Department of Transportation v. Riverview-Trenton Railroad Co

If this opinion indicates that it is “FOR PUBLICATION,” it is subject to

revision until final publication in the Michigan Appeals Reports.

STATE OF MICHIGAN

COURT OF APPEALS

DEPARTMENT OF TRANSPORTATION, FOR PUBLICATION

June 18, 2020

Plaintiff-Appellee, 9:00 a.m.

v No. 345708

Wayne Circuit Court

RIVERVIEW-TRENTON RAILROAD LC No. 17-000536-CC

COMPANY and CENTRAL TRANSPORT, LLC,

Defendants-Appellants,

and

CITY OF DETROIT, DOME PIPELINE

CORPORATION, DTE ELECTRIC COMPANY,

EES COKE BATTERY, LLC, ECONOMIC

DEVELOPMENT CORPORATION OF THE

CITY OF DETROIT, EDW C. LEVY CO.,

HONEYWELL INTERNATIONAL, INC.,

INTERNATIONAL TRANSMISSION

COMPANY, J.P. MORGAN CHASE BANK NA,

S&L DEVELOPMENT CO., and UNITED

STATES STEEL CORP.,

Defendants.

DEPARTMENT OF TRANSPORTATION,

Plaintiff-Appellee,

v No. 346105

Wayne Circuit Court

CROWN ENTERPRISES, INC., LC No. 17-000530-CC

Defendant-Appellant,

and

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CITY OF DETROIT and DEPARTMENT OF

NATURAL RESOURCES,

Defendants.

DEPARTMENT OF TRANSPORTATION,

Plaintiff-Appellee,

v No. 346106

Wayne Circuit Court

CROWN ENTERPRISES, INC., LC No. 17-000531-CC

Defendant-Appellant,

and

CITY OF DETROIT,

Defendant.

DEPARTMENT OF TRANSPORTATION,

Plaintiff-Appellee,

v No. 346107

Wayne Circuit Court

DIBDETROIT, LLC, LC No. 17-000533-CC

Defendant-Appellant,

and

CITY OF DETROIT,

Defendant.

DEPARTMENT OF TRANSPORTATION,

Plaintiff-Appellee,

v No. 346108

Wayne Circuit Court

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DIBDETROIT, LLC, LC No. 17-000534-CC

Defendant-Appellant,

and

DEPARTMENT OF NATURAL RESOURCES,

Defendant.

DEPARTMENT OF TRANSPORTATION,

Plaintiff-Appellee,

v No. 346109

Wayne Circuit Court

DETROIT INTERNATIONAL BRIDGE LC No. 17-000537-CC

COMPANY,

Defendant-Appellant,

and

CITY OF DETROIT and DEPARTMENT OF

NATURAL RESOURCES,

Defendants.

DEPARTMENT OF TRANSPORTATION,

Plaintiff-Appellee,

v No. 346110

Wayne Circuit Court

CROWN ENTERPRISES, INC., LC No. 17-000538-CC

Defendant-Appellant,

and

WAYNE SCRAP IRON & METAL COMPANY

and CITY OF DETROIT,

Defendants.

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DEPARTMENT OF TRANSPORTATION,

Plaintiff-Appellee,

v No. 346111

Wayne Circuit Court

DIBDETROIT, LLC, LC No. 17-000539-CC

Defendant-Appellant,

and

CITY OF DETROIT, BENJAMIN ZUCKER or

His Unknown Heirs, Devisees, Legatees and

Assigns, and ROSE ZUCKER or Her Unknown

Heirs, Devisees, Legatees and Assigns,

Defendants.

DEPARTMENT OF TRANSPORTATION,

Plaintiff-Appellee,

v No. 346112

Wayne Circuit Court

CROWN ENTERPRISES, INC., LC No. 17-000540-CC

Defendant-Appellant,

and

ARCOLA CLARK or Her Unknown Heirs,

Devisees, Legatees and Assigns, GWENDOLYN

MARIE SMITH or Her Unknown Heirs, Devisees,

Legatees and Assigns, and CITY OF DETROIT,

Defendants.

DEPARTMENT OF TRANSPORTATION,

Plaintiff-Appellee,

v No. 346113

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Wayne Circuit Court

CROWN ENTERPRISES, INC., LC No. 17-000541-CC

Defendant-Appellant,

and

CITY OF DETROIT,

Defendant.

DEPARTMENT OF TRANSPORTATION,

Plaintiff-Appellee,

v No. 346114

Wayne Circuit Court

CROWN ENTERPRISES, INC., LC No. 17-000542-CC

Defendant-Appellant,

and

CITY OF DETROIT, DTE ELECTRIC

COMPANY, EXPRESS SERVICE

ENTERPRISES, INC., FLAGSTAR BANCORP,

INC., THOMAS MCALLEN or His Unknown

Heirs, Devisees, Legatees and Assigns, AILEEN

MCALLEN or Her Unknown Heirs, Devisees,

Legatees and Assigns, BUSINESS LOAN

CENTER, LLC, UNITED STATES OF

AMERICA DEPARTMENT OF

TREASURY/INTERNAL REVENUE SERVICE,

and AFT INVESTMENTS, LLC,

Defendants.

DEPARTMENT OF TRANSPORTATION,

Plaintiff-Appellee,

v No. 346115

Wayne Circuit Court

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DIBDETROIT, LLC, LC No. 17-000544-CC

Defendant-Appellant,

and

MORTON INDUSTRIAL GROUP, INC., as

Successor in Interest to MCLOUTH STEEL

CORPORATION, DEPARTMENT OF

NATURAL RESOURCES, and CITY OF

DETROIT,

Defendants.

DEPARTMENT OF TRANSPORTATION,

Plaintiff-Appellee,

v No. 346116

Wayne Circuit Court

DIBDETROIT, LLC, LC No. 17-000545-CC

Defendant-Appellant,

and

IRENE GARZA and CITY OF DETROIT,

Defendants.

DEPARTMENT OF TRANSPORTATION,

Plaintiff-Appellee,

v No. 346117

Wayne Circuit Court

CROWN ENTERPRISES, INC., LC No. 17-000546-CC

Defendant-Appellant,

and

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DEPARTMENT OF NATURAL RESOURCES

and CITY OF DETROIT,

Defendants.

DEPARTMENT OF TRANSPORTATION,

Plaintiff-Appellee,

v No. 346118

Wayne Circuit Court

CROWN ENTERPRISES, INC., LC No. 17-000547-CC

Defendant-Appellant,

and

CURTIS PENICK and CITY OF DETROIT,

Defendants.

DEPARTMENT OF TRANSPORTATION,

Plaintiff-Appellee,

v No. 346119

Wayne Circuit Court

CROWN ENTERPRISES, INC., LC No. 17-000548-CC

Defendant-Appellant,

and

RYE GENTRY TRUCKING, INC., CAROL A.

GENTRY TRUST DATED 11/8/2000 As it May

be Amended, and CAROL A. GENTRY,

Individually and as Trustee,

Defendants.

DEPARTMENT OF TRANSPORTATION,

Plaintiff-Appellee,

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v No. 346120

Wayne Circuit Court

DIBDETROIT, LLC, LC No. 17-006977-CC

Defendant-Appellant,

and

CITY OF DETROIT,

Defendant.

DEPARTMENT OF TRANSPORTATION,

Plaintiff-Appellee,

v No. 346121

Wayne Circuit Court

DIBDETROIT, LLC, LC No. 17-006979-CC

Defendant-Appellant,

and

CITY OF DETROIT, DEPARTMENT OF

NATURAL RESOURCES, SAMIR HABIB-

SHAMKH AL-FATLAWI, MARIA ANTONIETA

PARDO-DE-GARCIA, MARJORIE ZAIZAR, and

RAMIRO ZAIZAR,

Defendants.

DEPARTMENT OF TRANSPORTATION,

Plaintiff-Appellee,

v No. 346122

Wayne Circuit Court

DIBDETROIT, LLC, LC No. 17-006980-CC

Defendant-Appellant,

and

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DEPARTMENT OF NATURAL RESOURCES,

Defendant.

Before: CAVANAGH, P.J., and STEPHENS and M. J. KELLY, JJ.

PER CURIAM.

In these 19 consolidated appeals,1 various entities controlled by Manuel “Matty” Moroun

(the Moroun entities) appeal by leave granted2 two orders of the circuit court rejecting challenges

1

Dep’t of Transportation v Riverview-Trenton RR Co, unpublished order of the Court of Appeals,

entered April 1, 2019 (Docket Nos. 345708 and 346105 through 346122).

2

Dep’t of Transportation v Riverview-Trenton RR Co, unpublished order of the Court of Appeals,

entered February 12, 2019 (Docket No. 345708); Dep’t of Transportation v Crown Ent, Inc,

unpublished order of the Court of Appeals, entered February 12, 2019 (Docket No. 346105); Dep’t

of Transportation v Crown Ent, Inc, unpublished order of the Court of Appeals, entered February

12, 2019 (Docket No. 346106); Dep’t of Transportation v DIBDETROIT, LLC, unpublished order

of the Court of Appeals, entered February 12, 2019 (Docket No. 346107); Dep’t of Transportation

v DIBDETROIT, LLC, unpublished order of the Court of Appeals, entered February 12, 2019

(Docket No. 346108); Dep’t of Transportation v Detroit Int’l Bridge Co, unpublished order of the

Court of Appeals, entered February 12, 2019 (Docket No. 346109); Dep’t of Transportation v

Crown Ent, unpublished order of the Court of Appeals, entered February 12, 2019 (Docket No.

346110); Dep’t of Transportation v DIBDETROIT, LLC, unpublished order of the Court of

Appeals, entered February 12, 2019 (Docket No. 346111); Dep’t of Transportation v Crown Ent,

Inc, unpublished order of the Court of Appeals, entered February 12, 2019 (Docket No. 346112);

Dep’t of Transportation v Crown Ent, Inc, unpublished order of the Court of Appeals, entered

February 12, 2019 (Docket No. 346113); Dep’t of Transportation v Crown Ent, Inc, unpublished

order of the Court of Appeals, entered February 12, 2019 (Docket No. 346114); Dep’t of

Transportation v DIBDETROIT, LLC, unpublished order of the Court of Appeals, entered

February 12, 2019 (Docket No. 346115); Dep’t of Transportation v DIBDETROIT, LLC,

unpublished order of the Court of Appeals, entered February 12, 2019 (Docket No. 346116); Dep’t

of Transportation v Crown Ent, Inc, unpublished order of the Court of Appeals, entered February

12, 2019 (Docket No. 346117); Dep’t of Transportation v Crown Ent, Inc, unpublished order of

the Court of Appeals, entered February 12, 2019 (Docket No. 346118); Dep’t of Transportation v

Crown Ent, Inc, unpublished order of the Court of Appeals, entered February 12, 2019 (Docket

No. 346119); Dep’t of Transportation v DIBDETROIT, LLC, unpublished order of the Court of

Appeals, entered February 12, 2019 (Docket No. 346120); Dep’t of Transportation v

DIBDETROIT, LLC, unpublished order of the Court of Appeals, entered February 12, 2019

(Docket No. 346121); Dep’t of Transportation v DIBDETROIT, LLC, unpublished order of the

Court of Appeals, entered February 12, 2019 (Docket No. 346122).

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to the authority of the Michigan Department of Transportation (MDOT) to condemn property for

the construction of the Gordie Howe International Bridge (GHIB). We affirm.

I. FACTS

The history of the GHIB extends back nearly two full decades. We need not provide

extensive detail to resolve the present matter, and as such, provide a limited summary of the

relevant facts, the majority of which involve appropriations bills enacted since 2011 and other

litigation involving the GHIB.

MDOT, the Federal Highway Administration (FHA), Transport Canada, and the Ontario

Ministry of Transportation formed a partnership in 2001 to investigate the feasibility of

constructing a new international bridge connecting Detroit and Windsor, Ontario. See Latin

Americans for Social & Economic Dev v Administrator of the FHA, 756 F3d 447, 454 (CA 6,

2014). A lengthy process resulted in the selection in 2009 of Detroit’s Delray neighborhood as

the preferred location for the site of a new international bridge.3 Id. at 451, 453-461.

In an appropriations bill that took effect on June 21, 2011, our Legislature included the

following language as Art XVII, Part 2, § 384 of 2011 PA 63 (Section 384):

(1) The department shall not expend any state transportation revenue for

construction planning or construction of the Detroit River International Crossing or

a renamed successor. In addition, except as provided in subsection (3), the

department shall not commit the state to any new contract related to the construction

planning or construction of the Detroit River International Crossing or a renamed

successor unless the legislature has enacted specific enabling legislation to allow

for the construction of the Detroit River International Crossing or a renamed

successor.

(2) On or before March 31, 2012, the department shall report to the state budget

director, the house and senate appropriations subcommittees on transportation, and

the house and senate fiscal agencies on department activities related to the Detroit

River International Crossing or a renamed successor.

3

The result of this process was the issuance of a Record of Decision (ROD) by the FHA. Latin

Americans, 756 F3d at 451. The Moroun-owned Detroit International Bridge Company was a

plaintiff in Latin Americans, a lawsuit that ended with the affirmance of the ROD. Id. at 477. The

Moroun-owned Canadian Transport Company unsuccessfully sought to have the ROD overturned

in the Canadian court system. Canadian Transit Co v Canada (Minister of Transport), 59 CELR

(3d) 127; 2011 FC 515 (2011). Moroun also sought to challenge MDOT’s pursuit of the project

in the Court of Claims. That action was likewise unsuccessful. Detroit Int’l Bridge Co v Dep’t of

Transportation, unpublished per curiam opinion of the Court of Appeals, issued December 6, 2011

(Docket No. 298276). These lawsuits predated the execution of the Crossing Agreement that is at

the core of the present matter.

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(3) If the legislature enacts specific enabling legislation for the construction of the

Detroit River International Crossing or a renamed successor, subsection (1) does

not apply once the enabling legislation goes into effect.

Subsequently, a bill that would have authorized the new international bridge died in Michigan’s

Senate after being rejected by a committee vote in October 2011.4

Nonetheless, on June 15, 2012, Her Majesty the Queen in Right of Canada (represented by

the Minister of Transport) (Canada), the Windsor-Detroit Bridge Authority (WDBA), and the State

of Michigan, “as represented by its Governor, and by and through,” MDOT and the Michigan

Strategic Fund (MSF), entered into the Crossing Agreement, which:

. . . provide[d] a framework for a Crossing Authority established by Canada to

design, construct, finance, operate and maintain a new International Crossing

between Canada and Michigan, under the oversight of a jointly established

International Authority with three members appointed by Canada and the Crossing

Authority and three members appointed by the Michigan Parties, and with funding

approved by Canada, but with no funding by the Michigan Parties. The Michigan

Parties are not obligated to pay any of the costs of the new International Crossing.

The “purpose” section of the agreement explains that the purpose of the Crossing Agreement is to

“provide a framework for the Crossing Authority to” design, construct, finance, operate, and

maintain the GHIB and a “US Federal Plaza” “with the assistance as necessary, but not funding

by, Michigan[.]”

Under the Crossing Agreement, the Canadian Crossing Authority “shall be responsible for

International Crossing Project Activities and shall be responsible for the design, construction,

financing, operation and maintenance of the International Crossing . . . .” The Crossing Authority

is also given authority to collect tolls. MDOT is responsible for acquiring, through condemnation

if necessary, Michigan land needed for construction of the bridge. However, funding for acquiring

property comes from Canada through the Crossing Authority. At his deposition, Myron Frierson,

the Deputy Director for Finance Administration for MDOT, explained that the parties have created

a reimbursement procedure. MDOT and the WDBA agree to a budget for anticipated activities,

and the WDBA places funds in escrow. MDOT spends money out of the state trunkline fund, and

sends invoices to the WDBA. Invoices are approved by the WDBA and the escrow agent disburses

funds to MDOT, which are placed in the state trunkline fund.

In its June 26, 2012 appropriations bill, the Legislature reenacted Section 384 with its

prohibition against MDOT “expend[ing] any state transportation revenue for construction planning

or construction of the Detroit River International Crossing or a renamed successor[]” absent

Legislative authorization for construction of the GHIB. 2012 PA 200, Art XVII, Part 2, § 384(1)

4

See Detroit-Windsor Bridge fails to clear hurdle as Senate panel rejects legislation, October 20,

2011; available at https://www.mlive.com/politics/2011/10/detroit-windsor_bridge_fails_t.html

(accessed May 13, 2020).

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and (3). MDOT was again required to provide quarterly reports to various entities regarding its

activities related to the GHIB. 2012 PA 200, Art XVII, Part 2, § 384(2).

But this language was modified in the Legislature’s 2013 appropriations bill. Pursuant to

2013 PA 59, Art XVII, Part 2, § 384:

(1) Except as otherwise provided in subsection (2), the department shall not

obligate the state to expend any state transportation revenue for construction

planning or construction of the Detroit River International Crossing or a renamed

successor. In addition, except as provided in subsection (2), the department shall

not commit the state to any new contract related to the construction planning or

construction of the Detroit River International Crossing or a renamed successor that

would obligate the state to expend any state transportation revenue. An

expenditure for staff resources used in connection with project activities, which

expenditure is subject to full and prompt reimbursement from Canada, shall not be

considered an expenditure of state transportation revenue.

(2) If the legislature enacts specific enabling legislation for the construction of the

Detroit River International Crossing or a renamed successor, subsection (1) does

not apply once the enabling legislation goes into effect. [Emphasis added.]

The reporting requirement that had been stated in Section 384(2) was replaced with the following

in Section 385:

(1) The department shall submit reports to the state budget director, the speaker of

the house, the house minority leader, the senate majority leader, the senate minority

leader, the house and senate appropriations subcommittees on transportation, and

the house and senate fiscal agencies on department activities related to all

nonconstruction or construction planning activities related to the Detroit River

International Crossing or a renamed successor. The initial report shall be submitted

on or before December 1, 2013 and shall cover the fiscal year ending September

30, 2013.

(2) The initial report shall include, at a minimum, all of the following:

(a) Department costs incurred in the fiscal year ending September 30, 2013,

including employee salaries, wages, benefits, travel, and contractual services, and

what activities those costs were related to.

(b) Costs of other executive branch agencies incurred in the fiscal year

ending September 30, 2013, including employee salaries, wages, benefits, travel,

and contractual services, and what activities those costs were related to.

(c) A breakdown of the source of funds used for the activities described in

subdivisions (a) and (b).

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(d) A breakdown of reimbursements made by Canada under section 384(1)

to the state for expenditures for staff resources used in connection with project

activities.

(e) A narrative description of the status of the Detroit River International

Crossing or a renamed successor, including efforts undertaken to implement

provisions of the crossing agreement executed June 15, 2012 by representatives of

the Canadian government and this state.

(3) After submission of the initial report, a subsequent report shall be submitted on

March 1, 2014, June 1, 2014, and September 1, 2014 and shall include the same

information described in subsection (2) for the applicable previous fiscal quarter.

[2013 PA 59, Art XVII, Part 2, § 385 (emphasis added).]

Other than changing the appropriate dates where needed, and revising the name “Detroit

River International Crossing” to the project’s new name, the “Gordie Howe International

Crossing,” the language of Sections 384 and 385 remained unchanged in each annual

appropriations bill until 2019. See 2014 PA 252, Art XVII, Part 2, §§ 384 and 385; 2015 PA 84,

Art XVII, Part 2, §§ 384 and 385; 2016 PA 268, Art XVII, Part 2, §§ 384 and 385; 2017 PA 107,

Art XVII, Part 2, §§ 384 and 385; 2018 PA 207, Art XVII, Part 2, §§ 384 and 385. In the 2019

appropriations bill, Section 384 remains unchanged. 2019 PA 66, Art XVII, Part 2, §§ 384.

Section 385, concerning reporting requirements, has been simplified as follows:

(1) The department shall submit monthly reports to the state budget director, the

speaker of the house of representatives, the house of representatives minority

leader, the senate majority leader, the senate minority leader, the house and senate

appropriations subcommittees on transportation, and the house and senate fiscal

agencies on all of the following:

(a) All expenditures by the state related to the Gordie Howe Bridge.

(b) All reimbursements made by Canada under section 384(1) of this part

to the state for expenditures for staff resources used in connection with project

activities.

(2) The initial report required under subsection (1) shall be submitted on or before

December 1, 2019. The initial report shall cover the fiscal year ending September

30, 2019. [2019 PA 66, Art XVII, Part 2, §§ 385.]

The Crossing Agreement has been the subject of prior litigation between MDOT and the

Moroun entities. After receiving good-faith offers for the purchase of the properties at issue in the

present appeals in December 2016, the Moroun entities filed a lawsuit in the Court of Claims

seeking declaratory and injunctive relief. Much the same as in the present appeals, the Moroun

entities sought to have the Crossing Agreement declared invalid. This Court affirmed the dismissal

of the suit. While this Court held that the Moroun entities had standing to raise their challenges,

this Court held that the suit was properly dismissed by the Court of Claims because the Moroun

entities failed to file the suit within a year of the date the claim accrued (which this Court

determined was in 2012 when the Crossing Agreement was executed) pursuant to MCL

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600.6431(1). Crown Enterprises, Inc v State of Mich, unpublished per curiam opinion of the Court

of Appeals, issued May 8, 2018 (Docket No. 340039). The Moroun entities sought to have the

Crossing Agreement declared invalid in a lawsuit filed in federal court, but that action was not

successful. See Detroit Int’l Bridge Co v Government of Canada, 434 US App DC 317; 883 F3d

895 (2018).

The present appeals arise out of condemnation proceedings instituted in 2017 while the

Court of Claims matter was pending.5 The various lower court cases were consolidated and argued

together. The circuit court directed the Moroun entities to clearly identify each specific legal

challenge, filing each as a separate motion. The Moroun entities ultimately identified 18 separate

legal challenges, all of which were rejected by the trial court. The Moroun entities argue on appeal

that the circuit court was wrong to reject six of these challenges, apparently abandoning the

remainder. These challenges were brought pursuant to MCR 2.116(C)(4) (lack of subject-matter

jurisdiction), (C)(5) (lack of capacity to sue), (C)(8) (failure to state a claim), and/or (C)(10) (no

material question of fact). All motions also purported to seek rulings regarding necessity pursuant

to MCL 213.56, which states, in relevant part:

(1) Within the time prescribed to responsively plead after service of a complaint,

an owner of the property desiring to challenge the necessity of acquisition of all or

part of the property for the purposes stated in the complaint may file a motion in

the pending action asking that the necessity be reviewed. The hearing shall be held

within 30 days after the filing of the motion.

(2) With respect to an acquisition by a public agency, the determination of public

necessity by that agency is binding on the court in the absence of a showing of

fraud, error of law, or abuse of discretion.

* * *

(5) The court’s determination of a motion to review necessity is a final judgment.

(6) Notwithstanding section 309 of the revised judicature act of 1961, Act No. 236

of the Public Acts of 1961, being section 600.309 of the Michigan Compiled Laws,

an order of the court upholding or determining public necessity or upholding the

validity of the condemnation proceeding is appealable to the court of appeals only

by leave of that court pursuant to the general court rules. In the absence of a timely

5

The Moroun entities previously sought leave to appeal an order denying their motions to dismiss

the condemnation suits, which were brought under MCR 2.116(C)(6) on the basis that the Court

of Claims suit precluded litigation of the condemnation suits in Wayne Circuit Court. This Court

denied leave to appeal in each of those appeals for failure to persuade the Court of the need for

immediate appellate review. See, e.g., Dep’t of Transportation v Riverview-Trenton RR Co,

unpublished order of the Court of Appeals, entered May 5, 2017 (Docket No. 337664). The

Moroun entities have not challenged the denial of the MCR 2.116(C)(6) motions in the instant

appeals.

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filed appeal of the order, an appeal shall not be granted and the order is not

appealable as part of an appeal from a judgment as to just compensation.

(7) If a motion to review necessity is not filed as provided in this section, necessity

shall be conclusively presumed to exist and the right to have necessity reviewed or

further considered is waived.

The first challenge pursued by the Moroun entities on appeal argues that MDOT was not

authorized to enter into the Crossing Agreement because such action was prohibited by the first

appropriations bill at issue, 2011 PA 63. The second challenge pursued on appeal contends that

MDOT has no authority to pay just compensation for land acquired for the GHIB project. The

third challenge pursued on appeal argues that MDOT cannot use the state trunkline fund to pay

expenses and receive reimbursement from Canada. The fourth challenge pursued on appeal is a

claim that the takings are invalid because MDOT lacks authority to collect tolls on the GHIB when

it is complete. The fifth challenge raised on appeal claims that certain provisions concerning

tolling contained within the Crossing Agreement illegally limit the authority of the Legislature to

impose tolls on the GHIB in the future. Finally, the sixth challenge raised on appeal argues that

the GHIB will be a “commercial enterprise,” and that the operation of a commercial enterprise on

a limited-access highway is prohibited by MCL 252.52(1), a provision of the Limited Access

Highway Act (LAH Act), MCL 252.51 et seq.6

MDOT argues first that the entire appeal has been rendered nonjusticiable, and second, that

the trial court was correct to reject the Moroun entities’ challenges. We begin our analysis with a

discussion of MDOT’s justiciability concern.

II. DISCUSSION

A. JUSTICIABILITY

MDOT argues that the six issues raised on appeal have been rendered nonjusticiable

because the Moroun entities have not pursued on appeal a challenge to the circuit court’s

conclusion that MDOT’s authority to take the properties at issue may be derived from the LAH

Act and the State Agencies Act, MCL 213.21 et seq. According to MDOT, with that challenge

having been abandoned, the remaining challenges that have been pursued on appeal do not amount

to challenges raising an error of law related to the condemnation of the Moroun entities’ land.

Thus, according to MDOT, the Moroun entities no longer raise questions that may be decided in a

condemnation action pursuant to MCL 213.56(2). Rather, MDOT contends that the issues being

pursued on appeal are only ancillary challenges to the validity of the Crossing Agreement that

6

An amicus curiae brief has been filed on behalf of the “Michigan Legislators,” a group of current

and former state legislators who, like the Moroun entities, oppose the GHIB project. As is now

required by MCR 7.212(H)(3), the amicus brief indicates “whether counsel for a party authored

the brief in whole or in part and whether such counsel or a party made a monetary contribution

intended to fund the preparation or submission of the brief . . . .” The amicus brief discloses that

it was authored by the Moroun entities’ counsel, and was also paid for by the Moroun entities.

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should have been properly raised and decided in a declaratory suit filed in the Court of Claims.

We disagree.

1. ISSUE PRESERVATION AND STANDARD OF REVIEW

We first note that while MDOT raised a similar argument with respect to some of the

challenges raised in the circuit court, it did not claim below that all of the issues raised on appeal

could not be properly raised in a condemnation suit. Thus, while the issue is preserved in some

respects, it is unpreserved in others. See Mouzon v Achievable Visions, 308 Mich App 415, 419;

864 NW2d 606 (2014). Indeed, to the extent MDOT failed to argue in the trial court that certain

challenges were not proper challenges to be raised in a condemnation suit, we could deem MDOT’s

justiciability challenge waived. See Walters v Nadell, 481 Mich 377, 387-388; 751 NW2d 431

(2008) (issues not raised in the trial court are ordinarily deemed waived and will not be reviewed

by an appellate court). However, this Court may exercise its inherent authority to review issues

that were not raised in the circuit court. Id. at 387. MDOT’s arguments present purely legal

questions for which all of the relevant facts have been presented, and to the extent the issue is not

preserved, we thus choose to exercise our inherent authority to address MDOT’s argument in full.

See id.; Smith v Foerster-Bolser Const, Inc, 269 Mich App 424, 427; 711 NW2d 421 (2006).

This issue essentially is a question of statutory interpretation; specifically, it is a question

whether the Moroun entities’ challenges are challenges that are not properly raised pursuant to

MCL 213.56(2). Questions of statutory interpretation are reviewed de novo on appeal. City of

Riverview v Sibley Limestone, 270 Mich App 627, 636; 716 NW2d 615 (2006).

2. ANALYSIS

The instant matter consists of several condemnation actions brought by MDOT against the

Moroun entities to acquire real property. These suits are brought under the Uniform Condemnation

Procedures Act (UCPA), MCL 213.51 et seq. The UCPA “is merely a procedural statute . . . .”

City of Kalamazoo v KTS Indus, Inc, 263 Mich App 23, 32; 687 NW2d 319 (2004). Pursuant to

MCL 213.56(1), “[w]ithin the time prescribed to responsively plead after service of a complaint,

an owner of the property desiring to challenge the necessity of acquisition of all or part of the

property for the purposes stated in the complaint may file a motion in the pending action asking

that the necessity be reviewed.” Pursuant to MCL 213.56(2), “With respect to an acquisition by a

public agency, the determination of public necessity by that agency is binding on the court in the

absence of a showing of fraud, error of law, or abuse of discretion.” Thus, “pursuant to the statute,

the determination of necessity is left not to the courts but to the public agency . . . . The only

justiciable challenge following the agency’s determination is one based on ‘fraud, error of law, or

abuse of discretion.’ MCL 213.56(2).” City of Novi v Robert Adell Children’s Funded Trust, 473

Mich 242, 253; 701 NW2d 144 (2005).

MDOT argues that an “error of law” exists only where the condemning agency lacks legal

authority to condemn property for the purpose specified in the complaint. MDOT relies on City

of Novi, 473 Mich at 253, where the Court, in a single sentence, stated that because the “plaintiff

has the legal authority to condemn this land for a public road, . . . it has not made an error of law.”

We do not read City of Novi as standing for the premise that a lack of legal authority to condemn

is the one and only “error of law” that is cognizable under MCL 213.56(2). In a footnote, the

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Court explained that the defendants in City of Novi had argued that the condemnation action was

“not supported by appropriate enabling legislation.” City of Novi, 473 Mich at 253 n 9. The Court

rejected that contention. Id. Thus, it seems that the only claimed error of law in City of Novi was

a lack of authority to condemn. Given that the Court did not discuss the scope of MCL 213.56(2)

in any detail, we read the decision in City of Novi as standing only for the premise that the claimed

legal error in that case—a lack of legal authority to condemn—did not occur. The case does not

purport to set the scope of what may or may not amount to an error of law under MCL 213.56(2).

Thus, MDOT has not shown that the Moroun entities’ challenges fall outside the scope of what

may be decided in this condemnation suit.7

There is also a substantial gap in MDOT’s analysis. MDOT asserts that the appeal is

rendered nonjusticiable if the Moroun entities’ challenges do not amount to purported errors of

law that could be raised under MCL 213.56(2). What MDOT does not do is explain whether only

necessity challenges may be made in a condemnation action. In that regard, we note that MCL

213.56(6) appears to contemplate at least two types of challenges, as it describes two types of

orders that may be appealed by way of an application for leave to appeal filed in this Court: “an

order of the court upholding or determining public necessity or upholding the validity of the

condemnation proceeding . . . .” MCL 213.56(6) (emphasis added). MDOT has not addressed

whether the Moroun entities’ appellate challenges could be viewed as raising challenges to the

validity of the condemnation proceeding. Certainly, the Moroun entities view them as such; the

Moroun entities allege that the condemnation proceedings are invalid because they seek to acquire

land for a project that the Moroun entities believe is illegal.

We also note that when arguing the appeal from the order dismissing the Court of Claims

action, in which the Moroun entities sought to raise largely the same substantive challenges that

were raised in the circuit court, MDOT represented to this Court that dismissal of the Court of

Claims action would have no adverse impact on the Moroun entities because the same issues

were—and could—be litigated in this condemnation action. This representation was made

repeatedly in MDOT’s appellate briefing and again at oral argument.8

7

MDOT also relies on Condemnation for Route 58018, 31 PA Cmwlth 275, 280-281; 375 A2d

1364 (1977), which MDOT cites as standing for the premise that the only permitted challenges in

a condemnation suit are those that challenge the power or right of the governmental entity to take

land or procedures directly related to the taking. The decision in Condemnation for Route 58018

addressed what arguments could be made under Pennsylvania’s statutory scheme as preliminary

objections to a condemnation action. Id. What procedures were allowed by Pennsylvania’s

statutory scheme some 40 years ago would seem to have little relevance to what is permitted by

Michigan’s current UCPA, and MDOT makes no attempt whatsoever to show that the two schemes

are alike.

8

It is perhaps most ironic that, while MDOT has argued in this case that the Moroun entities should

have raised their challenges in a timely suit for declaratory relief in the Court of Claims, MDOT

previously argued to this Court in Docket No. 340039 that such a declaratory suit would be

improper because it would encourage time-consuming, pre-condemnation litigation.

-17-

As this Court explained in Spohn v Van Dyke Pub Sch, 296 Mich App 470, 489; 822 NW2d

239 (2012):

The doctrine of judicial estoppel is driven by the important motive of promoting

truthfulness and fair dealing in court proceedings. Judicial estoppel differs from

such other forms of estoppel as promissory estoppel and equitable estoppel in that

judicial estoppel focuses on the relationship between the litigant and the judicial

system as a whole, rather than solely on the relationship between the parties. Of

utmost importance in determining whether to apply the doctrine of judicial estoppel

is whether the party seeking to assert an inconsistent position would derive an unfair

advantage if not estopped. [Quotation and ellipses omitted.]

Ultimately, judicial estoppel is an equitable doctrine. Id. at 479. It is used to preserve the

integrity of the courts and to prevent abuse of the system through “cynical gamesmanship.” Id. at

479-480 (quotation marks and citations omitted). But it must be applied carefully, as ultimately,

use of the doctrine “precludes a contradictory position without examining the truth of either

statement.” Id. at 480 (quotation marks and citation omitted). Simply asserting contradictory

positions is not enough to invoke the doctrine. Id. Rather, and among other elements, there must

be some indication that the “court in the earlier proceeding accepted that party’s position as true.”

Id. (quotation marks and citation omitted).

We admit that the doctrine does not strictly apply in this case. MDOT has clearly taken

contradictory positions, but that is not enough, standing alone, to invoke the doctrine of judicial

estoppel. See id. It does not appear that this Court accepted as true MDOT’s assertion that all of

the Moroun entities’ challenges could be raised in this condemnation suit. See Crown Ent, Inc,

unpub op at 1-6 (Docket No. 340039). See also id. at 6 n 3 (“Given our resolution of this issue,

we decline to address . . . plaintiffs’ argument that the Court of Claims erred in holding that it did

not have jurisdiction to address challenges to the condemnation proceeding.”). Given that MDOT

has not presented any clear legal basis to hold that the Moroun entities’ arguments are

nonjusticiable, we need not rely on judicial estoppel to reject MDOT’s argument. But it is worth

noting that MDOT was clear and unequivocal when it previously informed this Court that the

issues raised in this appeal were appropriate issues to be litigated in a condemnation suit.

Having rejected MDOT’s justiciability challenge, we now turn to the substantive issues

raised by the Moroun entities.

B. VALIDITY OF THE CROSSING AGREEMENT IN LIGHT OF 2011 PA 63

The Moroun entities first argue that the entire Crossing Agreement is void because MDOT

lacked authority to enter into the agreement when it was executed. Specifically, the Moroun

entities contend that the language of Section 384, as enacted by 2011 PA 63, prohibited MDOT

from executing the agreement. We disagree.

1. STANDARD OF REVIEW

In condemnation proceedings, the trial court’s factual findings are reviewed for clear error,

and its legal conclusions are reviewed de novo. City of Novi, 473 Mich at 249. Questions of

statutory interpretation are reviewed de novo on appeal. City of Riverview, 270 Mich App at 636.

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2. ANALYSIS

The question raised in this issue mainly concerns the interpretation of appropriations bills.

Of course, the primary goal in interpreting this language is to ascertain the Legislature’s intent.

Spectrum Health Hosp v Farm Bureau Mut Ins Co of Mich, 492 Mich 503, 515; 821 NW2d 117

(2012). Generally, the plain language used by the Legislature is the best indicator of its intent.

Mich Ass’n of Home Builders v City of Troy, 504 Mich 204, 212; 934 NW2d 713 (2019).

Dictionary definitions are often helpful when the plain meaning of the Legislature’s enactment is

at issue. In re Erwin Estate, 503 Mich 1, 9-10; 921 NW2d 308 (2018). In most cases, the common

understanding of a word or phrase is sufficient, but where a word or phrase has acquired a peculiar

meaning in the law, it is that more specific understanding that should be consulted. Id. It is also

important to read words and phrases in context; i.e., one must consider the plain meaning of a word

or phrase, but while being aware of the context and purpose of the Legislative enactment. Bush v

Shabahang, 484 Mich 156, 167; 772 NW2d 272 (2009).

Again, in this case, what is at issue are appropriations bills.

In Black’s Law Dictionary (4th ed.), p. 131, an appropriation in public law

is defined as follows:

‘The act by which the legislative department of government designates a

particular fund, or sets apart a specified portion of the public revenue or of the

money in the public treasury, to be applied to some general object of governmental

expenditure, or to some individual purchase or expense.’ [Boards of Co Rd

Comm’rs of Van Buren Counties v Riley, 50 Mich App 89, 95; 213 NW2d 298

(1973).]

Stated differently, an appropriation “is the setting aside of a specified sum of money in the state

treasury to be used for some governmental expenditure, purchase or expense.” OAG, 1999, No.

7,022 (June 16, 1999).

In 2011 PA 63, and the following year in 2012 PA 200, Section 384 stated:

(1) The department shall not expend any state transportation revenue for

construction planning or construction of the Detroit River International Crossing or

a renamed successor. In addition, except as provided in subsection (3), the

department shall not commit the state to any new contract related to the construction

planning or construction of the Detroit River International Crossing or a renamed

successor unless the legislature has enacted specific enabling legislation to allow

for the construction of the Detroit River International Crossing or a renamed

successor.

There is no dispute that specific enabling legislation was not enacted, and thus, the prohibitions

stated in Section 384(1) applied when the Crossing Agreement was executed.

The first sentence of Section 384(1) prohibited MDOT from “expending any state revenue”

on the GHIB. The word “expend” is not difficult to understand, particularly considering that it

appears in an appropriations bill—the very purpose of which is to control how state funds will be

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spent. To “expend” means “to pay out.” Merriam-Webster’s Collegiate Dictionary (11th Ed).

And in the context of governmental revenue, “revenue” is “the yield of sources of income (such

as taxes) that a political unit (such as a nation or state) collects and receives into the treasury for

public use.” Merriam-Webster’s Collegiate Dictionary (11th Ed). The Crossing Agreement is

clear, however, in stating that no Michigan funds shall be spent on the GHIB project. Rather,

Canada assumed financial responsibility for the project, and any money spent by Michigan is

reimbursed by Canada. Thus, and while some Michigan funds might be used momentarily, no

Michigan funds are ultimately expended under the Crossing Agreement. 9 Michigan’s revenue

yield is not affected by the GHIB. We thus conclude that the Crossing Agreement does not run

afoul of the first sentence of Section 384(1).

It is the second sentence’s prohibition against “committing the state to any new contract

for the construction planning or construction” of the GHIB that is more difficult. The Moroun

entities read this as prohibiting MDOT from executing any agreement related to the construction

or construction planning of the GHIB. MDOT, on the other hand, reads this “boilerplate” language

as only prohibiting MDOT from executing a contract that would require Michigan to pay any part

of the costs of the GHIB. The question, then, is what it means to “commit the state” to an

agreement concerning the “construction planning or construction” of the GHIB.

In the context of a contract, “commit” means to “obligate” or “bind.” Merriam-Webster’s

Collegiate Dictionary (11th Ed). And certainly, by executing the Crossing Agreement, MDOT

and the other Michigan signatories committed Michigan to the terms of the agreement. But the

terms of the Legislative enactments at issue must be read in the context of what they are—

appropriations bills. These enactments are, at the core, bills for the appropriation of state funds.

With that context in mind, we, like the trial court, read the word “commit” as prohibiting the

execution of a contract that would “obligate” state funds.

Reinforcing this conclusion is the structure of Section 384. It is well-established that

individual sentences must not be read in isolation; rather, they must be read in the context with the

surrounding language. Robinson v City of Lansing, 486 Mich 1, 15; 782 NW2d 171 (2010).

“[C]ontext matters, and thus statutory provisions are to be read as a whole.” Id. With that in mind,

the first sentence of Section 384—which clearly prohibits the spending of Michigan funds on the

GHIB—is important to understanding the meaning of the second sentence. In context, the first

sentence is aimed at prohibiting spending Michigan revenue on the GHIB immediately, and the

second sentence prohibits obligating the state to spend Michigan revenue on the GHIB in the

future. The Crossing Agreement did neither.

Casting further light on the Legislature’s intent is Section 384(2). As written in 2011 PA

63, this section created a reporting requirement:

(2) On or before March 31, 2012, the department shall report to the state budget

director, the house and senate appropriations subcommittees on transportation, and

the house and senate fiscal agencies on department activities related to the Detroit

9

There is no dispute that Canada has, in fact, fully reimbursed MDOT.

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River International Crossing or a renamed successor. [2011 PA 63, Article XVII,

Part 2, Section 384(2).]

This provision clearly contemplates that MDOT would be engaged in some activities concerning

the GHIB. The existence of this reporting requirement makes little sense if the Legislature’s intent

was to prohibit MDOT from engaging in any way with Canada regarding the GHIB. If the

Legislature intended to completely prohibit MDOT from forming any sort of agreement

concerning the construction or construction planning of the GHIB, there would seem to be very

little, if anything, for MDOT to report. Looking at all of Section 384 as it existed when the

Crossing Agreement was signed, we conclude that, so long as no Michigan funds were obligated

to be spent, the Crossing Agreement did not violate Section 384.

But even presuming there is room to dispute the meaning of Section 384(1) as it existed in

2011 PA 63 and 2012 PA 200, subsequent appropriations bills now explicitly authorize the

Crossing Agreement. Beginning in 2013, Section 384 was amended to read as follows:

(1) Except as otherwise provided in subsection (2), the department shall not

obligate the state to expend any state transportation revenue for construction

planning or construction of the Detroit River International Crossing or a renamed

successor. In addition, except as provided in subsection (2), the department shall

not commit the state to any new contract related to the construction planning or

construction of the Detroit River International Crossing or a renamed successor that

would obligate the state to expend any state transportation revenue. An

expenditure for staff resources used in connection with project activities, which

expenditure is subject to full and prompt reimbursement from Canada, shall not be

considered an expenditure of state transportation revenue. [2013 PA 59, Art XVII,

Part 2, § 384(1) (emphasis added).]

This language extinguishes any reasonable dispute regarding whether the Crossing

Agreement is valid. While one might argue that the Legislature’s choice of words in 2011 and

2012 was not particularly clear, since 2013, our Legislature has been clear about what MDOT is

prohibited from doing: expending state transportation revenue on the GHIB. As explained, no

state transportation revenue is being expended on the GHIB project because any money that

MDOT spends is promptly reimbursed by Canada. Further buttressing this conclusion is the

reporting requirement that was stated in 2013 PA 59, Art XVII, Part 2, § 385. That section required

MDOT to submit reports to various offices “on department activities related to all nonconstruction

or construction planning activities related to the Detroit River International Crossing or a renamed

successor.” 2013 PA 59, Art XVII, Part 2, § 385(1). This revised reporting requirement shows

that the Legislature was fully aware of MDOT’s activities related to the GHIB. Rather than

prohibit them, the Legislature required MDOT to keep it informed of those activities. As

previously explained, the Legislature reenacted these same provisions every year since 2013.

And under the most recent appropriations bill, Section 385 has been amended to simplify

the reporting requirements. MDOT is now required to report two categories of information: “All

expenditures made by the state related to the Gordie Howe Bridge[,]” and “[a]ll reimbursements

made by Canada under section 384(1) of this part to the state for expenditures for staff resources

used in connection with project activities.” 2019 PA 66, Part 2, § 385(1)(a) and (b). Once again,

-21-

rather than limiting MDOT’s spending and reimbursement procedure, the Legislature has asked

that spending and reimbursements related to the GHIB be reported to various offices. This is, once

again, an indication that the Legislature approves of the way that the GHIB project is moving

forward, including the way payments for condemned properties are being handled.

Particularly in light of the fact that these legislative statements were made after the

Crossing Agreement was signed, one can conclude that the Legislature has affirmatively condoned

the Crossing Agreement, including how that agreement is being implemented. The Moroun

entities contend that this amounts to the use of legislative silence or acquiescence to interpret the

Legislature’s words. It is true that the Legislature’s silence (generally in the face of judicial

decisions) is a disfavored method of statutory interpretation. McCahan v Brennan, 492 Mich 730,

749; 822 NW2d 747 (2012). Thus, if the Legislature had merely sat silent after the Crossing

Agreement was executed, perhaps one would be correct to argue that such silence should not be

construed as approval. But this case does not involve silence. Rather, the Legislature has spoken,

and spoken annually, since the Crossing Agreement was executed. Every time, the Legislature

has made it clear that it is well aware of the Crossing Agreement. It has altered its prior, somewhat

vague prohibitory language into language that condones MDOT’s participation in the project so

long as no state funds are consumed. And the Legislature has continued to direct that it be kept

informed of activities related to the GHIB since the Crossing Agreement was executed. With that,

this is not a case of legislative acquiescence. It is a case where the Legislature has condoned

MDOT’s activities with regard to the GHIB. The Moroun entities’ arguments are without merit.10

C. MDOT’S AUTHORITY TO SPEND MONEY TO ACQUIRE PROPERTY

As explained earlier in this opinion, MDOT uses money from the state trunkline fund to

pay for the land it condemns for the GHIB. Canada then reimburses MDOT, who places these

reimbursement funds back in the state trunkline fund. The Moroun entities argue that this

procedure violates MCL 18.1366 and Const 1963, Art 9, § 17 because MDOT is spending money

without an appropriation. We disagree.11

Pursuant to Const 1963, Art 9, § 17, “No money shall be paid out of the state treasury

except in pursuance of appropriations made by law.” And pursuant to MCL 18.1366, “Each state

agency . . . shall be financed and maintained by specific appropriations by the legislature from the

10

While we do not consider the decision controlling, we note that the Moroun entities also failed

to convince the Federal Circuit Court for the District of Columbia that the Crossing Agreement

was invalid on this basis. See Detroit Int’l Bridge Co, 434 US App DC at 322. And given our

resolution of the issue, we decline to consider the constitutional issues raised by MDOT. J & J

Const Co v Bricklayers & Allied Craftsmen, Local 1, 468 Mich 722, 734; 664 NW2d 728 (2003)

(“[Q]uestions of constitutionality should not be decided if the case may be disposed of on other

grounds”).

11

As stated previously, to the extent we must interpret a statute, our review is de novo. City of

Riverview, 270 Mich App at 636. To the extent we must decide any constitutional issues, our

review is, likewise, de novo. Van Buren Twp v Garter Belt Inc, 258 Mich App 594, 602; 673

NW2d 111 (2003).

-22-

operating funds of the state, as such funds may be dedicated by law, pursuant to the submission of

the state budget.” The Moroun entities argue that there has been no appropriation of money to

MDOT to acquire land for the GHIB, and as such, MDOT cannot pay for the property it seeks to

acquire in this condemnation action.

Perhaps a threshold issue is whether, given the fact that MDOT is reimbursed by Canada

for every penny spent on the GHIB, MDOT is truly spending money such that a legislative

appropriation is even necessary. Const 1963, Art 9, § 17 requires that all money “paid out” of the

state treasury be done pursuant to an appropriation. Consistent with that constitutional

requirement, MCL 18.1366 explains that state agencies must be “financed and maintained by

specific appropriations by the legislature from the operating funds of the state, as such funds may

be dedicated by law, pursuant to the submission of the state budget.” In most ordinary

circumstances, it is not difficult to understand what this all means: state funds must generally be

spent pursuant to appropriations made by law. But this circumstance is different. Ultimately,

money spent by MDOT on acquiring land for the GHIB is fully reimbursed by Canada. In that

sense, what is being spent are Canadian funds, not Michigan funds. Where no Michigan funds are

ultimately lost, it is not clear whether an appropriation is even required.

Of guidance is Tiger Stadium Fan Club, Inc v Governor, 217 Mich App 439; 553 NW2d 7

(1996). In that case,

The questions presented [were] (1) whether funds generated under a consent

judgment entered into by Governor Engler and several Native American tribes in

settlement of an action brought under the Indian Gaming Regulatory Act (IGRA),

25 USC 2701 et seq., and deposited into the Michigan Strategic Fund (MSF)

pursuant to the terms of the settlement agreement, are, under the Appropriations

Clause, Const 1963, art 9, § 17, and the Separation of Powers Clause, Const 1963,

art 3, § 2, subject to the Legislature’s power of appropriation, and (2) whether the

MSF has the authority to distribute those funds in the form of a grant to the [City

of Detroit Downtown Development Authority (DDA)] for use in the construction

of a stadium for the Detroit Tigers baseball team. [Tiger Stadium Fan Club, Inc,

217 Mich App at 441-442.]

At issue in Tiger Stadium Fan Club, Inc was a consent judgment under which several

Native American tribes agreed to pay 8% of certain gaming revenues to the MSF, and 2% of

gaming revenues to local units of government “in the immediate vicinity of each tribal casino.”

Id. at 443. The parties agreed that it was “of no consequence that the funds were never placed in

the state treasury or that they were remitted directly to a public corporation. The location of the

funds is irrelevant; the question is whether the character of the funds and the manner in which they

were obtained makes them state funds subject to the Appropriations Clause.” Id. at 447-448

(emphasis added.) This Court explained:

In the instant case, the revenues are generated by the tribes. The revenues

are not paid as a tax or a fee, or pursuant to a legislative act. While the revenues

are paid to a public corporation as a result of the Governor’s negotiation of a

settlement of the federal litigation, the mere act of settling a lawsuit involving the

state’s obligation to negotiate does not automatically render the revenues subject to

appropriation; the character of the revenues must still be considered. While a

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lawsuit was involved, the state did not concede or give away anything in the

settlement of the suit. The revenues at issue do not result from the sale,

relinquishment, waste, or damage of state assets. They are not paid as rents or

royalties collected for the extraction of nonrenewable resources from state-owned

lands. MCL 324.1902; MSA 13A.1902; Const 1963, art 9, § 35. The revenues are

not designated as a gift or grant to the state. MCL 21.161; MSA 3.671. The

revenues are not received as payment of debts or as penalties. MCL 14.33; MSA

3.186. [Tiger Stadium Fan Club, Inc, 217 Mich App at 449-450 (emphasis added).]

This Court went on to explain that in negotiating the settlement, “the Governor identified an

opportunity to secure revenues to which the state was not entitled, except by virtue of the

negotiated settlement, when he entered in to an agreement that provided for the gratuitous payment

of eight percent of certain gaming revenues to the MSF as long as the tribes’ right to conduct these

activities remains exclusive.” Id. at 451. “The state gave nothing in exchange for the payments.

The tribes’ ability to conduct the gaming activities is a matter of right, not grace.” Id. As this

Court explained:

We thus conclude that the revenues involved are public funds not subject to

appropriation. The Governor’s negotiation of the settlement agreement providing

for payments to the MSF is akin to his procuring a grant of federal or corporate

funds for a specific purpose. In such circumstances, the Governor, acting as a

representative of the state, convinces the grant-making authority that it is in its best

interest to donate funds to the state for a particular purpose. That the Governor

might have sought the funds for a different or broader purpose is of no moment.

The terms of the grant or gift control. . . . The state gave up nothing; the tribes

perceived that it was in their interest to make, in effect, a continuing grant of eight

percent of certain revenues as long as the advantageous status quo—exclusive

rights to conduct certain gaming activities—is maintained. The negotiated

settlement agreement provides for the payment of those revenues to a fund that is

authorized to disburse funds to promote economic development throughout the

state, including in areas that might themselves be interested in seeing certain local

gaming activity, perhaps persuading the citizens and leaders of those areas that

there are benefits to be gained from leaving the exclusive right to conduct this

gaming activity with the tribes. In short, the payments were not procured by the

Governor in exchange for concessions. Rather, they are the tribes’ contribution to

the MSF to create an incentive to preserve the status quo. The Legislature and the

Governor, however, are in no way obligated to preserve the status quo. [Id. at 452-

453.]

MDOT argues that the present matter similarly involves what are essentially gratuitous

payments by Canada. The comparison is by no means perfect. In Tiger Stadium Fan Club, Inc,

this Court emphasized that Michigan gave up nothing for the payments, and that the tribes’

contributions only incentivized Michigan to maintain the status quo. Id. With respect to the GHIB,

clearly, the status quo is not being maintained; a brand-new international crossing is to be

constructed. But on the other hand, prior to execution of the Crossing Agreement, Canada was in

-24-

no way obligated to pay for the construction of an international bridge. One could thus view the

matter as involving a gift from Canada, at least to an extent.

But beyond that, ultimately, the focus must be on the character of the revenues. Id. at 449.

When one looks at the whole picture, one thing is clear: Canada is paying for the bridge. More

specifically, through the reimbursement procedure, Canada bears full responsibility for the costs

of land acquisition in Michigan. In that sense, it is not Michigan funds that are spent, but rather,

Canadian funds that are being spent on land acquisition. Certainly, no provision of Michigan’s

constitution, nor any Michigan statute, would require a legislative appropriation before Canadian

funds are spent. As was the case in Tiger Stadium Fan Club, Inc, the revenues at issue are not

generated through taxes, fees, or legislative act. Id. at 449. Rather, the revenues come from

Canada. Again, “the character of the revenues must still be considered.” Id. Canadian funds are

simply not subject to appropriation by Michigan’s Legislature. As such, no appropriation is

necessary under the unique circumstances of this case.

The question then becomes whether the Legislature has nonetheless prohibited MDOT

from using money to purchase land. This appears to be the crux of the Moroun entities’ argument.

The Moroun entities contend that through 2011 PA 63 and subsequent appropriations bills, the

Legislature prohibited MDOT from spending any money on the GHIB project, save for money

spent on “staff resources” that are fully reimbursed by Canada. This argument lacks merit. Since

2013, the appropriations bills have prohibited MDOT from “obligat[ing] the state to expend any

state transportation revenue” on the GHIB project. See, e.g., 2013 PA 59, Art XVII, Part 2,

§384(1). But because all funds used by MDOT to acquire land are reimbursed by Canada, no state

transportation revenue is being expended. Rather, Canadian funds are ultimately being used to

acquire Michigan land. Thus, the Legislature’s prohibition has not been violated.

The Moroun entities argue that this would render the sentence concerning staff

expenditures surplusage. See, e.g., 2013 PA 59, Art XVII, Part 2, §384(1). It is true that this Court

should, when possible, avoid construing a statute in such a way that would render any part of the

statute surplusage. Benedict v Dep’t of Treasury, 236 Mich App 559, 567; 601 NW2d 151 (1999).

But interpreting Section 384(1) as generally allowing expenditures on the GHIB does not render

this sentence concerning staff resources surplusage. As MDOT argues, the Legislature may simply

have wanted to make clear that a particular category of expenses that are initially paid by MDOT

shall not be deemed expenditures of state transportation revenue (such that they would require an

appropriation) so long as those expenditures are reimbursed by Canada. The language is not

limiting; it does not purport to state (as the Moroun entities believe) that this, and only this category

of expenditures is permitted. Nor would that make much sense. If, as the Moroun entities argue,

“staff resources” are limited to the payment of salaries, wages, employee benefits, and the like, 12

the Legislature would in effect be authorizing the use of MDOT’s staff for a project that cannot be

consummated. Just as statutory language should not be interpreted in a way so as to render any

portion nugatory, this Court must also avoid interpreting such language in an absurd or illogical

way. Benedict, 236 Mich App at 567.

12

As will be explained, the term “staff resources” is not defined, and it is not at all clear that the

term must be limited in the way the Moroun entities argue it should.

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Nor is it at all clear that funds spent on land acquisition do not fall within the concept of

“staff resources.” Section 384(1) has, since 2013, stated, “An expenditure for staff resources used

in connection with project activities, which expenditure is subject to full and prompt

reimbursement from Canada, shall not be considered an expenditure of state transportation

revenue.” See 2013 PA 59; 2014 PA 252; 2015 PA 84; 2016 PA 268; 2017 PA 107; 2018 PA 207;

and 2019 PA 66. According to the Moroun entities, “staff resources” are only staff expenses; i.e.,

wages, employee benefits, travel costs, and the like. This appears to come from the fact that until

recently, Section 385(2)(a) and (b) required MDOT to report certain costs, “including employee

salaries, wages, benefits, travel, and contractual services, and what activities those costs were

related to.” See, e.g., 2018 PA 207. But the provisions do not purport to define “staff resources,”

and in fact, later in the reporting requirements, MDOT is required to report “reimbursements made

by Canada . . . for expenditures for staff resources used in connection with project activities.”

Section 385(2)(d), as enacted by 2018 PA 207. If the Legislature understood the term “staff

resources” to include only “salaries, wages, benefits, travel, and contractual services,” its use of

these different terms in the same section would be redundant. Rather, the use of different terms

would imply that they mean different things. United States Fidelity & Guaranty Co v Mich

Catastrophic Claims Assoc, 484 Mich 1, 14; 795 NW2d 101 (2009). Even if one accepts that

MDOT may only expend money on the GHIB for “staff resources,” the Moroun entities have not

made a persuasive argument that “staff resources” would not encompass land acquisition costs.

Finally, it is hard to ignore that, since 2013, the Legislature has continually enacted the

same language in Sections 384 and 385. That language clearly shows that the Legislature is fully

aware of the GHIB. And through the reporting requirements of Section 385, MDOT has kept the

Legislature fully apprised of the fact that it has been acquiring property for the project, and that

MDOT is being reimbursed for those expenditures by Canada. Rather than enact any prohibition

against this procedure, the Legislature has reenacted the same appropriations language every year.

This pattern shows that the Legislature approves of MDOT’s activities, including the procedures

for acquiring land. While the Moroun entities (and amici curiae) characterize this type of analysis

as the use of legislative acquiescence, we disagree. This is simply not a case where the Legislature

has sat silent in the face of a judicial decision. Rather, the Legislature has annually enacted

appropriations language that demonstrates awareness and approval of MDOT’s activities.

Ultimately, no appropriation is necessary because what is being spent is Canadian revenue,

not Michigan revenue. The appropriations language relied on by the Moroun entities does not

prohibit MDOT from purchasing land where MDOT is fully reimbursed by Canada for those

expenses. The Legislature has permitted this procedure. As such, the Moroun entities fail to

demonstrate any reason to question the validity of the condemnations.

D. USE OF THE STATE TRUNKLINE FUND

The Moroun entities next argue that the reimbursement procedure discussed in the prior

issue is illegal because MDOT is using the state trunkline fund to spend money and receive

reimbursement proceeds from Canada. We disagree.

We question whether this is a relevant challenge to the condemnations at issue. As

explained in Section II(A) of this opinion, we are not persuaded by MDOT’s justiciability

challenge. But as explained in that section of this opinion, MCL 213.56 would seem to

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contemplate two types of challenges that may be raised: challenges to the determination of

necessity and challenges to the validity of the condemnation. The Moroun entities seem to claim

that if any aspect of the Crossing Agreement or its implementation is invalid, the entire GHIB

project is invalid. According to the Moroun entities, if the entire project is invalid and cannot go

forward, then the condemnation is illegal and invalid.

We would tend to agree that if the entire project is invalid, the takings are unnecessary.

Thus, a challenge that, if successful, would invalidate the entire GHIB project would seem to be a

proper one to raise in a condemnation suit. For example, the challenge to the validity of the

Crossing Agreement is a proper one to raise in this condemnation suit. Similarly, we believe that

the challenge raised in the prior issue is properly raised in a condemnation suit. Just compensation

is an integral part of the condemnation power; without paying just compensation, land cannot be

condemned. Const 1963, Art 10, § 2. Thus, the challenge discussed in Section II(C) above—

which challenges MDOT’s ability to pay just compensation—is appropriately raised in this

condemnation suit.

But the present challenge is different. Even if one assumes that the procedures being used

to move money from Canada to MDOT are improper, we doubt that would render the entire project

invalid. Perhaps MDOT would need to come up with a different way to move money about, but

it would seem that the project could go on. So long as the project can move forward, the taking

would remain necessary, and the condemnations valid. In other words, we do not believe that this

challenge ultimately has relevance to the condemnation suit.

And on the merits, we are not persuaded that the reimbursement procedure is illegal. The

Moroun entities first assert that placing Canadian reimbursement funds into the state trunkline

fund violates MCL 18.1443, which provides, “Except as otherwise provided by laws, all money

received by the various state agencies for whom appropriations are made by a budget act shall be

forwarded to the State Treasurer and credited to the state general fund.” MDOT and the trial court

agree that the key language is, “Except as otherwise provided by laws . . . .” MCL 18.1443.

MDOT argues, and the trial court concluded, that Sections 384 and 385 operate as just such an

exception—one which allows reimbursement proceeds to go directly to MDOT and not into the

general fund.

We agree with MDOT and the trial court. As has been discussed before, the Legislature

has, through Sections 384 and 385, authorized MDOT to spend money on the GHIB so long as

that money is reimbursed by Canada. Nothing in the appropriations language indicates that

reimbursement proceeds should go to the general fund. Rather, all indications are that

reimbursement proceeds would go to MDOT. That, in essence, is the point: so long as MDOT’s

bottom line remains the same, it may go forward with the GHIB. The reimbursement process

crafted by MDOT and Canada ensures that no state transportation revenue is expended for the

GHIB—exactly as contemplated by Sections 384 and 385.

The Legislature has been aware of this process for years, but has not made any changes to

the appropriations language stating that reimbursement proceeds should be placed in the general

fund. The Moroun entities and amici curiae argue that this Court should not use legislative silence

to interpret the Legislature’s intent. But we again point out that the Legislature has not been silent.

It has spoken every year, and its words, as found in the various appropriations bills, have condoned

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MDOT’s activities, including the fact that it is reimbursed by Canada for every penny that is spent

by MDOT. Accordingly, there is no violation of MCL 18.1443, as another law authorizes MDOT

to place reimbursement proceeds from Canada into the state trunk line fund and not the general

fund.13

E. CANADA’S COLLECTION OF TOLLS

The Moroun entities contend that the Crossing Agreement is illegal because it permits the

collection of tolls by Canada. Specifically, the Moroun entities argue that MDOT lacks any

statutory authority to agree to build an international toll bridge, as no legislation has authorized

MDOT or any other administrative agency to impose tolls on the GHIB. The Moroun entities also

argue that the tolling arrangement provided by the Crossing Agreement violates the Urban

Cooperation Agreement (UCA), MCL 124.501 et seq. We disagree.

We first note that the trial court did not believe these arguments were proper necessity

challenges because a dispute over the authority to toll did not go to MDOT’s authority to condemn.

The Moroun entities assert that the trial court was wrong in this regard because the necessity of a

taking depends on the legality of the underlying project. According to the Moroun entities, if the

tolling provisions of the Crossing Agreement are invalid, the entire agreement fails. This would

in turn mean that the whole GHIB project is itself invalid. And if the entire project is invalid and

cannot go forward, then the condemnation is illegal.

The Moroun entities make too many assumptions. If the tolling provisions of the

agreement are indeed invalid, it is a significant leap to assume that the entire Crossing Agreement,

and thus the entire project, are both illegal and void. Even if one assumes that the tolling provisions

that currently exist are invalid, the parties to the Crossing Agreement (mainly Canada, as it has

assumed financial responsibility for the project) may be able to come up with a different funding

mechanism which would allow the GHIB project to move forward. If so, the condemnation action

is not invalid and the necessity of the taking still exists. Thus, it is not at all clear that this and

other challenges concerning the collection of tolls are proper challenges to be made in this

condemnation action. Rather, the Moroun entities appear to be raising collateral challenges to the

Crossing Agreement that do not necessarily affect the condemnation itself.

Regardless, we cannot conclude that the tolling provisions of the Crossing Agreement are

invalid. The Moroun entities contend that MDOT lacks authority to agree to build an international

toll bridge absent approval by the Michigan Legislature. This is because the Michigan Legislature

“has never authorized MDOT or any other administrative agency to impose tolls on the GHIB.”

The Moroun entities have not demonstrated any legal error because tolls are not going to be

13

The Moroun entities also argue that MDOT is in violation of MCL 18.1366 and Const 1963, Art

9, § 17 by “relying on a financing mechanism that depends on funneling Canadian funds to the

state trunkline fund, rather than the MDOT [sic] general fund. This is because there is no

appropriation for spending money received from Canada.” As was discussed in Section II(C),

there is no need for an appropriation because, ultimately, Canadian funds are being spent, not

Michigan funds.

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collected in Michigan or by any Michigan agency. Section X(2) of the Crossing Agreement states

that the Crossing Authority—the Canadian entity created specifically to design, construct, and

maintain the GHIB—is entitled to collect “Canadian Crossing Tolls for payment of costs . . . .”

Section X(3) states that the “Crossing Authority shall provide the means whereby users accessing

the International Crossing from Michigan and returning to Michigan without leaving the

International Crossing may do so without paying any Canadian Crossing Tolls.” Section X(4)

states that “No Party may establish or collect tolls, fees or other charges for use of the Michigan

Crossing or the Michigan Interchange.”

In other words, under the Crossing Agreement, no tolls are to be collected by any Michigan

party; tolls will only be collected by Canada. Those tolls will not be collected for use of the

Michigan side of the bridge, but for use of the Canadian Crossing—the Canadian portion of the

GHIB. Again, what is authorized by the Crossing Agreement is the collection of “Canadian

Crossing Tolls” by the Crossing Authority. The Crossing Agreement defines “Canadian Crossing

Tolls” as “all tolls, fees or other charges for use of the Canadian Crossing.” The Canadian Crossing

is defined as “the bridge, plaza and approach in Canada included in the International Crossing

Alignment, but not including the Windsor-Essex Parkway.” (Emphasis added.) While the

approval of the Michigan Legislature might be needed for MDOT to collect tolls in Michigan,

Canada does not need the approval of the Michigan Legislature to collect tolls in Canada. For that

simple reason, the Moroun entities’ argument fails.

The Moroun entities argue that the reality of the situation is that if one pays a toll in Canada,

he or she is paying for use of the entire bridge, not only the Canadian half. The average traveler

may not understand the intricacies of the Crossing Agreement or the reasons it has been crafted

that way, but the fact remains that the parties have agreed not to conduct any tolling on the

Michigan portion of the bridge. Use of the Michigan side of the bridge (and indeed, the entire

bridge, if one never leaves the Canadian Crossing) is free; tolls are only imposed for use of the

Canadian portion of the bridge, and those tolls are only collected by Canada.

The Moroun entities argue that the arrangement does not comply with the UCA. Under

MCL 124.504, public agencies of this state can exercise jointly with “a public agency of Canada .

. . any power, privilege, or authority that the agencies share in common and that each might

exercise separately.” The Moroun entities argue that MDOT has no authority to toll on the GHIB,

and thus, MDOT cannot agree to the joint exercise of tolling authority with Canada, as both parties

do not share the same power or authority. The argument lacks merit. Again, only Canada is

collecting tolls, and is doing so only on the Canadian portions of the GHIB. There is no joint

exercise of powers; there is only the unilateral exercise of power, by Canada, to collect tolls. MCL

124.504 is of no relevance.14

14

And again, we note that the Federal Circuit Court for the District of Columbia has taken the

same position. See Detroit Int’l Bridge Co, 883 F3d at 900 (stating that, with regard to the tolling

provisions of the Crossing Agreement and MCL 124.504, “Those powers were granted to the

Crossing Authority, which is a Canadian entity not subject to the Urban Cooperation Act’s

requirement for Michigan agencies.”).

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The Moroun entities argue that by signing the Crossing Agreement, MDOT has helped

create a toll bridge. Further, there will be Michigan representatives on the board that approves toll

rates. “MDOT and the other Michigan parties thus are essential participants in the tolling of the

GHIB.” The Moroun entities stop there, however, and do not explain what relevance that has.

Again, only Canada will be exercising any tolling powers. MDOT may be helping to create a

bridge that Canada will be able to toll, but that does not mean that MDOT is a participant in that

tolling activity. The Moroun entities fail to explain how Michigan’s involvement in the GHIB

project transforms MDOT into a tolling party.

The Moroun entities argue that even if only Canada is viewed as exercising the power to

toll, the UCA is still violated by the execution of the Crossing Agreement. The Moroun entities

argue that the circuit court “never attempts to explain where MDOT gets the power to enter into

an agreement with Canada that relies on Canada’s power to toll, even if it is considered a unilateral

exercise of Canadian power.” Regardless of what the circuit court did or did not say, the UCA

authorizes MDOT’s actions. Pursuant to MCL 124.505(1), “a joint exercise of power pursuant to

this act shall be made by contract or contracts in the form of an interlocal agreement . . . .” The

“joint exercise of power” in this case is the construction of an international bridge. Funding of

that bridge, through the collection of tolls, is an aspect of that agreement. Pursuant to MCL

124.505(1)(a), an interlocal agreement may provide for “the manner in which the power will be

exercised.” There are a number of provisions of MCL 124.505(1) that allow an interlocal

agreement to contain provisions regarding funding and allocation of costs. For example, MCL

124.505(1)(f) allows the parties to create a “method or formula for equitably providing for and

allocating revenues, including . . . any other form of taxation, assessment, levy, or impost . . . .”

Given that Canada is paying for the entire project, it is entirely equitable to give Canada the sole

power to toll on the bridge. This is not the joint exercise of power, but rather, part of the manner

in which Michigan and Canada will jointly exercise their respective powers to construct a bridge,

set forth in the interlocal agreement.

The Moroun entities’ argument essentially asks that every term of an interlocal agreement

consist of powers that each entity could exercise alone. That makes little sense. For example, in

MCL 124.505(1)(j), the UCA states that an interlocal agreement may provide for the “acquisition,

ownership, . . . or sale of real or personal property.” Certainly, Michigan has no power of its own

to sell Canadian land, and vice-versa. Nor would Canada have the authority to acquire Michigan

land by condemnation. Thus, under the Moroun entities’ arguments, an interlocal agreement could

not contain provisions authorizing Michigan to acquire or sell Michigan land because Canada

could not exercise that same power, and vice-versa. This all goes to show that the financing

mechanism at issue in this case—tolling—must be viewed not as its own “joint exercise” of power,

but rather, as a term of an agreement explaining how the parties’ joint exercise of power will be

conducted. For these reasons, the Moroun entities have not shown that the tolling provisions are

illegal.

F. RESTRICTING THE LEGISLATURE

As will be explained in more detail below, the Crossing Agreement contains provisions

that would require Michigan to pay some costs of the GHIB should Michigan’s Legislature decide

to impose tolls on the bridge in the future. The Moroun entities contend that these provisions are

not permitted by the UCA and would tie the hands of the Legislature in the future. We disagree.

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Once again, we question whether this is a proper challenge to the condemnation of the

Moroun entities’ property. It would seem that even if the Moroun entities are correct, this would

not undermine the entire GHIB project. At most, one provision of the Crossing Agreement might

be invalid, and might require some renegotiation of the agreement. But that would not necessarily

undermine the entire GHIB project, and would thus not render the taking unnecessary or the

condemnation invalid. Again, this seems to be a collateral challenge that has no real relevance to

the condemnation action.

This challenge is even farther afield than some of the prior challenges because it relies on

a circumstance that has not, and may never, come to fruition. Ultimately, the question in this case

is whether the condemnation is valid now. The Moroun entities offer no evidence that Michigan

has any intent to impose tolls on the GHIB. Where the Moroun entities’ argument concerns a

future contingency that may never occur, we question how the issue could be properly raised in

this condemnation suit. Presently, the Crossing Agreement prohibits collecting tolls on the

Michigan side of the bridge, which is entirely consistent with both MDOT’s and the Moroun

entities’ understanding of the law; all agree that absent legislative authorization, there can be no

tolling by MDOT or any other Michigan agency on the Michigan side of the bridge. Thus, as of

this moment, there is no legal problem. A problem would only potentially arise if the Legislature

decides that it would like to toll on the bridge in the future. That possibility would not seem to

undermine the validity of the taking in the present moment.

But regardless, we will address the merits of the argument. And on the merits, the Moroun

entities have not demonstrated any legal problem with the Crossing Agreement. The Moroun

entities claim that the agreement prohibits the Legislature from imposing a toll in the future. It

does not. The Crossing Agreement does state that no party is permitted to “establish or collect

tolls, fees or other charges for use of the Michigan Crossing or the Michigan Interchange.” That

provision simply recognizes that currently, the Michigan Legislature has not authorized tolling on

the Michigan portion of the bridge.

As to what may be done in the future, the parties have created provisions planning ahead

in the event the Legislature decides to collect tolls. In that event, the parties have agreed that

Michigan shall become responsible for half of the costs of the bridge, less revenues that have

already been collected by Canada. Further, such tolls would be collected by the WDBA. Again,

pursuant to the UCA, an interlocal agreement may contain provisions providing methods for

equitably allocating revenues. MCL 124.505(1)(f). That is what the parties to the Crossing

Agreement have done. We conclude that the provisions concerning tolling on the Michigan side

of the bridge are valid and consistent with MDOT’s authority under the UCA.

G. DOES THE GHIB VIOLATE MCL 252.52?

All agree that the GHIB will be a limited-access highway, and pursuant to MCL 252.52,

commercial enterprises are generally banned from limited-access highways (although there are

many exceptions). The Moroun entities argue that the GHIB will be a commercial enterprise

because it will be “a toll bridge that will be operated by a for-profit private concessionaire requiring

drivers to pay tolls in exchange for the right to cross the bridge.” We disagree.

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As with other tolling-related challenges, we again question the relevance of this particular

issue in the context of a condemnation suit. Again, even if the GHIB cannot operate as a toll

bridge, that would not necessarily undermine the entire project; some other funding mechanism

may be possible, and thus, the taking could still be necessary. But regardless, we address the issue

on the merits.

Pursuant to Article II of the Crossing Agreement, titled, “Purpose,” the purpose of the

Crossing Agreement is:

. . . to provide a framework for the Crossing Authority established by Canada to,

with the assistance as necessary, but not funding by, Michigan:

(a) design, construct, finance, operate and maintain the International

Crossing through the life cycle of the International Crossing and

design, construct and finance the Michigan Interchange prior to the

International Crossing Opening Date, under the oversight of the

International Authority established by this Agreement with three

members appointed by Canada and the Crossing Authority and three

members appointed by the Michigan Parties, with funding as

approved by Canada, through one or more Public-Private

Agreements with one or more private sector Concessionaires

procured through one or more competitive procurement processes;

and

(b) design, construct, finance and/or maintain the US Federal Plaza,

with the agreement and funding as approved by US Federal

Agencies and with any funding as approved by Canada, through one

or more US Federal Plaza Public-Private Agreements with one or

more private sector Concessionaires procured through one or more

competitive procurement processes;

in order to facilitate international trade and the efficient movement of legitimate

goods and travelers between Canada and the United States of America; support the

economies of Ontario and Canada and Michigan and the United States of America;

and benefit the communities in and around Detroit and in and around Windsor.

At her deposition, Linda Hurdle, the Chief Operating Officer of the WDBA, explained that the

winning bidder will, in all likelihood, include an amount in their bid that represents the bidder’s

profit. Along with designing and constructing the bridge, the private concessionaire will also

maintain and operate the bridge in the future, and will be paid by Canada for those services as well.

As part of the agreement with the concessionaire, the WDBA will continue to pay the

concessionaire an agreed-upon amount at regular intervals for “operation, maintenance, as well as

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capital repayment.” The concessionaire will collect tolls, but will remit the entire amount collected

to the WDBA. The concessionaire’s profit will not depend on the amount of tolls collected.15

We conclude that this is not a “commercial enterprise” prohibited by MCL 252.52(2). The

statute does not define a “commercial enterprise.” But there are some obvious cues to be taken

from the surrounding statutory text. The statute at issue, MCL 252.52(2), provides the following:

The state transportation department shall allow only the installation of

vending machines at selected sites on the limited access highway system to

dispense food, drink, and other articles that the state transportation department

determines appropriate. The state transportation department shall allow only the

installation of vending machines at selected travel information centers. Following

a 2-year trial period the state transportation department shall use its discretion with

the advice of the commission for the blind to allow only vending machines at other

locations on the limited access highway system. The vending machines shall be

operated solely by the commission for the blind, which is designated as the state

licensing agency under section 2(a)(5) of chapter 638, 49 Stat. 1559, 20 U.S.C.

107a. Except as otherwise provided in this section, no other commercial enterprise

shall be authorized or conducted within or on property acquired for or designated

as a limited access highway. The commission for the blind shall require evidence

of liability insurance and monitor compliance as it pertains to only vending

machines in the designated areas, holding harmless the state transportation

department. [Emphasis added.]

Numerous exceptions to the prohibition against commercial activities on limited-access highways

are carved out in the sections that follow, but none specifically exempt tolling on any structure.

See MCL 252.52(3)-(11). These include such activities as the operation of facilities “for the sale

of only those articles which are for export and consumption outside the United States[]” at the

Blue Water Bridge and the International Bridge in Sault Ste. Marie, MCL 252.52(3) and (4), the

operation of customs brokering facilities at those locations, MCL 252.52(5), the distribution of

free travel-related information at rest areas, MCL 252.52(7), the “installation, operation, and

maintenance of commercial or noncommercial electronic devices and related structures . . . [that]

are intended to assist in providing travel related information to motorists who subscribe to travel

related information services, the public, or the state transportation department[,]” MCL 252.52(9),

the “use of logo signage within the right-of-way of limited access highways[,]” MCL 252.52(10),

and signs identifying nearby hospitals that provide 24-hour emergency care, MCL 252.52(11).

Looking at MCL 252.52(2), it seems fairly obvious that the types of “commercial

enterprises” at issue are generally those that are engaged in the sale or advertising of goods and

services. One thing is clear: no exception is made for the alleged “commercial” activity of

construction and maintenance of a limited-access highway. The reason for that is obvious. The

15

Since the record was developed and the matter was decided in the trial court, the private

concessionaire has been selected.

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Legislature has simply not viewed the construction and maintenance of a roadway as a type of

“commercial enterprise” that would require an exception under MCL 252.52.

Nor do we view the fact that tolls will be collected on the GHIB as all that important. For

one, those tolls will be collected on the Canadian side of the bridge. As was explained previously,

those tolls are not collected for use of the entire bridge, but for use of the Canadian portion of the

bridge. A Michigan statute prohibiting a commercial enterprise in any particular area would seem

entirely irrelevant; Michigan cannot regulate the use of Canadian land. And again, even presuming

that MCL 252.52 could be applied in this instance, the Legislature apparently does not view tolling

as a commercial activity. No exception is made for tolling under MCL 252.52, despite the fact

that other bridges (namely the Blue Water Bridge and International Bridge) collect tolls and would

be considered limited-access highways. Beyond that, it is clear that the tolling that will be

conducted is not “commercial.” Tolls will be collected by the WDBA to pay for the cost of

constructing the bridge and its ongoing maintenance. The purpose of building the bridge in the

first place is not commercial; i.e., neither Canada nor Michigan intends to operate the bridge as

any sort of a business. Rather, it is a governmental function. Cf. Goodhue v Dep’t of

Transportation, 319 Mich App 526; 904 NW2d 203 (2017) (for purposes of MCL 691.1413, the

proprietary function exception to governmental immunity, operation of the Blue Water Bridge,

which is funded primarily by tolls, was not a proprietary function; tolls were collected so that the

bridge could be operated on a self-sustaining basis). While this case does not involve the

proprietary function exception to governmental immunity, the underlying theme is the same:

collecting tolls to pay for the construction and maintenance of a public bridge does not transform

that bridge into a commercial enterprise.

Affirmed.

/s/ Mark J. Cavanagh

/s/ Michael J. Kelly

Stephens, J. did not participate because she recused herself to avoid the appearance of impropriety.

During oral argument both attorneys quoted from an opinion she had issued as judge of the Court

of Claims involving some of the parties to the instant case on an issue before the court in this

appeal. Neither party had cited the Court of Claims opinion in their briefs.

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