Case Name: INCH MEMORIALS v. CITY OF PONTIAC
Court: Michigan Court of Appeals
Jurisdiction: Michigan
Decision Date: 1979-11-06
Citations: 93 Mich. App. 532
Docket Number: Docket No. 78-2993
Parties: INCH MEMORIALS v CITY OF PONTIAC
Judges: Before: T. M. Burns, P.J., and M. F. Cavanagh and Mackenzie, JJ.
Reporter: Michigan appeals reports; cases decided in the Michigan Court of Appeals.
Volume: 93
Pages: 532–540

Head Matter:
INCH MEMORIALS v CITY OF PONTIAC
Docket No. 78-2993.
Submitted April 4, 1979, at Detroit.
Decided November 6, 1979.
Leave to appeal applied for.
Plaintiffs, Inch Memorials (a Michigan copartnership) and Michigan Division Monument Builders of North America, Inc., filed suit in the Oakland Circuit Court to prohibit defendant, City of Pontiac, from selling grave markers and memorials for use in its municipal cemeteries in competition with plaintiff Inch and others. Plaintiffs alleged that the sales were beyond the authority of the municipality and that, by failing to charge the four percent sales tax, defendant was engaging in unfair price discrimination resulting in the establishment of an illegal monopoly under the fair trade act. The court, Richard D. Kuhn, J., held that the authority to sell grave markers was implicit within the municipal authority to own and operate cemeteries and that the sales did not constitute unfair competition and denied the request for injunctive relief. Plaintiffs appeal. Held:
1. The provisions of the home rule cities act must be liberally construed in favor of municipalities. The Legislature’s grant of authority to municipalities to acquire, maintain, develop and operate cemeteries and to provide for the cost and expenses thereof should be interpreted to give a home rule city the power to sell grave markers in its own cemeteries.
2. The fair trade act has no application to a municipality which, as an adjunct to its maintenance of a cemetery, sold grave markers without charging sales tax where: 1) there is no evidence of the municipality "combining” with another person in restraint of trade; and, 2) the buyers are not in competition with one another. The four percent differential produced by the nonpayment of sales tax is not so unreasonably great as to render the competition with private sellers unfair.
References for Points in Headnotes
[1, 2] 14 Am Jur, 2d Cemeteries §§ 3, 5.
56 Am Jur 2d, Municipal Corporations, Counties, and Other Political Subdivisions § 126 et seq.
[2, 4] 32 Am Jur 2d, Fair Trade Laws §§ 9, 13.
68 Am Jur 2d, Sales and Use Taxes §§ 43, 118.
[3] 56 Am Jur 2d, Municipal Corporations, Counties, and Other Political Subdivisions §§ 193-195.
[4] 56 Am Jur 2d, Municipal Corporations, Counties, and Other Political Subdivisions § 212.
Affirmed.
Mackenzie, J., dissented. She would hold that the powers of municipal corporations are those 1) granted in express terms, 2) reasonably or fairly implied in or incident to the powers expressly granted, or 3) essential to the accomplishment of the declared objects and purposes of the corporation. Any fair, reasonable or substantial doubt concerning the existence of a power is to be resolved against the corporation. A municipality should not encroach upon the field of private enterprise where the articles provided are not of public necessity and are available from private enterprise. She would reverse.
Opinion of the Court
1. Municipal Corporations — Cemeteries — Sale of Grave Markers.
The provisions of the home rule cities act must be liberally construed in favor of municipalities; the Legislature’s grant of authority to municipalities to acquire, maintain, develop and operate cemeteries and to provide for the cost and expenses thereof should be interpreted to give a home rule city the power to sell grave markers for its own cemeteries (MCL 117.1 et seq.; MSA 5.2071 et seq.).
2. Municipal Corporations — Cemeteries — Sale of Grave Markers — Statutes.
The fair trade act has no application to a municipality which, as an adjunct to its maintenance of a cemetery, sells grave markers without charging sales tax where: 1) there is no evidence of the municipality "combining” with another person in restraint of trade; and, 2) the buyers are not in competition with one another; the four percent differential produced by the nonpayment of sales tax is not so unreasonably great as to render the competition with private sellers unfair (MCL 445.701 et seq.; MSA 28.31 et seq.).
Dissent by Mackenzie, J.
3. Municipal Corporations — Powers of Municipal Corporations.
The powers of municipal corporations are those 1) granted in express terms, 2) necessarily or fairly implied in or incident to the powers expressly granted, or 3) essential to the accomplishment of the declared objects and purposes of the corporation; and fair, reasonable or substantial doubt concerning the existence of a power is to be resolved against the corporation.
4. Municipal Corporations — Municipal Sales — Public Use.
The private sellers of grave markers who are capable of meeting the demand for markers meeting the specifications for placement in a municipal cemetery are entitled to be free from municipal competition; a municipality should not encroach upon the field of private enterprise where the articles provided are not of public necessity and are available from private enterprise.
Bebout, Potere, Cox, Hughes & Cadieux, for plaintiffs.
Rudy J. Nichols, for defendant.
Before: T. M. Burns, P.J., and M. F. Cavanagh and Mackenzie, JJ.

Opinion:
Per Curiam.
Plaintiffs appeal of right a lower court judgment denying them injunctive relief prohibiting defendant from selling grave markers and memorials for use in its own municipal cemeteries. We affirm.
Under the Michigan Constitution a municipal corporation may "acquire, own, establish and maintain" public cemeteries. Const 1963, art 7, § 23. This constitutional authority is not self-executing but requires enabling legislation. Wayne Village President v Wayne Village Clerk, 323 Mich 592; 36 NW2d 157; 8 ALR2d 357 (1949). The necessary statutory authority giving defendant the right to maintain its public cemeteries is found in the home rule cities act. MCL 117.1 et seq.; MSA 5.2071 et seq. In pertinent part, that act states that home rule cities may provide in their charters for the acquisition and operation of cemeteries and for the costs and expenses thereof. MCL 117.4e; MSA 5.2078.
In general, the powers that cities possess fall into three categories: those granted in express words; those necessarily or fairly implied in or incident to the powers expressly granted; and those essential to the accomplishment of the declared objects and purposes of the municipal corporation. Home Owners' Loan Corp v Detroit, 292 Mich 511; 290 NW 888 (1940), Toebe v City of Munising, 282 Mich 1; 275 NW 744 (1937). The power that defendant seeks in this case can be fairly implied from its authority to acquire, maintain, develop and operate its cemeteries and from its authority to provide for the costs and expenses thereof. We find this result supported by several considerations.
First, in accordance with the constitution, Const 1963, art 7, § 34, and with case law, 1426 Woodward Avenue Corp v Wolff, 312 Mich 352, 369; 20 NW2d 217 (1945), the provisions of the home rule cities act must be liberally construed in favor of municipalities. In light of this requirement, the Legislature's grant of authority to municipalities to acquire, maintain, develop and operate cemeteries and to provide for the costs and expenses thereof should be interpreted to give defendant the power to sell grave markers in its own cemeteries. Cf. McIntosh v City of Muskegon, 88 Mich App 30; 276 NW2d 510 (1979).
We also note that the primary reason that defendant sells grave markers is to help finance its cemetery operations. In Wetherby v City of Jackson, 264 Mich 146, 151; 249 NW 484 (1933), the Supreme Court stated that such a reason would support an otherwise valid municipal regulation of a cemetery:
"The rule prohibiting the erection of the tents of private funeral directors for use at funerals and compelling the use of the tents of the city or of the cemetery board is a condition attached to the exercise of the right of burial, and may be justified under the police power which has to consider rights of other lot owners and those where burial is to take place, and may be justified upon the ground of public revenue for the care, support, and maintenance and ornamentation of the cemetery itself." (Emphasis supplied)
In sum, we hold that the power to sell grave markers is reasonably related to the authority given defendant over its cemeteries.
Plaintiffs also argue that by failing to charge sales tax on the monuments that it sells, defendant has engaged in unfair price discrimination resulting in the establishment of an illegal monopoly under the fair trade act, MCL 445.701 et seq.; MSA 28.31 et seq. We find this argument unpersuasive.
The fair trade act has no application to the instant case. There is no evidence that defendant has engaged in an illegal "combination" with another person in restraint of trade. MCL 445.701; MSA 28.31. Further, because defendant's buyers are not in competition with one another, defendant cannot be said to have unfairly bestowed a competitive advantage upon one of its buyers to the disadvantage of that buyer's competitors. Finally, the 4% differential produced by the nonpayment of sales tax is not so unreasonably great as to render defendant's competition unfair and there is no evidence that defendant ever entertained the intent to "destroy" or "eliminate" private monument dealers in Pontiac.
Affirmed. No costs, a public question being involved.