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STATE OF MICHIGAN
COURT OF APPEALS


JOSEPH M. HESS and WILLIAM WHEELER, Plaintiffs-Appellants, V CANNON TOWNSHIP and GRATTAN TOWNSHIP, Defendants-Appellees.

FOR PUBLICATION March 31, 2005 9:05 a.m. No. 248974 Kent Circuit Court LC No. 03-002455-CZ

Official Reported Version

Before: Neff, P.J., and Smolenski and Schuette, JJ. SCHUETTE, J. Plaintiffs Joseph M. Hess and William Wheeler appeal as of right the trial court's order granting defendants' motion for summary disposition pursuant to MCR 2.116(C)(10). This case concerns whether Cannon Township may disburse or contribute funds to help defray or otherwise share the legal costs incurred by a neighboring township--Grattan Township--in a land use controversy that both townships oppose. The trial court dismissed plaintiffs' complaint because it concluded that Cannon Township had the authority pursuant to MCL 41.2 and that Cannon Township had a legitimate, compelling, and valid public policy interest in the litigation in which Grattan Township was involved. We affirm the decision of the trial court. I. FACTS Grattan Township was involved in litigation with Landon Holdings, Inc. (Landon), a developer seeking to build a manufactured housing community on property located in Grattan Township on its border with Cannon Township. Cannon Township attempted to intervene in that litigation, but its petition was denied. On November 11, 2002, the Cannon Township board adopted two separate formal resolutions setting forth its findings of fact with respect to the adverse impacts that the Landon mobile home park would have on both Cannon Township and Grattan Township. The first resolution, entitled: "Resolution Regarding Cannon Township's Interest in Defending Regional Land Use Planning for Manufactured Housing Communities," provides:

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WHEREAS, a manufactured housing community developer (the "Developer") sought and was denied zoning approval by Grattan Township for a proposed 690-unit manufactured housing community to be located on lands to the northeast of Highway M-44 and Tiffany Avenue, in Grattan Township, but immediately adjacent to Cannon Township's eastern border (the "Subject Property"): WHEREAS, the Developer has filed three separate lawsuits against Grattan Township in an attempt to obtain a court order allowing its proposed manufactured housing community to be developed on the Subject Property; and WHEREAS, both Cannon Township and Grattan Township have adopted future land use planning provisions in their Master Plans indicating that housing communities should not be located in the vicinity of the Subject Property. Now, therefore, be it hereby resolved as follows: 1. Adverse Impacts on Cannon Township and Grattan Township. The Township Board hereby finds and declares that the Developer's proposed manufactured housing community, due to its proposed location on the border between Grattan Township and Cannon Township, would have the following adverse impacts on both Cannon Township and Grattan Township: a. As detailed in the traffic reported prepared by the URS, the proposed manufactured housing community would cause unacceptable levels of service at intersections on M-44 in Cannon Township; would greatly increase traffic all the way through Cannon Township on M-44 and on other north-south roads in Cannon Township that would be used to travel to and from Northland Drive, greater Grand Rapids and the proposed manufactured housing community location; and would thereby endanger the health, safety and welfare of Cannon Township and Grattan Township residents who use M-44 and other north-south roads in Cannon Township as the primary routes of access into and from the Grand Rapids metropolitan area. b. The proposed manufactured housing community would be totally out of character with the Agricultural zoning in Grattan Township and the adjacent Agricultural-Residential zoning in Cannon Township. c. The proposed manufactured housing community would likely spur a demand for new commercial development in the surrounding areas of Cannon Township and Grattan Township, and such commercial development would be incompatible with both Cannon Township's and Grattan Township's future land use plans, which designate these areas for Open Space Residential and Agriculture. d. Children living in the proposed manufactured housing community would attend the same schools attended by children living in both Cannon

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Township and Grattan Township, which would likely lead to overcrowding and a diminishment in quality of these schools. e. The proposed manufactured housing community would not be in an area where public facilities have adequate capacity or are expected to be extended so as to accommodate the anticipated growth in Cannon Township and Grattan Township that would result from such development. f. The proposed manufactured housing community would be located in a vulnerable watershed area where intensive development should not be permitted because of the risks of pollution, sedimentation and flooding in both Cannon and Grattan Townships. 2. Joint Interests of Cannon Township and Grattan Township. The Township Board hereby finds and declares that, because of the potential adverse impacts on Cannon Township and Grattan Township, both Townships share a joint interest in ensuring that the Developer's proposed manufactured housing community is not permitted by court order or otherwise. 3. Public Purpose. The Township Board hereby finds and declares that appropriate actions by or on behalf of Cannon Township to ensure that the proposed manufactured housing community is not developed would serve a public purpose. 4. Township Purpose. The Township Board hereby finds and declares that appropriate actions by or on behalf of Cannon Township to ensure that the proposed manufactured housing community is not developed would serve a valid Township purposed for the residents of both Cannon Township and Grattan Township. 5. Assistance to Grattan Township. Based on the foregoing findings, the Township Board hereby approves the expenditure of Township funds, in amounts approved by the Township Board from time to time, for the purpose of defraying and/or reimbursing the costs and expenses that Grattan Township has incurred in defending the lawsuits filed by the Developer and otherwise responding to the Developer's actions in furtherance of the proposed manufactured housing community. The second resolution was entitled: "Resolution Authorizing Disbursement of Township General Funds for the Purpose of Defending Regional Land Use Planning for Manufactured Housing Communities." This second resolution reaffirmed and recited similar findings of fact as the first resolution and also authorized the disbursement of $90,660 to Grattan Township to assist in reimbursing and defraying the costs of legal proceedings already incurred by Grattan Township's lawsuit with Landon. Cannon Township and Grattan Township then executed an agreement that provides the following:

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WHEREFORE, in consideration of their mutual promises, the parties hereby mutually agree as follows: 1. Cannon Township will disburse funds to Grattan Township, in amounts approved by the Cannon Township Board from time to time, for the purpose of defraying and/or reimbursing portions of the costs and expenses that Grattan Township has incurred or will incur in defending the lawsuits filed by the Developer and in otherwise responding to the Developer's actions in furtherance of the proposed manufactured housing community. 2. Grattan Township will use said disbursements from Cannon Township only for the purpose of defraying and/or reimbursing the legal fees, expenses, costs and other professional service fees Grattan Township has incurred or will incur in defending the lawsuits filed by the Developer and in otherwise responding to the Developer's actions in furtherance of the proposed manufactured housing community. Plaintiffs, taxpayers who reside in Cannon Township, brought suit alleging they suffered damages as result of Cannon Township's unlawful expenditure of the township's general funds. Plaintiffs requested that the trial court declare that Cannon Township's disbursement of township funds to Grattan Township was unlawful, order that Grattan Township immediately return the $90,660 to Cannon Township, and permanently enjoin Cannon Township from making any future disbursements of township general funds for the purpose of defraying legal costs incurred by Grattan Township. Defendants filed a motion for summary disposition pursuant to MCR 2.116(C)(10). Defendants stated in their motion for summary disposition that not only did the Cannon Township board make amply supported factual findings in support of its determination that financial assistance to Grattan Township would serve a valid public purpose, it also ensured that from an auditing perspective, the expenditure would be acceptable to township auditors.1 A hearing was held on May 2, 2003. The trial court concluded that the Cannon Township board had a legitimate and compelling interest to participate in, and to assist with, the litigation involving Grattan Township and Landon. The trial court also concluded that the Cannon Township board had the authority to act pursuant to the Michigan Constitution and MCL 41.2. The trial court granted defendants' motion for summary disposition.

Defendants attached the affidavit of Michael J. Crandall, a certified public accountant with Siegfried Crandall, P.C., who stated that it was his opinion that such expenditures would serve a strong and valid public purpose and that such expenditures would be approved by his firm as auditors for Cannon and Grattan townships.

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II. STANDARD OF REVIEW On appeal, a trial court's decision on a motion for summary disposition is reviewed de novo. A motion for summary disposition under MCR 2.116(C)(10) tests the factual sufficiency of the complaint. When deciding a motion for summary disposition under this subrule, a court must consider the pleadings, affidavits, depositions, admissions and other documentary evidence submitted in the light most favorable to the nonmoving party. See Corley v Detroit Bd of Ed, 470 Mich 274, 277-278; 681 NW2d 342 (2004). This Court reviews de novo the interpretation and application of a statute. Eggleston v Bio-Medical Applications of Detroit, Inc, 468 Mich 29, 32; 658 NW2d 139 (2003). Constitutional issues are also reviewed de novo on appeal. Mahaffey v Attorney General, 222 Mich App 325, 334; 564 NW2d 104 (1997). III. ANALYSIS A. Constitutional and Statutory Authority for Cannon Township's Expenditure The trial court did not err in granting defendants' motion for summary disposition. The provision of money by Cannon Township to Grattan Township was lawful pursuant to MCL 41.2(1)(b) as part of its authority to enter into contracts when necessary and convenient for the exercise of Cannon Township's corporate powers. Determining the validity of the agreement between Cannon Township and Grattan Township and Cannon Township's decision to help defray the legal cost of a mutually shared land use issue starts with the Michigan Constitution. Const 1963, art 7,

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