Macomb Cnty. Rest., Bar, & Banquet Ass'n v. Dir. of Dep't of Health & Human Servs.
| Decision Date | 13 October 2022 |
| Docket Number | 357415 |
| Parties | MACOMB COUNTY RESTAURANT, BAR, AND BANQUET ASSOCIATION, Plaintiff-Appellant, v. DIRECTOR OF THE DEPARTMENT OF HEALTH AND HUMAN SERVICES, CHAIR OF THE LIQUOR CONTROL COMMISSION, and GOVERNOR, Defendants-Appellees. |
| Court | Court of Appeal of Michigan — District of US |
UNPUBLISHED
Before: Letica, P.J., and Servitto and Hood, JJ.
Plaintiff Macomb County Restaurant, Bar, and Banquet Association appeals as of right the order of the Court of Claims granting summary disposition to defendants, the Director of the Department of Health and Human Services (DHHS), the Chair of the Liquor Control Commission, and the Governor, under MCR 2.116(C)(5). We affirm.
Plaintiff is a non-profit corporation and trade association representing unidentified foodservice establishments in Macomb County. It filed a complaint in the Macomb County Circuit Court (circuit court) purportedly on behalf of its members, alleging regulatory taking, tortious interference with a contract, and tortious interference with a business relationship. Plaintiff's claims were premised on defendants' issuance of orders that affected food-service establishments during the COVID-19 pandemic. These orders reduced indoor dining capacity or closed in-person food service entirely, which plaintiff alleged caused lost profits to its members. It further asserted that these orders constituted a regulatory taking for which defendants had not paid just compensation under the Takings Clause of Article 10, § 2 of Michigan's 1963 Constitution. Plaintiff sought monetary damages on behalf of its members.
Defendants transferred the case from the circuit court to the Court of Claims because all claims were brought against acting state officials, MCL 600.6404(3). Plaintiff filed an emergency motion to return the case to the circuit court, citing its request for only monetary damages, not equitable or declaratory relief. It further asserted that the transfer to the Court of Claims had been improper because an exception to that court's exclusive jurisdiction existed when a party was entitled to a jury trial. Plaintiff submitted that it was entitled to a jury trial related to just compensation concerning its regulatory-takings claims and that its right to a jury trial had a constitutional basis. The Court of Claims ultimately denied plaintiff's emergency motion to transfer the action back to the circuit court, concluding that plaintiff did not have a right to a jury trial for the claims it had pleaded.[1]
Defendants sought summary disposition under MCR 2.116(C)(5) for lack of standing.[2]The motion alleged that restrictions on indoor dining did not apply to plaintiff as an association, and plaintiff had not sought declaratory relief on behalf of its unnamed members. Defendants contended that plaintiff could not recover monetary damages that belonged to unidentified restaurants, bars, and banquet halls. In addition, defendants submitted that plaintiff did not establish special injury to itself as an association. Consequently, summary disposition was appropriate in favor of defendants because plaintiff failed to raise a claim premised on its own legal rights and interests, but sought relief by claiming the rights or interests of third parties.
Plaintiff opposed the dispositive motion, asserting that it had standing to advocate on behalf of its members' interests. It claimed that plaintiff's members were all food-service establishments that had been deprived of their property by defendants and did not merely raise abstract concepts. Plaintiff alleged that it would be harmed if unable to proceed because it would "cease to exist or . . . be severely diminished" if its members' property continued to be taken without just compensation. Plaintiff asserted that the type of claims raised and the chosen remedy pursued did not preclude it from acquiring standing. Rather, plaintiff's pursuit of the claims as an association ensured that over 100 food-service establishments did not have to file individual complaints, and plaintiff could submit the damages for each individual member.
The Court of Claims granted summary disposition under MCR 2.116(C)(5), by concluding that plaintiff "lacke[ed] standing to sue for monetary damages on behalf of third parties." It was noted that a plaintiff generally could not rely on the claims of third parties although an organization had standing to advocate for the interests of its members. However, the question was not whether plaintiff could advocate for its members, but whether it had standing "to pursue monetary damages on behalf of its individual members."
The Court of Claims stated, in pertinent part:
[T]he idea that an association lacks standing to pursue a claim for monetary damages on behalf of its members is compelling. That is, while an organization or association can seek declaratory or injunctive relief on behalf of its members, the ability to seek monetary damages on behalf of individual members for particularized harm allegedly suffered by those individual members is of a different character. Any claim for monetary damages belongs to the individual members of the association, and plaintiff cannot assert rights belonging to others. See Barclae [v Zarb, 300 Mich.App. 455, 483; 834 N.W.2d 100 (2013)]. Such claims will necessarily require unique and individualized proofs regarding the nature and extent of the alleged injuries, and plaintiff has not directed the Court to any authority that would allow it to pursue these individualized claims for money damages on behalf of the association's members. Nor has plaintiff given the Court authority for the idea that it would be appropriate to order an award of money damages-assuming for purposes of discussion only that such an award would be warranted-to an association as opposed to the member institutions themselves. Furthermore, plaintiff's counsel conceded at oral argument that there was no assignment of any of the members' interests to plaintiff so as to allow plaintiff to pursue this action on behalf of those members. "The purpose of the standing doctrine in Michigan has always been to ensure sincere and vigorous advocacy." Lansing Schs Ed Ass'n [v Lansing Bd of Ed, 487 Mich. 349, 355; 792 N.W.2d 686 (2010)] (citation and quotation marks omitted). "Thus, the standing inquiry focuses on whether a litigant is a proper party to request adjudication of a particular issue and not whether the issue itself is justiciable." Id. (citation and quotation marks omitted). Here, plaintiff is simply not the proper party to request monetary damages on behalf of its member institutions for unique and individualized losses purportedly sustained by those institutions. As a result the Court agrees with defendants that plaintiff lacks the requisite interest to pursue an award of damages on behalf of its members and that plaintiff's action must be dismissed for lack of standing. [Footnote omitted.]
Accordingly, the Court of Claims concluded that plaintiff was not the proper party to request monetary damages.[3] From this decision, plaintiff appeals.
Plaintiff first contends that the Court of Claims lacked jurisdiction to consider its claim, which should have been transferred back to the Macomb County Circuit Court, because plaintiff was entitled to a jury trial to address the request for compensation under the Takings Clause. We disagree and conclude that the Court of Claims properly decided that plaintiff was not entitled to a jury trial on its claims.
A decision of the Court of Claims to transfer a case back to the circuit court implicates the court's inherent power to control its own docket, and this Court reviews the decision for an abuse of discretion. Baynesan v Wayne State Univ, 316 Mich.App. 643, 651; 894 N.W.2d 102 (2016). The court abuses its discretion when its decision falls outside the range of principled outcomes. Id. But this Court reviews unpreserved issues for plain error affecting the party's substantial rights. Whitmer v Bd of State Canvassers, 337 Mich.App. 396, 412; __N.W.2d__ (2021). An error is plain if it is clear or obvious, and it affects substantial rights if it affected the outcome of the lower court proceedings. Duray Dev, LLC v Perrin, 288 Mich.App. 143, 150; 792 N.W.2d 749 (2010).[4]
Plaintiff's arguments that the Court of Claims lacked subject-matter jurisdiction arise from the assertion that it has a right to a jury trial, whether statutorily or constitutionally, on its claim for just compensation. Courts must consider issues of subject-matter jurisdiction at any time. Bowie v Arder, 441 Mich. 23, 56; 490 N.W.2d 568 (1992). "When a court lacks subject[-]matter jurisdiction to hear and determine a claim, any action it takes, other than to dismiss the action, is void." Id.
Generally, the state and its subdivisions may not be sued without consent, and the Legislature may place conditions or limitations on such suits. Elia Cos, LLC v Univ of Mich. Regents, 335 Mich.App. 439, 447; 966 N.W.2d 755 (2021). "The Court of Claims is created by statute and the scope of its subject-matter jurisdiction is explicit." Dunbar v Dep't of Mental Health, 197 Mich.App. 1, 5; 495 N.W.2d 152 (1992), citing Lim v Dep't of Transp, 167 Mich.App. 753; 423 N.W.2d 343 (1988). The Court of Claims has jurisdiction "[t]o hear and determine any claim or demand . . . for monetary, equitable, or declaratory relief . . . against the state or any of its departments or officers notwithstanding another law that confers jurisdiction of the case in the circuit court." MCL 600.6419(1)(a).
If a matter is transferred to the Court of Claims, that court has exclusive jurisdiction over the matter, MCL 600.6421(4)(b) subject to MCL 600.6421(1). ...
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