City of Riverview v. City of Trenton, 12

Decision Date26 February 1960
Docket NumberNo. 12,12
Citation101 N.W.2d 352,359 Mich. 98
PartiesCITY OF RIVERVIEW, Successor to Township of Monguagon, a Municipal Corporation, Plaintiff and Appellant, v. CITY OF TRENTON, Defendant and Appellee.
CourtMichigan Supreme Court

Anthony F. Leone, Detroit, for plaintiff-appellant, William S. Munger and J. Lynn Fewlass, Detroit, of counsel.

Oldani, Raubolt & MacDonald, Trenton, for defendant and appellee.

Before the Entire Bench.

SOURIS, Justice.

Section 14 of Pa.1909, No. 279, as amended (C.L.S.1956, § 117.14 [Stat.Ann.1957 Cum.Supp. § 5.2093]), a part of the so-called home-rule act, provides in part:

'* * * Whenever a new city shall be incorporated, the personal property of the township from which it is taken shall be divided and its liabilities assumed between such city and the portion of the township remaining after such incorporation, which incorporation shall be effective as of the date of filing the certified copy of the charter as hereinafter provided, in the same ratio as herein provided in case of the sannexation of a part of a township to a city * * *'

The question to be decided in this case is whether or not elected township officials' salaries are 'liabilities' within the meaning of the act, as quoted above, such that a new city incorporated from a portion of a township is required to pay part of the township officials' salaries after the date of incorporation of the new city.

Defenant city of Trenton was incorporated as a home-rule city from territory comprising a major part of Monguagon township, plaintiff. Subsequent to commencement of this case, the remaining portion of the township became incorporated porated as the city of Riverview. Appropriate amendment of the pleadings and title of this case followed.

The ratio referred to in the statutory provision quoted above is the same ratio as the assessed valuation of the taxable property in the territory incorporated as a city bears to the assessed valuation of the taxable property in the entire township from which said territory is taken. By stipulation, it was agreed by the parties that the assessed valuation of the taxable property in the defendant city of Trenton comprised 87.62% of the assessed valuation of the taxable property in the entire township prior to defendant's incorporation. The parties likewise agreed that the personal property of the township to be divided and the liabilities of the township to be assumed by the defendant city and the remaining portion of the township shall be in the ratio of 87.62% and 12.38% respectively. Apparently, the parties had no difficulty dividing the personal property of the township and allocating its liabilities, except those items claimed here to be liabilities, in the ratio stipulated. Thus far, but no further, did the parties agree.

The items in dispute are the salaries which plaintiff township was obliged to pay its supervisor, treasurer, clerk and 4 trustees on and after July 31, 1957, the date defendant city's incorporation became effective. Four months prior thereto a complete slate of township officers had been elected to serve 2 and 4 year terms at the same salaries paid to their predecessors. However, upon incorporation of defendant city all township offices, except that of treasurer, became vacated because the incumbents in those offices were residents of the township territory which became the city of Trenton. See C.L.1948, § 41.103 (Stat.Ann. § 5.152), which requires residence within a township as one of the qualifications for township office. All township offices, except that of treasurer, remained vacant from July 31 until October 8, 1957, when successors were elected at a special township meeting called for that purpose by the county board of supervisors, pursuant to C.L.1948, § 41.24 (Stat.Ann. § 5.24). Plaintiff township claims that defendant city should be required to assume and pay 87.62% of the salaries for all of such officers from and after July 31, in the case of the treasurer, and October 8, in the cases of the other officers, to the end of each officer's 2 or 4 year term, pursuant to the disputed statutory provision. This suit for declaratory judgment, pursuant to the provisions of C.L.1948, § 691.501 (Stat.Ann. § 27.501), was instituted on December 20, 1957 by the township.

Plaintiff's claim, as it relates to the salaries of its officials other than its treasurer, is whitout merit. On July 31, 1957, 6 of the 7 township offices were vacant. There were then no incumbents in those 6 township offices to whom plaintiff could be liable for salaries then or in futuro. As a matter of fact, those 6 vacancies were not filled until October 8, 1957, at which time, and only then, did plaintiff incur any obligation which could ever ripen into a liability to pay salaries to the holders of the 6 offices involved. Defendant city's duty to assume liabilities of plaintiff township from which its incorporated territory was taken is determined as of July 31, 1957, the date of its incorporation, and its duty is limited to partial assumption of those liabilities of the township which then existed. See Dearborn Township v. City of Dearborn, 308 Mich. 284, 13 N.W.2d 821, where this Court so held in an annexation case arising out of another similar provision of the same statute here in dispute.

On October 8, 1957, but prior to the special election held on that date, the township electors voted to reduce the salaries to be paid to the 6 officials to be elected (but they did not vote to reduce the incumbent treasurer's salary). Plaintiff now claims that the action of its electors in reducing such salaries violated article 16, § 3, of the Constitution of the State of Michigan (1908) and C.L.1948, § 41.95 (Stat.Ann. § 5.82). Decision on this claim is unnecessary to disposition of this appeal, in the light of our holding that the salaries of the 6 officials elected in October, 1957 are not subject to apportionment between the township and the city.

The treasurer's salary presents a different problem. The treasurer resided in a portion of the township not incorporated by defendant city and, consequently, remained in office on July 31, 1957. The question hereafter considered is whether salaries of incumbent elected township officials are township liabilities subject to apportionment within the meaning of the statutory language quoted at the beginning of this opinion.

The trial judge ruled that such salaries are contingent or deferred liabilities not subject to apportionment under the statute. He said:

'To directly approach the question which appears to be controlling, the Court is of the opinion that it is the law of this state that current operating expenses not yet incurred or liquidated or final, are not liabilities which can be apportioned under this statute. By this I mean such items as light, rent, supplies, snow removal, auditing expenses, legal expenses, expenses of regular and special elections, if any, and salaries. Respectable authority is presented holding that these items are not liabilities within the contemplation of this statute, and that they are merely contingent or deferred liabilities, the amount of which cannot be determined now and which may become greater or less with the passing of time and the occurrence of subsequent events. I do not think it is the function of this Court to project its jurisdiction into the future and to retain the right indefinitely to determine piecemeal and from time to time, as the occasion may arise, whether or not a contingent liability has become a fixed liability. This would seem an interminable job and would be most disturbing and upsetting to any one attempting to set up a fiscal policy for either the township or the city. It is fraught with intangibles, with imponderables and any attempt to formulate a financial policy or to make long-range financial plans by either the township or the city, would be seriously hampered by the constant uncertainty arising from the possible impact of contingent and...

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2 cases
  • City of Holland v. Fillmore Tp.
    • United States
    • Michigan Supreme Court
    • 26 d3 Abril d3 1961
    ...13 N.W.2d 821; Hazel Park Nonpartisan Taxpayers Ass'n v. Township of Royal Oak, 317 Mich. 307, 27 N.W.2d 249; City of Riverview v. City of Trenton, 359 Mich. 98, 101 N.W.2d 352. While we deal here with apportionment of assets rather than liabilities, there would seem to be a Closer to point......
  • Spears' Estate, In re
    • United States
    • Michigan Supreme Court
    • 26 d5 Fevereiro d5 1960

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