Lynn Lumbard v. City of Ann Arbor ( 2017 )

STATE OF MICHIGAN
COURT OF APPEALS
ANITA YU, JOHN BOYER, and MARY RAAB, UNPUBLISHED
May 9, 2017
Plaintiff-Appellants,
v No. 331501
Washtenaw Circuit Court
CITY OF ANN ARBOR, LC No. 14-000181-CC
Defendant-Appellee.
LYNN LUMBARD, on Behalf of Herself and All
Others Similarly Situated,
Plaintiffs-Appellants,
v No. 332675
Washtenaw Circuit Court
CITY OF ANN ARBOR, LC No. 15-001100-CC
Defendant-Appellee.
Before: GADOLA, P.J., and JANSEN and SAAD, JJ.
PER CURIAM.
In these consolidated appeals, plaintiffs appeal as of right the trial court’s orders granting
summary disposition in favor of defendant, the City of Ann Arbor, and dismissing their cases
with prejudice. For the reasons set forth in this opinion, we affirm.
I. FACTS AND PROCEDURAL HISTORY
In the late 1990s and early 2000s, Ann Arbor experienced unusually heavy rainfalls that
caused backups in defendant’s sanitary-sewer system. The backups forced defendant to
discharge sewer water from its sanitary-sewer system into the Huron River and caused
wastewater to overflow through floor drains in the basements of many homes within the city.
-1-
The cause of the problem was identified as footing drains1 in some homes that collected storm
water from around the home and emptied it into the city’s sanitary-sewer system. Because the
sanitary-sewer system was not intended to accommodate storm water, introducing storm water
during heavy rainfalls overburdened the system and led to the overflow problems.
To address the issue, defendant passed an ordinance that notified homeowners with
footing drains that connected into the sanitary-sewer system of the need to disconnect those
drains from the sewer system. To facilitate these disconnects, the ordinance offered a program
that allowed homeowners to use prequalified contractors to perform the disconnect work. The
disconnect work consisted of installing sump pits, sump pumps, and related equipment to carry
water from homeowners’ footing drains to either the storm-water system or to a discharge
location outside of the home. As part of the program, defendant agreed to pay up to $3,700 for
the work performed, plus additional costs that were deemed necessary. Homeowners would then
be responsible to purchase a backup sump pump, if desired, and to maintain the newly installed
pump. To enforce compliance with the disconnect program, homeowners who refused or failed
to disconnect a footing drain from the sanitary-sewer system within 90-days of receiving a
certified letter of notice would be required to pay a $100 surcharge on subsequent sewage bills
and could lose funding assistance for future disconnect work.
A. DOCKET NO. 331501
Plaintiffs John Boyer and Mary Raab are married and own a home in Ann Arbor that had
a footing drain connected to the sanitary-sewer system. They received a notice that their home
was identified as one of the homes that needed to disconnect its footing drain from the sanitary-
sewer system. The couple had a sump pump installed in their home in 2002. The original
discharge location for the sump pump was outside of the home’s kitchen. This placement
allowed water to flow back toward the home, which then leaked into the basement. In 2003, the
leak caused six inches of flooding in the basement. After the incident, defendant and its
contractors assessed the problem and determined that a new discharge point was needed. Boyer
asked that the discharge be directed to a storm drain on the curb of the street, but defendant and
its contractors disregarded this request and moved the discharge point to an area in the backyard.
As a result of the new placement, a permanent depression formed in the yard. Boyer and Raab
testified that, since installing the sump pump, they have paid over $7,000 to maintain the system.
Plaintiff Anita Yu also owns a home in Ann Arbor and was notified by defendant that she
needed to disconnect her footing drain from the sanitary-sewer system. Yu believed that
participation in the disconnect program was mandatory. In May 2003, Yu had one of the city’s
1
Footing drains are small, perforated drainage pipes located near the foundation of a house.
They are intended to keep rainwater that seeps through the ground from building up along the
foundation or basement walls. In many homes, downspouts, which carry rainwater from the
gutters, discharge near the foundation walls. This water drains through the soil and into the
footing drains. In most homes constructed before the 1980s, the footing drains are connected to
the house sanitary connection (house lead). This house lead then carries the footing drain flow
and wastewater from the house into the sanitary-sewer system.
-2-
prequalified contractors come to her home for an evaluation. The contractor recommended
installing the sump pump in the back of a crawl space under Yu’s home. Yu objected to the
location, but the contractor informed her that anywhere else would require payment beyond that
approved by the city. Due to monetary constraints, Yu consented to the contractor’s
recommended location. In September 2003, the contractor installed the sump pump in the back
of Yu’s crawl space. Yu was then diagnosed with an incurable degenerative muscular condition,
which she said made it impossible for her to maintain the pump without retaining a contractor.
Yu, Boyer, and Raab filed a complaint against defendant, alleging inverse condemnation
claims under the state and federal Constitutions, as well as federal claims relating to involuntary
labor. They argued that defendant physically and permanently occupied their properties by
forcing them to install the sump pumps and other related equipment.
B. DOCKET NO. 332675
Plaintiff Lynn Lumbard owns a home in Ann Arbor. In 2002, defendant notified
Lumbard that her home was identified as one of the homes that needed to disconnect its footing
drain from the sanitary-sewer system. Lumbard hired one of defendant’s preapproved
contractors to disconnect her footing drain and install a sump pump. In 2014, Lumbard’s sump
pump discharge line backed up, causing her basement to flood. It was later determined that the
discharge pipe was buried too close to the ground surface and that cold weather caused the pipe
to freeze. Lumbard was not reimbursed for the cost to repair any damage from the flood.
Lumbard filed a class action2 complaint against defendant. In an amended complaint,
Lumbard asserted that defendant’s actions constituted a taking without just compensation under
the Michigan Constitution.
C. DEFENDANT’S MOTIONS FOR SUMMARY DISPOSITION
In Docket No. 331501, defendant filed a motion for summary disposition, arguing, in
part, that Yu, Boyer, and Raab failed to state a claim upon which relief could be granted because
defendant did not permanently and physically occupy plaintiffs’ properties because plaintiffs
maintained complete ownership of those properties.3 At a hearing on the motion, Yu, Boyer, and
Raab’s counsel stated that they were pursuing a theory of “physical invasion,” not regulatory
taking. Counsel also agreed that plaintiffs “own[ed] the property” and that there was “no dispute
about that,” but argued that ownership was immaterial because defendant’s physical invasion
interfered with the ownership rights of exclusion and complete enjoyment. The trial court
2
At no point during the lower court proceedings did the trial court certify Lumbard as part of a
formal class, nor did the trial court ever formally recognize Lumbard’s suit as a class action. See
MCR 3.501(B).
3
In October 2014, defendant stipulated to the dismissal of Yu, Boyer, and Raab’s federal claims
without prejudice, and the trial court entered an order to that effect.
-3-
ultimately denied defendant’s motion under MCR 2.116(C)(8), but noted that defendant could
file a motion under MCR 2.116(C)(10) once additional facts were developed in the case.
Defendant later filed a motion for summary disposition under MCR 2.116(C)(10),
arguing that no taking by physical occupation occurred. Defendant noted that it was undisputed
that Yu, Boyer, and Raab owned the sump pumps in their homes, and argued that a taking by
physical occupation could not occur if the plaintiff owned the installation on his or her property.
At a hearing on the motion, Yu, Boyer, and Raab maintained that a taking occurred because
defendant interfered with their full rights of ownership. Yu, Boyer, and Raab conceded that they
maintained title to the sump pumps and associated equipment, but argued that these items
interfered with their rights to exclude others from their property. They argued that the
determinative factor in any takings case, including a case involving a taking by permanent
physical occupation, was the denial of a property owner’s rights of ownership without
compensation.
The trial court concluded that the “issue of ownership” was determinative and that
installation of the sump pumps and associated equipment did not amount to a taking by
permanent physical occupation because Yu, Boyer, and Raab retained ownership of the pumps
and equipment. Accordingly, the trial court granted defendant’s motion for summary disposition
and dismissed the case because the “physical invasion” theory was the only theory on which Yu,
Boyer, and Raab had sought relief.
In Docket No. 332675, defendant filed a motion for summary disposition, arguing that
Lumbard’s claims were barred by collateral estoppel by the trial court’s order dismissing the case
in Docket No. 331501. Defendant also argued that summary disposition of Lumbard’s inverse
condemnation claim was warranted under MCR 2.116(C)(8) because Lumbard failed to state in
her complaint that defendant or one of defendant’s agents deprived Lumbard of ownership of her
property. Likewise, defendant argued under MCR 2.116(C)(10) that there was no issue of
material fact regarding whether Lumbard owned the property that was the target of the alleged
taking and, therefore, defendant was entitled to judgment as a matter of law. At a hearing on the
motion, the trial court noted that the issue raised by Lumbard had already come before the court
and it had rendered a decision. Therefore, the trial court granted defendant’s motion “[f]or the
same reasons” it had granted summary disposition in Docket No. 331501.4
II. STANDARD OF REVIEW
We review de novo a trial court’s grant or denial of a motion for summary disposition.
Arabo v Mich Gaming Control Bd, 310 Mich App 370, 382; 872 NW2d 223 (2015). When
reviewing a motion under MCR 2.116(C)(10), we consider all of the documentary evidence in a
light most favorable to the party opposing the motion. Id. Summary disposition under MCR
2.116(C)(10) is proper if there is “no genuine issue regarding any material fact and the moving
4
This Court later granted the parties’ request to consolidate the cases on appeal. Yu v City of
Ann Arbor, unpublished order of the Court of Appeals, entered June 29, 2016 (Docket Nos.
331501, 332675).
-4-
party is entitled to judgment as a matter of law.” Latham v Barton Malow Co, 480 Mich 105,
111; 746 NW2d 868 (2008). The parties do not contest the basic facts of the case; therefore,
whether the trial court erred by granting summary disposition is dependent on whether defendant
was “entitled to judgment as a matter of law.” Id.III. ANALYSIS
Plaintiffs’ sole argument on appeal is that the trial court erred as a matter of law by
concluding that a taking by permanent physical occupation cannot occur if a plaintiff owns the
installation. We disagree.
The Takings Clause of the Michigan Constitution states, “Private property shall not be
taken for public use without just compensation therefore being first made or secured in a manner
prescribed by law.” Const 1963, art 10, § 2. Generally, the Takings Clause of the Michigan
Constitution offers the same level of protection as that of the United States Constitution.5 See
Tolksdorf v Griffith, 464 Mich 1, 2; 626 NW2d 163 (2001) (“The Taking Clause of the state
constitution is substantially similar to that of the federal constitution.”). In some instances,
however, Michigan’s Takings Clause “offers broader protection than” its federal counterpart.
AFT Mich v Michigan, 497 Mich 197, 217; 866 NW2d 782 (2015).6
In Cummins v Robinson Twp, 283 Mich App 677, 707; 770 NW2d 421 (2009), this Court
noted that there are two types of per se takings, also known as “categorical takings.” “ ‘First,
where government requires an owner to suffer a permanent physical invasion of her property—
however minor—it must provide just compensation.’ ” Id., quoting Lingle v Chevron USA Inc,
544 US 528, 538; 125 S Ct 2074; 161 L Ed 2d 876 (2005). “ ‘A second categorical rule applies
to regulations that completely deprive an owner of “all economically beneficial us[e]” of her
property.’ ” Cummins, 283 Mich App at 707, quoting Lucas v South Carolina Coastal Council,
505 US 1003, 1019; 112 S Ct 2886; 120 L Ed 2d 798 (1992) (emphasis in Lucas; alteration in
Cummins). Apart from these two categories, the Cummins Court noted that a third type of
takings, known as “regulatory takings,” are “ ‘governed by the standards set forth in Penn
Central Transp Co v New York City, 438 US 104[;] [98 S Ct 2646; 57 L Ed 2d 631] (1978).’ ”
Cummins, 283 Mich App at 707, quoting Lingle, 544 US at 538 (second alteration in Cummins).
In this case, plaintiffs argue only that the first type of categorical taking occurred.
Namely, plaintiffs argue that defendant permanently and physically occupied their property by
forcing them to disconnect their footing drains from the sanitary-sewer system and install sump
5
“[N]or shall private property be taken for public use, without just compensation.” US Const,
Am V.
6
In AFT Mich, 497 Mich at 217 n 9, our Supreme Court only provided one example of when the
state Takings Clause offers broader protection than the federal Takings Clause, that being in the
context of the taking of private property and transferring that property to another private entity
for “public use.” Compare Kelo v New London, 545 US 469; 125 S Ct 2655; 162 L Ed 2d 439(2005), with Wayne Co v Hathcock, 471 Mich 445; 684 NW2d 765 (2004).
-5-
pumps, sump pits, and other fixtures and equipment needed to facilitate the footing drain
disconnect. The question on appeal is whether this conduct constituted a categorical taking as a
matter of law. See Latham, 480 Mich at 111.
In Loretto v Teleprompter Manhattan CATV Corp, 458 US 419, 426; 102 S Ct 3164; 73
L Ed 2d 868 (1982), the United States Supreme Court recognized the first type of categorical
taking by stating that “permanent physical occupation authorized by government is a
taking . . . .” But the Loretto Court added that “[s]o long as the[] regulations do not require the
landlord to suffer the physical occupation of a portion of his building by a third party, they will
be analyzed under the multifactor inquiry generally applicable to nonpossessory governmental
activity.” Id. at 440, citing Penn Central Transp Co, 438 US 104 (emphasis added). The Loretto
Court went on to explain that the “permanent physical occupation” analysis is dependent on
whether the landowner owns the installation, stating the following in footnote 19 of its opinion:
If § 828 required landlords to provide cable installation if a tenant so desires, the
statute might present a different question from the question before us, since the
landlord would own the installation. Ownership would give the landlord rights to
the placement, manner, use, and possibly the disposition of the installation. The
fact of ownership is, contrary to the dissent, not simply “incidental,” it would give
a landlord (rather than a CATV company) full authority over the installation
except only as government specifically limited that authority. The landlord
would decide how to comply with applicable government regulations concerning
CATV and therefore could minimize the physical, esthetic, and other effects of
the installation. Moreover, if the landlord wished to repair, demolish, or construct
in the area of the building where the installation is located, he need not incur the
burden of obtaining the CATV company’s cooperation in moving the cable.
[Loretto, 458 US at 440 n 19 (citation omitted).]
Although the Loretto Court was interpreting the federal Takings Clause, we find Loretto
persuasive because our state Takings Clause is “substantially similar” to its federal counterpart.
Tolksdorf, 464 Mich at 2.
Moreover, the principle from Loretto, 458 US at 440 n 19, is basic to any takings analysis
under the Michigan Constitution. As this Court has stated, “The ‘common touchstone’ of all
taking analyses is ‘to identify regulatory actions that are functionally equivalent to the classic
taking in which government directly appropriates private property or ousts the owner from his
domain.’ ” Cummins, 283 Mich App at 707-708, quoting Lingle, 544 US at 539. In other words,
all takings analyses look to determine whether the government’s action deprived a plaintiff of his
or her ownership of property. See Peterman v State Dep’t of Natural Resources, 446 Mich 177,
190; 521 NW2d 499 (1994) (“Any injury to the property of an individual which deprives the
owner of the ordinary use of it is equivalent to a taking, and entitles him to compensation.”)
(quotation marks and citation omitted). Loretto merely applied this principle to the case of a
taking by permanent physical occupation by the government; if an owner of real property owns
the installation, it is not the functional equivalent of a classic taking in which an owner is ousted
from his domain. See Cummins, 283 Mich App at 708. Accordingly, a permanent physical
-6-
occupation does not occur so long as the owner can exercise the rights of ownership over the
installation. Id. at 707-708.
Turning to the facts of this case, we initially note that plaintiffs waived the issue of
ownership. “Waiver is the voluntary and intentional relinquishment of a known right.” Varran v
Granneman, 312 Mich App 591, 623; 880 NW2d 242 (2015). “A party cannot stipulate with
regard to a matter and then argue on appeal that the resulting action was erroneous.” Hodge v
Parks, 303 Mich App 552, 556; 844 NW2d 189 (2014). At the hearing on defendant’s first
motion for summary disposition in Docket No. 331501, plaintiffs’ counsel stated that plaintiffs
“own[ed] the property” and that there was “no dispute about that.” Plaintiffs’ counsel went on to
state, “We’re not challenging the fact that the property is still owned by the Plaintiffs[.]”
Accordingly, the issue of ownership is waived. See The Cadle Co v City of Kentwood, 285 Mich
App 240, 255; 776 NW2d 145 (2009) (“A party who waives a right is precluded from seeking
appellate review based on a denial of that right because waiver eliminates any error.”).
Even addressing the substance of the issue of ownership, however, plaintiffs clearly
owned the installations. Ownership is defined as “[t]he bundle of rights allowing one to use,
manage, and enjoy property, including the right to convey it to others.” Black’s Law Dictionary
(10th ed). Plaintiffs had use of the installations; the sump pumps pumped water from plaintiffs’
footing drains to the storm-water system or to an aboveground outlet. Plaintiffs also managed
the installations; part of their complaint was that they had to maintain the pumps, and they
complain on appeal that they are responsible for the pumps’ maintenance and operation.
Plaintiffs contest that they were not able to dispose of the pumps. However, plaintiffs did
not present evidence to this effect before the trial court. See Quinto v Cross & Peters Co, 451
Mich 358, 363; 547 NW2d 314 (1996) (“If the opposing party fails to present documentary
evidence establishing the existence of a material factual dispute, [a motion under MCR
2.116(C)(10)] is properly granted.”). Moreover, evidence to the contrary was presented below;
plaintiff Raab stated in her deposition that she had replaced her sump pump. The only limitation
on this disposition is that plaintiffs would likely have to purchase any replacement equipment.
Plaintiffs also claim that they did not own the installations because they could not choose
where the sump pumps were installed and could not move them once they were installed. See
Loretto, 458 US at 440 n 19 (“Ownership would give the landlord rights to the placement,
manner, use, and possibly the disposition of the installation.”) (emphasis added). Again,
plaintiffs provided no evidence that they could not move the sump pumps after they were
installed. See Quinto, 451 Mich at 363. And nothing in the language of the ordinance prevented
plaintiffs from moving the installations. Regarding the initial placement, plaintiffs rely on Yu’s
deposition, in which she stated that her sump pump was installed in her crawl space over her
objection. However, it appears that all of the plaintiffs retained the final say regarding the
placement of their sump pumps; the only caveat was that they would be responsible to pay any
added costs if they chose a location that increased the installation price beyond what the city
authorized.
-7-
Viewing the evidence in the light most favorable to plaintiffs, the trial court did not err by
concluding that there was no taking by permanent physical occupation in this case because
plaintiffs owned the installations on their properties.
Affirmed.
/s/ Michael F. Gadola
/s/ Kathleen Jansen
/s/ Henry William Saad
-8-