Title: DANSE CORP V CITY OF MADISON HEIGHTS
Citation: N/A
Docket Number: 119011
State: Michigan
Issuer: Michigan Supreme Court
Date: May 29, 2002

____________________________________________________________________________________________ 
____________________________________________________________________________________________________________________________ 
________________________________ 
 
Michigan Supreme Court 
Lansing, Michigan 48909 
C hief Justice 
Justices 
Maura D. Corrigan  
Michael F. Cavanagh 
Elizabeth A. Weaver 
Marilyn Kelly 
Clifford W. Taylor 
Robert P. Young, Jr. 
Opinion 
Stephen J. Markman 
FILED MAY 29, 2002  
DANSE CORPORATION,  
Petitioner-Appellant,  
v  
No. 119011  
CITY OF MADISON HEIGHTS,  
Respondent-Appellee.  
PER CURIAM  
The Michigan Tax Tribunal entered a judgment, holding  
that 
certain 
personal property belonging to petitioner did not  
constitute “special tools” and was therefore subject to  
taxation.  On appeal, petitioner argued that guidelines  
utilized by the Tax Tribunal were not determinative, since  
they were not rules promulgated in accordance with the  
Administrative Procedures Act.1
 The Court of Appeals  
affirmed.2  We reverse the judgments of the Tax Tribunal and  
1 MCL 24.201 et seq.  
2 Unpublished opinion per curiam, issued March 23, 2001 
(Docket No. 215486).  
Court of Appeals because the guidelines relied on to expand  
the definition of “special tools” did not have the force of  
law as they were not promulgated under the APA.  We remand  
this case to the Tax Tribunal for reconsideration in light of  
this opinion.  
I  
Petitioner manufactures roof line ridge vents for  
residential construction.  In that process it uses plastic  
injection molds and related components.  It excluded the molds  
from 
personal 
property statements and, as required, noted that  
fact on the personal property statements it filed.  A personal  
property audit was performed, and respondent subsequently  
notified the State Tax Commission that personal property  
allegedly subject to taxation had not been included on  
petitioner’s 1994 and 1995 personal property statements and  
sought an increase in the assessment valuation.  The State Tax  
Commission held that the molds were not exempt “special tools”  
within the meaning of MCL 211.9b and corrected increased  
assessment valuations were approved.  Petitioner filed an  
appeal with the Michigan Tax Tribunal. After an evidentiary  
hearing, the Tax Tribunal held that petitioner was not  
entitled to a MCL 211.9b exemption for the molds.  It found  
that the Legislature intended to allow the State Tax  
Commission to define what “special tools” meant.  
2  
  
 
 
The Court of Appeals, with one judge dissenting,  
affirmed. Petitioner has applied for leave to appeal.3  
II  
Issues concerning the interpretation and application of  
statutes are questions of law that this Court decides de novo.  
Lincoln v General Motors Corp, 461 Mich 483, 489-490; 607 NW2d  
73 (2000).  In Michigan Bell Telephone Co v Treasury Dep’t,  
445 Mich 470, 476; 518 NW2d 808 (1994), we noted that, in the  
absence of fraud, review of a Tax Tribunal decision is  
“limited 
to 
determining whether the tribunal erred in applying  
the law or adopted a wrong principle[.]” “[F]actual findings  
are conclusive if supported by competent, material, and  
substantial evidence on the whole record.” Id.  
III  
MCL 211.9b provides:  
(1) 
All 
special 
tools 
are 
exempt 
from  
taxation.  
(2) As used in this section, “special tools” 
means those manufacturing requisites, such as dies, 
jigs, fixtures, molds, patterns, gauges, or other 
tools, as defined by the state tax commission, that 
are held for use and not for sale in the ordinary 
course of business.  
(3) Special tools are not exempt from taxation 
if the value of the special tools is included in 
the valuation of inventory produced for sale. 
[Emphasis added.]  
3 The motion to file a brief amicus curiae is granted.  
3  
 
The State Tax Commission has adopted a rule defining  
“special tools.”4  What is commonly referred to as rule 21  
provides:  
“Special tools” as used in section 9b of the 
act, means those finished or unfinished devices, 
such as dies, jigs, fixtures, molds, patterns, and 
special gauges, used or being prepared for use in 
the manufacturing function for which they are 
designed or are acquired or made for the production 
of products or models and are of such specialized 
nature that their utility and amortization cease 
with the discontinuance of such products or models.  
Pursuant 
to 
MCL 
211.10e, 
assessing 
officials 
are 
required  
to use an assessor’s manual prepared by the State Tax  
Commission “as a guide in preparing assessments.”  The Tax  
Tribunal utilized seven guidelines from the State Tax  
Commission Assessor’s Manual in reaching the determination  
that the plastic injection molds were not “special tools”5  
4 1999 AC, R 209.21.  
5 Chapter 15 of the Assessor’s Manual, entitled “Personal 
Property” states at pp 15-6 and 15-7:  
The following guidelines should be used by the 
assessor when making the determination of whether a 
particular device is a special tool.  
1. 
Special tools include devices such as 
dies, jigs, fixtures, molds, patterns and gauges. 
Special tools do not include devices which differ 
in nature from dies, jigs, fixtures, molds, 
patterns, and gauges. Thus the press into which a 
die is placed is not a special tool.  
2. 
Special tools are specially designed to 
produce a particular product and could not be used 
to produce a different product.  
4  
 
 
and therefore were not exempt from personal property tax under  
MCL 211.9b. 
In determining that the Assessor’s Manual  
guidelines were applicable, the Tax Tribunal stated in part:  
The 
State 
Tax 
Commission 
(STC) 
further  
provided seven guidelines to determine whether a 
“particular device is a special tool” based on that 
tool’s 
purpose, 
“utility 
and 
amortization.”  
Although these guidelines are clarifications of its 
Rule 21 general definition and not promulgated 
rules, this Tribunal must look at the Legislature’s 
intent of allowing the State Tax Commission to not 
only define what a special tool is, but to further 
allow the STC to clarify how to recognize a special 
tool when an assessor sees it and the “utility and  
3. 
Special tools are used to produce models 
or products which are expected to change. Thus, a 
die used to produce a car fender is likely a 
special tool because the fender will predictably 
change, whereas a mold used in the manufacture of a 
common wrench will not change for many years and is 
not a special tool.  
4. 
Special tools frequently become obsolete 
before they wear out and therefore have a short 
useful life.  
5. 
Models or products produced by special  
tools are usually expected to change within 3  
years.  
6. 
A die, jig, etc., may have a short life  
simply because it wears out fast rather than  
because it is used to produce a model.  In this  
case the tool would not be exempt as a special 
tool.  
7. 
The term “amortization” used by the State 
Tax Commission in its definition of special tools 
refers to the writing off of an expenditure over a 
certain period of time. 
This reference to  
amortization in the definition of special tools is 
more of a descriptive aid than a condition that 
must be met.  
5  
 
amortization” of that special tool.  
The Court of Appeals majority agreed that the factors  
from the Assessor’s Manual were determinative. 
The Court  
relied on MCL 211.10e, which provides:  
All assessing officials, whose duty it is to 
assess real or personal property on which real or 
personal property taxes are levied by any taxing 
unit of the state, shall use only the official 
assessor’s manual or any manual approved by the 
state tax commission, consistent with the official 
assessor’s manual, with their latest supplements, 
as prepared or approved by the state tax commission 
as a guide in preparing assessments.  Beginning 
with the tax assessing year 1978, all assessing 
officials shall maintain records relevant to the  
assessments, including appraisal record cards, 
personal property records, historical assessment 
data, tax maps, and land value maps consistent with 
standards set forth in the assessor’s manual  
published by the state tax commission.  
It also relied on OAG, 1981-1982, No. 5,909, p 207  
(May 20, 1981).  It further noted that exemption statutes are  
to be strictly construed in favor of the taxing unit and that  
a prior decision of that Court appeared to accept a definition  
of “special tools” that included a factor from the guidelines.  
The dissenting judge would have held that the Assessor’s  
Manual did not have legal authority because it was not  
promulgated as an administrative rule and thus could not  
impose additional requirements to meet the definition of  
“special tools” beyond that contained in rule 21.  The  
dissenting judge would have held that the plastic injection  
molds were “special tools” as defined by rule 21 and that,  
6  
 
 
  
 
  
  
therefore, 
petitioner 
was 
entitled 
to 
the 
statutory 
exemption.  
IV  
In order for an agency regulation, statement, standard,  
policy, ruling, or instruction of general applicability to  
have the force of law, it must fall under the definition of a  
properly promulgated rule.  If it does not, it is merely  
explanatory. Goins v Greenfield Jeep Eagle, 449 Mich 1, 7-10;  
534 NW2d 467 (1995). As the Tax Tribunal noted, rule 21 was  
properly promulgated under the APA, and therefore has the  
force of law.  
However, it is undisputed that the Assessor’s Manual was  
not promulgated as an administrative rule.  Therefore, the  
manual may be used as a “guide,” but does not itself have the  
force of law.  The portion referred to can only be used to  
explain rule 21; it cannot impose requirements not found in  
rule 21 to meet the definition of “special tools.”  Thus, for  
petitioner to have a valid exemption under MCL 211.9b, the  
molds at issue need only meet the requirements of rule 21.  
MCL 221.10e does not exempt the Assessor’s Manual from  
APA 
promulgation 
requirements. 
The 
rules 
governing  
construction of a statute are well known.  Giving effect to  
the intent of the Legislature is a fundamental task. We are  
required to examine the plain language of the involved  
statutes. In re MCI Telecommunications, 460 Mich 396, 411;  
7  
 
  
596 NW2d 164 (1999). 
Where the statutory language is  
unambiguous, the plain meaning reflects the Legislature’s  
intent and the statute must be applied as written.  Tryc v  
Michigan Veterans’ Facility, 451 Mich 129, 135; 545 NW2d 642  
(1996).  No further construction is necessary or allowed to  
expand what the Legislature clearly intended to cover.  In re  
MCI, supra at 411. The court must presume that every word has  
some meaning and, if possible, effect should be given to each  
provision. People v Borchard-Ruhland, 460 Mich 278, 285; 597  
NW2d 1 (1999).  
Following these principles of statutory construction, we  
conclude that the plain language of MCL 211.10e demonstrates  
a legislative intent that the Assessor’s Manual is to be used  
“as a guide.”  It cannot be concluded from a plain reading of  
the statute that the Legislature intended that the State Tax  
Commission was entitled to bypass the APA and promulgate the  
Assessor’s Manual as a rule having the force of law.  The  
mandatory “shall” language in MCL 211.10e refers to the  
requirement that assessors use the Assessor’s Manual as a  
guide.  The statute was apparently enacted in order to create  
uniformity among appraisal techniques.  See OAG, supra at  
207.6  
6 We note that this Opinion of the Attorney General was 
cited by defendant as authority that the manual has the force 
of law.  However, a closer reading of the OAG reveals that the  
8  
 
Likewise, MCL 211.9b does not provide the authority for  
a conclusion that the Legislature intended that the State Tax  
Commission could bypass the promulgation requirements of the  
APA. We quote that statute again:  
(1) 
All special 
tools 
are 
exempt 
from  
taxation. 
 
(2) As used in this section, “special tools” 
means those manufacturing requisites, such as dies, 
jigs, fixtures, molds, patterns, gauges, or other 
tools, as defined by the state tax commission, that 
are held for use and not for sale in the ordinary 
course of business.  
(3) Special tools are not exempt from taxation 
if the value of the special tools is included in 
the valuation of inventory produced for sale. 
[Emphasis added.][7]  
Attorney General concluded that the manual is not subject to 
the promulgation rules of the APA because they are not rules. 
As a result, local assessors could be forced to use the manual 
as a guide.  Contrary to defendant’s assertion, this does not 
mean that the Attorney General opined that the manual has the 
force of law.  In any event, opinions of the Attorney General  
are not binding on courts as precedent. Frey v Dep't of  
Management & Budget, 429 Mich 315, 338; 414 NW2d 873 (1987). 
Indeed, the extent to which a governmental agency is even 
bound by an opinion of the  Attorney General is open to  
question. Compare East Grand Rapids Sch Dist v Kent Co, 415 
Mich 381, 394; 330 NW2d 7 (1982) (a state agency is not bound 
by 
an 
Attorney 
General 
opinion 
that 
a 
statute 
is  
unconstitutional), and Traverse City Sch Dist v Attorney  
General, 384 Mich 390, 410, n 2; 185 NW2d 9 (1971) (an opinion  
of the Attorney General commands allegiance of state  
agencies).  
7 
 While the rule-making authority of the State Tax 
Commission may more precisely be characterized as an  
administrative or executive branch function, it is clear  
nonetheless that the resemblance of this authority to  
traditional “law-making” has prompted the Legislature’s 
requirement that such authority be exercised only in  
9  
 
 
 
The phrase “as defined by the state tax commission” does  
not, by itself, allow the State Tax Commission to define  
“special tools” without complying with the APA. 
The  
Legislature has prescribed an elaborate procedure for rule  
promulgation in order to “ensure that none of the essential  
functions of the legislative process are lost in the course of  
the performance by agencies of many law-making functions once  
performed by [the Legislature].” Coalition for Human Rights  
v DSS, 431 Mich 172, 177-178; 428 NW2d 335 (1988).  “[T]he  
adoption of a rule by an agency has the force and effect of  
law and may have serious consequences . . . for many people.”  
Id. at 177.  
There is no indication the Legislature authorized the  
State Tax Commission to adopt a rule-like definition using a  
procedure other than that required by the APA. We will not  
attribute such an intent to the Legislature absent a clear  
statement from the Legislature.  Therefore, without a clear  
legislative intent to waive the requirements of the APA, we  
will not sanction state agency “law-making” in the absence of  
the 
legislatively 
designed 
protections 
of 
the 
APA.  
Accordingly, MCL 211.10e cannot be said to have created an  
exemption from the requirements of the APA for the Assessor’s  
Manual.  
conformity with the APA.  
10  
 
 
Having concluded that rule 21 governs, we now apply to it  
the same rules of statutory construction.  As with a statute,  
we are governed by its plain language.  We agree with the  
Court of Appeals dissenting judge’s reading of rule 21 as  
establishing two requirements for qualification for the  
special tools exemption.  First, the special tool must be  
“used” or be “being prepared for use” in a manufacturing  
function.  It is undisputed that the molds here meet this  
requirement.  Second, the special tools must be of “such a  
specialized nature that their utility and amortization cease  
with the discontinuance of such products or models.”  The Tax  
Tribunal and Court of Appeals opined that there also is a  
short useful life requirement. 
The Assessor’s Manual  
guidelines contain such a requirement, but the plain language  
of rule 21 does not allow that construction.  There is nothing  
in rule 21 suggesting that a proposed special tool have a  
short useful life. As the dissenting judge in the Court of  
Appeals noted, rule 21 only addresses whether the tool will  
have usefulness after the product or model is discontinued.  
In the words of rule 21, the question is whether the molds’  
“utility and amortization cease with the discontinuance of  
such products or models.”  There is no other time condition.8  
8 Univ Microfilms v Scio Twp, 76 Mich App 616; 257 NW2d 
265 (1977), is not persuasive. 
As pointed out by the 
dissenting judge in the Court of Appeals, it is not clear what  
11  
 
 
 
 
Accordingly, 
we 
reverse the judgments of the Tax Tribunal  
and Court of Appeals and remand this matter to the Tax  
Tribunal for reconsideration in light of this opinion.  MCR  
7.302(F)(1).  
CORRIGAN, C.J., and WEAVER, TAYLOR, YOUNG, and MARKMAN, JJ.,  
concurred.  
the Court’s holding was founded on.  The Court may or may not 
have relied on the life-expectancy issue.  If it did, the 
holding would lack any basis in the plain language of rule 21.  
12  
 
 
________________________________ 
 
v 
S T A T E 
O F 
M I C H I G A N  
SUPREME COURT  
DANSE CORPORATION,  
Petitioner-Appellant,  
No. 119011  
CITY OF MADISON HEIGHTS,  
Respondent-Appellee.  
KELLY, J. (dissenting).  
A per curiam opinion is an inappropriate mechanism for  
resolving this dispute.  The issue is one of statutory  
interpretation concerning the phrase "special tools" found in  
MCL 211.9b.  Resolution of the issue requires consideration of  
more than just the language found in that particular statute.  
It also implicates the language of MCL 211.10e, mandating the  
use of the assessor's manual.  Considering the statutes  
together, 
it 
is 
questionable whether a plain language analysis  
of MCL 211.9b adequately resolves the matter.  
This Court should not, therefore, decide the dispute in  
a per curiam decision.  Instead, it should allow full briefing  
and oral argument.  I would grant leave to fully consider the  
effect of MCL 211.10e on MCL 211.9b.  
CAVANAGH, J., concurred with KELLY, J.