Westervelt v. Natural Resources Commission

• Citation: 402 Mich. 412,263 N.W.2d 564
• Decision Date: 20 March 1978
• Docket Number: J,No. 14,14
• Parties: Albert A. WESTERVELT and Capitola L. Westervelt, husband and wife, and Roger Beilfuss and Marcia Beilfuss, husband and wife, and Recreational Canoeing Association, a Michigan non-profit Corporation, Plaintiffs and Appellees, v. NATURAL RESOURCES COMMISSION, an Agency of the State of Michigan created pursuant to Public Act 17 of 1921, and Ralph A. MacMullan, Director of the Department of Natural Resources, Defendants and Appellants. une Term 1976. 402 Mich. 412, 263 N.W.2d 564
• Court: Supreme Court of Michigan

Page 564

263 N.W.2d 564

Albert A. WESTERVELT and Capitola L. Westervelt, husband and

wife, and Roger Beilfuss and Marcia Beilfuss, husband and

wife, and Recreational Canoeing Association, a Michigan

non-profit Corporation, Plaintiffs and Appellees, v. NATURAL RESOURCES COMMISSION, an Agency of the State of

Michigan created pursuant to Public Act 17 of 1921, and

Ralph A. MacMullan, Director of the Department of Natural

Resources, Defendants and Appellants.

No. 14, June Term 1976.

402 Mich. 412, 263 N.W.2d 564

Supreme Court of Michigan.

March 20, 1978.

[402 MICH 418] Ronald C. Wilson, Scottville, for plaintiffs-appellees.

Frank J. Kelley, Atty. Gen., Robert A. Derengoski, Sol. Gen., Jerome Maslowski, Thomas L. Casey, Asst. Attys. Gen., Lansing, for Natural Resources Commission.

WILLIAMS, Justice.

This case comes to us on appeal from a declaratory judgment. There are two issues: (1) whether the Legislature, in conferring authority upon the Department of Conservation and the Commission of Conservation ¹ to promulgate rules and regulations pursuant to sections 3 and 3a of 1921 P.A. 17, as amended; M.C.L.A. §§ 299.3, 299.3a; M.S.A. §§ 13.3, 13.4, unconstitutionally delegated its legislative power; and (2) whether the "river use rules" promulgated by the successor Department of Natural Resources are invalid because the agency exceeded the scope of authority granted to it by the Legislature under sections 3 and 3a of 1921 P.A. 17, as amended; M.C.L.A. §§ 299.3, 299.3a; M.S.A. §§ 13.3, 13.4.

With respect to issue (1), we hold that sections 3 and 3a of 1921 P.A. 17, as amended; M.C.L.A. §§ 299.3, 299.3a; M.S.A. §§ 13.3, 13.4, do not unconstitutionally delegate legislative power to the agency. Accordingly, we reverse the Court of Appeals and the trial court as to this issue. With respect to issue (2), we remand to the trial court for proceedings not inconsistent with this opinion. We also remand to the trial court, without prejudice, with respect to the other issues to which the parties stipulated but which were not considered at trial.

I FACTS

In 1971 and 1972 the Department of Natural Resources (the DNR) conducted a series of extensive meetings and hearings, the result being, in March, 1972, the promulgation of a set of rules (the "river use rules") designed to regulate the use of certain portions of the Au Sable, Manistee, Pine, and Pere Marquette rivers. 1972 AACS, R 299.2701 et seq. The authoritative source for these rules, according to the DNR, was sections 3 and 3a of 1921 P.A. 17, as amended; M.C.L.A. §§ 299.3, 299.3a; M.S.A. §§ 13.3, 13.4. See Appendix, Appellants' Brief, 107a.

The Joint Rules Committee of the Legislature entered actively into the formulation of the "river use" rules. A special hearing of the Joint Rules Committee was held April 18, 1972, to hear the DNR "river rules" Committee and other DNR staff concerning the rules. On April 27, 1972, the Joint Rules Committee held another meeting to question the DNR. Apparently, as a result of these meetings, the Joint Rules Committee suggested changes in the rules, which, after DNR discussion, were discussed with legislators and the Legislative Service Bureau. After revision pursuant to these contacts, further minor revisions were made at the suggestion of the Joint Rules Committee on June 1, 1972. The Joint Rules Committee adopted the Rules on June 6, 1972. Appendix, Appellants' Brief, 8a-10a.

The "river use" rules, in general, divide portions of the rivers into sections and designate the uses to which these sections of the rivers may be put. On certain sections of the rivers, the rules prohibit the use of any type of watercraft, while on other sections, non-motor watercraft or motor watercraft operating at slow, non-wake speeds are the only types of watercraft permitted to be operated. The rules provide that they are to be in effect from the On April 27, 1972, plaintiffs, who are boat and canoe livery operators, brought this action against defendants Natural Resources Commission and Ralph A. MacMullan, Director of the DNR, seeking (1) a temporary injunction against enforcement of the proposed rules, and (2) a declaratory judgment as to the validity of the proposed rules. In a rather elaborate complaint, plaintiffs essentially alleged that (1) the rules "if finally 'promulgated' and carried into effect and enforced by the Department, would be unconstitutional and would represent an unconstitutional assumption of authority by the Department" because the Legislature had not delegated to the DNR the authority to promulgate such rules, that the rules, if carried into effect, would result in a taking of business opportunities and properties which amounts to a taking of property without due process of law, and that the rules were discriminatory and in violation of the equal protection of the laws; (2) the rules are invalid and unenforceable because the DNR failed "substantially to comply with the requirements of the Administrative Procedures Act of 1969" (the APA). See Appendix, Appellants' Brief, 11a-23a.

[402 MICH 420] last Saturday in April through Labor Day; they do not apply during the remainder of the year. The rules also specify certain responsibilities of river users and impose certain duties on livery operators or other persons who have watercraft for rent. These rules, however, apply only to those persons who have watercraft for rent "in a stretch of a river designated for non-motor watercraft use" or those persons who use a "stretch of a river designated for non-motor watercraft use". 1972 AACS, R 299.2709, 299.2710. Finally, the rules provide release and pickup points for watercraft and establish a scheme whereby a permit is required to be carried in all watercraft using these portions of the rivers designated for non-motor watercraft use. Such permits are available on a limited basis only, and the number of available permits is scheduled to decrease over a period of years. Violation of any of these rules is stated to be a misdemeanor under the provisions of M.C.L.A. § 299.3a; M.S.A. § 13.4. See Appendix, Appellants' Brief, 107a-115a.

On April 28, 1972, the circuit court entered a temporary order restraining the DNR from effectuating or attempting to enforce the rules, ordering the DNR to show cause why the temporary order should not be made a temporary injunction pending determination of the cause. On May 10, 1972, the date scheduled for the show-cause hearing, the circuit court issued an order, stipulated to by all parties, that the temporary restraining order be modified to permit administrative procedural matters to continue with respect to the rules, but the court continued the restraining order against enforcement of the rules. See Appendix, Appellants' Brief, 32a-36a. Defendants thereafter answered plaintiff's complaint, and filed a motion for summary judgment under GCR 1963, 117.2(1) (this motion was subsequently withdrawn in the "stipulation" discussed infra ).

On September 11, 1972, it was "stipulated and agreed between counsel for the respective parties" that the case would be submitted to the court "for a declaratory ruling" on nine stipulated legal issues. See Appendix, Appellants' Brief, 50a-53a. Trial was held on November 23, 1973, on the basis of the pleadings, stipulated issues and exhibits, written briefs and oral argument. Appellants' Brief, p. 3. The stipulation, in addition to the agreed-upon issues, contained the following extremely meager facts and the unfortunate record-limiting stipulation "to insure the non-introduction of factual matter in a case where, by stipulation, the legal issues only are to be argued". This record limitation is counterproductive because some of the legal issues raised can only be resolved in the context of the surrounding and, because of the stipulation and trial method, missing facts. The applicable excerpt from the stipulation is:

"It is further stipulated and agreed that for the purpose and only for the purpose, of the declaratory consideration, it is specified that there was and is conduct, conflict of use, pollution and other injury to the natural resources on the "That as to those plaintiffs doing business in the controlled river stretches, it is agreed for the purposes of this case that there would be a diminution of profit if the permit system of use is instituted.

streams in question sufficient to justify concern by the Department of Natural Resources and some form of regulation of river use.

"This stipulation is to insure, the non-introduction of factual matter in a case where, by stipulation, the legal issues only are to be argued.

"It is also further stipulated and agreed:

"1. That the various drafts of the proposed 'River Use Rules' with dates of publication, the transcript of testimony taken at the three public hearings, the transcript of Commission meetings when rules were considered, the chronological schedule of events, the technical reports and the report to the joint committee all be submitted and that these documents be used by the Court in its deliberation and Judgment." Appendix, Appellants' Brief, 52a-53a.

The issue at trial was framed as "the legality of the final draft of 'The Department of Natural Resources Use of River Rules' ". After hearing arguments on both sides as to the legal issues involved, the court, by opinion dated January 2, 1974, found "the authority lacking in the Department of Natural Resources by legislative grant to promulgate the rules in question as they are finally drafted". As to the other allegations complained of by plaintiffs, the court stated that "on these matters, the Court passes no opinion as to the validity of the rules". Subsequently, defendants filed a motion for the amendment of findings and for additional findings, and a hearing was held pursuant to this motion. The trial court replied pertinently to this motion as follows:

"In this particular case, there was no testimony taken and all of the facts presented were...