Usa Cash v. Saginaw

• Decision Date: 30 July 2009
• Docket Number: Docket No. 279378.
• Citation: 776 N.W.2d 346,285 Mich. App. 262
• Parties: USA CASH # 1, INC. v. CITY OF SAGINAW.
• Court: Court of Appeal of Michigan — District of US

776 N.W.2d 346

285 Mich. App. 262

USA CASH # 1, INC. v. CITY OF SAGINAW.

Docket No. 279378.

Court of Appeals of Michigan.

Submitted December 2, 2008, at Lansing.

Decided July 30, 2009, at 9:15 a.m.

Smith Bovill, P.C., (by Andrew D. Concannon), Saginaw, for Stretch-A-Buck Discount.

Thomas H. Fancher, Saginaw, for the city of Saginaw.

Before: SAAD, C.J., and FITZGERALD and BECKERING, JJ.

PER CURIAM.

Plaintiff Stretch-A-Buck Discount appeals as of right the trial court's orders denying its motions for summary disposition and granting defendant city of Saginaw's motion for summary disposition. The trial court upheld a city ordinance regulating secondhand merchants' reporting of transactions to local law enforcement. We affirm.

I. FACTS AND PROCEDURAL HISTORY

On June 19, 2006, the city of Saginaw enacted an ordinance, Saginaw Ordinances, title XI, § 110.25, requiring secondhand merchants to electronically report transactions in which the merchants received secondhand or used personal property to the chief of police within 48 hours of the transaction and pay a fee of $2 for each transaction. The ordinance required the merchants to electronically report transactions beginning August 1, 2006. Stretch-A-Buck and plaintiff USA Cash # 1, Inc. (USA Cash), both licensed secondhand merchants in the city of Saginaw, initiated this action alleging that the ordinance is preempted by the secondhand and junk dealers act, MCL 445.401 et seq., and the pawnbroker act, MCL 445.471 et seq., denies secondhand merchants equal protection under the law, and imposes an unlawful tax on secondhand merchants.

Stretch-A-Buck and USA Cash moved for partial summary disposition pursuant to MCR 2.116(C)(9) and (10) on their claim that the ordinance is preempted by state law. In an opinion and order dated January 5, 2007, the trial court denied the motion, finding that the ordinance does not directly conflict with state law. Thereafter, the city of Saginaw moved for summary disposition pursuant to MCR 2.116(C)(8) and (10), asserting that the ordinance is rationally related to a legitimate governmental interest and thus does not deny secondhand merchants equal protection, and that the transaction fee imposed by the ordinance is a valid user fee. Stretch-A-Buck and USA Cash then filed a motion for summary disposition pursuant to MCR 2.116(C)(8), (9), and (10) on their equal protection and unlawful taxation claims. In an opinion and order dated June 28, 2007, the trial court granted summary disposition in favor of the city of Saginaw pursuant to MCR 2.116(C)(10). The court reiterated its prior finding that the ordinance is not preempted by state law and additionally found that the ordinance does not deny secondhand merchants equal protection or impose an unlawful tax. Stretch-A-Buck now appeals as of right.

II. STANDARDS OF REVIEW

A grant or denial of summary disposition is reviewed de novo to determine if the moving party is entitled to judgment as a matter of law. Maiden v. Rozwood, 461 Mich. 109, 118, 597 N.W.2d 817 (1999). A motion under MCR 2.116(C)(8) tests the legal sufficiency of a claim by the pleadings alone. Maiden, supra at 119, 597 N.W.2d 817. The motion should be granted only when the claim is so legally deficient that recovery would be impossible even if all well-pleaded factual allegations were true and viewed in the light most favorable to the nonmoving party. Id. Likewise, a motion under MCR 2.116(C)(9) tests the legal sufficiency of a defense by the pleadings alone. Slater v. Ann Arbor Pub. Schools Bd. of Ed., 250 Mich.App. 419, 425, 648 N.W.2d 205 (2002). All well-pleaded factual allegations are accepted as true, and summary disposition is appropriate only "when the defendant's pleadings are so clearly untenable that as a matter of law no factual development could possibly deny the plaintiff's right to recovery." Id. at 425-426, 648 N.W.2d 205. A motion under MCR 2.116(C)(10) tests the factual sufficiency of a claim. Maiden, supra at 120, 597 N.W.2d 817. All admissible evidence submitted by the parties is reviewed in the light most favorable to the nonmoving party and summary disposition is appropriate only when the evidence fails to establish a genuine issue regarding any material fact. Id.; MCR 2.116(G)(6).

III. PREEMPTION

Stretch-A-Buck first argues that the city of Saginaw's ordinance directly conflicts with the secondhand and junk dealers act, specifically MCL 445.404 and 445.405, and is therefore preempted by state law.¹ According to Stretch-A-Buck, the ordinance is preempted to the extent it requires secondhand merchants to electronically report transactions, report transactions within 48 hours, and pay a fee of $2 for each transaction. We disagree.

A. STATUTORY INTERPRETATION

As this Court stated in USAA Ins. Co. v. Houston Gen. Ins. Co., 220 Mich. App. 386, 389-390, 559 N.W.2d 98 (1996) Statutory interpretation is a question of law subject to review de novo on appeal. The primary goal of statutory interpretation is to ascertain and give effect to the intent of the Legislature in enacting a provision. Statutory language should be construed reasonably, keeping in mind the purpose of the statute. The first criterion in determining intent is the specific language of the statute. If the statutory language is clear and unambiguous, judicial construction is neither required nor permitted, and courts must apply the statute as written. However, if reasonable minds can differ regarding the meaning of a statute, judicial construction is appropriate. [Citations omitted.]

Every word or phrase of a statute should be accorded its plain and ordinary meaning, but if the Legislature's intent cannot be determined from the statute itself, this Court may consult dictionary definitions. Haynes v. Neshewat, 477 Mich. 29, 36, 729 N.W.2d 488 (2007).

A state statute preempts regulation by an inferior government when the local regulation directly conflicts with the statute or when the statute completely occupies the regulatory field. McNeil v. Charlevoix Co., 275 Mich.App. 686, 697, 741 N.W.2d 27 (2007), citing Rental Prop. Owners Ass'n of Kent Co. v. Grand Rapids, 455 Mich. 246, 257, 566 N.W.2d 514 (1997). "For purposes of preemption, a direct conflict exists between a local regulation and a state statute when the local regulation permits what the statute prohibits or prohibits what the statute permits." McNeil, supra at 697, 741 N.W.2d 27, citing People v. Llewellyn, 401 Mich. 314, 322 n. 4, 257 N.W.2d 902 (1977). It is well established, however, that a local ordinance that regulates in an area where a state statute also regulates, with mere differences in detail, is not rendered invalid due to conflict. Walsh v. River Rouge, 385 Mich. 623, 635-636, 189 N.W.2d 318 (1971). "As a general rule, additional regulation to that of a State law does not constitute a conflict therewith." Id. at 636, 189 N.W.2d 318 (quotation marks and citation omitted). Where no direct conflict exists, both laws stand. Id.

In Rental Prop. Owners Ass'n of Kent Co., supra at 262, 566 N.W.2d 514, and in the cases cited therein, id. at 261, 566 N.W.2d 514, our Supreme Court quoted with approval the following passage from 56 Am. Jur. 2d, Municipal Corporations, § 374, pp. 408-409:

"It has been held that in determining whether the provisions of a municipal ordinance conflict with a statute covering the same subject, the test is whether the ordinance prohibits an act which the statute permits, or permits an act which the statute prohibits. Accordingly, it has often been held that a municipality cannot lawfully forbid what the legislature has expressly licensed, authorized, permitted, or required, or authorize what the legislature has expressly forbidden."

* * *

"The mere fact that the state, in the exercise of the police power, has made certain regulations does not prohibit a municipality from exacting additional requirements. So long as there is no conflict between the two, and the requirements of the municipal ordinance are not in themselves pernicious, as being unreasonable or discriminatory, both will stand. The fact that an ordinance enlarges upon the provisions of a statute by requiring more than the statute requires creates no conflict therewith unless the statute limits the requirement for all cases to its own prescription. Thus, where both an ordinance and a statute are prohibitory, and the only difference between them is that the ordinance goes further in its prohibition but not counter to the prohibition under the statute, and the municipality does not attempt to authorize by the ordinance what the legislature has forbidden or forbid what the legislature has expressly licensed, authorized, or required, there is nothing contradictory between the provisions of the statute and the ordinance because of which they cannot coexist and be effective. Unless legislative provisions are contradictory in the sense that they cannot coexist, they are not deemed inconsistent because of mere lack of uniformity in detail." [Emphasis in original, final emphasis added.]

B. THE CITY ORDINANCE

The challenged city ordinance states, in pertinent part:

(D) (1) No person shall fail to keep record of all persons with whom he or she does business and all property coming into his or her possession. All reports must be electronically transmitted to the Chief of Police. Every secondhand merchant, within forty-eight (48) hours, must transmit to the Chief of Police by means of electronic transmission through a modem or similar device in such a format that the data is capable of direct electronic entry into the Saginaw Police Department's computerized system approved by the Chief of Police for identifying secondhand or used personal property, all transactions in which the secondhand merchant received secondhand or used personal property the preceding day by pawn, trade, purchase, or consignment. A transaction reported by electronic transmission under this subsection shall not be...