State Bar of Mich. v. City of Lansing, 25

Decision Date16 September 1960
Docket NumberNo. 25,25
Citation105 N.W.2d 131,361 Mich. 185
PartiesSTATE BAR OF MICHIGAN, a public body corporate, Plaintiff and Appellee. v. CITY OF LANSING, a Michigan municipal corporation, Lester N. Pressley, its assessor, John F. Webb, its treasurer, School District of the City of Lansing, a public corporation, and County of Ingham, a municipal corporation, Defendants and Appellants. Paul L. Adams, Attorney General of the State of Michigan, Intervenor.
CourtMichigan Supreme Court

Joseph Lavey, Lansing, for appellant City of Lansing, Hubbard, Fox, Thomas & Born, Lansing, of counsel.

MacLean & Seaman, Lansing for appellant City of Lansing School Dist.

Jack W. Warren, Lansing, Pros. Atty., for appellant County of Ingham.

Joseph W. Planck, Everett R. Trebilcock, Lansing, for appellee.

Paul L. Adams, Atty. Gen., Samuel J. Torina, Sol. Gen., Lansing, for intervenor-appellant.

Before the Entire Bench.

KELLY, Justice.

This controversy involves certain real and personal property belonging to the State Bar of Michigan, including the land upon which the present State Bar headquarters were at time of trial being erected, and the personal property of the State Bar which was at that time situated in the Hollister building, Lansing, Michigan. The real estate involved had been assessed for city, school and county taxes for the years 1955, 1956, 1957 and 1958, and all of said taxes had been paid under protest.

Plaintiff appeared before the board of review of the city of Lansing and filed a written claim of exemption from taxation, claiming that it is a public body corporate, created by statute, organized and regulated under the rules of and under the direct and immediate control of the Supreme Court of Michigan, and that it is an educational and scientific institution and, therefore, exempt from taxation under the general property tax laws.

The exemption was denied by the board of review. The State Bar of Michigan filed a petition for declaration of rights.

At the hearing, Mr. Raymond Dresser, then president of the State Bar of Michigan, testified that the State Bar association Maintained offices at 384 Hollister building, Lansing, Michigan, on leased property and that the quarters were not adequate; that the State Bar had about 8,900 members and was in the process of completing new headquarters; that the new building would house executive offices of the State Bar, including administrative work of the State Bar Association as well as the work of its 49 regular committees and 28 grievance committees and the board of bar examiners; that there were no plans for any charge for use of the building that there is a large lounge in the building for entertainment purposes with limited facilities for the service of food through a catering service; that the building contains a large meeting room, primarily for the use of committees and sections of the State Bar; and that, although members of the public might be permitted the use of the facilities, the facilities were primarily intended for the members of the bar; that 'if the public has matters which are germane to the functions of the State Bar, they will probably use the building, but to open it up for general public purposes, any meetings they might want to hold, I know of no plans for that'; that the State Bar of Michigan controls the building subject to the rules adopted by the Supreme Court; that the money for the construction of the State Bar building came from lawyers and donations from the public; that no money was contributed by the State of Michigan and there is no obligation of the State of Michigan on any bonds in connection with the building; that the land was purchased from funds of the State Bar and the building constructed through voluntary contributions from lawyers, banks, trust companies, and relatives of deceased lawyers; that funds used to purchase the land came from dues contributed by lawyers, which dues were set by the Supreme Court, plus small additional revenues from advertising in the Bar Journal and a few other sources; that no funds are received by the State Bar from taxes collected by the State of Michigan.

Mr. Milton Bachmann, executive secretary of the State Bar, testified that action had been taken by the board of commissioners seeking a change of the rules of the Supreme Court relative to the designation of the State Bar of Michigan as a public body corporate just before the State Bar made the final determination to construct its building; that a commissioners' committee of the State Bar presented recommendations to the board of the State Bar and the board approved presentation of the recommendations to the Supreme Court; that the petition of the State Bar was approved by the Supreme Court, as the result of which the rules were changed so as to refer to the State Bar of Michigan as being organized and existing as a public body corporate; that he books of the State Bar Association are not audited by any division of the government of the State of Michigan, and no accounts are filed with any division of the State government except the clerk of the Supreme Court; that none of the employees of the State Bar are paid out of tax funds collected by the State of Michigan; that it was not contemplated that the State of Michigan would maintain the building; that the operating expenses would be paid for out of funds accruing to the State Bar through dues; that 18 of the commissioners of the State Bar are elected by lawyers of their respective congressional districts and four are appointed by the Supreme Court at large, making a total board of 22, and that neither the governor nor the legislature has anything to do with the appointment of the State Bar commissioners.

E. Blythe Stason, A.B., B.S., J.D., after having been qualified as an international authority on legal education, testified that the legal education of a lawyer begins in a formal way somewhere in the middle of college years, continues through college and law school and into post graduate years, for the reason that the body of the law is constantly changing and the lawyer today must deal with problems that differ from those yesterday and the day before yesterday; that the need for continuing legal education is being met by three or four institutes offered by the University of Michigan Law School, the program of the American Bar Association, and educational programs offered by the State Bar of Michigan, both by institutes and convention workshops; that various committees of the State Bar involve legal research in many fields toward the end of improvement of certain phases of the law; that the institutes offered by the law school and the State Bar are specialized training intended for the legal profession.

At the conclusion of proofs defendants' motion to dismiss was denied. Defendants appeal, asking:

'That the decree entered below be set aside.

'That the case be remanded for entry of a new decree declaring the real and personal property involved to be subject to taxation.'

The integrated State Bar was first created by the legislature by the enactment of P.A.1935, No. 58 (C.L.1948, § 691.51 et seq. [Stat.Ann., § 27.101 et seq.]), using the following language:

'An Act to create the state bar of Michigan; and to authorize the supreme court to provide for the organization, regulation and rules of government thereof.

'The People of the State of Michigan enact:

'Sec. 1. There is hereby created an association to be known as the state bar of Michigan, the membership of which shall consist of all persons in the state now or hereafter regularly licensed to practice law in this state.

'Sec. 2. The supreme court is hereby authorized to provide for the organization and regulation of the state bar of Michigan; to provide rules and regulations concerning the conduct and activities of the association and its dues therein * * *.' udues therein * * *.'

The Supreme Court has adopted certain rules granting powers and duties to the State Bar, some of which are:

a.--The State Bar is charged with enforcement of the Supreme Court rule that any person not an active member who practices law in this State shall be subject to discipline. (Rule 3.)

b.- The State Bar is required to prosecute by way of injunction any of its members in case of persistent or repeated misconduct publicly committed. (Rule 14, § 2.)

c.- The State Bar has the duty and power to investigate complaints against members of the bar and to hold hearings thereon. It may dismiss or may reprimand. It may prosecute for suspension or disbarment in circuit court which shall confirm the recommendation unless just cause is shown to the contrary. (Rule 15.) d.--Every grievance committee of the State Bar has the power to issue subpoenas in the name and under the seal of the State Bar of Michigan and to cause evidence to be taken under oath. (Rule 15, § 27.) Failure of a witness to appear and give evidence constitutes contempt of court. (Rule 15, § 29.)

e.--Depositions in grievance matters may be taken before any member of a grievance committee or before any judge authorized to take depositions. (Rule 15, § 28.)

f.--The State Bar has the power and the duty to investigate petitions for reinstatement and to file with the court its certified report and recommendations thereon. (Rule 15, § 18.)

g.--The State Bar has the power and the duty to investigate the moral character of student applicants for admission to the bar and report thereon to the board of law examiners. (Rule 16.)

h.--The State Bar is authorized and empowered to investigate and to file and prosecute actions and proceedings pertaining to the unauthorized practice of law and its general counsel is directed to assist therein. (Rule 17.)

In determining the right of an inactive member of the State Bar of Michigan to engage in practice of law, our Court in Ayres v. Hadaway, 303 Mich. 589, 597, 6 N.W.2d 905, 908, said:

'In our opinion there is inherent power in the supreme...

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