Michigan State AFL-CIO v. Secretary of State

• Decision Date: 22 May 1998
• Docket Number: 206620,Docket Nos. 206522,AFL-CIO and F
• Citation: 583 N.W.2d 701,230 Mich.App. 1
• Parties: MICHIGAN STATEranklin D. Garrison, Plaintiffs-Appellees. and Michigan Education Association, Intervening Plaintiff-Appellee, v. Michigan Chamber of Commerce, Defendant-Appellant, and SECRETARY OF STATE, Defendant. MICHIGAN STATEranklin D. Garrison, Plaintiffs-Appellees, and Michigan Education Association, Intervening Plaintiff-Appellee, v. SECRETARY OF STATE, Defendant-Appellant, and Michigan Chamber of Commerce, Defendant.
• Court: Court of Appeal of Michigan — District of US

Page 701

583 N.W.2d 701

230 Mich.App. 1

MICHIGAN STATE AFL-CIO and Franklin D. Garrison, Plaintiffs-Appellees.

and

Michigan Education Association, Intervening Plaintiff-Appellee, v. Michigan Chamber of Commerce, Defendant-Appellant, and SECRETARY OF STATE, Defendant.

MICHIGAN STATE AFL-CIO and Franklin D. Garrison, Plaintiffs-Appellees, and Michigan Education Association, Intervening Plaintiff-Appellee, v. SECRETARY OF STATE, Defendant-Appellant, and Michigan Chamber of Commerce, Defendant.

Docket Nos. 206522, 206620.

Court of Appeals of Michigan.

Submitted March 3, 1998, at Lansing.

Decided May 22, 1998, at 9:10 a.m.

Released for Publication Sept. 10, 1998.

[230 Mich.App. 3] Sachs, Waldman, O'Hare, Helveston, Bogas & McIntosh, P.C. (by Andrew Nickelhoff), Detroit, for Michigan State AFL-CIO and Franklin D. Garrison.

[230 Mich.App. 4] White, Przybylowicz, Schneider & Baird, P.C. (by Thomas A. Baird), Okemos, for Michigan Education Association.

Frank J., Kelley, Attorney General, Thomas L. Casey, Solicitor General, and Gary P. Gordon and Katherine C. Galvin, Assistant Attorneys General, for Secretary of State.

Honigman Miller Schwartz and Cohn (by John D. Pirich and Timothy Sawyer Knowlton), Lansing, for Michigan Chamber of Commerce.

Before McDONALD, P.J., and O'CONNELL and SMOLENSKI, JJ.

SMOLENSKI, Judge.

In these consolidated interlocutory appeals, defendant Secretary of State and intervening defendant Michigan Chamber of Commerce appeal by leave granted a September 24, 1997, preliminary injunction enjoining This case concerns a preenforcement challenge to the validity of emergency rules promulgated by the secretary. This case arises out of the secretary's efforts to implement the annual affirmative consent requirement contained in § 55(6) of the Michigan Campaign Finance Act (MCFA), M.C.L. § 169.201 et seq.; M.S.A. § 4.1703(1) et seq. Specifically, § 55(6) provides that certain entities, including labor organizations, may solicit or obtain contributions for a separate segregated fund on an automatic basis, including a payroll deduction plan, "only if the individual who is contributing to the fund affirmatively consents to the contribution at least once in every calendar year." See M.C.L. § 169.255(6); M.S.A. § 4.1703(55)(6). ¹ A person who knowingly violates § 55(6) is guilty of a felony punishable by either a fine or up to three years' imprisonment. M.C.L. § 169.255(7); M.S.A. § 4.1703(55)(7).

the secretary from enforcing emergency rules. We affirm.

The MCFA requires the secretary to "[p]romulgate rules and issue declaratory rulings ² to implement this act" pursuant to the Administrative Procedures Act (APA), M.C.L. § 24.201 et seq.; M.S.A. § 3.560(101) et seq. See M.C.L. § 169.215(1)(e); M.S.A. § 4.1703(15)(1)(e). The MCFA also provides that when a person requests a declaratory ruling, the secretary "may issue an interpretative statement providing an informational response to the question presented." M.C.L. § 169.215(2); M.S.A. § 4.1703(15)(2). Finally, the MCFA provides that

[a]declaratory ruling or interpretative statement issued under this section shall not state a general rule of law, other than that which is stated in this act, until the general rule of law is promulgated by the secretary of state as a rule pursuant to the [APA], or pursuant to judicial order. [M.C.L. § 169.215(2); M.S.A. § 4.1703(15)(2).]

Ordinarily, agencies must follow the notice-and-participation rule-making procedures contained in the APA. Blank v. Dep't of Corrections, 222 Mich.App. 385, 392, 564 N.W.2d 130 (1997). However, § 48 of the APA provides for the promulgation of emergency rules:

(1) If an agency finds that preservation of the public health, safety, or welfare requires promulgation of an emergency rule without following the notice and participation procedures required by sections 41 and 42 and states in the rule the agency's reasons for that finding, and the governor concurs in the finding of emergency, the agency may dispense with all or part of the procedures and file in the office of the secretary of state the copies prescribed by section 46 indorsed as an emergency rule, to 3 of which copies shall be attached the certificates prescribed by section 45 and the governor's certificate concurring in the finding of emergency. The emergency rule is effective on filing and remains in effect until a date fixed in the rule or 6 months after the date of its filing, whichever is earlier. The rule may be extended once for not more than 6 months by the filing of a governor's certificate of the need for the extension with the office of the (2) If the agency desires to promulgate an identical or similar rule with an effectiveness beyond the final effective date of an emergency rule, the agency shall comply with the procedures prescribed by this act for the processing of a rule which is not an emergency rule. The rule shall be published in the Michigan register and in the code.

secretary of state before expiration of the emergency rule. An emergency rule shall not be numbered and shall not be compiled in the Michigan administrative code, but shall be noted in the annual supplement to the code. The emergency rule shall be published in the Michigan register pursuant to section 8.

(3) The legislature by a concurrent resolution may rescind an emergency rule promulgated pursuant to this section. [M.C.L. § 24.248; M.S.A. § 3.560(148).]

In this case, the Chamber of Commerce, through its general counsel, Robert S. LaBrant, submitted to the secretary a request for a declaratory ruling and interpretative statement in April, 1997. ³ The request for a declaratory ruling sought answers to questions concerning what constituted annual affirmative consent for purposes of § 55(6). The request for an interpretative statement sought answers to questions concerning the applicability of the annual affirmative consent requirement to certain contributions and elections.

On July, 11, 1997, the secretary issued the requested declaratory ruling and interpretative statement. The declaratory ruling outlined the secretary's interpretation of what constituted annual affirmative consent for purposes of § 55(6). In particular, the declaratory ruling provided that beginning July 20, 1997, affirmative consent was required to be evidenced by a writing signed by the contributor (the signed writing requirement) and would be effective only until the end of the calendar year for which it was given (the December 31 expiration requirement). On both July 11 and 14, 1997, the secretary issued memorandums summarizing how separate segregated funds obtaining contributions on an automatic basis, including payroll deduction plans, would be affected by the declaratory ruling.

On July 31, 1997, plaintiffs Michigan State AFL-CIO and its president, Franklin D. Garrison (collectively referred to as the union), filed a complaint in the Ingham Circuit Court against the secretary. The complaint contained three counts and was entitled "Verified Complaint For Declaratory Judgment And Injunction And/Or Petition For Review." In count one, the union asserted that the secretary's declaratory ruling concerning the requirements for annual affirmative consent, particularly the signed writing and December 31 expiration requirements, constituted "a general rule of law, other than On August 26, 1997, the chamber was permitted to intervene in this action as a defendant. Following oral argument on August 28, 1997, the circuit court issued a preliminary injunction that, in relevant part, enjoined the secretary from applying the declaratory ruling and interpretative statement to the "Plaintiff Michigan State AFL-CIO and its political committee and its affiliated organizations and their political committees." In so doing, the court noted that the express language of § 55(6) did not include either a signed writing or December 31 expiration requirement. The court also suggested that the secretary's interpretation of the annual affirmative consent requirements had to be promulgated as a rule under the APA. ⁴

                that which is stated in the [MCFA]" and therefore was required by § 15(2) of the MCFA to be promulgated by the secretary as rules pursuant to the APA.  The union requested that the circuit [230 Mich.App. 9] court enter a declaratory judgment that the declaratory ruling and interpretative statement was "invalid and without effect."   The union also sought preliminary and permanent injunctions enjoining the secretary from enforcing the declaratory ruling and interpretative statement against the political committees of the union and other labor organizations.  In count two, the union sought judicial review of the declaratory ruling and interpretative statement for the reasons asserted in count one.  Count two also requested declaratory and injunctive relief.  Count three challenged certain actions taken by the secretary with respect to the affiliation requirements contained in § 52(10) of the MCFA, M.C.L. § 169.252(10);  M.S.A. § 4.1703(52)(10)
                

That same day, the secretary filed the following emergency rules pursuant to § 48 of the APA:

FINDING OF EMERGENCY

Act No. 117 of the Public Acts of 1994 amended the Michigan campaign finance act, Act No. 388 of the Public Acts of 1976, as amended, being § 169.201 et seq. of the Michigan Compiled Laws, to prohibit corporations, joint stock companies, domestic dependent sovereign and labor organizations from soliciting or obtaining contributions for separate segregated funds from certain individuals on an automatic or passive basis including but not limited to payroll deductions or reverse checkoffs. The amendment permits contributions to be solicited or obtained on an automatic basis, including but not limited to payroll deductions, only if the contributing individual affirmatively consents to the contribution at least once in every calendar year.

In a declaratory ruling dated July 11, 1997, issued to Robert S. LaBrant, the...