Silver Creek Drain District v. Extrusions Division, Inc

Michigan Supreme Court
Lansing, Michigan 48909
____________________________________________________________________________________________
C h i e f J u s ti c e J u s t ic e s
Maura D. Corrigan Michael F. Cavanagh

Opinion
Elizabeth A. Weaver
Marilyn Kelly
Clifford W. Taylor
Robert P. Young, Jr.
Stephen J. Markman
____________________________________________________________________________________________________________________________

FILED JUNE 17, 2003

SILVER CREEK DRAIN DISTRICT,

Plaintiff-Appellant,

v No. 119721

EXTRUSIONS DIVISION, INC., and

AZZAR STORE EQUIPMENT, INC,

Defendants-Appellees,

____________________________________

BEFORE THE ENTIRE BENCH

TAYLOR, J.

We granted leave to appeal in this case to consider

whether environmental-contamination conditions are factors to

be considered when a court is determining fair market value to

establish just compensation in a condemnation action under the

Uniform Condemnation Procedures Act (UCPA ), MCL 213.51 et seq.

We hold that they are to be considered. Accordingly, we

reverse the judgment of the Court of Appeals in this regard

and remand this matter to the trial court for further

proceedings consistent with this opinion.

I. FACTUAL AND PROCEDURAL BACKGROUND

Defendant Extrusions Division, Inc. (Extrusions),

operates a plastics extruding business and owned an eight-acre

parcel of vacant land adjacent to its operations complex in

Grand Rapids. In 1992, Extrusions applied to the city of Grand

Rapids for a permit to build a warehouse on the eight acres.

The application was denied, and Extrusions was informed that

the Silver Creek Drain District (Drain District), in 1991, had

identified the parcel as its desired site for a storm-water

retention pond. Extrusions claimed that denial of a permit,

together with the failure of the Drain District to commence a

condemnation action, amounted to an unconstitutional taking of

private property without just compensation. Accordingly, in

1992, Extrusions initiated an inverse-condemnation action

against the city and the Kent County Drain Commissioner.

On March 7, 1994, the Drain District, pursuant to the

UCPA , tendered a good-faith “just compensation” offer1 in the

amount of $211,300 to Extrusions for the parcel. This offer,

as allowed under MCL 213.55(1) of the UCPA , also reserved the

1
“Before initiating negotiations for the purchase of

property, the agency shall establish an amount that it

believes to be just compensation for the property and promptly

shall submit to the owner a good faith written offer to

acquire the property for the full amount so established

. . . .” MCL 213.55(1).

Drain District’s right to proceed against Extrusions in a

federal or state action for contamination-cost recovery.2

Cost-recovery actions are intended to give governmental

authorities the ability to seek reimbursement from those

responsible for the damage done to the land by the release of

hazardous substances. At the time of this litigation, the

procedure to reserve the right to bring a cost-recovery action

against the condemnee was new, having been established by

amendments of the UCPA in 1993. The purpose of the amendments

was not merely to allow the condemnor to reserve the right to

demand remediation costs, but also to ensure that, if a

reservation of rights occurred, the funds for condemnation

would be escrowed to satisfy any judgment that the condemnor

might eventually secure against the condemnee.3

2
Cost-recovery proceedings may be brought under the

federal Comprehensive Environmental Response Compensation and

Liability Act (CERCLA ), 42 USC 9601 et seq., or under part 201

of the Natural Resources and Environmental Protection Act

(NREPA), MCL 324.20101 et seq.

3
As discussed above, § 5 of the amended UCPA (MCL 213.55)

requires a condemning agency to deposit its estimated just
compensation amount in escrow when it files the condemnation

complaint; this escrowed amount is to pay the condemnee upon

the order of the court. MCL 213.55(5); MCL 213.58(4). However,

in the 1993 amendments of the UCPA , in order to facilitate the

collection of remediation costs of environmental

contamination, the Legislature allowed the agency, when it

submits a “good faith” written offer, to reserve the right to

seek contamination costs from the condemnee. If this is done,

the escrowed funds may remain in escrow “as security for

remediation costs of environmental contamination . . . .” MCL

(continued...)

On May 26, 1994, the Drain District executed, as required

by MCL 213.55(4)(e), a “declaration of taking,” which

indicated that this private property was being taken for

purposes of a necessary public improvement.

In June, the $211,300 good-faith “just compensation”

amount was placed in escrow. The Drain District then filed its

condemnation action and again reserved the right to bring a

federal or state cost-recovery action.

On February 20, 1995, the parties stipulated, and the

trial court ordered, that the parcel be conveyed to the Drain

District and that the Drain District pay Extrusions $211,300

for the taking. Following this, the Drain District,

notwithstanding the stipulation and order, sought an order

that would hold the funds in escrow as security for the

remediation costs as allowed under the UCPA . Extrusions, in

response, citing part 201 of the Natural Resources and

3
(...continued)

213.58(2).

However, even if the governmental agency reserves the

cost-recovery option against a condemnee, under subsection 6a

(MCL 213.56a) a court can order an agency to waive its right

to pursue a cost-recovery action under certain circumstances.

The predicate for seeking this reversal of the agency’s

election is that, under part 201 of the NREPA , the condemnee

has no liability because it did not cause the contamination.

MCL 213.58(3). If the court orders the waiver of the rights,

the agency is required to submit a revised good-faith offer.

Subsection 6a(3) also allows the parties to a condemnation

action to stipulate the reversal of the reservation.

Environmental Protection Act (NREPA), MCL 324.20101 et seq.,

claimed that it was not the cause of the contamination as

identified in the amendments and, thus, was not liable for

remediation costs. Accordingly, it argued, on the authority of

MCL 213.55(5) and MCL 213.58(4), that the funds should be

released. On November 3, 1995, by stipulation, the court

ordered the escrowed sums, as well as interest, paid to

Extrusions.

In a 1997 bench trial concerning valuation, the court

found that the value of the eight-acre parcel, if

environmental concerns were ignored, was $278,800. The court

then determined that the parcel “was an environmentally

contaminated site, with respect to which a reasonably prudent

purchaser would have required, at a minimum, a formal Type-C

Closure from the [Department of Natural Resources] as a

condition precedent to closing.”

Because the court found that the reasonable cost of the

Type-C closure was $237,768, it concluded that the net fair

market value was $41,032. The court entered an order to that

effect and reiterated in the order that the once-escrowed

$211,300 was awarded to Extrusions.

On appeal, the Court of Appeals reversed in part and

remanded the case to the trial court.4 The Court of Appeals

held that the UCPA gave no authority for a court to consider

any contamination factor in the establishment of fair market

value. Rather, contamination could only be considered in

separate proceedings for remediation costs. It was the Court’s

position that this outcome was appropriate because § 5 of the

UCPA provided “little guidance regarding the factors a court

should consider when called on to determine just

compensation.”5 Given the minimal guidance, the Court

concluded that the plain language of the UCPA amendments

addressing federal and state cost-recovery actions meant that

only in those separate proceedings could such factors be

considered.

We granted leave to appeal to consider the Drain

District’s claim that a court may consider a parcel’s

environmental condition as a factor affecting fair market

value in a determination of just compensation under the UCPA .

We conclude that a court may consider such conditions in

establishing fair market value and, thus, reverse the judgment

of the Court of Appeals on this issue only.

4
245 Mich App 556, 557-558; 630 NW2d 347 (2001).

5
Id. at 563.

II. STANDARD OF REVIEW

This case presents an issue of statutory interpretation of UCPA

provisions. Statutory interpretation is a question of law that

we review de novo. Cruz v State Farm Mut Auto Ins Co, 466 Mich

588, 594; 648 NW2d 591 (2002).

III . ANALYSIS

“Eminent domain” or “condemnation” is the power of a

government to take private property. The power arises from the

sovereign power of the state and is of ancient provenance.6

The federal government’s power in this regard is found in the

Fifth Amendment of the United States Constitution, in which it

is stated that the government may not take private property

unless it is done for a public use and with just compensation.

Every Michigan constitution has had a similar clause requiring

just compensation in these circumstances.7 Our current

Constitution states that: “[p]rivate property shall not be

taken for public use without just compensation . . . .”8

In Michigan, in furtherance of this constitutional power,

statutes have regulated the exercise and procedure of

6
See Magna Carta, Grant 39 (1215): “No freeman shall be

. . . disseised . . . unless by the lawful judgment of his

peers, or by the law of the land.”

7
See Const 1835, art 1, § 19; Const 1850, art 18, § 2;

Const 1908, art 13, § 1.

8
Const 1963, art 10, § 2.

condemnation. In 1980, the Legislature unified all

condemnation statutes in the UCPA . Under the act, echoing the

Constitution, it was stated at MCL 213.55(1) that a court was

to “. . . ascertain and determine just compensation to be made

for the acquisition of the [condemned] property.”

As is evident, the “just compensation” requirement in the

statute mirrors the identical requirement in our Constitution.

This reiteration of the constitutional language is significant

because to the degree the Constitution has been construed to

outline the nature of “just compensation,” the statute must be

similarly construed because no act of the Legislature can take

away what the Constitution has given. Sharp v City of Lansing,

464 Mich 792, 810; 629 NW2d 873 (2001).

Thus, we must determine the meaning of the phrase “just

compensation” in our Constitution. As we recently outlined in

Michigan Coalition of State Employee Unions v Civil Service

Comm, 465 Mich 212, 222-223; 634 NW2d 692 (2001), in analyzing

constitutional language, the first inquiry is to determine if

the words have a plain meaning or are obvious on their face.

If they are, that plain meaning is the meaning given them. If,

however, the constitutional language has no plain meaning, but

is a technical, legal term, we are to construe those words in

their technical, legal sense. Moreover, in that undertaking,

we are to rely on the understanding of the terms by those

sophisticated in the law at the time of the constitutional

drafting and ratification. The rule is, as we said in Michigan

Coalition, that “if a constitutional phrase is a technical

legal term or a phrase of art in the law, the phrase will be

given the meaning that those sophisticated in the law

understood at the time of enactment unless it is clear from

the constitutional language that some other meaning was

intended.”9

The meaning of “just compensation” cannot be discerned

merely by a careful reading of the phrase. The words

themselves, as the Court of Appeals found, just do not inform

a court about the potential complexity and variety of factors

to be considered in determining value.10 This circumstance is

9
465 Mich 223. We also pointed out in Michigan Coalition,

id. at n 9, that the same rule, pursuant to the Legislature’s

directive at MCL 8.3a, applies to the construction of a

statute.

10
It is, perhaps, useful to illustrate the correctness of

the point, inasmuch as the partial concurrence and dissent of

Justice Weaver asserts the contrary. In establishing value

for residential properties, for example, can sentimental

factors such as long-time ownership or historic importance be

considered? Or in the case of commercial properties, can

business interruption be considered in establishing value and,

if so, how? Should an income-capitalization approach be

considered in a business valuation, or should some other

approach, such as cost-less-depreciation or sales of

comparable properties be used to assist in fixing value? As

is obvious, one cannot merely review the dictionary

definitions of “just” and “compensation” and combine them to

produce a coherent meaning for this phrase. Rather, as a

result of longstanding legal practice and custom, as revealed

(continued...)

not unusual in the realm of statutory construction. For

example, it can be seen also when statutes, as they

occasionally do, use words such as “negligence,” “due

process,” or “equity.” These are words with meanings that are

not generally self-evident from a mere reading of the words or

an assessment of their definitions in a dictionary. They are,

in this respect, unlike self-evident words such as “bridge,”

“road,” “building,” or “horse.” Rather, they are words that

fall into that category we have described as technical legal

terms or phrases of art in the law, and thus they are to be

given the meaning that those sophisticated in the law gave

them at the time of enactment. We believe it is necessary, if

the law is to be applied uniformly across the state, that this

class of words—words that are freighted with historic

meaning—be given the same legal meaning in all our courts

rather than allowing each court to impose its own meaning. to

hold otherwise would all but ensure in similar cases different

outcomes in different courts, as Justice Weaver, drawing from

her opinion would apparently be content to allow. This means

10
(...continued)

through countless judicial opinions over the centuries, this

phrase means something more than the sum of its discrete

parts. That juries would make decisions on these issues,

after being instructed on the law, is not contradictory to the

point we raise. That is always the process whether the

statute at issue is susceptible to plain-meaning analysis or

is interpreted using some other method of statutory

explication.

that, in this case, it is appropriate to review the consensus

understanding in 1963, by those skilled in this area of law,

of the meaning of “just compensation.”

Throughout our history and clearly by the 1960s, it was

uncontroversial that a determination of “just compensation”

required the consideration of all the multiplicity of factors

that go into making up value. In the nineteenth century, while

summarizing just compensation and its meaning in American

constitutional law, Michigan Supreme Court Justice Thomas M.

Cooley, in his treatise The General Principles of

Constitutional Law in the United States of America, said:

The rule by which compensation shall be

measured is not the same in all cases, but is

largely affected by the circumstances. If what is

taken is the whole of what the owner may have lying

together, it is clear that he is entitled to its

value, judged by such standards as the markets and

the opinions of witnesses can afford, and that

this, except in extraordinary cases, must be the

full measure of his injury.11

The United States Supreme Court has had a similar and

unvarying view of this matter, holding in Searl v Lake Co

School Dist No 2, 133 US 553, 564; 10 S Ct 374; 33 L Ed 740

(1890), that the value of land must include “every . . .

element entering into its cash or market value, as tested by

its capacity for any and all uses . . . .” Then, again, in

11
Cooley, Constitutional Law (Boston; Little, Brown and

Co, 1880), p 341.

1933, the Supreme Court held that “[t]he requirement that

‘just compensation’ shall be paid is comprehensive and

includes all elements . . . .” Seaboard A L R Co v United

States, 261 US 299, 306; 43 S Ct 354; 67 L Ed 664 (1923);

accord Jacobs v United States, 290 US 13, 16-17; 54 S Ct 26;

78 L Ed 142 (1933). The calculation is to “include any element

of value that [property] might have by reason of special

adaptation to particular uses.” Clark’s Ferry Bridge Co v Pub

Service Comm, 291 US 227, 238; 54 S Ct 427; 78 L Ed 767

(1934). Yet again in 1956, the high court held that “[j]ust

compensation includes all elements of value that inhere in the

property . . . .” United States v Twin City Power Co, 350 US

222, 250-251; 76 S Ct 259; 100 L Ed 240 (1956).12

Michigan’s understanding of just compensation has been

identical in all relevant particulars.13 In In re Widening of

Gratiot Avenue, 294 Mich 569, 574-575; 293 NW 755 (1940), we

explained that “‘[t]he determination of value is not a matter

of formulas or artificial rules, but of sound judgment and

12
This continues to be the universal rule. As it was

stated more recently, just compensation “has been held to be

equivalent to the full value of the property. All elements of

value inherent in the property merit consideration in the

valuation process.” 4 Nichols, Eminent Domain (rev 3d), ch 12,

§ 12.01, pp 12-2 to 12-3.

13
The effect on market value of the condemnation

proceeding itself may not be considered as an element of

value. MCL 213.70(1); In re Urban Renewal, Elmwood Park

Project, 376 Mich 311, 318; 136 NW2d 896 (1965).

discretion based upon a consideration of all the relevant

facts in a particular case.’” In considering various factors,

we have held that compensation may include an award for the

taking of leasehold, see id.; for fixtures, see In re Slum

Clearance, 332 Mich 485; 52 NW2d 195 (1952); for business

interruption expenses, see In re Grand Haven Hwy, 357 Mich 20;

97 NW2d 748 (1959); and even for the increase in value

attributable to the reasonable probability that the property

would be rezoned, see State Hwy Comm’r v Eilender, 362 Mich

697; 108 NW2d 755 (1961). Thus, in our law, “just

compensation” was a legal phrase of art in 1963 that meant,

and still means, that the proper amount of compensation for

property takes into account all factors relevant to market

value.14 It is this meaning that the constitutional drafters

and ratifiers are held to have understood when they were

adopting the Michigan Constitution of 1963, and a similar

understanding is attributed to the legislators, who also used

the phrase “just compensation” when they enacted the UCPA in

1980.

That the legislators who amended the UCPA in 1993 provided

14
We reiterated the general rule recently in Dep’t of

Transportation v Van Elslander, 460 Mich 127, 129-130; 594

NW2d 841 (1999), where we described what is relevant to just

compensation as “any evidence that would tend to affect the

market value of the property as of the date of the

condemnation . . . .”

the procedures and means for securing remediation costs and

dovetailed those with the just-compensation determination

indicates no intent to abrogate the meaning of “just

compensation” established in our jurisprudence. Indeed, to

attribute such an intent, i.e., the intent to diminish a

constitutional standard by statute, is to place the

legislators in the posture of acting unconstitutionally. This

we avoid unless no other construction is possible15 and, as

such an alternate construction is possible, we adopt it.

The Court of Appeals error was to utilize the plain

language doctrine in a context where it was inapplicable. The

phrase “just compensation” cannot be analyzed on the basis of

the plain understanding each word conveys, but is a phrase of

art that imports with it all the understandings those

sophisticated in the law give it.

Moreover, we agree with the argument made in the brief

amicus curiae of the Attorney General, on behalf of the

Michigan Department of Transportation, that the Court of

Appeals was led to error by the commingling of two different

concepts: (1) accounting for contamination in a determination

of fair market value and (2) making an assessment of liability

and damages for the cost of remediation of environmental

15
See Gora v Ferndale, 456 Mich 704, 722 n 15; 576 NW2d

141 (1998).

contamination.

As the Attorney General pointed out, a condemnation

action is an in rem proceeding governed by the UCPA . It is

instituted to allow a state agency to take title to privately

owned property; thus, the agency and the owner are parties. An

essential part of the proceeding is the determination of the

fair market value of the property. Because this proceeding is

not designed to assign liability for environmental

contamination, the value of the property is unaffected by

whether its owner would be liable for the contaminated state

of the property. The estimated costs of remediation are

relevant only as they pertain to the fair market value of the

property.

In contrast, a cost-recovery action under Michigan’s

environmental-cleanup laws is an in personam proceeding

specifically designed to assign liability for remediation

costs. Those costs are typically sought under CERCLA or the

NREPA and the fair market value of property is not relevant in

such proceedings. Further, in a cost-recovery action, in

addition to the agency and the owner, any other person or

entity, such as prior owners, lessees, adjacent property

owners, or other third parties who may have contributed to the

contamination, may be parties. Finally, that the damages

awarded in a cost-recovery action are different, sometimes

dramatically so, from the amount by which contamination

reduced fair market value,16 makes manifest how different these

proceedings are. What is to be grasped, then, is that the

primary connection between a condemnation proceeding and a

cost-recovery action is the escrow that may be created during

the condemnation proceeding to provide security for the

payment of the potential cost-recovery award.

The trial court, we believe, understood this matter

properly and merely considered contamination as one factor,

albeit a significant one, in establishing a fair market value.

It was the trial judge’s conclusion that any purchaser would

have insisted on a minimal cleanup (the Type-C closure) that

would have made the property useable. The cost of this Type-C

closure is far different from the amount remediation would

have cost.17 Thus, we conclude that the trial court made its

just-compensation determination not on the basis of

Extrusions’ liability for cleanup costs, but on the basis of

the effect of contamination on the parcel’s fair market value.

This was an appropriate way to consider contamination in a

just-compensation proceeding under the UCPA .

16
The actual cost of remediation in this case was

approximately $2.3 million, while the loss of value caused by

the contamination was found by the trial court to be $237,768.

17
See n 16.

We reverse that portion of the judgment of the Court of

Appeals holding that the UCPA does not vest courts with the

authority to consider contamination and how it affects fair

market value when determining just compensation in a

condemnation proceeding. In all other respects, we affirm the

Court of Appeals and remand this case for proceedings

consistent with this opinion.

Clifford W. Taylor

Maura D. Corrigan

Robert P. Young, Jr.

Stephen J. Markman

S T A T E O F M I C H I G A N

SUPREME COURT

SILVER CREEK DRAIN DISTRICT,

Plaintiff-Appellant,

v No. 119721

EXTRUSIONS DIVISION, INC, and

AZZAR STORE EQUIPMENT, INC,

Defendants-Appellees.

________________________________

CAVANAGH, J. (concurring).

Although the majority arrives at the correct result, it

unnecessarily reaches a constitutional issue. We have stated

previously, "there exists a general presumption by this Court

that we will not reach constitutional issues that are not

necessary to resolve a case." Booth Newspapers, Inc v Univ of

Michigan Bd of Regents, 444 Mich 211, 234; 507 NW2d 422

(1993); see also Taylor v Auditor General, 360 Mich 146, 154;

103 NW2d 769 (1960). Because resolution on statutory grounds

alone would suffice, I would not reach the constitutional

issue.

Additionally, I write separately to note that I am

concerned about the majority’s focus on original intent. As

I noted in my concurrence in WPW Acquisition Co v City of

Troy, 466 Mich 117, 128-130; 643 NW2d 564 (2002), the

drafters’ intent is but one method among many useful in the

endeavor to properly interpret our constitution.

Michael F. Cavanagh

Marilyn Kelly

S T A T E O F M I C H I G A N

SUPREME COURT

SILVER CREEK DRAIN DISTRICT,

Plaintiff-Appellant,

v No. 119721

EXTRUSIONS DIVISION, INC.,

AZZAR STORE EQUIPMENT, INC,

Defendant-Appellees.

____________________________________

WEAVER, J. (concurring in part and dissenting in part).

I concur in the result only of the majority. I write

separately to express my disagreement with the majority’s

construction of the constitutional concept, “just

compensation.”1 The majority suggests that “just

1
Article 10, § 2 of the Michigan Constitution provides:

Private property shall not be taken for public

use without just compensation therefor being first

made or secured in a manner prescribed by law.

Compensation shall be determined in proceedings in

a court of record.

(continued...)

compensation” is a “technical legal term or phrase of art”

that cannot be grasped by those not “sophisticated in the

law.” Ante at 10. This incorrect suggestion leads the

majority to conclude that the meaning of “just compensation”

must be restricted to the “consensus understanding in 1963,

by those skilled in this area of the law, of the meaning of

‘just compensation.’” Ante at 11.

While it may be that the understanding of “just

compensation” of those sophisticated in the law of

condemnation in 1963 may not differ significantly from that

of the common person, either past or present, this Court

should not engage in a method of constitutional construction

that unnecessarily sidesteps the long-established primary

rule of constitutional construction. The primary rule2 of

constitutional construction is that constitutional language

is to be interpreted according to “common understanding” as

1
(...continued)

This case was brought under the Uniform Condemnation

Procedures Act, MCL 213.51 et seq., which prescribes the

manner in which just compensation is “first made or secured”

pursuant to Const 1963, art 10, § 2.

2
If the plain meaning is unascertainable, secondarily,

“the circumstances surrounding the adoption of the

constitutional provision and the purpose sought to be

accomplished may be considered . . . . Finally, whenever

possible, an interpretation that does not create

constitutional invalidity is preferred to one that does.”

State Highway Comm v Vanderkloot, 392 Mich 159, 179; 220 NW2d

416 (1974)(opinion by WILLIAMS , J.)

described by Justice COOLEY :

“A constitution is made for the people and by

the people. The interpretation that should be

given it is that which reasonable minds, the great

mass of the people themselves, would give it. ‘. .

. the intent to be arrived at is that of the

people, and it is not to be supposed that they

have looked for any dark or abstruse meaning in

the words employed, but rather that they have

accepted them in the sense most obvious to the

common understanding . . . .’” [Traverse City

School Dist v Attorney General, 384 Mich 390, 405;

185 NW2d 9 (1971).]

The Supreme Court has reiterated this primary rule of

constitutional construction: “Each provision of a State

Constitution is the direct word of the people of the State,

not that of the scriveners thereof.” Lockwood v Comm’r of

Revenue, 357 Mich 517, 565; 98 NW2d 753 (1959). Thus, when

attempting to interpret a constitutional provision, “‘the

primary source for ascertaining its meaning is to examine

its plain meaning as understood by its ratifiers at the time

of its adoption.’” People v Bulger, 462 Mich 495, 507; 614

NW2d 103 (2000), quoting Charles Reinhart Co v Winiemko, 444

Mich 579, 606; 513 NW2d 713 (1994).

Thus, the issue in this case is whether the term “just

compensation” can be said to possess a “plain meaning.”

Contrary to the majority’s suggestion, the meaning of “just

compensation” is neither difficult to discern nor does it

require “sophistication in the law” to be grasped. Ante at

9-10, generally.3

“Just compensation” has long been readily and

reasonably understood to be that amount of money that puts

the property owner whose property is taken in as good, but

not better, a financial position after the taking as the

property owner enjoyed before the taking.4 The measure of

“just compensation” is “the property owner’s loss rather

than the government’s gain.”5

Though determining the dollar figure that most

accurately describes the property owner’s loss can be a

complicated task, such complication does not render “just

3
In certain circumstances, it is appropriate and

necessary to consider the meaning of constitutional terms that

are established in the law. See, e.g., Michigan United

Conservation Clubs v Secretary of State (After Remand), 464

Mich 359, 414-420; 630 NW2d 297 (2001)(WEAVER , J.,

dissenting)(construing “acts making appropriations” in art 2,

§ 9 of the Michigan Constitution), and WPW Acquisition Co v

City of Troy, 466 Mich 117, 123; 643 NW2d 564 (2002)(holding

unconstitutional the Legislature’s definition of a statutory

term that conflicted “with the established meaning of the term

at the time that it was” adopted by constitutional amendment).

4
Wayne Co v Britton Trust, 454 Mich 608, 622; 563 NW2d

608 (1997); In re Edward J Jefferies Homes Housing Project,

306 Mich 638, 650; 11 NW2d 272 (1943); In re Widening of

Bagley Ave, 248 Mich 1, 5; 226 NW 688 (1929).

5
Brown v Legal Foundation of Washington, __ US __,__; 123

S Ct 1406, 1419; 155 L Ed 2d 376 (2003), in which the United

States Supreme Court reiterated that “[t]his conclusion is

supported by consistent and unambiguous holdings in our

cases.” See also Boston Chamber of Commerce v Boston, 217 US

189, 195; 30 S Ct 459; 54 L Ed 725 (1910).

compensation” a “technical legal term or phrase of art.”

Indeed, though complicated, that task was expressly

dedicated by the 1850 and 1908 constitutions of Michigan to

a jury of “twelve freeholders, residing in the vicinity of

such property, or by not less than three commissioners,

appointed by a court of record, as shall be prescribed by

law . . . .” Const 1850, art 18, § 2; Const 1908, art 13, §

2. Further, this Court has said of condemnation

proceedings, “the jury is the judge of law and fact. Its

conclusions need not be based entirely on the testimony but

it may use its own judgment and knowledge from a view of the

premises and its experience as freeholders.” Dep’t of

Conservation v Connor, 316 Mich 565, 593; 25 NW2d 619

(1947).6 While the task of quantifying just compensation

can be a complicated task, in light of this history, it

cannot seriously be suggested that the concept of “just

compensation” is anything but obvious on its face.

In addition, I write to express concern with the

majority’s adoption of a one-size-fits-all rule in the

6
Under the current constitutional and statutory

framework, a just-compensation award is determined by a jury

or the court. Const 1963, art 10, § 2 provides in pertinent

part that “[c]ompensation shall be determined in proceedings

in a court of record.” MCL 213.63 provides in pertinent part,

“[t]he jury or the court shall award in its verdict just

compensation for each parcel.”

context of just compensation. The majority asserts that

contamination costs must be considered in just-compensation

determinations or the court would “place the legislators in

the posture of acting unconstitutionally.” Ante at 14.7

This conclusion is certainly debatable. The statute at

issue provides:

Before initiating negotiations for the

purchase of property, the agency shall establish

an amount that it believes to be just compensation

for the property and shall submit to the owner a

good faith written offer to acquire the property

for the full amount so established. . . . The

good faith offer shall state whether the agency

reserves or waives its rights to bring federal or

state cost recovery actions against the present

owner of the property arising out of a release of

hazardous substances at the property and the

agency’s appraisal of just compensation for the

property shall reflect such reservation or waiver.

The amount shall not be less than the agency’s

appraisal of just compensation for the

property. . . . [MCL 213.55(1).]

The statute’s express consideration of what compensation is

just under the constitution does not necessarily mean that

the Legislature intended, or was constitutionally obligated

to require, that a good-faith offer be reduced by the cost

7
The majority notes that “the primary connection between

a condemnation proceeding and a cost-recovery action is the

escrow that may be created during the condemnation proceeding

to provide security for the payment of the potential cost
recovery award.” Ante at 16. However, the existence of the

escrow mechanism does not answer whether the Legislature

intended that the cost of remediation should be considered in

condemnation proceedings.

6
of remediation in order to constitute “just compensation.”

Though market value typically serves as a measure of just

compensation, it is not the sole criterion. As recognized

by the United States Supreme Court, where the market value

is “too difficult to find” or the “payment of market value

would result in ‘manifest injustice’ to the owner or the

public,” the market value should not be the measure of just

compensation. Kirby Forest Industries, Inc v United States,

467 US 1, 10; 104 S Ct 2187; 81 L Ed 2d 1 (1984).

Because the effect of contamination on the value of a

property is difficult to determine and is susceptible to

different remediation and calculation approaches, it is

perhaps more appropriate to leave this fact-laden and case

specific determination to the judge or jury rather than the

majority’s one-size-fits-all formula or artificial rule. A

determination by a judge or jury is consistent with this

Court’s prior holdings that just-compensation awards in

condemnation proceedings should be decided on a case by case

basis. “[T]he determination of value in condemnation

proceedings is not a matter of formula or artificial rules

but of sound judgment and discretion based upon a

consideration of all relevant facts in a particular case.”

In re Grand Haven Hwy, 357 Mich 20, 28-29; 97 NW2d 748

(1959), citing In re Widening of Gratiot Avenue, 294 Mich

569; 293 NW 755 (1940).

Elizabeth A. Weaver

Silver Creek Drain District v. Extrusions Division, Inc

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