Universal Am-Can Ltd. v. Attorney General

494 N.W.2d 787, 197 Mich. App. 34
CourtMichigan Court of Appeals
DecidedNovember 17, 1992
DocketDocket 127145
StatusPublished
Cited by20 cases

This text of 494 N.W.2d 787 (Universal Am-Can Ltd. v. Attorney General) is published on Counsel Stack Legal Research, covering Michigan Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Universal Am-Can Ltd. v. Attorney General, 494 N.W.2d 787, 197 Mich. App. 34 (Mich. Ct. App. 1992).

Opinion

Connor, J.

The trial court granted defendants’ motion for summary disposition, MCR 2.116(C)(4) and (7), in its order of January 19, 1990. Plaintiff appeals as of right from that order. We reverse the trial court’s decision and remand this matter to the trial court for additional proceedings.

Plaintiff is a common and contract motor carrier with its principal place of business in Sterling Heights, Michigan. Plaintiff operates primarily in interstate commerce, with only 4.8 percent of its 1988 revenues being generated from intrastate operations in Michigan. It is plaintiff’s custom and practice to enter into contracts with independent contractors to provide leased equipment and driving services.

*36 Section 10a(6) of the Motor Carrier Act, MCL 479.10a(6); MSA 22.575(1)(6), requires intrastate motor carriers to operate only with direct employees, rather than with independent contractors. The Public Service Commission sent written notices informing plaintiff that it was not permitted to utilize independent contractors to operate leased equipment, and advising plaintiff to bring its intrastate leases into compliance with the statute. The psc refused to allow plaintiff to add equipment to its intrastate operations and refused to grant the decals necessary for intrastate operation until plaintiff complied with § 10a(6).

Plaintiff filed a complaint in the Macomb Circuit Court, requesting a preliminary injunction, a permanent injunction, a declaratory judgment, and a writ of mandamus against defendants. Plaintiff contended that the psc’s application of § 10a(6), which denied plaintiff, a carrier primarily engaged in interstate commerce, the right to intrastate decals and the use of additional equipment, was in violation of the Commerce Clause of the United States Constitution. US Const, Art I, § 8. Plaintiff argued that federal regulations allow interstate carriers to operate leased equipment with independent contractors, and claimed that its intrastate business was only incidental to its general business of interstate commerce. Plaintiff contends that § 10a(6) violates the Commerce Clause because it subjects plaintiff to inconsistent regulations and unduly burdens interstate commerce. Plaintiff requested a declaratory ruling from the circuit court that § 10a(6) was unconstitutional. Among the other requested relief, plaintiff asked that the psc be forced to apply this section in a manner consistent with the federal constitution.

Defendants moved for summary disposition of the complaint. The trial court found that it did not *37 have subject-matter jurisdiction over plaintiffs challenges to the actions by the psc and that plaintiff had failed to exhaust reasonable and available administrative remedies. The trial court granted summary disposition, and plaintiffs complaint was dismissed with prejudice. We believe both parts of the trial court’s ruling were erroneous.

Whether a court has subject-matter jurisdiction is a question of law. Dep’t of Natural Resources v Holloway Construction Co, 191 Mich App 704, 705; 478 NW2d 677 (1991). The burden is on the plaintiff to establish jurisdiction. Gooley v Jefferson Beach Marina, Inc, 177 Mich App 26, 28; 441 NW2d 21 (1989). As a court of general equity jurisdiction, the circuit court had subject-matter jurisdiction to issue a declaratory ruling, an injunction, or a writ of mandamus. Const 1963, art 6, §13; MCL 600.605; MSA 27A.605; Consumers Power Co v Public Service Comm, 415 Mich 134, 144; 327 NW2d 875 (1982); State ex rel Ingham Co Prosecutor v American Amusement Co, Inc, 71 Mich App 130, 135; 246 NW2d 684 (1976). However, where the Legislature intended to make an administrative tribunal’s jurisdiction exclusive, a circuit court cannot exercise jurisdiction over those same areas. MCL 600.605; MSA 27A.605; Wikman v Novi, 413 Mich 617, 646-647; 322 NW2d 103 (1982).

The psc’s jurisdiction is limited to regulating motor carriers involved in intrastate commerce, MCL 460.6(1); MSA 22.13(6X1). While the psc has jurisdiction over the enforcement of the Motor Carrier Act, it has generally been held that an agency that exercises quasi-judicial authority does not possess the power to determine the constitutionality of statutes. Wikman, supra, pp 646-647; Eyde v Lansing Twp, 420 Mich 287, 292; 363 *38 NW2d 277 (1984); Dation v Ford Motor Co, 314 Mich 152, 159-160; 22 NW2d 252 (1946). The circuit court retains jurisdiction to consider certain constitutional issues related to the validity of laws. Johnston v Livonia, 177 Mich App 200, 204-205; 441 NW2d 41 (1989). However, if the agency is merely asked to resolve issues couched in constitutional terms that do not involve the validity of a statute, it has jurisdiction to do so. Id.

In the case at bar, plaintiff’s entitlement to the relief requested was dependent upon a ruling that § 10a(6), as applied to interstate motor carriers, was unconstitutional under the Commerce Clause. Plaintiff was directly challenging the constitutionality of the statute and not merely couching the complaint in constitutional terms. We find that the trial court erred in determining that it lacked subject-matter jurisdiction. See also Plymouth Twp v Wayne Co Bd of Comm’rs, 137 Mich App 738, 747-748; 359 NW2d 547 (1984).

While it was possible for plaintiff to have first pursued any remedies it may have had before the psc, both judicial economy and the interests of justice supported plaintiff’s actions in filing a complaint in the circuit court for declaratory relief. Plaintiff claimed that the psc lacked statutory authority to regulate it because its primary business as an interstate carrier fell outside the parameters of the powers granted by the Legislature to the psc over intrastate carriers. Plaintiff’s pursuit of its administrative remedies would have been futile; therefore, the failure to do so is excusable. Generou v Kalamazoo Regional Psychiatric Hosp, 192 Mich App 295, 305; 480 NW2d 638 (1991). When the controlling issue involves a constitutional right, the exhaustion doctrine does not apply. Dickerson v Warden, Marquette Prison, 99 Mich App 630, 641; 298 NW2d 841 (1980). Com *39 pare Jones v Dep’t of Corrections, 185 Mich App 134, 138; 460 NW2d 575 (1990); O’Keefe v Dep’t of Social Services, 162 Mich App 498, 505-506; 413 NW2d 32 (1987).

We also believe that the doctrine of primary jurisdiction does not apply because the agency’s statutory authority and the constitutionality of § 10a(6) were issues that did not require the agency’s special expertise or fact-finding skills. Attorney General v Diamond Mortgage Co, 414 Mich 603, 613; 327 NW2d 805 (1982); Int’l Business Machines Corp v Dep’t of Treasury, 75 Mich App 604, 610; 255 NW2d 702 (1977). Therefore, there was no need for the circuit court to defer to the psc’s jurisdiction.

We are satisfied that the remainder of defendants’ arguments do not support the trial court’s ruling.

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Bluebook (online)
494 N.W.2d 787, 197 Mich. App. 34, Counsel Stack Legal Research, https://law.counselstack.com/opinion/universal-am-can-ltd-v-attorney-general-michctapp-1992.