald Canvasser, Robert Canvasser and Byron Canvasser, doing business as Canvasser Investment Company. The defendants challenged the condemnation, incurring considerable pretrial expense. Prior to trial the township filed a notice of discontinuance of the action, and the defendants moved for award of attorney and appraisal fees. The Wayne Circuit Court, Charles Kaufman, J., granted attorney fees in the amount of $7,548.25 and appraisal fees in the amount of $8,000. The township appeals the award of attorney fees. Held: The award of attorney fees was improper. Attorney fees may be taxed and awarded only as authorized by statute or court rule, and the statute provides that in a condemnation case which is dismissed prior to impaneling of a jury attorney fees are authorized only up to a maximum of $25.
    Reversed and remanded.
    1. Eminent Domain — Condemnation—Costs—Attorney Fees.
    Attorney fees may not be taxed and awarded as costs in condemnation cases unless specifically authorized by statute or by court rule.
    2. Eminent Domain — Condemnation—Attorney Fees — Dismissal of Action — Statutes.
    Attorney fees in a condemnation case which is dismissed prior to impaneling of a jury are authorized only up to a maximum of $25 (MCL 213.37; MSA 8.27).
    References for Points in Headnotes

       27 Am Jur 2d, Eminent Domain §§ 473, 476.
    Attorney’s fees as within statute imposing upon condemner liability for "expenses,” "costs,” and the like. 26 ALR2d 1295.

       27 Am Jur 2d, Eminent Domain §§ 465, 467.
    Liability upon abandonment of eminent domain proceedings, for loss or expenses incurred by property owner, or for interest on award or judgment. 92 ALR2d 355.

      Travis, Warren, Nayer & Burgoyne, P.C. (by John M. Roche), for plaintiff.

      Felix S. Kubik, for defendants.
    Before: Allen, P.J., and R. M. Maher and J. E. Townsend, JJ.

       Circuit judge, sitting on the Court of Appeals by assignment.

   Per Curiam.

Plaintiff brought this condemnation action against the defendants on June 15, 1973. Prior to trial the defendants incurred substantial legal expenses in challenging the authority of the plaintiff to acquire property through condemnation proceedings without a referendum of the people. Prior to trial the plaintiff filed a notice of discontinuance of the action. Defendants filed motions for attorney fees and appraisal preparation fees. The trial court awarded attorney fees in the amount of $7,548.25 and appraisal fees in the amount of $8,000. Plaintiff appeals, alleging that the award of attorney fees was improper.

It has long been the rule that attorney fees may not be taxed and awarded as costs in condemnation cases unless specifically authorized by statute or by court rule, Hester v Commissioners of Parks and Boulevards of the City of Detroit, 84 Mich 450; 47 NW 1097 (1891); Detroit Edison Co v Janosz, 350 Mich 606; 87 NW2d 126 (1957). In condemnation cases, except those dismissed after the jury is impaneled, attorney fees are authorized by MCL 213.37; MSA 8.27, only up to a maximum of $25. No jury having been impaneled in this case, the award of attorney fees may not exceed $25.

Defendants contend that the rule regarding attorney fees in condemnation cases was abrogated by the adoption of GCR 1963, 504.1(2), which confers upon the trial court the power to dismiss upon motion of the plaintiff upon such terms and conditions as it deems just and proper. While this rule may empower the court to tax costs as a condition of dismissal, it may still tax only those costs authorized by statute, GCR 1963, 526.1. Attorney fees are taxable only as authorized by statute, MCL 600.2405; MSA 27A.2405.

We are not unsympathetic to defendants’ plight. They have gone to considerable expense preparing to defend an action which was dismissed over their objection, with no guarantee that they will not be subjected to a new proceeding with its attendant expense. However, we are bound by the statutes and court rules. In the case at bar, the applicable statute authorizes attorney fees up to a maximum of $25, MCL 213.37; MSA 8.27. The trial court erred in awarding a greater amount as attorney fees.

The award of attorney fees is reversed. We remand to the trial court! for an award of attorney fees not to exceed $25. Plaintiff may tax its costs of appeal.

       Cases dismissed after a jury has been impaneled are governed by MCL 213.38; MSA 8.28, which authorizes reasonable attorney fees.


source: Caselaw Access Project

author: R. H. Campbell, J. V. J. Brennan, J.

license: Public Domain

text:
    PEOPLE v CRABTREE
    Docket No. 77-411.
    Submitted June 5, 1978, at Grand Rapids.
    Decided January 3, 1979.
    Tillman Crabtree was convicted of criminal sexual conduct in the third degree in the Van Burén Circuit Court, Meyer Warshaw-sky, J. Defendant appeals alleging prosecutorial intimidation of the complainant. Held:

    1. The prosecutor’s action in apprising the complainant prior to trial of possible perjury charges if she changed her story to one exculpating the defendant was reversible error since (a) neither the trial court nor either of the counsel asked her if she had in fact been intimidated by the threat, (b) the prosecutor made no attempt to bring the matter to the attention of the court, and (c) the prosecutor made a blatant attempt to bolster the witness’s credibility by announcing that he would not prosecute her for perjury after she had testified against the defendant.
    2. A prosecutor may not show the general lack of morality of a defense witness by evidence of specific instances of conduct.
    3. Specific instances of conduct may be inquired into on cross-examination only if probative of truthfulness and if concerned with the witness’s character for truthfulness or untruthfulness; marijuana use is not such an instance of specific conduct.
    4. A prosecutor may not rebut reputation evidence of character with specific instances of conduct, however, inquiry is allowable into reports of relevant specific instances of conduct.
    Reversed and remanded.
    V. J. Brennan, J., dissented and would hold that the prosecutor’s action in apprising the complainant of possible perjury penalties was not error since any possibility of taint through intimidation was eliminated when the complainant stated at trial that her original version was the truth and that the prosecutor and police only wanted her to testify to the truth.

      References for Points in Headnotes

       63 Am Jur 2d, Prosecuting Attorneys §§ 22-27. 75 Am Jur 2d, Trial §§ 192-201.

       81 Am Jur 2d, Witnesses § 417.

       81 Am Jur 2d, Witnesses § 507.

       81 Am Jur 2d, Witnesses §§ 500-504.
    Cross-examination of character witness for accused with reference to particular acts or crimes. 47 ALR2d 1258.

      Opinion of the Court
    1. Witnesses — Criminal Law — District and Prosecuting Attorneys — Prosecution Intimidation.
    Prosecution intimidation of witnesses has been condemned whether the witnesses are defense witnesses or prosecution witnesses.
    2. Witnesses — Criminal Law — District and Prosecuting Attorneys — Prosecution Intimidation — Perjury—Appeal and Error.
    A prosecutor’s action in apprising the complainant prior to trial, in an action for criminal sexual conduct, of possible perjury penalties if she changed her story from that given at the preliminary examination, wherein she testified to the sexual act, was reversible error where (1) neither the trial court nor either of the counsel asked the complainant if she had in fact been intimidated by the threat, and (2) the prosecutor made no effort to bring the matter to the attention of the court, by examination or otherwise, and (3) the prosecutor made a blatant attempt to bolster the witness’s credibility by announcing that he would not prosecute her for perjury after she had testified against the defendant.
    3. District and Prosecuting Attorneys — Witnesses—Lack of Morality — Specific Instances of Conduct — Rules of Evidence.
    A prosecutor is not permitted to show the general lack of morality of a defense witness by evidence of specific instances of conduct; specific instances of conduct may be inquired into on cross-examination only if probative of truthfulness and if concerned with the witness’s character for truthfulness or untruthfulness; marijuana use is not such an instance of specific conduct contemplated by the rule (MRE 608[b]).
    4. District and Prosecuting Attorneys — Reputation Evidence— Specific Instances of Conduct — Reports—Rules of Evidence.
    A prosecutor may not rebut reputation evidence of character with specific instances of conduct, however, inquiry is allowable into reports of relevant specific instances of conduct (MRE 405).

      Dissent by V. J. Brennan, J.
    5. Witnesses — Criminal Law — District and Prosecuting Attorneys — Prosecution Intimidation — Perjury—Appeal and Error.

      A prosecutor’s action in apprising the complainant prior to trial, in an action for criminal sexual conduct, of possible perjury penalties if she changed her story from that given at the preliminary examination, wherein she testiñed to the sexual act, was not error where the complainant wanted to change her testimony to get out of going to court, the prosecutor emphasized that the complainant tell the truth, and the complainant testiñed at trial that her original version was the truth; any possibility of taint through intimidation was eliminated when the complainant stated that her original version was the truth and that the prosecutor and the police only wanted her to testify to the truth.

      Frank J. Kelley, Attorney General, Robert A. Derengoski, Solicitor General, Ward S. Hamlin, Jr., Prosecuting Attorney, and Thomas C. Nelson, Assistant Attorney General, Prosecuting Attorneys Appellate Service, for the people.

      Domnick J. Sorise, Assistant State Appellate Defender, for defendant on appeal.
    Before: Danhof, C.J., and V. J. Brennan and R. H. Campbell, JJ.

      Circuit judge, sitting on the Court of Appeals by assignment.

   R. H. Campbell, J.

The defendant was convicted by a jury of criminal sexual conduct in the third degree, MCL 750.520(d)(1); MSA 28.788(4X1), and was sentenced to a term of imprisonment from 4 to 15 years.

The 14-year-old alleged victim in this matter, as a result of apparent peer group pressures and inner dilemmas which we only speculate about, visited the prosecutor on thé day before trial was to begin. She informed him that she wanted to drop the charges against the defendant and explained that "he didn’t touch me” and that a police officer had pressured her into the charge in the first place. The prosecutor responded with a thinly-veiled threat of a perjury charge against the victim if she changed her story from that given at the preliminary examination (wherein she testified to the sexual act). At trial, this episode was revealed to the court and jury only as a result of the defense counsel’s thorough cross-examination of the witness. On redirect the prosecutor announced "for the record”, that "as Prosecutor of Van Burén County * * * I do not intend to prosecute this person as a perjuror. I am just interested in the truth”.

Prosecution intimidation of witnesses has been condemned, People v Pena, 383 Mich 402; 175 NW2d 767 (1970), whether the witnesses are defense witnesses or prosecution witnesses. People v Harley, 49 Mich App 729; 212 NW2d 810 (1973). We recognize the dilemma of the prosecutor when confronted with such a situation. But there were three additional problems which conclusively tilted the balance here toward reversal. First, neither the trial court nor either of the counsel asked the young witness if she had in fact been intimidated by the threat. Justice Adams in People v Pena, supra, suggested this, in particular, was a question to be asked by the trial court. Here, the prosecutor even requested that the judge ask the witness the question, but the trial judge declined. Second, the prosecutor made no effort to bring the matter to the attention of the court, by examination or otherwise. Rather, a thorough cross-examination of the witness by defense counsel yielded the information which, it is clear, would never have been revealed otherwise. And finally, the prosecutor’s announcement that he would not prosecute her for perjury — coming after she had testified against the defendant — was a blatant attempt to bolster the witness’s credibility. Such stands as an independent error, but also combines, in aggregate, with the prosecutor’s improper handling of the entire incident of the witness’s attempted recantation.

Other errors at trial also combined with the former to require reversal. Contrary to the prosecutor’s assertion at trial, he is not permitted to show the general lack of morality of a defense witness by evidence of specific instances of conduct. Rather, specific instances of conduct may be inquired into on cross-examination only if probative of truthfulness and if concerned with the witness’s character for truthfulness or untruthfulness. MRE 608(b), People v Bouchee, 400 Mich 253; 253 NW2d 626 (1977). Marijuana use is not such an instance of specific conduct contemplated by the rule.

Neither may the prosecutor rebut reputation evidence of character with specific instances of conduct, however, inquiry is allowable into reports of relevant specific instances of conduct. MRE 405, People v Roeder, 79 Mich App 595; 262 NW2d 872 (1977).

The resolution of the issues above makes discussion of the other issues raised by defendant unnecessary.

The defendant’s conviction is reversed and the case remanded for a new trial. The trial court should particularly ascertain whether the action of the prosecutor intimidated the victim into testifying as she did at trial.

Reversed and remanded.

Danhof, C.J., concurred.

V. J. Brennan, J.

(dissenting). I disagree with the majority’s disposition insofar as it is based on the question of intimidation of the complainant.

The facts surrounding the defendant’s claim of prosecutorial intimidation of the complainant are as follows. On the day before trial the complainant visited the prosecutor and stated that she wanted to drop the charges and that defendant "didn’t touch” her. The prosecutor then reviewed the complainant’s preliminary examination testimony and explained that if she changed her testimony she could be prosecuted for perjury. When asked at trial why she wanted to drop the charges the complainant stated that she didn’t like courtrooms and she wanted to "get out of going to Court”.

After reaffirming her original version of the incident, the following colloquy took place between the complainant and the prosecutor:

"BY MR. HAMLIN [Prosecutor]:
"Q * * * has Lieutenant Hogmire and myself had conversations with you in the last couple of days? •
"A Yes.
"Q During each of these conversations have we indicated to you that we wanted you to tell the truth?
"A Yes.
"Q Now, have you told the truth?
"A Yes.
"Q Now, when Mr. Hogmire came to your house that night, you indicated in response to Defendant Attorney’s questions that he asked you several times whether or not you had sex with him. Do you remember answering the Defense Attorney’s question?
"A I said yes.
"Q Yes he asked you several times. In the first of those several times that he asked you what was your reply?
"A No.
"Q Was there a reason why your reply was no?
"A Because I didn’t know what he would do.
"Q Pardon me?
"A I didn’t know what Ted [the defendant] would do if I told.
"Q Was your parents there when he was asking you those questions?
"A Yes.
"Q Has anybody told you what to say today or yesterday or when you testified yesterday?
"A Tedi [the defendant’s daughter], she told me to say he didn’t do it.
"Q Has Lieutenant Hogmire or myself told you what to testify to?
"A The truth.
"Q Have we given you words to testify to?
"A No.”

I would find the present case controlled by People v Zinn, 63 Mich App 204; 234 NW2d 452 (1975). There two prosecution witnesses who had made written statements prior to trial did not want to testify at trial. The prosecutor then warned both of the witnesses of the penalties for perjury. The jury was aware of this as it was heavily stressed in cross-examination by defense counsel. Upon testifying both witnesses maintained that they had not been intimidated when the prosecutor reminded them of the penalties for perjury. The Court held that the prosecutor did not commit error.

The facts in the present case are quite similar. The complainant, on the day before trial, did not want to testify. The prosecutor informed her of the penalties for perjury and at trial the complainant reaffirmed her original version. Any possibility of taint through intimidation was eliminated when the complainant stated that her original version was the truth and that the prosecutor and the police lieutenant only wanted her to testify to the truth.

Taking into account the reason for the complainant wanting to change her testimony, the emphasis by the prosecutor that the complainant tell the truth, and the fact that the complainant did testify that her original version was the truth, I would hold the prosecutor’s action in apprising the complainant of possible perjury penalties not to be error.


author: B. M. Hensick, J.

text:
    PEOPLE v ARNOLD SMITH
    Docket No. 77-3096.
    Submitted June 21, 1978, at Detroit.
    Decided January 3, 1979.
    Leave to appeal applied for.
    Two Detroit police officers observed Arnold C. Smith walking down a street after the curfew time for minors. The officers, believing that Smith was under 18 years of age, put a spotlight on the defendant and announced that they were police officers. Smith was actually 19 at the time. Smith then attempted to flee and just before being apprehended he threw a gun into some bushes. Smith was arrested and charged with carrying a concealed weapon. The defendant was subsequently found quilty as charged, Recorder’s Court of Detroit, Michael J. Hand, J. The defendant appeals, challenging the constitutionality of the Detroit curfew ordinance and claiming that because he was initially stopped pursuant to an unconstitutional ordinance, and the seizure of the gun flowed from the illegal stop, the gun should have been suppressed at trial. Held:

    1. The defendant lacks standing to challenge the constitutionality of the statute as applied to those who are 18 years old or younger, since he was not a member of the class to whom the statute applies.

      References for Points in Headnotes

       16 Am Jur 2d, Constitutional Law §§ 119-124.

       68 Am Jur 2d, Searches and Seizures § 2.

       5 Am Jur 2d, Arrest § 25.
    68 Am Jur 2d, Searches and Seizures § 99.

       5 Am Jur 2d, Arrest § 38.

       5 Am Jur 2d, Arrest § 46.

       16 Am Jur 2d, Constitutional Law § 121.

       5 Am Jur 2d, Arrest §§ 31, 40. 68 Am Jur 2d, Searches and Seizures §§ 23, 41-45, 88.

       56 Am Jur 2d, Municipal Corporations, Counties, and Other Political Subdivisions § 486.

       56 Am Jur 2d, Municipal Corporations, Counties, and Other Political Subdivisions §§ 353, 354.
    Conclusiveness of declaration of emergency in ordinance. 35 ALR2d 586.

       68 Am Jur 2d, Searches and Seizures § 99.

      2. The ordinance does not infringe on the constitutional rights of youthful-looking adults.
    3. The suspected violation of the curfew ordinance was a valid reason for the investigatory stop of the defendant. The subsequent observation of the gun provided the necessary probable cause to arrest defendant on the felony charge and the seizure of the gun was incident to a valid arrest.
    4. The Detroit curfew ordinance is not in conflict with the Governor’s exclusive emergency powers.
    Affirmed.
    1. Constitutional Law — Standing—Curfew Ordinance.
    A person over the age of 18 lacks standing to challenge the constitutionality of a curfew ordinance which applies to those who are 18 years old or younger.
    2. Searches and Seizures — Constitutional Law — Justification for Stop — Scope of Search.
    A police officer’s pursuit and arrest of a defendant whom the officer suspected of engaging in criminal activity is to be tested by the Fourth Amendment’s general proscription against unreasonable searches and seizures which requires inquiry as to: (1) whether the officer’s action was justified at its inception, and (2) whether it was reasonably related in scope to the circumstances which justified the interference in the first place (US Const, Am IV).
    3. Arrest — Searches and Seizures — Investigatory Stop — Probable Cause — Misdemeanors.
    A police officer who has probable cause to believe that a misdemeanor has been committed in his presence may make an investigatory stop in order to acquire additional information to confirm or refute his belief.
    4. Arrest — Probable Cause — Misdemeanors—Curfew Violation— Statutes — Juveniles.
    Probable cause is not sufficient to justify a warrantless misdemeanor arrest; therefore, a police officer cannot arrest a suspected curfew violator, under a curfew ordinance pertaining to persons 18 years old or younger, absent proof that the violator is in fact a juvenile.
    5. Arrest — Investigatory Stop — Police—Right to Question Citizens. ■
    The police have a right to request citizens to answer questions concerning unsolved crimes voluntarily, however, they have no right to compel them to answer.
    6. Constitutional Law — Statutes—Direct Injury — Challenge to Statute.
    A party who seeks to strike down a statute as unconstitutional must show direct injury from its enforcement.
    7. Arrest — Probable Cause — Concealed Weapons — Searches and Seizures — Investigatory Stop — Curfew.
    There was probable cause to arrest a defendant on the felony charge of carrying a concealed weapon where a gun was seen in the defendant’s possession subsequent to an investigatory stop of the defendant for a suspected violation of an ordinance providing a curfew for minors, and where the defendant did not stop but fled, and the gun was perceived during the pursuit; the seizure of the gun was incident to a valid arrest.
    8. Criminal Law — Constitutional Law — Curfew Ordinance — Miscalculation of Age — Minors.
    A police officer's understandable miscalculation of a person’s age which resulted in an investigatory stop to determine if the person was in violation of a curfew ordinance pertaining to minors does not give sufficient reason to question the constitutional validity of the curfew ordinance.
    9. Municipal Corporations — Curfew Ordinance — Minors.
    A city may regulate by ordinance a curfew on minors.
    10. Municipal Corporations — City Charter — Curfew Ordinance— Minors — State of Emergency — Governor—Exclusive Emergency Powers — Statutes.
    A provision in a city charter which allows a curfew ordinance pertaining to minors to be given immediate effect does not rise to the level of a declaration of a state of emergency; therefore, the curfew ordinance is not preempted by the statute which grants exclusive emergency powers to the Governor (MCL 10.31, 722.75; MSA 3.4[1], 28.342[4]).
    11. Searches and Seizures — Arrest—Probable Cause — Investigatory Stop.
    Probable cause to arrest is not necessary for an investigatory stop.

      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.

      Elizabeth Budman, for defendant on appeal.
    Before: D. C. Riley, P.J., and M. F. Cavanagh and B. M. Hensick, JJ.

       Circuit judge, sitting on the Court of Appeals by assignment.

   B. M. Hensick, J.

Defendant was charged with carrying a concealed weapon, MCL 750.227; MSA 28.424. He was jury convicted as charged and sentenced to 3 to 5 years imprisonment. He appeals as of right.

On September 13, 1977, at approximately 10 p.m., Detroit police officers Larry Nevers and Michael Angeluski were on street patrol in an unmarked police vehicle. They observed defendant walking down the street and directed the car’s spotlight on him. Officer Angeluski testified that they put the spotlight on defendant because there was a curfew in effect for persons under 18 years of age and they were checking for juveniles still out. Officer Nevers testified that he thought at the time that defendant was possibly a juvenile. Defendant was actually 19 years old at the time of this incident.

After placing the spotlight on defendant, Officer Nevers announced in a commanding voice that they were police officers and that they wanted to talk to defendant. Officer Nevers testified that defendant looked in their direction, reached under his shirt, ran a few steps and ducked behind a parked car. They pulled up next to the car and Officer Nevers again identified himself as a police officer. Defendant ran and Officer Nevers chased him on foot. While he was 10 to 15 feet behind defendant, Nevers saw defendant reach into his waist band area and throw a gun into some nearby bushes. Officer Angeluski also observed defendant throw a gun into some bushes. Defendant then stumbled and fell, and the officers arrested him and retrieved the gun. The gun and four live shells and one spent cartridge, found in the gun, were admitted into evidence.

On appeal, defendant raises several arguments challenging the constitutionality of the Detroit curfew ordinance. Defendant contends that the ordinance is void because it is unconstitutionally vague and overbroad, because it is an emergency enactment which is preempted by MCL 10.31; MSA 3.4(1), and because it permits the arrest of an individual without probable cause. Defendant argues that because he was initially stopped pursuant to an unconstitutional ordinance, and the seizure of the gun flowed from the illegal stop, the gun should have been suppressed at trial.

We begin our discussion of defendant’s constitutional arguments by narrowing the scope of this issue. Defendant, who was 19 years old at the time of the incident, was not a member of the class to whom the ordinance in question applies. He was not, and indeed, could not have been arrested, prosecuted or convicted for a violation of the ordinance. Defendant therefore lacks standing to attack the constitutionality of the statute as it applies to those who are 18 years old or younger. Mary v Lewis, 399 Mich 401, 416; 249 NW2d 102 (1976), Thomas v Morton Salt Co (On Rehearing), 258 Mich 231, 232; 242 NW 235 (1932).

We only address defendant’s contention that the ordinance impinges on the freedom of movement of youthful-looking persons over the age of 18. Although defendant was not charged under the curfew ordinance, we must address this question in order to determine whether the officers’ action in attempting to stop defendant and the subsequent pursuit which led to the seizure of the gun were justified. In People v Terrell, 77 Mich App 676, 679; 259 NW2d 187 (1977), this Court stated:

"The police officer’s investigatory pursuit of defendant must be tested by the Fourth Amendment’s general proscription against unreasonable searches and seizures. Terry v Ohio, 392 US 1; 88 S Ct 1868; 20 L Ed 2d 889 (1968). The inquiry demanded by Terry is a dual one.
" '* * * whether the officer’s action was justified at its inception, and whether it was reasonably related in scope to the circumstances which justified the interference in the first place.’ Terry v Ohio, 392 US at 20.”

An officer who has probable cause to believe that a misdemeanor has been committed in his presence may make an investigatory stop in order to acquire additional information to confirm or refute his belief. People v Ward, 73 Mich App 555, 561; 252 NW2d 514 (1977). However, probable cause is not sufficient to justify a warrantless misdemeanor arrest. MCL 764.15; MSA 28.874. Therefore, a police officer cannot arrest a suspected curfew violator, absent proof that the violator is in fact a juvenile.

In People v DeFillippo, 80 Mich App 197; 262 NW2d 921 (1977), lv den, 402 Mich 921 (1978); cert grt’d, — US —; 99 S Ct 76; 58 L Ed 2d 107 (1978), this Court held that the Detroit ordinance which allowed a police officer to arrest an individual for failure to produce identification was unconstitutional. The DeFillippo Court explained that while police may under certain circumstances intrude upon a person’s privacy by stopping him and asking questions, Terry v Ohio, 392 US 1; 88 S Ct 1868; 20 L Ed 2d 889 (1968), there can be no requirement that the person answer. " '[Wjhile police have a right to request citizens to answer voluntarily questions concerning unsolved crimes they have no right to compel them to answer.’ Davis v Mississippi, 394 US 721, 727 fn 6; 89 S Ct 1394, 1397, fn 6; 22 L Ed 676, 681 fn 6 (1969). Accord, Terry v Ohio, supra, at 34, 88 S Ct at 1886; 20 L Ed 2d at 913 (White, J., concurring).” 80 Mich App at 202.

In the instant case, defendant could have had no reasonable fear of prosecution under the ordinance. At most, the police officers could have asked defendant if he was a juvenile and defendant could have refused to answer. Given these circumstances, we fail to perceive any substantial infringement on defendant’s constitutional rights.

A party who seeks to strike down a statute as unconstitutional must show direct injury from its enforcement. City of Allegan v Consumers Power Co, 71 F2d 477 (CA 6, 1934). As the instant case only involves a relatively minor intrusion, we reject defendant’s contention that the ordinance infringes on the rights of youthful-looking adults.

We conclude that the suspected violation of the curfew ordinance was a valid reason for the investigatory stop of defendant and that an understandable miscalculation of age is not sufficient to question the validity of the ordinance. The subsequent observation of the gun provided the necessary probable cause to arrest defendant on the felony charge and the seizure of the gun was incident to the valid arrest.

We also reject defendant’s argument that the enactment of the Detroit curfew ordinance as an emergency ordinance is preempted by the exclusive emergency powers granted to the Governor in MCL 10.31; MSA 3.4(1).

The ordinance involved here was passed by the Detroit City Council as an emergency ordinance on August 18, 1976, following the robbing and terrorizing by youths of patrons of a rock concert at Cobo Hall on August 15, 1976. In October, 1976, the curfew provisions were made permanent with only two minor changes. See Note: Juvenile Curfew Ordinances and the Constitution, 76 Mich L Rev 109 (1977), for the background of this ordinance.

Section 4-116 of the Detroit City Charter provides an expedited procedure for immediate enactment of an ordinance at the meeting in which it is introduced where a public emergency exists. The emergency ordinance is automatically repealed on the 61st day after its enactment, unless re-enacted. This procedure eliminates the usual waiting period between passage and enactment of an ordinance.

Walsh v River Rouge, 385 Mich 623; 189 NW2d 318 (1971), which holds that the emergency powers granted to the Governor by MCL 10.31; MSA 3.4(1) are exclusive, is not applicable here. In Walsh, the City Council passed an emergency curfew ordinance which purported to give to the Mayor the power to " 'proclaim a state of emergency, in the City of River Rouge whenever he is advised by the Chief of Police that a civil disturbance, riot or civil commotion is in progress ***.’” 385 Mich at 626. At the same time the ordinance was passed, the Mayor reissued a proclamation which prohibited possession of firearms, ammunition, explosives, inflammable materials or liquids, or other dangerous weapons, within the city by any citizen except law officers; prohibited "unlawful traffic” within the city; created a 6 p.m. to 5 a.m. curfew when no person could be on the city streets except those proceeding to and from work or answering emergency calls or who had special permission; closed all liquor stores and prohibited the sale of alcoholic beverages; prohibited all assemblies of more than 5 persons "unless permission has been granted”; closed gas stations in the city except between the hours of 12 noon and 5 p.m.; and prohibited the sale of more than 5 gallons of gas to individuals with private automobiles.

Section 4-116 does not provide for the declaration of a state of emergency with all the attendant consequences as envisioned by MCL 10.31; MSA 3.4(1) and Walsh. Rather, it merely provides that an ordinance may be given immediate effect where an emergency situation requires it. Further support for this conclusion is found in the commentary to § 4-116 contained in "The Final Report Of The Detroit Charter Revision Commission”, p 9, August 3, 1973 (reprinted with corrections February, 1974), in which the Commission specifically notes the limitations imposed by Walsh on a city’s power to declare an emergency and impose emergency regulations.

Under MCL 722.754; MSA 28.342(4), a city may regulate by ordinance a curfew on minors. The provision of the Detroit City Charter which allows such an ordinance to be given immediate effect does not rise to the level of a declaration of a state of emergency as provided for in MCL 10.31; MSA 3.4(1). We therefore conclude that no preemption problem exists in the instant case.

Finally, we reject defendant’s contention that the curfew ordinance permits the arrest of an individual without probable cause. Defendant confuses the concept of an investigatory stop with the concept of an arrest. Probable cause to arrest is not necessary for an investigatory stop. People v Lillis, 64 Mich App 64, 70; 235 NW2d 65 (1975).

We have carefully reviewed defendant’s two remaining allegations of error and conclude that no reversible error occurred.

Affirmed.

       The relevant provisions of the Detroit curfew ordinance are:
      "Sec. 36-3-1. Public Streets, playgrounds, etc.
      "It shall be unlawful for a minor to be on the public streets, playgrounds, vacant lots or other unsupervised place, if such minor is under eighteen years of age, between the hours of 10:00 P.M. and 6:00 A.M., except Fridays and Saturdays, when the time for minors sixteen and seventeen years of age shall be between 11:00 P.M. and 6:00 A.M. (Ord. No. 424-F, § 1; Ord. No. 142-H, § 1; Ord. No. 157-H, § 1.)
      "Sec. 36-3-5. Exceptions to article.
      "The provisions of this article do not apply to:
      “(a) A minor accompanied by his or her parent, legal guardian or other adult person having the care or custody of the minor; or
      "(b) A minor going to or returning from work, provided, that the minor’s hours of employment do not violate state law; provided further, that the minor possesses a signed statement issued by his or her employer within the previous ninety days setting forth the minor’s hours of employment; and provided further, that such minor shall be exempt from the requirements of this article for not more than one hour before the minor’s work day begins and for not more than one hour after the minor’s work day ends. (Ord. No. 424-F, § 5; Ord. No. 450-F, § 1; Ord. No. 144-H, § 1; Ord. No. 157-H, § 1.)”


author: D. F. Walsh, P.J.

text:
    THE CHESAPEAKE & OHIO RAILWAY COMPANY v DEPARTMENT OF TREASURY
    Docket Nos. 77-3652-77-3657.
    Submitted November 7, 1978, at Lansing.
    Decided January 3, 1979.
    Chesapeake and Ohio Railway Company (C & O), an interstate railroad operating in Michigan, filed annual reports for the years 1968 through 1974 with the Department of Treasury, Franchise Fee Division, and paid annual franchise fees. Deficiencies were assessed against C & O by the division for each of those years. In each instance C & O applied for a redetermination of its franchise fees to the Corporation Tax Appeal Board. These applications were consolidated for a hearing before the board in 1975. C & O, in an amended petition, allowed by the chairman of the tax appeal board, alleged that the Franchise Fee Division had utilized an incorrect formula in computing its annual franchise fees. The tax appeal board granted C & O franchise fee refunds for the years 1973 and 1974 and reversed a franchise fee deficiency assessed against C & O for 1972. Defendant, Department of Treasury, Franchise Fee Division, appeals this order by leave granted. C & O cross-appeals seeking reversal of the board’s denial of its petitions for franchise fee refunds for the years preceding 1973 and for reversal of the deficiencies assessed for the years 1968 through 1974, excluding 1972. Held:

    1. The Corporation Tax Appeal Board erred in ruling that the refund of franchise fees for the years preceding 1973 was barred by a three-year statute of limitations.
    2. The board erred in reversing the 1972 deficiency assessment against C & O. Where an annual report and the franchise fee based thereon were never accepted by the Franchise Fee Division, the division has the power to recompute the franchise fee of a corporation.

      References for Points in Headnotes

       72 Am Jur 2d, State and Local Taxation § 1143.

       72 Am Jur 2d, State and Local Taxation § 1141.

       71 Am Jur 2d, State and Local Taxation § 270.

       35 Am Jur 2d, Federal Tax Enforcement § 1.

       71 Am Jur 2d, State and Local Taxation § 601.

       [No reference]

      3. The Franchise Fee Division’s use of a "weighted average” allocation formula for computing C & O’s franchise fees does not comply with the plain language of the statute. The board ruled properly in determining that the "weighted average” computations were prohibited by statute.
    4. Remand to the Corporation Tax Appeal Board is necessary where the record is insufficient for the Court of Appeals to determine if a new method or adjusted formula for tax computations was devised and published by the Franchise Fee Division.
    5. The board properly ruled that C & O’s reserve for deferred income taxes was to be treated as part of surplus for the purpose of computing its franchise fee.
    Affirmed in part, reversed in part, and remanded.
    1. Taxation — Corporation Tax Appeal Board — Pleadings—Amendment — Administrative Rules.
    Pleadings before the Corporation Tax Appeal Board may be amended at any time prior to 10 days before the initial hearing and thereafter by leave of the chairman of the board (1973 AACS, R 450.68).
    2. Taxation — Corporations—Franchise Fees — Limitation of Actions — Corporation Tax Appeal Board — Amendments— Chairman’s Discretion — Statutes.
    A statutory three-year period of limitations does not bar the refund of corporate franchise fees where petitions for refunds were originally timely filed and where the chairman of the Corporation Tax Appeal Board, in the proper use of his discretion, determines that an amended petition for refunds for present and prior years should be allowed (MCL 450.310; MSA 21.210[1]).
    3. Taxation — Corporations—Franchise Fees — Calculation—Statutes.
    The Corporation Franchise Fee Division, Department of Treasury, is responsible for final calculation of corporate franchise fees (MCL 450.304; MSA 21.205).
    4. Taxation — Corporations—Franchise Fees — Annual Reports— Acceptance of Annual Reports.
    The Department of Treasury is without power to recompute a corporation’s franchise fee after having accepted the corporation’s annual report and franchise fee; the rule, however, is inapplicable where the record clearly indicates that the annual report and franchise fee based thereon were never accepted by the department.
    5. Taxation — Corporations—Franchise Fees — Audits—Payments and Refunds — Repealed Franchise Fee Act — Enforcement— Statutes.
    Department of Treasury audits performed for the purpose of determining corporate franchise fees levied pursuant to the former statutory provision on fees, taxes and charges and all payments received and refunds made on the basis of those audits before repeal of the act are valid (MCL 450.321; MSA 21.213[1]).
    6. Taxation — Railroads—Franchise Fees — Weighted Average Formula — Statutes.
    The use of a "weighted average” formula for computing franchise fees payable by interstate railroads is not the formula mandated by statute (MCL 450.305b; MSA 21.208[2]).
    7. Taxation — Railroads—Franchise Fees — Allocation Factors— Publication of Rulings — New Methods or Formulas — Statutes.
    The Franchise Fee Division of the Department of Treasury has statutory authority, if it appears that business activity attributable to Michigan was not reflected in an allocation factor used to determine the tax payable by an interstate railroad, to apply any other similar method calculated to effect a fair and proper allocation, provided the division promptly publishes its rulings with respect to any applications of new methods or adjusted formulas (MCL 450.305e; MSA 21.208[5]).

      Frank J. Kelley, Attorney General, Robert A. Derengoski, Solicitor General, and Richard R. Roesch and Charles E. Liken, Assistants Attorney General, for defendant.

      Dykema, Gossett, Spencer, Goodnow & Trigg (by David M. Rosenberger), for plaintiff.
    Before: D. F. Walsh, P.J., and T. M. Burns and D. E. Holbrook, Jr., JJ.
   D. F. Walsh, P.J.

Defendant Department of Treasury, Franchise Fee Division, appeals the order of the Corporation Tax Appeal Board granting plaintiff railroad’s petition for franchise fee refund for the years 1973 and 1974 and reversing a franchise fee deficiency assessed against plaintiff by defendant for 1972. On cross-appeal plaintiff seeks reversal of the board’s order denying plaintiff’s petition for franchise fee refunds for the years preceding 1973 and for reversal of deficiencies assessed against plaintiff by defendant for 1968 through 1974, excluding 1972.

Plaintiff is a Virginia corporation with principal offices in Cleveland, Ohio. A portion of the railroad owned by plaintiff is operated in Michigan. Until the repeal in 1977, of the corporation fees, taxes and charges act, MCL 450.301 et seq.; MSA 21.201 et seq., plaintiff was obligated to pay an annual franchise fee in Michigan.

From 1968 to 1974, inclusive, plaintiff filed an annual report and paid a franchise fee based thereon, as required by the now repealed act. MCL 450.304; MSA 21.205. With respect to each of those years, deficiencies were assessed by defendant against plaintiff. In each instance, plaintiff applied under § 9 of the act (MCL 450.309; MSA 21.210) for a redetermination of its franchise fee. The redeterminations were timely appealed by plaintiff to the Corporation Tax Appeal Board. The appeals were consolidated for hearing before the board in 1975. Prior to hearing, plaintiff sought leave to amend its petitions for redetermination. The amended petitions added the allegation that defendant had utilized an incorrect formula in computing plaintiff’s annual franchise fee for each of the years in question, being 1969 through 1974. Plaintiff’s request to amend its petitions was granted. The board’s opinion was issued on August 30, 1977.

We address four issues on appeal:

1. Did the board err in ruling that consideration of issues raised in petitions for refund of franchise fees for the years preceding 1973 was barred by the three-year statute of limitations set forth in § 10 (MCL 450.310; MSA 21.210[1]) of the corporation fees, taxes and charges act?

2. Did the board err in ruling that the redeter-mination made by defendant for the 1972 tax year was void because it was based on a field audit conducted "some time after additional information was requested by [defendant] and supplied by [plaintiff]”?

3. Did the board err in ruling that the wrong formula had been used in computing plaintiff’s franchise fee?

4. Did the board err in ruling that deficiencies assessed against plaintiff by defendant were proper and necessary because plaintiff used an incorrect accounting system in determining its paid up capital and surplus?

I. Amended Petition for Refund

On January 30, 1976, plaintiff filed amended petitions for redetermination of franchise fees for the years 1969 through 1974. It was plaintiff’s position that it had paid excess franchise fees for those years based on erroneous calculation of the relevant portion of its paid-up capital and surplus. According to plaintiff, the formula which had been used by plaintiff at the direction of defendant did not satisfy the legislatively prescribed formula set forth in MCL 450.305b; MSA 21.208(2).

1973 A ACS, R 450.68, provides that pleadings before the Corporation Tax Appeal Board may be amended at any time prior to 10 days before the initial hearing and thereafter by leave of the chairman of the board. Citing this rule, the acting chairman granted plaintiiFs request to file the amended petitions.

In ruling on plaintiiFs request for redetermination based on alleged use of an improper formula, however, the board found that the amended petitions sought the relief provided for under § 10 of the act and that, therefore, § 10’s three-year statute of limitations applied. Issues raised in the amended petitions for refunds, therefore, were not considered for years preceding 1973. This was error.

Plaintiff filed proper and timely petitions for redeterminatións and appeals for each of the years at issue under § 9 of the act. That section contemplated not only reversal of incorrect deficiency assessments but also refund of excess franchise fees paid by corporate taxpayers. It was defendant who was responsible for final calculation of corporate franchise fees. MCL 450.304; MSA 21.205. Under §9 the appeal board was authorized to consider any issue pertinent to defendant’s determination. The chairman of the board, in the proper exercise of his discretion, determined that amendment of the petitions would be allowed. The allocation formula issue (see Issue III, infra) was, therefore, properly before the board as to all years for which plaintiff had timely filed for redetermi-nation under § 9 of the act and which were included in its amended petitions.

II. 1972 Field Audit

On May 15, 1972, plaintiff filed its 1972 annual report and paid its franchise fee based thereon. In April 1973, defendant requested a complete breakdown of items included in the report under the heading "Other deferred credits”. A field audit had begun at plaintiffs home office on October 4, 1972. From June to August 1973, plaintiff and defendant corresponded regarding further explanation of certain of the liabilities listed in plaintiffs 1972 annual report. The field audit was concluded on August 17, 1973. A determination of deficiency, based on this audit, was issued on October 9, 1973.

In Borden, Inc v Dep’t of Treasury, 391 Mich 495; 218 NW2d 667 (1974), an evenly divided Supreme Court affirmed an opinion of this Court (43 Mich App 106; 204 NW2d 34 [1972]) which had held that the Department of Treasury was without power to recompute a corporation’s franchise fee after having accepted the corporation’s annual report and franchise fee. A majority of the participating justices held similarly in Clark Equipment Co v Dep’t of Treasury, Revenue Division, 394 Mich 396; 230 NW2d 548 (1975).

The instant record clearly indicates that plaintiffs 1972 annual report and the franchise fee it computed based on that report were never accepted by defendant. The board, therefore, erred in relying on Borden and Clark in reversing the 1972 deficiency assessment.

We further note that the issue of defendant’s authority to conduct audits at anytime for the purpose of determining corporate franchise fee liability was recently definitively resolved by the Michigan Legislature. MCL 450.321; MSA 21.213(1); 1978 PA 392, an act approved August 1, 1978, and ordered to take immediate effect, provides:

"All audits performed by or at the direction of the department of treasury for the purpose of determining liability for a corporate franchise fee levied pursuant to former Act No. 85 of the Public Acts of 1921 [MCL 450.301 et seq., supra], and all payments received and refunds made on the basis of those audits before the repeal of former Act No. 85 of the Public Acts of 1921 are declared to be valid and to have been in fulfillment of the legislative purpose to provide for fair administration and enforcement of that act.”

III. Computation of Railroad’s Franchise Fee

Each of plaintiffs petitions of appeal was amended by addition of the following paragraph:

"Appellant [i.e., plaintiff] alleges that its Michigan Franchise Fees for all years in issue in this proceeding, being 1969 through 1974, have been incorrectly computed by the Corporation and by the Franchise Fee Division, since a weighted average has been used in the allocation of Appellant’s tax base to Michigan, under Section 5b of the Fees, Taxes and Charges Act, MCL 450.305b; MBA [sic] 21.208, whereas the plain language of that section calls for allocation on the basis of a simple average of the railroad’s passenger-mile and ton-mile fractions, separately computed and individually weighted by the ratio of gross receipts from passenger transportation to total gross receipts from all transportation, and by the ratio of gross receipts from freight transportation to total gross receipts from all transportation respectively.”

MCL 450.305b; MSA 21.208(2) set forth the formula to be used in determining the annual franchise fee payable by railroad companies:

"Sec. 5b. For the purpose of determining the annual franchise fee, the tax payable by a railroad company shall be measured by that portion of its paid-up capital and surplus determined by the average of its passenger-mile and ton-mile fractions, separately computed and individually weighted by the ratio of gross receipts from passenger transportation to total gross receipts from all transportation, and by the ratio of gross receipts from freight transportation to total gross receipts from all transportation, respectively: Provided, That in computing the tax of a non-operating railroad there shall be excluded that portion of its paid-up capital and surplus as the ratio of the value of its property released to an operating railroad bears to the total value of its assets.”

For many years defendant has utilized a "weighted average” formula in computing the Michigan franchise fees payable by interstate railroads. There seems to be little argument that this formula fairly accurately reflected the actual amount of plaintiffs business activity attributable to Michigan. Plaintiff argues, however, that this formula is not the formula described in the above-quoted § 5b of the statute.

As noted above (Issue I), the board erroneously refused to consider this issue with respect to the years preceding 1973. With respect to 1973 and 1974, however, the board agreed with the plaintiff that the formula provided for by statute had not been used. Plaintiff’s petitions for refunds for those years were granted.

Our review of the statutory language persuades us that the board’s understanding of that language was correct, and that the "weighted average” formula used by defendant was not the formula mandated by § 5b of the statute.

Defendant now argues that, under § 5e of the act (MCL 450.305e; MSA 21.208[5]), it had authority to compute corporate franchise fees to reflect more properly business activity attributable to Michigan. Section 5e(4) provided that, if it appeared that business activity attributable to Michigan was not reflected in an allocation factor determined pursuant to § 5b, the defendant could apply "any other similar method calculated to effect a fair and proper allocation according to the receipts, activity, business and capital reasonably attributable to this state”. However, §5e also provided that defendant was to publish promptly its rulings with respect to application of adjusted formulas under §5e. The rulings were to be promulgated in conjunction with the Michigan Department of Revenue.

The record indicates that, in 1952, a handwritten message was sent by Mrs. Alma Marzke, the then Administrator of the Corporation Franchise Fee Division, to plaintiff. This message informed plaintiff that the "weighted average” formula would be used by the Franchise Fee Division in computing the railroad’s annual franchise fee. Plaintiff used this formula until consultation with independent counsel in 1975-1976. It was at that time that plaintiff first realized that the plain language of § 5b did not call for a "weighted average”.

Although the Franchise Fee Division has authority under §5e to devise new formulas to further the express legislative intent that franchise fees reflect the amount of a corporation’s business activity attributable to Michigan, the instant record is insufficient for us to determine if the division devised such a formula for railroads engaged in interstate business and properly published it pursuant to §5e(4) and the final paragraph jof §5e. The board did not address the issue of the applicability of § 5e. We, therefore, remand to the board for initial determination of this issue.

IV. Accounting Method

In assessing deficiencies for the years in question, defendant expressed its disagreement with certain accounting procedures used by plaintiff. We affirm the board’s ruling that plaintiff’s reserve for deferred Federal income taxes is to be treated as part of "surplus” for the purpose of computing its franchise fee. National-Standard Co v Dep’t of Treasury, 384 Mich 184; 180 NW2d 764 (1970).

Conclusion

1. With respect to the Corporation Tax Appeal Board’s ruling that consideration of issues raised in plaintiff’s amended petitions was precluded for years preceding 1973 by virtue of the three-year statute of limitations contained in § 10 of the corporation fees, taxes and charges act, the board is reversed.

2. With respect to the board’s ruling that "determinations and redeterminations assessing deficiencies based on field audits are void” the board is reversed.

3. With respect to the board’s ruling as to the propriety of the "weighted average” allocation formula utilized by the Corporation Franchise Fee Division the board is affirmed. Although we affirm the board’s ruling that the "weighted average” formula does not comply with the plain language of § 5b, we remand for consideration of the possible applicability of § 5e. If the board determines that defendant devised and published an alternative formula in compliance with the provisions of § 5e of the act, that alternative formula is to be applied to all years in question, being the years 1969 through 1974. If the board decides that defendant did not devise and publish an alternative formula in compliance with the provisions of § 5e, the formula provided for in § 5b of the act is to be applied, as interpreted by the board in its opinion, to the years 1969 through 1974.

4. With respect to the board’s ruling that the accounting method utilized by the Corporation Franchise Fee Division was correct the board is affirmed. National Standard Co v Dep’t of Treasury, supra.

Reversed in part, affirmed in part, but remanded for redetermination and further proceedings consistent with this opinion. We retain jurisdiction. No costs, a public question.


author: T. M. Burns, J.

text:
    TAGGIE v DEPARTMENT OF NATURAL RESOURCES
    Docket No. 77-4879.
    Submitted October 4, 1978, at Grand Rapids.
    Decided January 3, 1979.
    JoAnne Taggie was rendered a permanent paraplegic when she was struck by falling rocks in Tahquamenon State Park. She and her husband, Ben Taggie, commenced an action in the Court of Claims against the Department of Natural Resources for damages for personal injuries and for loss of consortium. The plaintiffs subsequently filed an amended complaint and a second amended complaint. The defendant did not file answers to the complaints but interposed the defense of governmental immunity. The Court of Claims, Ronald M. Ryan, J., dismissed the plaintiffs’ suit holding that the plaintiffs’ claims were barred by governmental immunity. The plaintiffs appeal. Held:

    1. The trial court erred in dismissing the intentional nuisance count of the complaint. The defense of governmental immunity is not a bar to a claim based on an intentionally created nuisance in fact.
    2. The plaintiff-husband’s claim for loss of consortium was improperly dismissed. There is no rule which prohibits appending a claim for loss of consortium to a claim based on nuisance in an action against the state.
    3. The dismissal of the count which alleged a breach of an implied contractual duty was proper. Michigan courts do not recognize such a cause of action.
    Affirmed in part, reversed in part and remanded.
    1. Nuisance — Governmental Immunity.
    Governmental immunity is not a bar to a claim based on an intentionally created nuisance in fact.
    References for Points in Headnotes

       57 Am Jur 2d, Municipal, School, and State Tort Liability §§ 293-295.

       57 Am Jur 2d, Municipal, School, and State Tort Liability §§ 54, 59, 60.
    Municipal immunity from liability for torts. 60 ALR2d 1193.

       58 Am Jur 2d, Nuisances § 125.

       17 Am Jur 2d, Contracts § 441.

      2. Nuisance — Governmental Immunity — Intentional Nuisance— Pleading — Summary Judgment.
    A complaint which alleged that a governmental agency negligently created a nuisance and that the agency "refused” to eliminate the dangerous condition sufficiently describes an intentional act by the government which, if established by proofs, could result in a finding by the trier of fact that the agency intentionally brought about the condition and, therefore, the agency is not entitled to claim governmental immunity from the suit.
    3. Nuisance — Governmental Immunity — Common Law — Statutes.
    The nuisance exception to governmental immunity from tort liability arises solely from case law and not from statute (MCL 691.1407; MSA 3.996[107]).
    4. Nuisance — Consortium—Common Law — Case Precedent — Actions Against State.
    There is no rule in Michigan case law which prohibits appending a claim for loss of consortium to a claim based on nuisance in an action against the state.
    5. Contracts — Breach of Implied Duty — Action for Personal Injuries — Case Precedent.
    An action for personal injuries based only on a breach of an implied contractual duty is not recognized by Michigan courts.

      Gray & Taylor, P.C., for plaintiffs.

      Frank J. Kelley, Attorney General, Robert A. Derengoski, Solicitor General, and Jerome Maslow-ski and Curtis G. Beck, Assistants Attorney General, for defendant.
    Before: D. F. Walsh, P.J., and T. M. Burns and C. J. Byrns, JJ.

       Circuit judge, sitting on the Court of Appeals by assignment.

   T. M. Burns, J.

Plaintiff Jo Anne Taggie was rendered a permanent paraplegic when she was struck by falling rocks in Tahquamenon State Park on July 4, 1975. She and her husband, plaintiff Ben Taggie, filed a complaint and eventually an amended and second amended complaint seeking to impose liability for her injury on the Department of Natural Resources under several theories. None of the complaints have been answered. Instead, the defendant interposed the defense of governmental immunity. The Court of Claims dismissed the suit on that basis. We reverse.

I

The Court of Claims had initially refused to dismiss the complaint finding that plaintiff had properly pled the existence of a nuisance in fact. On the DNR’s motion for rehearing, the trial court reversed its earlier conclusion, although troubled by the proposition, and found that only a claim of nuisance which resulted in the taking of private property or a trespass on private property would survive a properly pled claim of governmental immunity. Buddy v Dep’t of Natural Resources, 59 Mich App 598; 229 NW2d 865 (1975), and Gerzeski v Dep’t of State Highways, 68 Mich App 91; 241 NW2d 771 (1976), were cited in support of dismissal.

Recent Supreme Court decisions make it clear that the trial court’s decision was incorrect. In Gerzeski v Dep’t of State Highways, 403 Mich 149; 268 NW2d 525 (1978), and Rosario v City of Lansing, 403 Mich 124; 268 NW2d 230 (1978), the Court attempted to clarify the judicially created nuisance exception to governmental immunity. No opinion in either case was signed by a majority of the justices, but five justices would agree that governmental immunity is not a bar to a claim based on an intentionally created nuisance in fact. See, Affiliated FM Ins Co v Michigan, 86 Mich App 203; 272 NW2d 239 (1978).

Rosario is controlling here. Like the present case, Rosario involved a nuisance claim which was dismissed without taking evidence. Justice Moody stated that the pleadings in this type of case must be liberally construed and concluded the allegation that the City of Lansing had "refused” to replace a manhole cover or take other remedial action was a sufficient allegation of intentional nuisance in fact to avoid summary dismissal. 403 Mich at 143-144.

The condition which plaintiffs claim was a nuisance in this case resulted from the convergence of two circumstances which also bring it within the intentional nuisance classification. According to the complaint, the defendant knew that previous rockslides had occurred in the area in which plaintiff was injured and that future rock slides would occur, but did not take any steps to make the area safer, either by removing the offending rocks or keeping tourists out of this area. At the same time, the defendant created an appearance of safety by the use of diagrams, maps, stairs and trails which led these plaintiffs, and other tourists, to the danger area in ignorance of the risk. It is knowledge of these facts which may bring the nuisance within the intentional classification. Rosario, 403 Mich at 143, n 2. As a question of pleading, the complaint is sufficient to avoid dismissal. Whether it can be factually supported is a question which is not properly before us at this time.

The court erred in dismissing the nuisance count of the complaint.

II

The trial court dismissed plaintiff Ben Taggie’s derivative claim for loss of consortium because of a belief that derivative claims could not be maintained in the Court of Claims. The trial court’s rationale was based on Dillon v Secretary of State, 61 Mich App 588; 233 NW2d 96 (1975), lv den, 397 Mich 812 (1976). Dillon prohibited or limited payment of certain derivative claims under the Motor Vehicle Accident Claims Act, MCL 257.1101 et seq.; MSA 9.2801 et seq., because of the specific language of that act. It does not control this case.

The trial court and defendant seem to base their position on the erroneous assumption that Mrs. Taggie’s claim, on which the husband’s claim is dependent, is somehow controlled by the governmental immunity statute, MCL 691.1407; MSA 3.996(107). But, as Justice Fitzgerald makes clear through his opinion in Rosario,. 403 Mich at 131, nuisance as an exception to governmental immunity is a judicially created exception and is controlled solely by the case law. There is no rule in our cases which prohibits appending a claim for loss of consortium to a claim based on nuisance. The trial court erred in dismissing plaintiff Ben Taggie’s claim for loss of consortium.

Ill

At the time of the injury, plaintiffs were camping in the Tahquamenon Falls State Park. A fee was paid to the state for the use of the campsite. Based on these facts, plaintiff alleged a right to recover for personal injuries under a breach of contract theory. The trial court dismissed this claim.

The trial court’s action in this regard was correct. Assuming that some contractual relation arose between plaintiffs and the DNR under the "camper permit and receipt”, there is nothing in that document which would impose on defendant the duties claimed by plaintiffs in their complaint with regard to the site of the injury, which was some distance from the camping area.

Baatz v Smith, 361 Mich 68; 104 NW2d 787 (1960), and Clark v Dalman, 379 Mich 251; 150 NW2d 755 (1967), were properly applied by the trial court. The result suggested by those authorities is not changed by Mobil Oil Corp v Thorn, 401 Mich 306; 262 NW2d 651 (1977). The contract involved in Thorn contained a clause specifically requiring the defendant to make repairs. It was breach of the express contractual clause which led to the possibility of liability on a contract theory in Thorn. Here, plaintiffs claim no breach of an express contractual undertaking by defendant, but only a breach of an implied contractual duty. Such an action is not recognized by our courts. Plaintiffs’ remedy lies under the nuisance count of their complaint. Baatz v Smith, supra.

The dismissal of plaintiff’s claims based on nuisance and loss of consortium are reversed and the matter remanded to the Court of Claims for proceedings not inconsistent with this opinion. Costs to abide the final result.


author: R. M. Maher, J.

text:
    MICHIGAN BELL TELEPHONE COMPANY v C & C EXCAVATING COMPANY
    Docket No. 77-4895.
    Submitted November 8, 1978, at Detroit.
    Decided January 3, 1979.
    Leave to appeal denied, 406 Mich 930.
    Plaintiff, Michigan Bell Telephone Company, contracted with defendant C & C Excavating Company for certain construction work. The contract called for C & C to supply proof that subcontractors and materialmen had been paid and allowed Michigan Bell to withhold payment to C & C until such proof was furnished. During the construction C & C abandoned the project. Michigan Bell filed an interpleader action against defendants C & C Excavating Co., Stock Brothers, Inc., W. C. Investment Corp., Shores Re-Steel, Inc., Troy W. Maschmeyer Co., Midway Supply Co., Price Brothers Co., Auburn Supply Co., Inc., and the Michigan Department of Treasury to determine the rights of potential claimants to a sum of money still due C & C on the contract. Default judgments were entered against all defendants except the Department of Treasury, Shores Re-Steel and Auburn. The Department of Treasury cross-claimed a lien in excess of the amount due on the contract for income taxes withheld and motor fuel taxes accrued and unpaid. Auburn counterclaimed against Michigan Bell alleging the contract between Michigan Bell and C & C, the failure of C & C to provide proof of payment of subcontractors and materialmen, and delivery of labor and materials to C & C under the contract for which a balance was due. Shores Re-Steel counterclaimed also alleging the contract and delivery of labor and materials thereunder for which it was owed and, in addition, alleged that Michigan Bell was negligent in failing to withhold payment to C & C until furnished with evidence of payment of subcontractors’ and materialmen’s claims and alleged a wrongful disclosure to a writ of garnishment previously served on Michigan Bell. The Macomb Circuit Court, Hunter D. Stair, J., found Michigan Bell negligent in continuing to make payments under the contract to C & C after C & C abandoned the project and entered judgments against Michigan Bell in favor of the Department of Treasury, Auburn and Shores Re-Steel. Michigan Bell’s motion for a new trial or for amendment of the judgments was denied. Michigan Bell appeals. Held:

      References for Points in Headnotes

       72 Am Jur 2d, Statute of Frauds § 251.
    72 Am Jur 2d, Statute of Frauds § 589.

       73 Am Jur 2d, Statute of Frauds § 565.

       72 Am Jur 2d, State and Local Taxation §§ 898-903.

      1. Neither the contract provision nor an alleged ofal promise by Michigan Bell’s agent to pay the debts of the contractor can form the basis of recovery on the subcontractors’ counterclaims, nor does payment of some subcontractors render Michigan Bell liable to others.
    2. There was no evidence justifying a finding that Michigan Bell was liable for back taxes owed by C & C.
    3. The Michigán Treasury Department’s lien for accrued and unpaid income tax withholdings and motor fuel taxes and penalties is prior to a claim by a subcontractor who does work for the taxpayer after the taxes and penalties accrued and applies to monies due the taxpayer on a contract under which the subcontractor supplied the work.
    Reversed and remanded.
    1. Frauds, Statute of — Labor and Material Bonds — Promise to Pay Debt of Another — Contracts in Writing.
    A property owner’s indirect promissory representation that a labor and material bond would be given by the general contractor who contracted to construct a building on the owner’s property can not create a more binding obligation than a direct promise to the plaintiff, a subcontractor, to pay him or to see that the general contractor pays him; in such a case, the law is clear and well settled that such promises must be in writing under the statute of frauds (MCL 566.132; MSA 26.922).
    2. Frauds, Statute of — Contracts—Subcontractor—Payments— Mechanic’s Lien — Estoppel—Oral Promise to Pay.
    The action of a property owner in making payments to a subcontractor does not create an obligation to pay, in the absence of a writing; similarly, the subcontractor’s forbearance from perfecting his mechanic’s lien does not create an estoppel such as to support an oral promise to pay made by the property owner.
    3. Taxation — Income Taxes — Withholding Taxes — Motor Fuel Taxes — Liens—Priority of Liens.
    The Michigan Treasury Department’s lien for accrued and unpaid income tax withholdings and motor fuel taxes and penalties is prior to a claim by a subcontractor who does work for the taxpayer áfter the taxes and penalties accrued and applies to monies due the taxpayer on a contract under which the subcontractor supplied the work.

      Werner M. Killen, for plaintiff.

      Charles J. Moceri, for defendant Auburn Supply Co., Inc.

      Frank J. Kelley, Attorney General, Robert A. Derengoski, Solicitor General, and Alan H. Broad, Assistant Attorney General, for defendant Michigan Department of Treasury.

      Peterson & Hay, P.C., for defendant Shores Re-Steel, Inc.
    Before: Allen, P.J., and R. M. Maher and J. E. Townsend, JJ.

       Circuit judge, sitting on the Court of Appeals by assignment.

   R. M. Maher, J.

Michigan Bell Telephone Company brought this interpleader action to determine rights of potential claimants to a sum of money due defendant C & C Excavating for services rendered under a construction contract between Bell and C & C Excavating, as general contractor. Other defendants include various subcontractors and the Michigan Department of Treasury. Default judgments were entered against all defendants except the Department of Treasury and two subcontractors. The Treasury Department, Shores Re-Steel, Inc., and Auburn Supply Company, Inc., filed answers and cross-claims alleging priority of their claims to the subject fund. Shores Re-Steel and Auburn Supply also filed counterclaims against plaintiff Michigan Bell, alleging that plaintiff was liable for certain sums due them from the general contractor, C & C Excavating, for work performed and materials supplied for the job performed for Michigan Bell by C & C. From judgments rendered against Bell in favor of the Treasury Department, Auburn Supply and Shores Re-Steel, Michigan Bell now appeals.

Auburn Supply based its counterclaim on a provision of the contract between Michigan Bell and C & C Excavating which provides as follows:

"The Contractor, if required by the Construction Superintendent before the making of any payment, or at any time during the progress of the work, shall furnish said Construction Superintendent with evidence, in such form as the Construction Superintendent shall require, that all claims, causes of action for damages and all claims or liens for payment of wages or salaries or for payment for tools, machinery or supplies have been paid, released or settled, and in case such evidence be not furnished as aforesaid, such amount as said Construction Superintendent may consider necessary to meet any and all of such claims, shall be retained from any moneys otherwise due the Contractor hereunder, until such claims, causes of action or liens shall have been fully satisfied and until such evidence shall have been furnished.”

Shores Re-Steel also relied on the above-quoted contract provision, alleging in one count that it was a third-party beneficiary of the contract between Michigan Bell and C & C Excavating, and that Michigan Bell breached a duty owed to subcontractors under the contract with C & C to withhold payment from C & C until C & C furnished evidence that claims of subcontractors had been paid. In a second count, Shores Re-Steel alleged that Michigan Bell was negligent in failing to withhold payment from C & C until furnished evidence of payment of claims. In a third count, Shores Re-Steel alleged wrongful disclosure by Michigan Bell in response to a writ of garnishment served on Bell on November 2, 1973, in connection with a lawsuit brought by Shores Re-Steel against C & C Excavating.

Although the pleadings alleged primarily that Michigan Bell was negligent in failing to withhold payment from C & C Excavating under its contract until C & C furnished evidence of payment to subcontractors, the evidence presented at trial was directed at establishing that Michigan Bell’s agent had agreed to pay the subcontractors’ accrued claims against C & C Excavating. The trial court’s opinion, on the other hand, states that once C & C abandoned the project, Michigan Bell assumed the role of general contractor and thereby assumed C & C’s obligations to the subcontractors. The trial court also ruled that Michigan Bell negligently continued to pay C & C after it became aware that C & C had abandoned the project. Thus it appears that the counterclaims were pled on one theory, tried on a second theory and decided on still a third theory. We find, however, that none of the theories presented entitles counterplaintiffs to recover from Michigan Bell.

Dealing first with Shores Re-Steel’s challenge to the garnishment disclosure, we agree with the trial court that Shores’ failure to file a timely challenge to the disclosure under GCR 1963, 738.6 and 738.9 bars it from raising the issue in this proceeding.

Prior to trial, all parties stipulated to the validity of the claims asserted by defendants against C & C Excavating. It was further agreed that the question of priority of claims to the interpleader stake would be submitted for decision on briefs to be filed after the trial. The sole issue upon which testimony was taken was the counterclaims of Auburn Supply and Shores Re-Steel against Michigan Bell.

Auburn Supply presented testimony of Daniel Alexánder, the secretary-treasurer of C & C Excavating, Inc., to the effect that he told a representative of Michigan Bell, one Ed Heichel, at the end of July, 1973, that C & C was in financial difficulties and could not finish the job, and that Alexander would undertake to finish the job started by C & C, forming a new company for that purpose. Alexander further testified that Heichel agreed to pay subcontractors directly, and did in fact pay some subcontractors. He testified that he sent letters to Mr. Heichel authorizing direct payment of Auburn Supply and Shores Re-Steel. Stephen Messina, president of Auburn Supply, testified that he believed oh the strength of Mr. Alexander’s telephone conversation with Mr. Heichel, which he overheard, that his company would be paid directly by Michigan Bell for past and future deliveries of materials.. Messina acknowledged that no representative of Michigan Bell had ever told him directly that Bell would pay him.

As evidence in support of its counterclaim, Shores Re-Steel adopted the testimony of Daniel Alexander and entered into evidence a writ of garnishment previously served on Michigan Bell.

All the many theories raised in this case allege negligence on the part of Michigan Bell. In order to recover on a negligence theory, the subcontractors must prove that Michigan Bell owed them a duty, that it breached that duty and that they were damaged as a result of that breach, Clark v Dalman, 379 Mich 251; 150 NW2d 755 (1967). The primary theory pled by the subcontractors in their counterclaims was that Michigan Bell’s duty to them arose out of Bell’s contract with C & C Excavating. The evidence presented at trial sought to establish that Michigan Bell promised to pay C & C’s obligations to its subcontractors. The theory on which the trial court apparently based recovery was that Michigan Bell assumed the obligations of C & C Excavating by continuing the construction project after it knew of C & C’s precarious financial position.

The Supreme Court dealt with the first two theories in Roulo v Automobile Club of Michigan, 386 Mich 324; 192 NW2d 237 (1971), a case similar on its facts to the case at bar. In Roulo, as in the case now before us, the general contractor on a construction project went bankrupt, leaving a subcontractor unpaid. The subcontractor sued the owner of the building which was the subject of the contract, claiming that the owner was negligent in not requiring the general contractor to furnish a labor and material bond, as specified in the construction contract. The trial court granted defendant’s motion for summary judgment for failure to state a cause of action, and the Supreme Court affirmed. The Roulo Court noted that plaintiff alleged negligence, and could therefore recover only if defendant owed him a duty and breached that duty. The Court rejected the claim that a duty to subcontractors could arise out of a bond requirement in the general contract, Roulo, supra, 328-329:

"Plaintiff * * * tells us that the defendant undertook to render him assistance in collecting his bill from the contractor; that such undertaking was in the form of requiring the contractor to furnish a bond; that the assistance was rendered negligently in that the defendant failed to secure the bond as undertaken.
"The theory is ingenious, but it does not fit.
"The owner’s indirect promissory representation that a bond would be given can hardly create a more binding obligation than a direct promise to the plaintiff to pay him or see that the general contractor pays him.
"In such a case, the law is clear and well settled. MCLA § 566.132 (Stat Ann 1970 Rev § 26.922) provides that such promises must be in writing. We have many times held this statute applicable to cases of this kind. Welch v. Marvin (1877), 36 Mich 59; Carr v. Leavitt (1884), 54 Mich 540; Dupuis v Improvement Co. (1891), 88 Mich 103; Ramsdell v The Citizen’s Electric Light & Power Company (1894), 103 Mich 89; Wilhelm v Voss (1898), 118 Mich 106; Sherman v. Alberts (1908), 153 Mich 361; Raridan v. Bick (1932), 259 Mich 200.
"Even the action of the owner of making payments to the subcontractor does not create an obligation to pay, in the absence of a writing. Preston v. Young (1881), 46 Mich 103.”

Accord, Shurlow Tile & Carpet Co v Farhat, 60 Mich App 486; 231 NW2d 384 (1975).

The situation in the case at bar is identical to that presented in Roulo, supra, with the additional factor of an alleged oral promise by Michigan Bell’s agent to pay the contractor’s debts. Neither the provision in Bell’s contract with C & C Excavating nor the alleged oral promise to pay C & C’s obligations can form the basis of recovery on the subcontractor’s counterclaims.

Regarding the theory that Michigan Bell assumed the role of general contractor when C & C abandoned the project, we find that the facts simply will not support such a theory. Alexander testified that when it became apparent that C & C would be unable to continue, he formed his own company and undertook (with the knowledge of Heichel) to complete the project in the name of C & C Excavating, in order to protect his own reputation in the construction business. Thus it seems clear that if anyone assumed the role of general contractor, it was the new company formed by Alexander, not Michigan Bell. The fact that Bell in fact paid some subcontractors does not create an obligation to pay others, Roulo, supra.

The trial court in its opinion dealt exclusively with the counterclaims against Michigan Bell, making no reference to the original interpleader action. When the Department of Treasury presented a proposed judgment awarding the inter-pleaded fund to the State of Michigan, the court altered it to award a money judgment against Michigan Bell for the amount of the interpleaded fund. Michigan Bell claims that the trial court erred in awarding the Treasury Department a money judgment when the Treasury filed no counterclaim and sought only to claim the interpleaded fund. The Treasury Department, on the other hand, urges us to hold that the judgment entered was in fact nothing more than an award of the interpleaded fund.

GCR 1963, 518.3 gives trial courts broad powers to grant relief to the prevailing party, even if such relief has not been demanded in the pleadings, Tomei v Bloom Associates, Inc, 75 Mich App 661; 255 NW2d 727 (1977); see also Livingston v Krown Chemical Mfg, Inc, 394 Mich 144; 229 NW2d 793 (1975). The relief granted, however, must be supported by the evidence adduced at trial, Tomei, supra. In the case before us there is no evidence which would justify a finding that Michigan Bell is personally liable for the back taxes owed by C & C Excavating.

Having concluded that none of the parties is entitled to a money judgment against Michigan Bell, we must determine which of the three claimants is entitled to the interpleaded fund. The Department of Treasury contends that it is entitled to the fund by virtue of withholding and motor fuel tax liens authorized by MCL 206.351; MSA 7.557(1351), MCL 206.431; MSA 7.557(1431) and MCL 207.114; MSA 7.304, and recorded on November 7 and November 9, 1973, pursuant to MCL 211.682; MSA 7.753(52). Auburn Supply and Shores Re-Steel contend that the tax liens never attached to the interpleaded funds because C & C Excavating was required by MCL 570.151; MSA 26.331 to hold those funds in trust for subcontractors and materialmen, and C & C therefore never had title to the said fund. This argument, however, ignores the provision of the Michigan Income Tax Act which requires an employer to hold taxes withheld from wages as a trustee for the state, MCL 206.351; MSA 7.557(1351). The same statutory section provides that such taxes are payable to the state within 15 days after the end of the month in which they are withheld. The affidavit attached to the Treasury Department’s amended answer sets forth its claim (undisputed by Auburn and Shores) that as of the end of June, 1973, more than $15,000 in unpaid taxes and penalties had accrued. It is thus clear that a trust in favor of the state for more than the amount interpleaded had arisen prior to the time defendants Auburn and Shores performed the work upon which their claims are based.

The Treasury Department’s lien is prior to all other unrecorded liens, MCL 206.431; MSA 7.557(1431), and against all liens attaching after recording of the tax liens. The Department of Treasury is therefore entitled to the interpleaded fund. We remand to the trial court for entry of a judgment to that effect.

Reversed and remanded for proceedings consistent with this opinion.

      C & C Excavating, apparently as a result of financial difficulties, had abandoned the job prior to completion and had ceased functioning, leaving a number of subcontractors and materialmen unpaid. The fund which is the subject of Michigan Bell’s interpleader action apparently represents the remaining amount due C & C for work performed prior to the time it abandoned the job.

       Heichel died prior to trial, and plaintiff Michigan Bell objected to Alexander’s testimony, on grounds that it was barred by the dead man’s statute, MCL 600.2166; MSA 27A.2166. Plaintiff raises this issue on appeal as well. However, because of our disposition of the other issues raised on appeal, we do not reach the issue of admissibility of Alexander’s testimony.

       He testified that subsequent deliveries totaled $884.17 in price.

       We are aware of the rule that the Statute of Frauds must be pled as an affirmative defense, GCR 1963, 111.7; Trisch v Fairman, 334 Mich 432; 54 NW2d 621 (1952). We are of the opinion that such a requirement may be considered waived where, as here, the alleged oral promise was itself not pled.

       The cited section reads as follows:
      "In the building construction industry, the building contract fund paid by any person to a contractor, or by such person or contractor to a subcontractor, shall be considered by this act to be a trust fund, for the benefit of the person making the payment, contractors, laborers, subcontractors or materialmen, and the contractor or subcontractor shall be considered the trustee of all funds so paid to him for building construction purposes.”

       MCL 206.351; MSA 7.557(1351), prior to its amendment, provided in pertinent part:
      "(2) The taxes withheld under this section shall be returned and paid to the department by the employer within 15 days after the end of any month in which the amount withheld exceeds $100.00. In the case of lesser amounts payment shall be made within 15 days after the end of the quarter period ending in March, June, September and December.
      "(3) Every employer required by this section to deduct and withhold taxes on compensation shall be liable for the payment thereof to the state and shall not be liable to any individual for the amount of such payment.”

         The exhibits and evidence reveal that the materials were furnished and the work was performed by Auburn and Shores during July, August and September of 1973.

       Shores Re-Steel obtained a judgment against C & C Excavating on December 23, 1974. However, the tax liens had already been recorded and therefore are prior to Shores Re-Steel’s judgment lien.