Cherry Growers, Inc. v. AG. MKTG. BD.

• Citation: 240 Mich. App. 153,610 N.W.2d 613
• Decision Date: 22 May 2000
• Docket Number: Docket No. 217396,Docket No. 218584.,Docket No. 216917,Docket No. 218400
• Parties: Cherry Growers, Inc., Appellant, v. Michigan Processing Apple Growers, Inc., a Division of Michigan Agricultural Cooperative Marketing Association, Inc., Appellee. Michigan Processing Apple Growers, Inc., a Division of Michigan Agricultural Cooperative Marketing Association, Inc., Plaintiffs, v. Cherry Growers, Inc., Defendant. CHERRY GROWERS, INC., Plaintiff-Appellee, v. Michigan AGRICULTURAL MARKETING AND BARGAINING BOARD, Defendant-Appellant, and Michigan Processing Apple Growers, Inc., a Division of Michigan Agricultural Cooperative Marketing Association, Inc., Intervening-Defendant. Cherry Growers, Inc., Plaintiff-Appellee, v. Michigan Processing Apple Growers, Inc., a Division of Michigan Agricultural Cooperative Marketing Association, Inc., Defendant-Appellant, and Michigan Agricultural Marketing and Bargaining Board, Defendant.
• Court: Court of Appeal of Michigan — District of US

610 N.W.2d 613

240 Mich. App. 153

Cherry Growers, Inc., Appellant, v. Michigan Processing Apple Growers, Inc., a Division of Michigan Agricultural Cooperative Marketing Association, Inc., Appellee.

Michigan Processing Apple Growers, Inc., a Division of Michigan Agricultural Cooperative Marketing Association, Inc., Plaintiffs, v. Cherry Growers, Inc., Defendant.

CHERRY GROWERS, INC., Plaintiff-Appellee, v. Michigan AGRICULTURAL MARKETING AND BARGAINING BOARD, Defendant-Appellant, and Michigan Processing Apple Growers, Inc., a Division of Michigan Agricultural Cooperative Marketing Association, Inc., Intervening-Defendant.

Cherry Growers, Inc., Plaintiff-Appellee, v. Michigan Processing Apple Growers, Inc., a Division of Michigan Agricultural Cooperative Marketing Association, Inc., Defendant-Appellant, and Michigan Agricultural Marketing and Bargaining Board, Defendant.

Docket Nos. 216917, 217396, 24.

Court of Appeals of Michigan.

Submitted February 1, 2000, at Lansing.

Decided March 3, 2000, at 9:25 a.m.

Released for Publication May 22, 2000.

Warner Norcross & Judd LLP (by William K. Holmes and Edward J. Bardelli), Grand Rapids, for Cherry Growers, Inc.

White, Przybylowicz, Schneider & Baird, P.C. (by James J. Chiodini and James A. White), Okemos, for Michigan Processing Apple Growers, Inc., a division of Michigan Agricultural Cooperative Marketing Association, Inc.

Jennifer M. Granholm, Attorney General, Thomas L. Casey, Solicitor General, and Randall Whitworth, Assistant Attorney General, for the Agricultural Marketing and Bargaining Board.

Before McDONALD, P.J., and DOCTOROFF and NEFF, JJ.

NEFF, J.

In these consolidated cases, all involving the same three parties, we are presented issues of jurisdiction and statutory construction under the Agricultural Marketing and Bargaining Act (hereafter the AMBA or the act), M.C.L. § 290.701 et seq.; MSA 12.94(101) et seq., to determine whether Cherry Growers, Inc. (CGI), is subject to the mandatory bargaining and arbitration provisions of the act. We hold that jurisdiction in this matter rests with the Agricultural Marketing and Bargaining Board¹ (AMBB) rather than the circuit court. We affirm the AMBB's determination that CGI is subject to mandatory bargaining and arbitration under the act as a "handler" of agricultural commodity. We, therefore, grant the complaint of the Michigan Agricultural Cooperative Marketing Association (MACMA)² for enforcement of the arbitration decision.

I

This controversy arises over provisions in the AMBA that require a "handler" of agricultural commodity to bargain with the accredited association, in this instance, the MACMA, to establish minimum prices and terms for a handler's purchase of agricultural commodity, in this instance, process apples, from Michigan producers. The underlying facts of this controversy are succinctly set forth in the circuit court's decision and order, as follows:

This dispute arose in 1998 when the Plaintiff [CGI] and the Intervening Defendant [MACMA] could not reach agreement regarding "support" or "acceptance" of a price for apples. The Intervening Defendant invoked the arbitration provisions of the Act. The Plaintiff sought clarification from the Defendant's [AMBB] administrator regarding the ostensible requirement that a cooperative association [CGI] be forced to negotiate with an accredited association [MACMA]. The Plaintiff was advised initially by the administrator that it need not negotiate with the Intervening Defendant for purchases made from its own [CGI's] members. Thereafter, Plaintiff decided to purchase only from its members. The Intervening Defendant nonetheless persisted in its demand that Plaintiff submit to arbitration. The Plaintiff refused and asserted that as a cooperative association, it was statutorily defined not to be a "handler" and was not subject to the bargaining and arbitration provisions of the Act. In an about face from its earlier position, the Defendant Board informed Plaintiff through its administrator that Plaintiff was considered a "handler" when it takes delivery of more than the contract amount of product from one of its members and that the amount of the product above the cooperative contract amount is subject to the bargaining provisions of the Act.

A

The parties' dispute over the act's bargaining requirements resulted in simultaneous administrative agency and circuit court actions to resolve the matter. The AMBB notified CGI that it was subject to mandatory bargaining and arbitration. Pursuant to the act's arbitration provisions, M.C.L. § 290.716; MSA 12.94(116), the AMBB established a joint settlement committee (hereafter the JSC or the committee) to arbitrate the dispute. CGI claimed that it was exempt from arbitration, and, therefore, the JSC lacked jurisdiction over the dispute.

CGI filed a complaint in the Grand Traverse Circuit Court, seeking declaratory and injunctive relief. The court granted a temporary restraining order (TRO), enjoining the JSC arbitration hearing. However, CGI took no further action and the TRO expired. The JSC resumed the administrative proceedings and renoticed the arbitration hearing for November 23, 1998. CGI contested the jurisdiction of the JSC and did not attend the hearing. The JSC concluded that CGI was subject to arbitration and, therefore, it had jurisdiction over the dispute, and proceeded with the hearing. On December 21, 1998, a two-member majority³ of the JSC rendered its decision on the merits, setting minimum prices to be paid for process apples handled by CGI for the 1998 apple crop.⁴

In the meantime, both the AMBB and the MACMA filed motions for summary disposition of the circuit court action, claiming that the court lacked subject-matter jurisdiction. CGI filed a cross-motion for summary disposition pursuant to MCR 2.116(C)(10). Following a hearing with regard to the motions on January 11, 1999, the circuit court issued its decision and order on February 10, 1999, determining that the court had subject-matter jurisdiction over the dispute and that CGI was not subject to mandatory bargaining and arbitration under the AMBA. The court denied the motions for summary disposition by the AMBB and the MACMA, granted summary disposition in favor of CGI, and enjoined the AMBB from asserting jurisdiction over CGI with regard to the issues decided by the court. These appeals followed.

B

In Docket No. 216917, CGI appeals the arbitration award of the JSC, under the act's provision for judicial review of committee awards by this Court, M.C.L. § 290.723; MSA 12.94(123). In Docket No. 217396, the MACMA seeks enforcement of the arbitration award, under the act's provision for enforcement by either party of a majority decision of the JSC, M.C.L. § 290.721; MSA 12.94(121). In Docket No. 218400, the AMBB appeals the circuit court's grant of summary disposition in favor of CGI. In Docket No. 218584, the MACMA separately appeals the circuit court's grant of summary disposition in favor of CGI.

II

We first address the issue of jurisdiction. The committee concluded that CGI had a duty to negotiate process apple prices under the AMBA, and therefore, it had subject-matter jurisdiction over the dispute pursuant to the administrative remedies provided in the act. The circuit court concluded that the court had original jurisdiction because this was a matter of statutory construction and, further, because the circuit court is a court of general equity jurisdiction and CGI sought declaratory and equitable relief.

A

Whether a court has subject-matter jurisdiction is a question of law subject to review de novo. Specht v. Citizens Ins. Co. of America, 234 Mich.App. 292, 294, 593 N.W.2d 670 (1999); Alliance for the Mentally III of Michigan v. Dep't of Community Health, 231 Mich.App. 647, 659, 588 N.W.2d 133 (1998). "Circuit courts are courts of general jurisdiction, and have original jurisdiction over all civil claims and remedies `except where exclusive jurisdiction is given by the constitution or by statute to some other court or where the circuit courts are denied jurisdiction by the constitution or statutes of this state.'" Farmers Ins. Exchange v. South Lyon Community Schools, 237 Mich.App. 235, 241, 602 N.W.2d 588 (1999), quoting M.C.L. § 600.605; MSA 27A.605. As a court of general equity jurisdiction, a circuit court has subject-matter jurisdiction to issue an injunction. Alliance for the Mentally III, supra at 660, 588 N.W.2d 133.

B

The AMBB is charged with administering the AMBA. M.C.L. § 290.703(1); MSA 12.94(103)(1). However, the Michigan Supreme Court also has recognized that the circuit courts have subject-matter jurisdiction over certain matters of statutory construction involving the AMBA. Michigan Canners & Freezers Ass'n, Inc. v. Agricultural Marketing & Bargaining Bd., 397 Mich. 337, 345-346, 245 N.W.2d 1 (1976), (After Remand), 416 Mich. 706, 332 N.W.2d 134 (1982), rev'd in part on other grounds 467 U.S. 461, 104 S.Ct. 2518, 81 L.Ed.2d 399 (1984). (On remand from the United States Supreme Court, the Michigan Supreme Court ordered a remand to the circuit court for further consideration and entry of a final judgment. 422 Mich. 862, 365 N.W.2d 760 [1985].) The doctrine of primary jurisdiction applies when concurrent original subject-matter jurisdiction exists between the courts and an administrative agency. Rinaldo's Constr. Corp. v. Michigan Bell Telephone Co., 454 Mich. 65, 70, 559 N.W.2d 647 (1997); LeDuc, Michigan Administrative Law, § 10:01, p. 5. "[T]he courts may defer to the agency in order to promote uniformity and take advantage of the special powers and expertise the agency may have in dealing with the subject matter." Id.

No fixed formula exists for determining whether the doctrine of primary jurisdiction applies; each case must be decided on its own facts. Rinaldo's, supra at 71, 559 N.W.2d 647; White Lake Improvement Ass'n v. City of Whitehall, 22 Mich.App. 262, 284, 177 N.W.2d 473 (1970). The...