Associated Builders v. Dept. of Consumer

• Citation: 267 Mich. App. 386,705 N.W.2d 509
• Decision Date: 19 July 2005
• Docket Number: Docket No. 234037.
• Parties: ASSOCIATED BUILDERS AND CONTRACTORS, SAGINAW VALLEY AREA CHAPTER, Plaintiff-Appellee/Cross-Appellant, v. DIRECTOR, DEPARTMENT OF CONSUMER & INDUSTRY SERVICES, and Midland County Prosecuting Attorney, Defendants/Cross-Appellees, and National Electrical Contractors Association, Michigan Chapter, Defendant/Intervenor-Appellant/Cross-Appellee, and Michigan Mechanical Contractors Association, Michigan Chapter of Sheet Metal & Air Conditioning Contractors, and Michigan State Building & Construction Trades Council, Defendants/Intervenors-Appellants/Cross-Appellees, and Saginaw County Prosecutor, Intervenor. (On Remand).
• Court: Supreme Court of Michigan

Page 509

705 N.W.2d 509

267 Mich. App. 386

ASSOCIATED BUILDERS AND CONTRACTORS, SAGINAW VALLEY AREA CHAPTER, Plaintiff-Appellee/Cross-Appellant, v. DIRECTOR, DEPARTMENT OF CONSUMER & INDUSTRY SERVICES, and Midland County Prosecuting Attorney, Defendants/Cross-Appellees, and National Electrical Contractors Association, Michigan Chapter, Defendant/Intervenor-Appellant/Cross-Appellee, and Michigan Mechanical Contractors Association, Michigan Chapter of Sheet Metal & Air Conditioning Contractors, and Michigan State Building & Construction Trades Council, Defendants/Intervenors-Appellants/Cross-Appellees, and Saginaw County Prosecutor, Intervenor. (On Remand).

Docket No. 234037.

Court of Appeals of Michigan.

Submitted April 5, 2005, at Detroit.

Decided July 19, 2005, at 9:00 a.m.

Released for Publication October 13, 2005.

COPYRIGHT MATERIAL OMITTED

Masud, Gilbert & Patterson, P.C. (by David John Masud and Kraig M. Schutter), Saginaw, for Associated Builders and Contractors, Saginaw Valley Area Chapters.

Michael A. Cox, Attorney General, Thomas L. Casey, Solicitor General, and Richard P. Gartner, Assistant Attorney General, for the Consumer and Industry Services Department Director.

Jensen, Gilbert, Smith & Borrello, P.C. (by Lawrence Wm. Smith), Saginaw, for the Midland County Prosecuting Attorney.

Smeltzer, Aptaker & Shephard, P.C. (by Gary L. Lieber and Anessa Abrams), Washington, DC, and Sachs Waldman (by Mary Ellen Gurewitz), Detroit, for the Michigan Chapter of the National Electrical Contractors Association, the Michigan Mechanical Contractors Association and the Michigan Chapter of the Sheet Metal Air Conditioning Contractors National Association.

Klimist, McKnight, Sale, McClow & Canzano, P.C. (by John R. Canzano), Southfield, and Jensen, Gilbert, Smith & Borrello (by Stephen L. Borrello), Saginaw, for the Michigan State Building & Construction Trades Council.

David M. Gilbert for the Saginaw County Prosecuting Attorney.

Before: WHITBECK, C.J., and WHITE and DONOFRIO, JJ.

(ON REMAND)

WHITE, J.

This case is before us on remand from the Supreme Court. Plaintiff brought this action for declaratory and injunctive relief, challenging the constitutionality of the prevailing wage act (PWA), M.C.L. § 408.551 et seq., as vague and as an unconstitutional delegation of legislative authority to private parties, specifically, unions and union contractors. The circuit court dismissed plaintiff's vagueness claim on defendants' motions for summary disposition, and allowed the delegation of legislative authority claim to proceed to discovery. Defendants-intervenors were granted leave to file an interlocutory appeal of the latter ruling, and plaintiff cross-appealed as of right the dismissal of its vagueness claim.

Our initial opinion concluded that, because plaintiff had not alleged an "actual controversy," it could not seek declaratory relief. Thus, we did not reach the merits of the constitutional challenges; we reversed the circuit court's denial of summary disposition of the delegation of legislative authority claim and affirmed the dismissal of the vagueness claim. See Associated Builders & Contractors v. Dep't of Consumer & Industry Services Director (ABC I), unpublished opinion per curiam, issued August 5, 2003 (Docket No. 234037), 2003 WL 21802756. Plaintiff applied for leave to appeal in the Supreme Court. After hearing oral arguments on plaintiff's application for leave, in lieu of granting leave to appeal, the Supreme Court reversed and remanded for reconsideration by this Court, stating:

We reverse the decision of the Court of Appeals and hold that plaintiff has presented an "actual controversy" so that plaintiff can seek declaratory relief under MCR 2.605. We do not address the substantive issue regarding the constitutionality of the PWA; instead, we remand to the Court of Appeals for reconsideration and resolution of the defendants' appeal and plaintiff's cross-appeal on the merits. [Associated Builders & Contractors v. Dep't of Consumer & Industry Services Director, 472 Mich. 117, 120, 693 N.W.2d 374 (2005) (ABC II).]

Having considered the merits of the appeal and cross-appeal, we conclude that the PWA does not unconstitutionally delegate legislative authority to private parties, and so we reverse the circuit court's denial of summary disposition on that claim. In the cross-appeal, we conclude that the PWA is not unconstitutionally vague on its face or as applied, and affirm the circuit court's dismissal of those claims, though for somewhat different reasons.

I. Appeal

Defendants assert that plaintiff's challenge to the PWA as an unconstitutional delegation of legislative authority to private parties must fail because that precise claim was rejected by this Court in West Ottawa Pub. Schools v. Director, Dep't of Labor, 107 Mich.App. 237, 309 N.W.2d 220 (1981).

This Court reviews de novo the circuit court's denial of summary disposition. Maiden v. Rozwood, 461 Mich. 109, 118, 597 N.W.2d 817 (1999). The constitutionality of a statute is a question of law this Court reviews de novo. Dep't of State v. MEA-NEA, 251 Mich.App. 110, 115-116, 650 N.W.2d 120 (2002). Legislation is presumed constitutional absent a clear showing to the contrary. Caterpillar Inc. v. Dep't of Treasury, 440 Mich. 400, 413, 488 N.W.2d 182 (1992). Statutes must be construed in a constitutional manner if possible. Id.

A. West Ottawa

West Ottawa was an appeal of the circuit court's declaratory judgment and permanent injunction precluding enforcement of the PWA on the ground that the act constituted an unlawful delegation of legislative power to private parties, i.e., unions. This Court reversed, stating:

Plaintiffs argue that, because the Department of Labor [now the Department of Consumer & Industry Services (CIS)¹] is statutorily required to set the prevailing wage rate at union rate, the Legislature has unconstitutionally delegated its power to a private party. We cannot agree.

Article 4, § 1, of the Michigan Constitution prohibits the delegation of "legislative power". The Michigan doctrine of nondelegation has been expressed in terms of a "standards" test:

"`There is no doubt that a legislative body may not delegate to another its lawmaking powers. It must promulgate, not abdicate. This is not to say however, that a subordinate body or official may not be clothed with the authority to say when the law shall operate, or as to whom, or upon what occasion, provided, however that the standards prescribed for guidance are as reasonably precise as the subject matter requires or permits.' (Emphasis supplied.)" Detroit v. Detroit Police Officers Ass'n, 408 Mich. 410, 458, 294 N.W.2d 68 (1980), quoting Osius v. St. Clair Shores, 344 Mich. 693, 698, 75 N.W.2d 25 (1956). The preciseness of the standards will vary in proportion to the degree to which the subject regulated requires constantly changing regulation. Dep't of Natural Resources v. Seaman, 396 Mich. 299, 309, 240 N.W.2d 206 (1976). As stated by the Court in G.F. Redmond & Co. v. Michigan Securities Comm., 222 Mich. 1, 5, 192 N.W. 688 (1923):

"The power to carry out a legislative policy enacted into law under the police power may be delegated to an administrative board under quite general language, so long as the exact policy is clearly made apparent, and the administrative board may carry out in its action the policy declared and delegated * * *. This marks the line between arbitrary officiousness and the exercise of delegated power to carry out a designated policy under the police power."

In Male v. Ernest Renda Contracting Co., Inc., 122 N.J.Super. 526, 301 A.2d 153 (1973), aff'd 64 N.J. 199, 314 A.2d 361 (1974), cert. den. 419 U.S. 839, 95 S.Ct. 69, 42 L.Ed.2d 66 (1974), the court reversed the trial court's finding that the New Jersey prevailing wage act was unconstitutional as an unlawful delegation of legislative power to a private party. Under the New Jersey act, the Commissioner of Labor established the prevailing wages for state projects from collective bargaining agreements. The Commissioner did not adopt any further rules or regulations but took the collective bargaining agreement that covered the majority of the workers in the locality and used the wages in that agreement as the prevailing rate. In holding that the statute was not unconstitutional, the appellate court reasoned:

"We do not find that the act, or the Commissioner's interpretation thereof, presents a problem of delegation of legislative power. As we view the act, the Commissioner has not been delegated power to perform a legislative function; rather, he has merely been granted the power, as a matter of legislative convenience, to determine a set of facts, i.e., the wage rates established under collective bargaining agreements in given circumstances. The Legislature has determined, for reasons set forth in section 1 of the act (NJSA 34:11-56.25), that the wages paid under collective bargaining agreements negotiated between labor unions representing a majority of the workmen engaged in the trade under collective bargaining agreements and their employers shall be the wages paid in the performance of public work. That public policy determination was for the Legislature. We find no constitutional bar thereto. To conclude, as the trial judge did, that under such a scheme `the public is not sufficiently protected against such arbitrary or self-motivated action on the part * * * of such private party to whom the legislative function has really been delegated,' misses the point and actually constitutes a substitution of judicial judgment for that of the Legislature." Male v. Ernest Renda Contracting Co., supra, [at] 533-534, 301 A.2d 153.

Accord, Kugler v. Yocum, 69 Cal.2d 371, 71 Cal.Rptr. 687, 445 P.2d 303 (1968), Union School Dist. of Keene v. Comm'r of Labor, 103 N.H. 512, 176 A.2d 332

(1961), Baughn v. Gorrell & Riley, 311 Ky. 537, 224 S.W.2d 436 (1949), Metropolitan Water Dist. of...