Case Name: MILLER v. DEPARTMENT OF TREASURY, REVENUE DIVISION
Court: Michigan Supreme Court
Jurisdiction: Michigan
Decision Date: 1971-07-07
Citations: 385 Mich. 296
Docket Number: No. 20; Docket No. 52,529; No. 34
Parties: MILLER v. DEPARTMENT OF TREASURY, REVENUE DIVISION
Judges: T. M. Kavanagh, C. J., and Black and Swainson, JJ., concurred with Adams, J.
Reporter: Michigan Reports
Volume: 385
Pages: 296–337

Head Matter:
MILLER v. DEPARTMENT OF TREASURY, REVENUE DIVISION
Opinion op the Court
1. Mental Health — Charge por Care — Hospitals—Statutes.
Pursuant to statute, 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 and the amount is fixed at the beginning of each fiscal year (MCLA § 330.41).
2. Mental Health — Charge por Care — Hospitals—Liability op Belatives.
It is clear the legislature intended that the “net taxable income” to be used in originally determining the monthly liability of relatives is the same amount prescribed in the statute for determining liability for future fiscal years for the care and maintenance of mentally retarded and epileptic persons and mentally ill children admitted to public institutions (MCLA §§ 330.658, 330.659).
Beperences for Points in Headnotes
[1] 40 Am Jur 2d, Hospitals and Asylums § 6.
41 Am Jur 2d, Incompetent Persons § 55.
2, 3, 8, 16, 19, 21, 27] 41 Am Jur 2d, Incompetent Persons § 59.
3] 16 Am Jur 2d, Constitutional Law § 560 et seq.
4] 50 Am Jur, Statutes §§ 36-39, 215.
5] 16 Am Jur 2d, Constitutional Law § § 211, 240.
6, 7, 9,10,13,15,16] 16 Am Jur 2d, Constitutional Law § 240 it seq.
8,11] 16 Am Jur 2d, Constitutional Law §§ 240, 242.
12] 16 Am Jur 2d, Constitutional Law §§ 242, 245.
14] 16 Am Jur 2d, Constitutional Law § 245.
17] 16 Am Jur 2d, Constitutional Law § 485 et seq.
18] 50 Am Jur, Statutes §§ 377, 378.
20, 21] 16 Am Jur 2d, Constitutional Law § 502.
22, 23] 16 Am Jur 2d, Constitutional Law § 485 et seq.
41 Am Jur 2d, Incompetent Persons § 59.
24] 16 Am Jur 2d, Constitutional Law §§ 560-568.
25’ 16 Am Jur 2d, Constitutional Law §§ 569-577.
26] 4 Am Jur 2d, Appeal and Error § 2
16 Am Jur 2d, Constitutional Law § 584.
16 Am Jur 2d, Constitutional Law §§ 583, 584.
3. Statutes — Mental Health — Public Institutions — Payment por Care — Liability op Relatives — Notice—Hearing—Standards.
The statute relating to the liability of relatives for the care and maintenance of mentally retarded and epileptic persons and mentally ill children admitted to public institutions and authorizing a responsible relative to request at any time a new determination of liability by the Department of Revenue is glaringly deficient in that: (1) no provision is made for notice of hearing, (2) there is no statutory designation of a hearing officer or examiner to make a determination either from evidence or the submitted information, (3) it contains no legal requirements or provisions to be applied to the facts by the Department of Revenue in redetermining liability, (4) it operates with an uncontrolled discretion, and (5) there are no legislative standards or guidelines for the exercise of the rule-making power (MCLA § 330.660).
Dissenting Opinion
T. E. Brennan, T. G. Kavanagh, and Williams, JJ.
4. Statutes — Incorporation by Reperence — Federal Law — Constitutional Law.
Incorporation by reference of an existing Federal law in a state statute does not render that statute constitutionally infirm.
5. Constitutional Law — Legislative Power — Non-Delegation Doctrine — Judicial Interpretation.
Although neither the Federal Constitution nor any state constitution explicitly provides that the legislative' power cannot be delegated, the non-delegation doctrine has been written into our constitutions by judicial interpretation.
6. Constitutional Law — Delegation op Legislative Power.
Judicial invalidation of legislative delegations must ultimately be attentive to the important distinctions as to that power which is exclusively legislative and thus non-delegable and should be assessed in terms of the practical needs of effective government.
7. Statutes — Delegation op Legislative Power — Legislative Will —Constitutional Law.
The substance of the legislation as embodying a complete ex pression of the legislative will is the resolvent of the question of delegation of legislative power and not the form of the legislative action or the nature of the contingency in question.
8. Statutes — Mental Health — Retarded Persons — Payment for Care — -Liability of Relatives — Federal Law — Delegation of Legislative Power.
Statute determining monthly liability of a responsible relative of a mentally retarded person admitted to a public institution by incorporating future Federal income tax legislation constituted a permissible delegation of legislative power since it was a means of effectuating a legislative plan, a controlling judgment made by that body, and was made for convenience to the taxpayer and simplicity of administration (MCLA § 330-.651 et seq.).
9. Administrative Law- — -Delegated Legislative Authority — Arbitrariness — Federal Statutes.
A prominent reason for invalidation of legislative authority delegated to an administrative body — to protect against arbitrariness — is largely inapplicable when the legislative intent is to incorporate future Federal statutes.
10. Constitutional Law — Delegated Legislative Authority — Legislature — Statutes—Regulations.
Decisive on the question of improper delegation of legislative authority is a conideration of whether, in the light of the practicalities of the situation, the legislature has in fact abdicated its powers, or has instead exercised its controlling judgment and, in pursuance of its adopted policy, chosen to refer to other acts or regulations.
11. Mental Health — Public Institutions — Retarded Persons— Payment for Care — Liability of Relatives — Federal Income Tax — Probate Courts — Legislative Powers.
No abdication of legislative powers is found in the legislation in which the legislature has chosen to determine the monthly liability of a responsible relative for mentally retarded persons admitted to a public institution, as the ultimate and controlling policy decisions were dictated by the legislature by determining, upon its own reasons and sole responsibility, the necessity for uniformity across the state for the support of those persons; the desirability of attaching liability to certain designated responsible relatives; and the expediency of determining in the first instance the controlling standard of “ability to pay” by a specified percentage of a relative’s net taxable income figure as disclosed on the last Federal income tax return, subject to redetermination by the probate court (MCLA § 330.651 et seq.).
12. Constitutional Law — Legislature—Legislative Power — Internal Revenue Code.
It is wholly unrealistic to contend that the legislature, in choosing to use an income figure which would reflect prospective changes in the complex provisions of the Federal Internal Revenue Code, “abdicated” its legislative power i/n favor of the Federal Congress; as there was, rather, an exercising of legislative power coupled with a permissible delegation to, in a sense, “fill up the details” of the broad policy of the statute requiring certain relatives to pay for the support of a mentally retarded person admitted to a public institution (MCLA § 330-.651 et seq.).
13. Statutes — Delegated Legislative Authority — Administrative Law — Congress.
Delegation to an administrative agency with a charge “fill up details” is true delegation of legislative power because the agency is expected to “legislate” within the bounds of the legislative guidelines established, while “delegation” to the Federal Congress is different in that there ■ is no “filling up details” in the sense that the Congress is in any way charged with the responsibility of carrying out Michigan legislative policy.
14. Constitutional Law — Legislature—Federal Internal Revenue Code — Net Taxable Income.
The legislative decision to accept future changes of the definition of net taxable income in the Federal Internal Revenue Code, “sight unseen”, is a reasonable decision in light of the existing scheme of that code and the improbability that any substantial change in the theory and substance of the congressional concept of net taxable income will come to pass without ample opportunity for Michigan legislative action to effect a timely dissolution of the partnership of the state and Federal statutes (MCLA § 330.651 et seq.).
15. Statutes — Foreign Legislation — Incorporation by Reference —Constitutional Law — Delegation of Legislative Power.
A statute which prospectively recognises future amendments to existing foreign legislation incorporated by reference in the statute does not constitute an unconstitutional delegation of legislative power where the prospective recognition is only incidental to the administration of the statute and where the prospective recognition constitutes a legislative policy decision that continuing uniformity with the foreign legislation is desirable and not likely to frustrate the purpose of the statute.
16. Constitutional Law — Delegated Legislative Power — Mental Health — Public Institutions — Retarded Persons — Payment for Care — Liability op Relatives — Federal Internal Revenue Code.
The prospective legislative recognition of future amendments to the Federal Internal Bevenue Code as a part of the overall scheme of the statute which requires certain relatives to reimburse the state for the maintenance and care of mentally retarded persons admitted to public institutions and provides that the amount of monthly liability of a responsible relative is to be originally determined by the use of a schedule which associates a monthly liability with the relative’s net taxable income appearing on a submitted Federal income tax return is a constitutional delegation of legislative power (MCLA § 330.651 et seq.).
17. Constitutional Law — Equal Protection.
Identical standards regarding equal protection of the laws are applicable to both the Federal and our state Constitutions.
18. Statutes — Reasonableness of Classification.
The reasonableness of a given statutory classification is to be examined with reference to the purpose for which the statute was enacted.
19. Mental Health — Public Institutions — Retarded Persons— Payment for Care — Liability op Relatives — Statutes—Purpose.
The purpose of the act requiring relatives to reimburse the state for the maintenance and care of mentally retarded persons admitted to public institutions is to charge those of sufficient ability to reimburse the state in a reasonable manner (MCLA § 330.651 et seq.).
20. Statutes — Constitutional Law — Classification—Arbitrary Classification.
The finding that a given classification could, in certain limited instances, operate without complete uniformity and not fulfill the purpose for which a statute was enacted is not in itself dis-positive of the question of its constitutionality, since reason ableness of legislative classification is not dependent on complete equality of the chosen standard and the existence of minor inequalities over a class does not amount to arbitrariness - in the classification.
21. Mental Health — Constitutional Law — Public Institutions— Retarded Persons — Payment por Care — Liability op Relatives —Equal Protection.
The mere possibility that a few wealthy citizens could, availing themselves of the economic incentive provisions of the Internal Revenue Code, reduce their net taxable income thus understating their ability to pay for purpose of reimbursement under the statute requiring relatives to reimburse the state in part for the maintenance and care of mentally retarded persons admitted to public institutions does not render the criterion selected arbitrary and violative of equal protection (MCLA § 330.651 et seq.).
22. Mental Health — Public Institutions — Retarded Persons— Redetermination op Liability — Constitutional Law — Equal Protection.
A finding that there is no denial of equal protection of the laws, in the provisions of the act requiring relatives to reimburse the state for the maintenance and care of mentally retarded persons admitted to public institutions, is supported by the factor that any inequality resulting from the original determination of liability could be minimized by the redetermination expressly provided for in that act (MCLA § 330.651 et seq.).
23. Mental Health — Public Institutions — Retarded Persons— Liability op Relatives — Constitutional Law — Equal Protection.
The act requiring certain relatives to reimburse the state for the maintenance and care of mentally retarded persons admitted to public institutions satisfies the minimum constitutional requirements of equal protection since it produces generally fair results and establishes a classification which bears a reasonable relationship to the object of the enacted legislation (MCLA § 330.651 et seq.).
24. Administrative Law — Hearing—Constitutional Law — Due Process — Property Rights.
Absence of notice and a hearing before an administrative agency prior to a determination of liability by that agency does not contravene constitutional due process requirements when property rights are involved.
25. Administrative Law — Hearing—Review—Due Process.
Allowing a hearing before the making of an administrative determination is not essential if thereafter there is adequate opportunity for administrative or judicial review.
26. Mental Health — Public Institutions — Retarded Persons— Payment eor Care — Liability op Relatives — Probate Court — ■ Appeal and Error — Trial De Novo.
Since the probate court is not in any sense an appellate court, the word “appeal” as used in the statute requiring relatives to reimburse the state for the maintenance and care of mentally retarded persons admitted to public institutions means a trial de novo in the probate court (MOLA § 330.660).
27. Mental Health — Retarded Persons — Payment por Care— Liability op Relatives — Statutes—Administrative Law — Judicial Review — Due Process.
The statute requiring relatives to reimburse the state for the maintenance and care of mentally retarded persons admitted to public institutions makes ample provision for judicial review of the initial administrative determination of liability and the availability of such review cures the initial denial of an administrative hearing and satisfies procedural due process requirements (MOLA § 330.651 et seq.).
Appeal from Court of Appeals, Division 1, Lesinski, C. J., and Holbrook and Levin, JJ., affirming Wayne, Carl M. Weideman, J.
Submitted March 10, 1970.
(No. 20
January Term 1970,
Docket No. 52,529.)
Resubmitted June 22, 1971.
(No. 34
June Term 1971, Docket No. 52,529.)
Decided July 7, 1971.
18 Mich App 145 affirmed.
Complaint by Donald A. Miller and Geraldine B. Miller against the State of Michigan, Department of Revenue, for a determination that Act 335 of the Public Acts of 1965, regarding the liability of rela tives for the care and maintenance of mentally retarded persons in public institutions, is unconstitutional and for an injunction to prevent its enforcement. Summary judgment for plaintiffs. Defendant appealed to Court of Appeals. Affirmed. Defendant appeals.
Affirmed.
Donald A. Miller, for plaintiffs.
Frank J. Kelley, Attorney General, Robert A. Derengoski, Solicitor General, and William D. Dexter, Richard Roesch, and James R. Saunders, Assistant Attorneys General, for defendant.
Amicus Curiae: Michigan Association of Retarded Children by Strom & Hoehn (Thomas L. Dutch, of counsel).

Opinion:
Adams, J.
A summary judgment of unconstitutionality of PA 1965, No 335, was entered by the circuit judge on December 11, 1967. Then, as now, admission to a state mental institution might result from a court-ordered commitment 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, 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. 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 provi sions 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.
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.
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.
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]).
MCLA § 330.21 (Stat Ann 1969 Rev § 14.811) has been amended by PA 1969, No 110, PA 1970, No 69, and PA 1970, No 210.—Re-porter.
MCLA § 330.41 (Stat Ann 1969 Rev § 14.831).
The fiscal year of the State commences on July first and closes on June thirtieth. MCLA § 21.91 (Stat Ann 1969 Rev § 3.561).
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."