City of Ecorse v. Peoples Community Hospital Authority

• Decision Date: 13 April 1953
• Docket Number: No. 62,62
• Citation: 58 N.W.2d 159,336 Mich. 490
• Parties: CITY OF ECORSE v. PEOPLES COMMUNITY HOSPITAL AUTHORITY et al.
• Court: Michigan Supreme Court

Page 159

58 N.W.2d 159

336 Mich. 490

CITY OF ECORSE v. PEOPLES COMMUNITY HOSPITAL AUTHORITY et al.

No. 62.

Supreme Court of Michigan.

April 13, 1953.

Cozadd, Shangle, Cherry & Schmidt, Detroit, for appellant.

Earl E. Montie, Ecorse, for City of Ecorse, appellee.

Jesse W. Bollinger, Dearborn, for Village of Inkster and Dearborn Tp.

Maxton R. Valois, River Rouge, for City of River Rouge.

Frederic J. Keppen, Detroit, for City of Lincoln Park.

Julius L. Berns, Detroit, for City of Melvindale.

Tinkham & Snyder, Wayne, for Romulus Tp., Wayne County.

Miller, Canfield, Paddock and Stone, Detroit, amicus curiae.

Before the Entire Bench.

BUSHNELL, Justice.

Plaintiff City of Ecorse brought this suit in equity for the purpose of obtaining a determination that the defendant Peoples Community Hospital Authority had not been legally or properly created, established or constituted under the authorizing statute so as to make that city an affiliate or constituent member thereof. The court was asked to declare unconstitutional P.A.1945, No. 47, C.L.1948, §§ 331.1-331.11, Stat.Ann. § 5.2456(1)-(11), as amended by P.A.1949, No. 62, and P.A. 1952, No. 170. Plaintiff also claimed that the resolution of its city council, adopted August 5, 1947, 'did not constitute legal and binding action on the city of Ecorse so as to make it a member of the 'Authority," and that 'the rescission and/or disclaimer of membership by the city of Ecorse is binding upon the defendants.'

Other municipalities, members of the authority, located southerly and westerly of the city of Detroit, were joined as defendants, namely: the villages of Inkster, Wayne, Flat Rock, Allen Park and Trenton; the cities of Melvindale, River Rouge, Lincoln Park and Ypsilanti; and the townships of Nakin, Dearborn, Huron, Sumpter, Taylor, Romulus and Ecorse.

Amicus curiae was granted leave to file a brief here in behalf of other hospital authorities. These are the Mackinac Straits Hospital Authority, whose members are the city of St. Ignace and the townships of Clark, Hendricks, Moran, Portage and St. Ignace, all located in Mackinac county; the Kalkaska County Hospital Authority, whose members are Village of Kalkaska and townships of Bear Lake, Boardman, Clearwater, Cold Springs, Excelsior, Garfield, Kalkaska, Oliver, Orange, Springfield and Wilson, all located in Kalkaska county; the Lakeview Hospital Authority, whose members are the villages of Decatur, Gables, Lawton and Paw Paw, and the townships of Almena, Antwerp, Decatur, Hamilton, Porter, Paw Paw and Waverly, all in Van Buren county; and the South Oakland Hospital Authority, which is presently inactive but has remained in existence 'to protect its constituent municipalities with respect to commitments made by the Greater Detroit Hospital Fund,' which will provide the necessary hospital services for the area included in this authority.

The defendant authority moved to dismiss the bill on the grounds of lack of equitable jurisdiction, the adequacy of a remedy at law, and that the legal existence of a public or quasi corporation can be inquired into in a direct proceeding instituted by the State. This motion was denied. The trial judge held that, while some of the questions propounded could be raised in quo warranto proceedings, the ends of justice would be better served and time and labor would be saved if the whole controversy was retained by the equity court. In Powers v. Fisher, 279 Mich. 442, 448, 272 N.W. 737, 739, it was said:

'The theory of saving a multiplicity of suits as a ground for equitable jurisdiction is that one equitable suit is substituted in place of all other kinds of judicial proceedings by means of which the entire controversy may be finally settled.'

This practice has the advantage of settling all the disputed questions in one action, which is a traditional aim of equity. Pungs v. Hilgendorf, 289 Mich. 46, 55, 286 N.W. 152.

Some of the defendants who asked for a declaration of their rights and liabilities filed pleadings which generally support the bill filed by the city of Ecorse; others took the position that the law under which the authority was created is valid, and that all acts taken thereunder were also valid. Some neither admitted nor denied the allegations of plaintiff; another chose to seek relief as a cross-plaintiff; others took the position that the amendatory act of 1949 was unconstitutional.

All the pleadings were filed prior to the enactment of the amendatory act of 1952, and hence the parties were not in a position to make any reference thereto. Nevertheless, the circuit judge discussed the 1952 act in his written opinion filed on May 16, 1952. That act was given immediate effect on April 24.

At the pretrial hearing on February 28, 1952, the court was unsuccessful in its attempt to get the parties to submit the case on stipulated facts. An extensive statement of the facts and the positions of the various parties was, therefore, prepared and filed on March 20, 1952. It was stated therein that, 'unless amended by the parties, they are bound thereby, under the rules of this court.' Shortly thereafter the city of Ecorse filed an amendment to the pretrial statement, and the village of Inkster and townshop of Dearborn filed amended answers. After taking extensive testimony, the trial judge on May 16th filed a written opinion in which he embodied, by reference, the pretrial statement.

It is unnecessary to burden this opinion with extensive quotations from the opinion of the trial judge or the statement, it being sufficient to say that a decree was entered on June 13, 1952, declaring and determining that the cited acts of 1945, 1949 and 1952 were unconstitutional and void, and determining that the authority had been illegally and unlawfully organized, voiding and cancelling all its acts and ordering the authority dissolved and enjoined from levying further assessments or doing any other acts save those necessary in the dissolution, winding up of its affairs, and disposition of its assets and liabilities, under the direction of the court. The authority was permitted to continue its usual course of business during the pendency of an appeal. No costs were allowed.

The first question raised by the appeal of the authority is whether its motion to dismiss plaintiff's bill of complaint should have been granted. This question, in the light of the authorities heretofore cited, must be answered in the negative. See, also, authorities cited in Diggs v. State Board of Embalmers and Funeral Directors, 321 Mich. 508, 514, 32 N.W.2d 728, 731, where the following is stated:

'This court has repeatedly held that in cases where an irreparable injury will result from the acts of public officials in attempting to proceed under an invalid law, the jurisdiction of equity may be invoked for the purpose of obtaining injunctive relief and a determination as to the constitutionality of the statute that is involved.'

With 17 municipalities concerned and problems of accounting and taxation involved, it would seem proper and desirable to resort to equity to determine the entire matter.

It would unnecessarily lengthe this opinion to discuss the numerous questions raised by the participating parties and the amicus curiae. Decision turns on the question of the constitutionality of the cat of 1945, as amended. The act, as stated in its title, authorized two or more cities, townships and incorporated villages, or any combination thereof, to incorporate a hospital authority for planning, promoting, acquiring, constructing, improving, enlarging, extending, owning, maintaining and operating a community hospital; to provide for changes in membership therein; to authorize its member municipalites to lvey taxes; to provide for the issuance of revenue bonds; to borrow money and to authorize condemnation proceedings.

As suggested in the brief of the amicus curiae, the defendant is not the only hospital authority concerned. The Mackinac Authority has raised funds and plans to begin the construction of a 24-bed hospital almost immediately. The Kalkaska Authority has in the process of construction a 10-bed combination hospital and health center, which when completed will cost approximately $176,000. The Lakeview Authority contemplates a 44-bed hospital, with construction awaiting the issuance of bonds.

The defendant authority began its operations in 1945 when certain municipalities at the invitation of the village of Wayne formed the authority. Other municipalities were added in 1947, and all of them, as contemplated by the act, appointed their representatives to serve as members of the authority's board of directors. In 1947 the authority acquired a lease from the city of Ypsilanti on the Beyer Memorial Hospital, and has successfully operated this hospital facility since January 1, 1948, for the benefit of its constituent members. It has provided in its annual budget for the accumulation of a fund with which it might build, erect and equip two hospitals more suitably located and accessible to all the participating communities. Immediately after the authority commenced to operate the Ypsilanti facility, the council of the city of Ecorse adopted a resolution which purported to rescind its 1947 resolution, and since that time has represented itself as having withdrawn from the authority. The city of River Rouge then took a similar position. The efficacy of both resolutions is denied by the authority.

It is fundamental that courts should not substitute their judgment for that of the legislature. Attorney General v. Board of Supervisors of Sanilac County, 71 Mich. 16, 26, 38 N.W. 639; Young v. City of Ann Arbor, 267 Mich. 241, 255 N.W. 579; People v. Powell, 280 Mich. 699...