Miller v. Department of Treasury

188 N.W.2d 795, 385 Mich. 296, 1971 Mich. LEXIS 194

• Court: Michigan Supreme Court
• Decided: July 7, 1971
• Docket: 20 January Term 1970, Docket No. 52,529. No. 34 June Term 1971, Docket No. 52,529
• Status: Published

Opinions

Adams, J.

A summary judgment of unconstitutionality of PA 1965, No 335, was entered by the circuit judge on December 11, 1967.¹ Then, as now, admission to a state mental institution might result from a court-ordered commitment² based on proceedings initiated by persons not related to the handicapped person, the statute providing:

“The father, mother, husband, wife, brother, sister, child, if the petitioner be of legal age, or guardian of a person alleged to be mentally ill, mentally handicapped or epileptic, or the sheriff or supervisor of any township, or county agent, or by any other person whom a judge of probate, upon examination into the facts and circumstances of any particular case, shall determine would be a proper person to make such petition, or. any peace officer within the county in which such alleged mentally diseased person resides, or may be, may petition the probate court of said county for an order directing the admission of said person to a hospital, home or institution for the care of the mentally ill, mentally handicapped or epileptic, such petition to contain a statement giving the facts and not the conclusions upon which the allegation of such mental disease is based and because of which the application for the order is made.” MCLA § 330.21 (Stat Ann 1969 Rev § 14.811.)

Pursuant to statute,⁴ the state determines the charge for the care and treatment of mental patients in state hospitals by an average daily rate which may not exceed the anticipated operating cost, exclusive of capital outlay. The amount is fixed at the beginning of each fiscal year.⁵ Section 6 of the act under challenge here in part provides:

“Within 30 days after admission of the patient or the effective date of this act, whichever is later, the relative shall file the signed, completed form with the department of revenue. * * * The department of revenue shall bill the relative for the amounts of liability determined under the provisions of this act from the date of admission of the patient or the effective date of this act, whichever is later, through the succeeding June 30.” (Emphasis added.)

The above provision obviously refers to the initial filing by the responsible relative and the resultant initial billing period by the State.

Section 7 of the act sets forth the requirements of the original form and the accompanying information in these words:

“The form shall contain the name of the patient; the name of the institution to which the patient has been admitted; the name and address of the relatives liable for the care and maintenance of the patient under the provisions of this act; the schedule of liability set forth in section 8; the net taxable income of the relative last reported to the United States internal revenue service for federal income tax purposes; the names and ages of dependents of the relatives; and such other information as may be required by rules adopted by the department of revenue.” (Emphasis added.) MCLA § 330.657 (Stat Ann 1969 Rev § 14.870 [107]).

Section 8 provides in part:

“(1) The amount of monthly liability of a relative for the care and maintenance of a mentally retarded person under the provisions of this act shall be originally determined by use of the following schedule:

Net Taxable Monthly Net Taxable Monthly Income Liability Income Liability

$ 0 to 4 999 0 ***

5,000 to 5,499 20 19,000 to 19,499 190

5,500 to 5,999 25 19,500 to 19,999 200'

*** 20,000 and over 210.”

"When these sections are compared, it is clear the legislature intended that the “net taxable income” to be used in determining monthly liability under the schedule appearing in § 8 of the act is the same amount prescribed by § 9 of the act, which is as follows:

“By May 1 of each year the department of revenue shall send a renewal form to all relatives liable for the care and maintenance of a patient under the provisions of this act. The renewal form shall contain the same information as the original form but shall include the most recent information concerning the net taxable income of the relative and be accompanied by a signed copy of the relative’s income tax return submitted to the United States internal revenue service. The renewal form and the signed copy of the return shall be filed with the department of revenue by the succeeding June 1. The department of revenue shall reascertain the amount of liability under the provisions of this act and bill the relative accordingly for the period commencing on the succeeding July 1 and continuing through the following June 30. Payments by the relative shall be made as if the patient were first admitted on July 1.” (Emphasis added.) MCLA § 330.659 (Stat Ann 1969 Rev § 14.870 [109]).

Section 10 of PA 1965, No 335, authorizes a responsible relative to request at any time a new determination of liability by the Department of Revenue. The statute continues:

“ * * * For purposes of the determination, the department of revenue may request the relative to supply all relevant financial information and such additional information as may be provided by rules of the department of revenue. After review of the information, the department of revenue shall establish the monthly liability of the relative. If the relative is dissatisfied with the determination, he may appeal the determination to the probate court of the county of residence of the patient. The prohate court shall then determine the liability. In no case may the liability determined by the department or by the probate court exceed that established by the schedule. Appeals from the determination of the probate court may be made as in other cases.” MCLA § 330.660 (Stat Ann 1969 Rev §14.870 [110]).

The deficiency of this legislation is glaring. No provision is made for notice of hearing. There is no statutory designation of a hearing officer or examiner to make a determination either from evidence or the submitted information. Detroit Edison Company v. Corporation & Securities Commission (1960), 361 Mich 150. The statute contains no legal requirements or provisions to be applied to the facts by the Department of Revenue in redetermining liability. It operates with an uncontrolled discretion. There are no legislative standards or guidelines for the exercise of the rulemaking power. Osius v. St. Clair Shores (1956), 344 Mich 693; McKibbin v. Corporation & Securities Commission (1963), 369 Mich 69; Fowler v. Board of Registration in Chiropody (1965), 374 Mich 254; Milford v. People’s Community Hospital Authority (1968), 380 Mich 49.⁶

I would affirm the trial court and the Court of Appeals. No costs, a public question being involved.

T. M. Kavanagh, C. J., and Black and Swainson, JJ., concurred with Adams, J.

1 The title of PA 1965, No 335, describes the act as “relating to the liability of relatives for the care and maintenance of mentally retarded persons admitted to public institutions; * * * .”

Section 1 of the act, as originally enacted, defined a mentally retarded person to mean “a mentally handicapped person, including a moron, idiot, imbecile, and any person as to whom congenital defects have produced the same deficiency.”

PA 1966, No 77, amended § 1 to include any epileptic admitted to the Caro State Hospital for Epileptics.

The title was amended and a new section added by PA 1969, No 228, to impose additional liability under the act for the care and maintenance of mentally ill children.

2 By statute, except in certain specified situations, the Commissioner of Revenue ex officio shall be the public guardian of every patient admitted to a State mental institution. MCLA § 330.21b (Stat Ann 1969 Rev § 14.811 [1]).

4 MCLA § 330.41 (Stat Ann 1969 Rev § 14.831).

5 The fiscal year of the State commences on July first and closes on June thirtieth. MCLA § 21.91 (Stat Ann 1969 Rev § 3.561).

6 For a discussion of the administrative function in this area, see Handlon v. Belleville (1950), 4 NJ 99, 105 (71 A2d 624, 16 ALR2d 1118, 1123), where it was said:

“The requirement of a ‘hearing’ has reference to the tradition of judicial proceedings in which evidence is received and weighed by the trier of the facts and the issue determined uninfluenced by extraneous considerations which might not be exceptionable in other fields involving purely executive action. The ‘hearing’ is ‘the hearing of evidence and argument.’ Morgan v. United States, 298 US 468, 56 S Ct 906, 80 L Ed 1288 (1936); Shields v. Utah Idaho Cent. R. Co., 305 US 177, 59 S Ct 160, 83 L Ed 111 (1938); Pennsylvania R. R. Co. v. New Jersey Aviation Commission, 2 NJ 64 [65 A2d 61] (1949). The quality of the act rather than the character of the agency exercising the authority is determinative of the nature of the power and the need for procedural due process.”