6 ELR 20435 | Environmental Law Reporter | copyright © 1976 | All rights reserved

Superior Public Rights, Inc. v. Department of Natural Resources

No. 73-15852-CE (Mich. Cir. Ct. March 2, 1976)

ELR Digest

In this action brought under the Michigan Environmental Protection Act (MEPA), Mich. Comp. Laws Ann. § 691.1201, ELR 43001, plaintiff fails to prove that the granting of an easement by the Department of Natural Resources (DNR) for construction of a proposed coal unloading facility and power plant water pipes on the Lake Superior shore will pollute natural resources or violate the state's public trust duty.

VI. Scope of Judicial Review (Conclusions of Law)

The Michigan Constitution of 1963, Article VI, § 28, provides, inter alia, minimum requirements for judicial review of administrative actions. The Great Lakes Submerged Lands Act, as amended, does not provide either a standard of judicial review or, for that matter, provisions for review. (To the extent applicable, the Inland Lakes and Streams Act (§ 11(3)) subjects determinations made thereunder to the review as provided by Act 306 of the Public Acts of 1969 (the Administrative Procedures Act of 1969)). Thus, to determine the ordinary course of review when administrative determination is made under either the Great Lakes Submerged Land Act or the Inland Lakes and Streams Act, recourse must be had to the Administrative Procedures Act (PA 1969, 306, CL 24.201 et seq.), specifically § 106 therein, which provides as follows (MCLA 24.306):

Except when a statute or the Constitution provides for a different scope of review, the court shall hold unlawful and set aside a decision or order of an agency if substantial rights of the petitioner have been prejudiced because the decision or the order is any of the following:

(a) In violation of the Constitution or a statute.

(b) In excess of the statutory authority or the jurisdiction of the agency.

(c) Made upon unlawful procedure resulting in material prejudice to a party.

(d) Not supported by competent, material and substantial evidence on the whole record.

(e) Arbitrary, capricious or clearly an abuse or unwarranted exercise of discretion.

(f) Affected by other substantial and material error of law.

The court, as appropriate, may affirm, reverse or modify the decision or order or remand the case for further proceedings.

It is thus the contention of the defendants in this matter that the Administrative Procedures Act limits the scope of review as delineated by § 106, and more particularly, with reference to questions of fact prohibits this court from making a "de novo" determination; that the function of the reviewing tribunal is to determine whether or not conclusions of fact were or were not "supported by competent, material and substantial evidence on the whole record."

Plaintiffs contend, however, as to those issues herein which may heretofore have been submitted to the administrative hearing and adjudication process as provided for by law, that they are still subject to review in this court by way of an independent action, not encumbered by the Administrative Procedures Act and any limitations imposed thereon upon the scope of review.

Article IV, § 52, of the Michigan Constitution of 1963 provides as follows:

The conservation and development of the natural resources of the state are hereby declared to be of paramount public concern in the interests of the health, safety and general welfare of the people. The Legislature shall provide for the protection of the air, water and other natural resources of this state from pollution, impairment and destruction.

By Act 127, 1970 (the Environmental Protection Act) the legislature took a definite step in furtherance of that declared constitutional policy. Section 2(1) of [MEPA] provides:

The attorney general, any political subdivision of the state, any instrumentality or agency of the state or of a political subdivision thereof, any person, partnership, corporation, association, organization, or other legal entity may maintain an action in the circuit court having jurisdiction where the alleged violation occurred or is likely to occur for declaratory and equitable relief against the state, any political subdivision thereof, any instrumentality or agency of the state or other political subdivision thereof, any pertinent person, partnership, corporation, association, organization or other legal entity for the protection of the air, water and other natural resources and the public trust therein from pollution, impairment or destruction. (Emphasis added.)

After providing in § 3 of [MEPA] for evidentiary standards applicable in an environmental case (see burden of proof discussion, infra) the legislature provided in § 4 as follows:

(1) The court may grant temporary and permanent equitable relief, or may impose conditions on the defendant that are required to protect the air, water and other natural resources or the public trust herein from pollution, impairment or destruction.

(2) If administrative, licensing or other proceedings are required or available to determine the legality of the defendant's conduct, the court may remit the parties to such proceedings, which proceedings shall be conducted in accordance with and subject to the provisions of Act No. 306 of the Public Acts of 1969, being sections 24.201 to 24.313 of the Compiled Laws of 1948. In so remitting the court may grant temporary equitable relief where necessary for the protection of the air, water and natural resources or the public trust therein from pollution, impairment or destruction. In so remitting the court shall retain jurisdiction of the action pending completion thereof for the purpose of determining whether adequate protection from pollution, impairment or destruction has been afforded.

(3) Upon completion of such proceedings, the court shall adjudicate the impact of the defendant's conduct on the air, water or other natural resources and on the public trust therein in accordance with this act. In such adjudication the court may order that additional evidence be taken to the extent necessary to protect the rights recognized in this act.

(4) Where, as to any administrative, licensing or other proceeding, judicial review thereof is available, notwithstanding the provisions to the contrary of Act No. 306 of the Public Acts of 1969, pertaining to judicial review, the court originally taking jurisdiction shall maintain jurisdiction for purposes of judicial review. (Emphasis added).

Section 4(2) thus provides that the court may remit the parties to such proceedings, to proceedings subject to the provisions of theAdministrative Procedures Act. However, the section closes by providing that in so remitting the court shall retain jurisdiction of the action pending completion thereof for the purpose of determining whether adequate protection from pollution, impairment or destruction has been afforded. Section 4(4) of [MEPA], in turn, provides that where in any administrative proceeding judicial review is available, that notwithstanding the provisions to the contrary contained within the APA pertaining to judicial review, the court originally taking jurisdiction shall maintainjurisdiction for purposes of judicial review. Section 5 of [MEPA] further details procedures for administrative hearing and judicial review, provides additional standards in environmental cases (no conduct shall be authorized or approved which does, or is likely to have such effect (alleged pollution, impairment or destruction of the air, water or other natural resources or the public trust therein) so long as there is a feasible and prudent alternative consistent with the reasonable requirements of the public health, safety and welfare), but specifically fails to limit the scope of judicial review from an administrative hearing. Finally, in § 6 of [MEPA] the legislature provided:

This act shall be supplementary to existing administrative and regulatory procedures provided by law.

Though the recent, and most oft-cited, Michigan case on environmental protection (Ray v. Mason County Drain Commissioner, 393 Mich. 294 [5 ELR 20176] (1975)), fails to speak to the issue posed herein directly, it is still a ringing judicial pronouncement in support of the legislative policy set forth in [MEPA]. In addition, it mandates the fact-finding function of the trial judge (GCR 1963, 517), and recognizes that the legislature in establishing environmental rights merely set the parameters for the standard of environmental quality but did not attempt to set forth an elaborate scheme of detailed provisions designed to cover every conceivable type of environmental pollution or impairment. The supreme court recognized that the legislature spoke as precisely as the subject matter permitted and in its wisdom left the courts the important task of giving substance to the standard by developing a common law of environmental quality. At no place in Ray did the supreme court indicate that the legislature had intended that in any proper case brought before the court, that the court could abdicate its fact finding responsibilities to an administrative tribunal. But in addition to Ray, on the same day that Ray was decided, the supreme court decided Eyde v. State of Michigan, 393 Mich. 453 (1975). At p. 454 the court held as follows:

The EPA is significant legislation which gives the private citizen a sizeable share of the initiative for environmental law enforcement. The act creates an independent cause of action, granting standing to private individuals to maintain actions in the circuit court for declaratory and other equitable relief against anyone for the protection of Michigan's environment. (Emphasis added.)

The court then went on to say that there was no statutory duty that required citizens to intervene in condemnation proceedings to assert their rights under [MEPA], even though a condemnation action was an in rem proceeding and would bind all persons with respect to its traditional objective. Though holding that Eyde was restricted to the unique facts of the case, the principles set forth by the supreme court in Ray and Eyde and the analogies that can be drawn therefrom are apparent. In an original and independent citizen action under the Environmental Protection Act a plaintiff is not per se barred by such traditional doctrines as res judicata or exhaustion of administrative remedies. (This, of course, does not mean that public policy dictates that the same parties could continuously relitigate the same issues ad infinitum or that doctrines of res judicata or collateral estoppel could not be applied in the proper instances (see § 5(3) of [MEPA])). Thus, though some dispute has arisen between the parties as to whether or not the administrative proceedings conducted upon the application of LS&I Railroad for permission to build the coal-unloading facility upon the submerged lands of Lake Superior was conducted as a separate administrative hearing or conducted pursuant to the remission provisions of § 4(2) of [MEPA], this court holds that whether those proceedings were conducted as original proceedings or conducted upon remission makes no difference to the issue of the scope of judicial review. Remission under [MEPA] may be (and was in this case) a very useful function in developing a factual record for judicial scrutiny. The legislature has so recognized. But to hold that upon remission the scope of review is thereafter limited to the scope of review dictated by § 106 of the APA would be but to cede not only this court's authority, but its obligation to make independent factual determination of issues properly raised in plaintiff's "independent cause of action." Any reviewing court recognizes that a significant difference exists between the making of a de novo or independent factual determination and the determination that a decision below was or was not supported by competent, material and substantial evidence on the whole record. Although any given court may desire to give high credence to factual determinations made by an agency based upon the proven experience, competence, expertise and sensitivity of that agency's decisional-making process, to rule that the reviewing court is bound by the administrative fact finding would be but to destroy one of the central thrusts and purposes of [MEPA] — to watchdog the controlling governing agencies themselves in order to guarantee that they do not by inadvertence become the captives of the very entities they are seeking to control and/or fail to recognize, due to ingrained myopia, inertia and bureaucratic complacence, the very environmental dangers they were established to prevent.1

This is not to determine an issue of "primary jurisdiction." There is both ample room and ample need for administrative agencies playing a large and far more important role in protecting the environment. In fact, this very lawsuit discloses indirectly a growth and development in sensitivity to environmental concern brought to the attention of the agency by involved citizens, Rather, this ruling is merely that, in the instance of an independent environmental action where administrative proceedings are properly brought into the ambit of that action, the Environmental Protection Act directs an independent, de novo, factual determination by the court. Particularly is this principle essential in the present case, for as heretofore indicated, the total record before this court consists not only of the record made before the Department of Natural Resources, but such record as made therein was supplemented and extended by the record made before this court. The standard of review hereafter shall be a de novo review upon the entire record submitted to this court.

[Opinion at pp. 17-23.].

The ultimate burden of proof in MEPA actions remains with the plaintiff, but the burden of going forward with rebuttal evidence or with a showing that no feasible and prudent alternative exists shifts to the defendant once the plaintiff has established a prima facie case of pollution, impairment, or destruction of natural resources. Ray v. Mason County Drain Comm'r, 393 Mich. 294, 310-12, 5 ELR 20176 (1975). Although the plaintiff in fact established a prima facie case that the construction of the contested intake and discharge pipes will pollute the environmental the defendant has rebutted plaintiff's case with evidence showing that the easement will improve the subject public trust lands and will not injure the public trust in the remaining trust lands of Lake Superior. In addition, the defendants have shown that there exists no feasible and prudent alternative to the proposed pipe construction. The court rejects plaintiff's novel proposition that public trust lands can never be put to private use:

In conclusion, this court concludes the disposition of trust land can be made by the DNR, subject to the restrictions and requirements of the Great Lakes Submerged Land Act and pursuant to the exceptions recognized in Obrecht v. National Gypsum Company, 361 Mich. 399 (1960), even for private purposes. The public trust concept as articulated in Illinois Central Railroad Co. v. State of Illinois and City of Chicago, 146 U.S. 387; 13 S. Ct. 110; 36 L. Ed. 1018 (1892), and as interpreted and extended in our jurisdiction does not, per se, prohibit the utilization of public trust land (whether for a private use or for a private purpose), even if we are to assume that GENCO's [Upper Peninsula Generating Company] ultimate electrical generating capacity, whether sold to municipalities for street lighting or sold to private citizens for residential use or sold totally to one industrial behemoth, served no valid public purpose, so long as the use would be determined to be in the public interest.

[Opinion at p. 29.]

In any event, the easement is not an irrevocable alienation of public trust lands.

The administrative rules applied by the DNR for disposition of Great Lakes submerged lands do not exceed the agency's power under the Great Lakes Submerged Lands Act. Mich. Comp. Laws Ann. § 322.651. Although pragmatic consideration ought to yield to the overriding public interest in protecting public trust lands, a public hearing is not a procedural prerequisite to the DNR's issuance of submerged lands permits. Nor has the DNR delegated its authority over the public trust lands by granting the easement. The statutory criterion of consideration for alienated public trust lands is fair cash market value, Mich. Comp. Laws Ann. § 322.655(a), not, as plaintiff asserts, the value of the diminution of public uses in remaining trust lands. As to other miscellaneous contentions, the doctrine of exhaustion of administrative remedies does not apply in actions brought under MEPA, laches is inapplicable under the facts of this case; and, the record does not justify the sweeping conclusion that granting an injunction would create massive adverse economic impacts.

VIII. H. Constitutionality of EPA

Finally, Defendant GENCO maintains that insofar as § 2.(2) of the Environmental Protection Act purports to grant jurisdiction to this court to direct the adoption of standards approved and specified by this court in the event of a finding that standards heretofore utilized are deficient, that section is an unconstitutional delegation of authority as proscribed by Art. III, § 2, of the Michigan Constitution of 1963. Such contention is rejected. The Environmental Protection Act is not violative of the concept of separation of powers, nor is judicial intervention into the environmental arena such a violation; nor is the creation of new environmental standards by the judiciary upon the rejection of standards heretofore established by the legislature or by the DNR, a judicial assumption of power properly belonging to either the legislative or executive branches of government. No branch of government has a constitutional stranglehold upon the domain of the public trust and environmental protection. All have responsibilities thereunder. At times conflicts and frictions may arise which may mandate, alternatively, either sound exercise of judicial restraint or timely intervention of constitutional judicial authority. The Environmental Protection Act itself is constitutional and is a personificiation of the needed interplay between the legislative, executive and judicial branches of government.

[Opinion at p. 42.]

A 1971 submerged lands agreement between the DNR and the owners of existing nearby docks, which demanded consideration for continued use of the docks, does not violate the public trust doctrine, which cannot be used to frustrate reasonable riparian uses. Fully cognizant of its duties under MEPA to make an independent de novo factual determination, Ray v. Mason County Drain Comm'r, supra, the court nevertheless adopts as proper the findings of facts and conclusions of law approved by the Natural Resources Commission regarding the coal unloading facility. The plaintiff has established a prima facie case that the facility will create a risk of water and air pollution and that the mining operations necessary for burning the coal for electricity will denude certain land areas. However, the defendant has shown that the environmental impact of the facility on Great Lakes bottomlands will be minimal, and that the proposed location is the most feasible and is consistent with the promotion of the public welfare. Attorney fees and costs cannot be awarded in the absence of specific legislative or judicial direction, despite the environmentally protective measures concededly incorporated into the disputed easements as a result of this lawsuit. Alyeska Pipeline Service Co. v. Wilderness Soc'y, 421 U.S. 240, 5 ELR 20286 (1975).

The full text of this opinion is available from ELR (55 pp. $13.50, ELR Order No. C-1033).

1. Sax, Professor Joseph L., Defending the Environment — A Strategy for Citizen Action, Alfred A. Knopf, New York, 1971. Of particular interest on the topic of administrative failures in the area of environmental control are chapters 1-3.

Counsel for Plaintiff
James M. Olson
Olson, Dettmer & Bowerman
520 S. Union St.
Traverse City MI 49684
(616) 947-2912

Counsel for Defendant Department of Natural Resources
Clive D. Gemmill, Asst. Attorney General
Law Building, Suite 630
Lansing MI 48913
(517) 373-1130

Counsel for Defendant Upper Peninsula Generating Company
Rodger R. Ederer
Snyder, Loomis, Ewert, Ederer & Parsley
1200 Bank of Lansing Bldg.
Lansing MI 48933
(517) 489-5724

Counsel for Defendant Lake Superior & Ishpeming Railroad
Douglas B. Vielmetti
Clancy, Hansen & Vielmetti
Peninsula Bank Bldg.
Ishpeming MI 49849
(906) 486-9981

Webb A. Smith
Foster, Swift & Collins
401 S. Washington
Lansing MI 48933
(517) 372-8050

Counsel for Amicus Curiae West Michigan Environmental Action Council
Roger L. Conner
822 Cherry St. SE
Grand Rapids MI 49506
(616) 451-3051

Reisig, J.


6 ELR 20435 | Environmental Law Reporter | copyright © 1976 | All rights reserved