City of Detroit v. City of Highland Park, 33.

• Decision Date: 12 October 1949
• Docket Number: No. 33.,33.
• Citation: 326 Mich. 78,39 N.W.2d 325
• Parties: CITY OF DETROIT et al. v. CITY OF HIGHLAND PARK.
• Court: Michigan Supreme Court

326 Mich. 78

39 N.W.2d 325

CITY OF DETROIT et al.

v.CITY OF HIGHLAND PARK.

No. 33.

Supreme Court of Michigan.

Oct. 12, 1949.

Suit by City of Detroit and another against City of Highland Park for injunction and other relief and defendant's crossbill involved reasonableness of charge by plaintiff for treatment of defendant's raw sewage.

The Circuit Court of Wayne County, Vincent M. Brennan, J., held that rate charged was reasonable and entered decree for plaintiff.

The Court, Butzel, J., affirmed the decree.

Before the Entire Bench.

Raymond J. Kelly, Corporation Counsel, Paul T. Dwyer, Chief Assistant Corporation Counsel, Julian P. Rodgers, Assistant Corporation Counsel, Detroit, for plaintiffs, cross-defendants and appellees.

Earl B. Young, City Attorney, Highland Park (Claude H. Stevens, Detroit, of counsel), for defendant, cross-plaintiff and appellant.

BUTZEL, Justice.

The City of Detroit, as plaintiff, filed a bill against the City of Highland Park, defendant. Harry C. Genshaw of Detroit, a rate payer for sewage disposal service and a taxpayer, joined in the bill. We shall refer to the city of Detroit, however, as plaintiff. We use ‘/mcfw’ to designate ‘per 1000 cubic feet of water,’ and we refer to the raw sewage before it is treated by the sewage disposal plant as ‘sanitary sewage,’ as it is frequently called.

Plaintiff makes the following allegations. It has constructed, owns, maintains and operates a sewage disposal system, including a sewage treatment plant, interceptors, pumping stations, etc., in Detroit and its vicinity. The system has been in operation since prior to May 3, 1940, and the entire cost, including interceptors, et cetera, was $26,842,349.45. In order to partly provide for the cost of the system, including necessary interceptors, plants, pumping stations, et cetera, it issued revenue bonds in the amount of $5,075,000 and in addition to the proceeds therefrom it expended $21,767,369.45 for the sewage disposal system; that it has been required to expend for the maintenance and operation of the system up to June 31, 1941, an amount in excess of $1,380,053.82, and it did expend for the year ending June 30, 1940, the sum of $338,290.84, and from year to year it will be necessary to expend similar large sums of money and also provide for depreciation reserves, bond and interest redemption fund reserves, and contingent fund reserves as required by law; that in accordance with P.A.1933, No. 94, as amended, C.L.1948, § 141.101 et seq., Stat.Ann. § 5.2731 et seq., Ch. 124, Compiled Ordinances of the city of Detroit of 1936, as amended, plaintiff is required to establish rates for services furnished by the system and accordingly it did establish a rate of $0.2161/mcfw to all suburban municipalities, including Highland Park, on the basis of water-to-main, while the charge to individual suburban users was $0.25/mcfw as shows by the water meters. (It is conceded that the charge for sewage disposal is properly based on water used. The city of Highland Park, adjacent to the city of Detroit, had been discharging its sanitary sewage into plaintiff's mains and this has created a nuisance. While the city of Highland Park may, if it chooses, finance, construct and operate its own sewage treatment plant, it refuses to do so or to pay the amount charged by plaintiff. At the time of the filing of the bill defendant owed the city of Detroit $149,357.85. Plaintiff asks that Highland Park be enjoined from further discharging its untreated sewage, waste or other objectionable or deleterious matter into the public sewage disposal system of the city of Detroit pending an accounting and payment to the plaintiff of the reasonable charges theretofore established by plaintiff for the use of such system by Highland Park. Highland Park in its answer does not deny the right of the city of Detroit to charge a reasonable amount for sewage disposal treatment but does contend that $0.2161/mcfw is excessive. It claims that under various decrees in the past, and particularly the one entered in accordance with the opinion in City of Detroit v. Village of Highland Park, 186 Mich. 166, 152 N.W. 1002, Ann.Cas.1917E, 297, it has a right to use the Detroit sewers for surface waters and properly treated sewage. It shows that $9,000,000 of the cost to plaintiff was contributed by the Federal government as a PWA project, towards the construction of the sewage disposal plant, on the representation of the city of Detroit that the sewage disposal system was being built to serve not only the city of Detroit but also the surrounding communities; and that the actual cost to the city, after eliminating charges which it claims should be excluded, and after deducting the $9,000,000 received from the Federal government, was $16,626,721.44. Defendant filed a crossbill asking the court to determine the proper method or formula by which the amount to be paid by the city of Highland Park to the city of Detroit from year to year for sewage treatment and disposal may be established. The rate charged to its own residents by the city of Detroit, which paid from its tax moneys for a very large portion of the cost of the sewage disposal system, is $0.11/mcfw.

When Detroit was comparatively small and Highland Park a sparsely populated village there was no difficulty. Woodward Avenue runs north and south through the center of Detriot and is also the main street of Highland Park, which it bisects, and all the sewage from Highland Park ran through the Woodward Avenue sewer to the river at the foot of Woodward Avenue. As both municipalities grew in size difficulties were encountered. Highland Park is situated directly north of Detroit and is entirely landlocked. On the east it abuts Hamtramck, formerly a village and now a city, and on the other three sides it is bounded by the city of Detroit. Litigation arose in 1898 when the city of Detroit sought to enjoin Highland Park from connecting its swere with the Woodward Avenue sewer in Detroit. The following year the circuit court for Wayne county entered a decree authorizing such construction but provided for the payment of the sum of $500 per year to Detroit. Shortly thereafter, however, Detroit constructed a sewer system for the Palmer Park area of Detroit, immediately north of Highland Park, and petitioned the court for leave to connect its new sewer with the Highland Park sewer. By supplemental decree this was granted but the annual payment of $500 was ordered discontinued. No appeal was taken in this case. In 1913, due to the growth of the populations of both Detroit and Highland Park and the overloading of the capacity of the sewer system, the State board of health declared the existence of a nuisance because the large flow of sewage caused the sewers to overflow. In 1913 Highland Park by decree supplemental to the former one was granted permission to connect certain of its sewers with the new Morrell street sewer of Detroit. In 1915 by an evenly divided opinion of this court, the decree was affirmed on appeal in slightly modified form. City of Detroit v. Village of Highland Park, 186 Mich. 166, 152 N.W. 1002, Ann.Cas.1917E, 297. The final decree provided that the village of Highland Park had the right to discharge its sewage through the sewers of the city of Detroit to the Detroit river; further, that $600,000 was a proper compensation to Detroit for the use of such portion of its sewers as was required for disposal of the sewage of the village of Highland Park; and further

‘D. It is further ordered, adjudged and decreed that * * * the payment of said sum of six hundred thousand dollars ($600,000.00) shall require the City of Detroit to furnish to the Village of Highland Park full, complete and adequate outlet for its sewage; and should the outlet furnished through a connection with the Morrell Street sewer hereafter prove inadequate, the City of Detroit shall be bound to furnish other connections to the Village of Highland Park at its limits, said connections being constructed of such sizes and upon such grades as shall enable the Villageto properly drain all the territory within its present limits.

‘G. It is further ordered, adjudged and decreed that either party may apply to the Court for a modification of this decree at any time in the future as occasion may require.’

This sum of $6000,000 in the decree was arrived at by charging $380,183.35 based on one-half cent per square foot of drainage area of Highland Park, and the further sum of $219,816.65 as compensation for changes in the sewer system then or thereafter made to furnish and provide for present and future outlet needs of the village of Highland Park.

With the tremendous growth of both cities and the enormous quantity of sanitary sewage discharged at the outlets of the sewers a condition arose that was dangerous to the health and comfort of the city of Detroit and resulted in the pollution of the Detroit reiver. By Act 245, P.A.1929, C.L.1948, § 323.1, Stat.Ann. § 3.521 et seq., and a treaty between the United States and Great Britain, 36 Stat. 2448,¹ it became unlawful to pollute the Detroit river. It thus became necessary to treat sanitary sewage before it was discharged into the Detroit river. Detroit adopted an ordinance authorizing the construction and operation of a sewage disposal system and the issuance of revenue bonds to pay in part for the cost of such construction, in accordance with the provisions of P.A.1933, No. 94, as amended, see C.L.1948, § 141.101 et seq., entitled ‘the revenue bond act of 1933;’ Stat.Ann. § 5.2731 et seq. This ordinance became effective October 28, 1935. Other facts will be detailed in the course of this opinion.

The entire issue in the instant case largely resolves itself into the question of whether the rate established by plaintiff to defendant is a reasonable one. The trial judge after a protracted hearing held that the rate of $0.2161/mcfw established by plaintiff was proper and...