Michigan Supreme Court Lansing, Michigan 48909 ____________________________________________________________________________________________ C h i e f J u s ti c e J u s t ic e s Maura D. Corrigan Michael F. Cavanagh
Opinion Elizabeth A. Weaver Marilyn Kelly Clifford W. Taylor Robert P. Young, Jr. Stephen J. Markman ____________________________________________________________________________________________________________________________
FILED JULY 9, 2003
PARKWOOD LIMITED DIVIDEND
HOUSING ASSOCIATION,
Plaintiff-Appellee,
v Nos. 120410, 120411
STATE HOUSING DEVELOPMENT AUTHORITY,
Defendant-Appellant.
BEFORE THE ENTIRE BENCH
MARKMAN, J.
We granted leave to appeal to consider the jurisdiction
of the Court of Claims over this case, which involves a
contractual claim for declaratory judgment against a state
agency. The Court of Appeals, relying on Silverman v Univ of
Michigan Bd of Regents, 445 Mich 209; 516 NW2d 54 (1994),
determined that the Court of Claims lacked subject-matter
jurisdiction because the complaint did not request monetary
damages. Because we conclude that the Court of Claims has
exclusive jurisdiction over the claim, we reverse the judgment
of the Court of Appeals.
I. FACTS AND PROCEDURAL HISTORY
In 1973, plaintiff, a limited dividend housing
association, received a mortgage from defendant Michigan State
Housing Development Authority to finance the construction of
an apartment complex for low-income and moderate-income
residents. In September 1998, plaintiff informed defendant of
its intention to pay off the mortgage on October 1, 1998, and
requested a payoff letter showing the amount due. Plaintiff
also inquired whether the balances in all escrow and reserve
accounts would be applied against the amount due or paid
directly to plaintiff. In response, defendant indicated that
it would retain any amounts remaining in the accounts after
payment of the full limited dividend to which plaintiff was
entitled.1 Plaintiff then filed a “Complaint for Declaratory
1 The State Housing Development Authority Act, MCL
125.1493(b), allows the authority to establish a reasonable
and proper rate for cumulative dividends payable to members of
limited dividend housing associations and provides that on
dissolution of the limited dividend housing association, any
surplus shall be paid to the authority:
That every member of a limited dividend
housing association shall be deemed, by acceptance
of a beneficial interest in the limited dividend
(continued...)
Relief” in the Wayne Circuit Court, seeking a declaration that
the money contained in certain escrow accounts belonged to
plaintiff and that plaintiff would be entitled to possession
of the accounts when plaintiff paid the full balance due under
the mortgage. The circuit court dismissed the case, finding
that the claim was within the exclusive jurisdiction of the
Court of Claims.
Plaintiff appealed from the circuit court's dismissal,
and refiled its complaint in the Court of Claims. Both
parties filed motions for summary disposition. The Court of
Claims granted summary disposition for defendant. Plaintiff
appealed from the Court of Claims judgment.
The Court of Appeals consolidated plaintiff’s two appeals
and, in a split decision, reversed.2 The majority determined
1 (...continued)
housing association or by executing the document of
basic organization, to have agreed that he or she
at no time shall receive from the limited dividend
housing association any return in excess of the
face value of the investment attributable to his or
her respective interest plus cumulative dividend
payments at a rate which the authority determines
to be reasonable and proper, computed from the
initial date on which money was paid or property
delivered in consideration for the interest; and
that upon the dissolution of the limited dividend
housing association, any surplus in excess of those
amounts shall be paid to the authority or to any
other regulating governmental body as the authority
directs.
2 Unpublished opinion per curiam, issued October 26, 2001
that, because plaintiff’s complaint sought only a declaratory
judgment concerning the ownership of certain money, contingent
on certain circumstances, and did not seek monetary damages,
the circuit court possessed subject-matter jurisdiction.
Additionally, the majority concluded that because the Court of
Claims only has jurisdiction over claims for monetary damages,
and because plaintiff’s complaint did not seek monetary
damages, the Court of Claims lacked subject-matter
jurisdiction and its rulings were void.
The dissenting Court of Appeals judge concluded that the
claim would ultimately result in money damages if plaintiff
were granted the relief requested in the complaint, and,
therefore, that the case was properly before the Court of
Claims.
Defendant filed an application for leave to appeal, and
plaintiff filed an application for leave to cross-appeal the
Court of Claims decision on its merits. We denied plaintiff’s
application and granted defendant’s application, directing the
parties to address the jurisdictional question in the context
of the relevant statutes, MCL 600.6419 and 600.6419a, and this
Court’s decision in Silverman.3
2 (...continued)
(Docket Nos. 218433, 229448).
3 467 Mich 896 (2002).
II. STANDARD OF REVIEW
In order to resolve this jurisdictional issue, we must
consider the Court of Claims Act. This is a question of
statutory construction, which is reviewed de novo as a
question of law. Cruz v State Farm Mut Automobile Ins Co, 466
Mich 588, 594; 648 NW2d 591 (2002).
III. DISCUSSION
A. STATUTORY PROVISIONS
The jurisdiction of the Court of Claims is provided by
statute. The main statutory provision, MCL 600.6419, grants
the Court of Claims exclusive jurisdiction over certain claims
against the state and its subparts:
(1) Except as provided in sections 6419a and
6440, the jurisdiction of the court of claims, as
conferred upon it by this chapter, shall be
exclusive. . . . The court has power and
jurisdiction:
(a) To hear and determine all claims and
demands, liquidated and unliquidated, ex contractu
and ex delicto, against the state and any of its
departments, commissions, boards, institutions,
arms, or agencies.
In regard to the jurisdiction of the circuit courts, MCL
600.6419 provides:
(4) This chapter shall not deprive the circuit
court of this state of jurisdiction over . . .
proceedings for declaratory or equitable relief, or
any other actions against state agencies based upon
the statutes of this state in such case made and
provided, which expressly confer jurisdiction
thereof upon the circuit court . . . .
Additionally, MCL 600.6419a, which was added in 1984,
gives the Court of Claims concurrent jurisdiction with the
circuit courts over any claim for equitable and declaratory
relief that is ancillary to a claim filed under § 6419:
In addition to the powers and jurisdiction
conferred upon the court of claims by section 6419,
the court of claims has concurrent jurisdiction of
any demand for equitable relief and any demand for
a declaratory judgment when ancillary to a claim
filed pursuant to section 6419. The jurisdiction
conferred by this section is not intended to be
exclusive of the jurisdiction of the circuit court
over demands for declaratory and equitable relief
conferred by section 605.[4]
B. CASE LAW
Michigan courts have interpreted § 6419(1)(a) “as
limiting the jurisdiction of the Court of Claims to actions
for money damages.” AuSable Manistee Action Council, Inc v
Michigan, 182 Mich App 596, 598; 452 NW2d 832 (1989)
(citations omitted). This interpretation was first set forth
in Taylor v Auditor Gen, 360 Mich 146, 151; 103 NW2d 769
(1960), which was decided before the 1984 amendment, when this
Court, noting that the Court of Claims was created as a court
of limited jurisdiction having “no ‘equity side’ as that term
4 MCL 600.605 provides:
Circuit courts have original jurisdiction to
hear and determine all civil claims and remedies,
except where exclusive jurisdiction is given in the
constitution or by statute to some other court or
where the circuit courts are denied jurisdiction by
the constitution or statutes of this state.
is employed in respect of the jurisdiction of Michigan
courts,” concluded that the Court of Claims did not possess
jurisdiction over declaratory-judgment actions.
Relying on Taylor, Michigan courts have since adhered to
the view that the Court of Claims lacks jurisdiction over a
claim that is solely for declaratory relief. See, e.g.,
AuSable, supra at 598; 77th Dist Judge v Michigan, 175 Mich
App 681, 699; 438 NW2d 333 (1989). However, in Greenfield
Constr Co, Inc v Dep’t of State Hwys, 402 Mich 172; 261 NW2d
718 (1978), six participating justices agreed, in five
separate opinions, that the circuit court lacked jurisdiction
over the plaintiff’s suit for declaratory judgment against a
state department.5 Id. at 198 (opinion by RYAN , J., COLEMAN and
FITZGERALD , JJ., concurring), 202 (opinion by LEVIN , J., KAVANAGH ,
C.J., concurring), 231 (WILLIAMS , J., concurring that the
circuit court lacks jurisdiction over a citizen suit against
a government agency for a declaratory judgment).
After the addition of § 6419a, the Court of Appeals noted
that, “The holding in Taylor, premised on the absence of an
equity side to the Court of Claims, was discredited in view of
the subsequent abolition of procedural distinctions between
5 Three justices also opined that the Court of Claims has
jurisdiction over a declaratory-judgment action against the
state. Id. at 200 (concurring opinion of COLEMAN , J.), 230
(opinion by LEVIN , J., KAVANAGH , C.J., concurring).
the law and equity sides of a court docket.” 77th Dist Judge,
supra at 699. Nonetheless, the Court in 77th Dist Judge
concluded “declaratory judgment is appropriate in the Court of
Claims only if the underlying dispute or controversy is of a
nature lending itself to an eventual remedy in money damages
against the state or one of its branches.” Id. at 700.
In 1994, this Court in Silverman, supra at 216-217, noted
the uncertainty regarding the Court of Claims jurisdiction
over declaratory claims before the addition of § 6419a.
According to Silverman, with the enactment of § 6419a, “the
Legislature authorized the Court of Claims to exercise
jurisdiction over claims for declaratory and equitable relief
against the state, provided that the plaintiff’s suit also
seeks money damages from the state or one of its agencies.”
Id. at 217. Significantly, Silverman also noted that the
actual “nature of the claim,” not how the plaintiff phrases
the request for relief, controls whether the Court of Claims
possesses jurisdiction. Id. at 216 n 7.
C. ANALYSIS
Plaintiff concedes that this case involves a contract
based claim. However, plaintiff argues that, inasmuch as the
complaint sought declaratory relief only, the Court of Claims
did not possess jurisdiction, because MCL 600.6419(1)(a),
interpreted in light of MCL 600.6419a, only grants the Court
of Claims exclusive jurisdiction over complaints that request
monetary damages. Defendant, on the other hand, argues that,
because this is a contract-based claim against a state agency,
it comes squarely within the exclusive jurisdiction of the
Court of Claims under § 6419(1)(a).
In order to resolve the jurisdictional question
presented, we must first consider the “nature of the claim.”
Plaintiff’s prayer for relief states:
WHEREFORE, Plaintiff requests that the court
adjudicate and declare that the accounts which are
the subject of this complaint are assets belonging
to Plaintiff, subject to Defendant’s custodial
rights while the mortgage is in force, and that
Plaintiff shall be entitled to sole possession of
the accounts at the time Plaintiff pays the full
balance due under Defendant’s mortgage. Plaintiff
also requests its costs and attorney fees and such
other relief as the court determines to be just.
From the face of the complaint, it is apparent that plaintiff
is seeking a declaration regarding its entitlement to money in
certain accounts, at such time that it prepays the mortgage.
Pursuant to MCR 2.605(A)(1),
[i]n a case of actual controversy within its
jurisdiction, a Michigan court of record may
declare the rights and other legal relations of an
interested party seeking a declaratory judgment,
whether or not other relief is or could be sought
or granted.
Considering the language of the court rule, it appears that
plaintiff is seeking a court declaration regarding its rights
relative to the contract between the parties. Plaintiff does
not directly request monetary damages,6 although the complaint
pertains to money that is contained in certain accounts.
Instead, plaintiff asks for a court ruling regarding its
rights and the effects of its future actions. Thus,
plaintiff’s complaint may be properly characterized as seeking
solely declaratory relief.
In light of our conclusion that this case involves a
complaint for declaratory relief only, we must next consider
whether this claim falls within the exclusive jurisdiction of
the Court of Claims pursuant to § 6419(1)(a). In resolving
this issue of statutory interpretation, our primary aim is to
effect the intent of the Legislature. Wickens v Oakwood
Healthcare Sys, 465 Mich 53, 60; 631 NW2d 686 (2001). First,
we examine the language of the statute. Id. “If the
statute's language is clear and unambiguous, we assume that
the Legislature intended its plain meaning, and we enforce the
statute as written.” Id., citing People v Stone, 463 Mich
558, 562; 621 NW2d 702 (2001).
The plain language of § 6419(1)(a), the primary source of
jurisdiction for the Court of Claims, does not refer to claims
for money damages or to claims for declaratory relief.
6 It is noteworthy, however, that at oral argument,
plaintiff’s counsel indicated that this case “involves a
million and a half dollars approximately,” and thus that the
losing party will likely seek to return to this Court for
consideration of the merits of the case.
Rather, in broad language, this provision grants the Court of
Claims exclusive jurisdiction of “all claims and demands,
liquidated and unliquidated, ex contractu and ex delicto,
against the state . . . .” Because the present case involves
a contract-based claim for declaratory relief against a state
agency, we conclude that it falls within the exclusive
jurisdiction of the Court of Claims under the plain language
§ 6419(1)(a).7
In reaching this conclusion, we recognize that in
Silverman this Court suggested that the circuit court is the
appropriate forum for complaints against the state that
request only declaratory relief. Silverman, supra at 217 (“A
complaint seeking only money damages against the state must be
filed in the Court of Claims. A complaint seeking only
equitable or declaratory relief must be filed in circuit
court.”). As previously discussed, the idea that the Court of
Claims lacks jurisdiction over declaratory-judgment actions
was first articulated by this Court in Taylor in 1960 and was
premised on the lack of an equity side to the Court of Claims.
Subsequently, the Court of Appeals in 77th Dist Judge, supra
7 We construe the enactment of § 6419a as having added to
this jurisdiction by clarifying that the Court of Claims also
has jurisdiction over other declaratory and equitable claims,
specifically, those that relate neither to contract nor
tort—over which the circuit court would otherwise have
exclusive jurisdiction—when those claims are ancillary to a
claim within the court’s exclusive jurisdiction under § 6419.
at 699, indicated that Taylor’s holding was “discredited” on
the basis of the later “abolition of procedural distinctions
between the law and equity sides of a court docket.” Despite
this, and despite the plain language of the statute, cases
have continued, with the exception of Greenfield, to interpret
the jurisdiction granted by § 6419(1)(a) as extending only to
claims for money damages. As we have indicated, however, §
6419(1)(a) clearly provides the Court of Claims with exclusive
jurisdiction over “all claims and demands, liquidated and
unliquidated, ex contractu and ex delicto, against the state
. . . .” In light of this language, we conclude today that
the grant of exclusive jurisdiction conveyed to the Court of
Claims by § 6419(1)(a) includes jurisdiction over declaratory
judgment actions against the state that involve contract or
tort without more; that is, the claim need not expressly claim
money damages. We disavow any contrary statements found in
Taylor and Silverman.8
In reaching this conclusion, we recognize that, with
regard to the jurisdiction of the circuit court, our
8 In addition, we disavow similar statements contained in
various Court of Appeals cases, including 77th Dist Judge and
AuSable.
However, we specifically reaffirm the statements in
Silverman recognizing that the nature of the claim, rather
than how the plaintiff phrases the request for relief,
controls how a court will characterize the claim.
constitution provides that “[t]he circuit court shall have
original jurisdiction in all matters not prohibited by law
. . . .” Const 1963, art 6, § 13.9 In addition, § 6419(4)
recognizes that the circuit court has jurisdiction over
In our view, § 6419(1)(a), by its explicit grant of exclusive
jurisdiction to the Court of Claims of “all claims and demands
. . . ex contractu and ex delicto” against the state, deprives
“by law” the circuit court of jurisdiction over these types of
claims. Under the language of MCL 600.605, § 6419(1)(a) is an
instance “where exclusive jurisdiction is given . . . by
statute to some other court . . . .” Thus, we construe §
6419(4) as maintaining the jurisdiction of the circuit court
over those declaratory claims against the state that do not
involve contract or tort.10
9 Similarly, MCL 600.605, which is quoted in its entirety
in n 4, grants circuit courts jurisdiction over “all civil
claims and remedies, except where exclusive jurisdiction is
given . . . by statute to some other court . . . .” (Emphasis
added.)
10 This jurisdiction of the circuit court is concurrent
with the jurisdiction of the Court of Claims over such claims
in the circumstances set out in § 6419a, see n 7. That is,
when such a declaratory action is ancillary to another claim
within the Court of Claims exclusive jurisdiction under §
6419, the circuit court and the Court of Claims have
IV. CONCLUSION
For these reasons, we conclude that the Court of Claims
possesses exclusive subject-matter jurisdiction over this
case, which involves a contract-based complaint against a
state agency seeking solely declaratory relief. Today we hold
that pursuant to the plain language of § 6419(1)(a), the Court
of Claims has exclusive jurisdiction over complaints based on
contract or tort that seek solely declaratory relief against
the state or any state agency. We disavow any contrary
statements found in our prior case law that have seemingly
interpreted § 6419(1)(a) as granting the Court of Claims
jurisdiction over claims for money damages only. We,
therefore, reverse the judgment of the Court of Appeals on the
jurisdictional issue. We remand to the Court of Appeals for
consideration of the merits of the Court of Claims rulings,
which were not previously considered.
Stephen J. Markman
Maura D. Corrigan
Michael F. Cavanagh
Elizabeth A. Weaver
Marilyn Kelly
Clifford W. Taylor
Robert P. Young, Jr.
10 (...continued)
concurrent jurisdiction over the declaratory action.
S T A T E O F M I C H I G A N
SUPREME COURT
YOUNG, J. (concurring).
I concur with the majority because it sets forth a
reasonable interpretation of MCL 600.6419(1), MCL 600.6419(4),
and MCL 600.6419a. However, I write separately to encourage
the Legislature to reexamine these poorly drafted statutes.
It is extremely rare that the meaning of a statute cannot
be plainly or constructively ascertained. If the clear and
unambiguous text does not provide a statute’s meaning, then an
application of the well-established rules of statutory
construction usually resolves any ambiguity. I believe the
statutes conferring jurisdiction on the Court of Claims may
present one of those extremely rare instances where the
meaning of a statute, or set of statutes, cannot be clearly
determined through this process.
While the majority selects a reasonable interpretation of
the Court of Claims statutory authority to resolve this
plaintiff’s complaint,1 a study of MCL 600.6419(1), MCL
600.6419(4), and MCL 600.6419a suggests a host of potential
jurisdictional ambiguities that cannot be easily resolved by
the usual modes of judicial analysis.
Perhaps more important, because the jurisdictional
provisions set forth in the Court of Claims Act are
unquestionably less than clear, it is possible that a future
court may find the jurisdictional reach of the Court of Claims
to be inconsistent with current practice. Because lack of
subject matter jurisdiction is a challenge that can be brought
at any time, even after a case is concluded, the effect of
such an interpretation could prove to be a significant barrier
to finality and thus to the efficient administration of
justice.
Simply put, in my judgment, the statutory scheme enacted
by the Legislature is a textbook example of poor
draftsmanship. Because easily applicable subject matter
jurisdiction guidelines are a basic and necessary prerequisite
1 For example, compare Silverman v Univ of Michigan Bd of
Regents, 445 Mich 209; 516 NW2d 54 (1994), which presents, in
my view, an alternative reasonable construction.
to an efficient judicial system, I strongly encourage the
Legislature to reconsider the jurisdictional provisions in the
Court of Claims Act, MCL 600.6401 et seq., and to make more
clear its intent concerning the scope of the Court of Claims
jurisdiction, including the jurisdictional relationship
between the Court of Claims and our circuit courts.