Opinion ID: 848684
Heading Depth: 3
Heading Rank: 3

Heading: poletown, the pinnacle project, and public use

Text: The exercise of eminent domain at issue here  the condemnation of defendants' properties for the Pinnacle Project and the subsequent transfer of those properties to private entities  implicates none of the saving elements noted by our pre-1963 eminent domain jurisprudence. The Pinnacle Project's business and technology park is certainly not an enterprise whose very existence depends on the use of land that can be assembled only by the coordination central government alone is capable of achieving. [73] To the contrary, the landscape of our country is flecked with shopping centers, office parks, clusters of hotels, and centers of entertainment and commerce. We do not believe, and plaintiff does not contend, that these constellations required the exercise of eminent domain or any other form of collective public action for their formation. Second, the Pinnacle Project is not subject to public oversight to ensure that the property continues to be used for the commonwealth after being sold to private entities. Rather, plaintiff intends for the private entities purchasing defendants' properties to pursue their own financial welfare with the single-mindedness expected of any profit-making enterprise. The public benefit arising from the Pinnacle Project is an epiphenomenon of the eventual property owners' collective attempts at profit maximization. No formal mechanisms exist to ensure that the businesses that would occupy what are now defendants' properties will continue to contribute to the health of the local economy. Finally, there is nothing about the act of condemning defendants' properties that serves the public good in this case. The only public benefits cited by plaintiff arise after the lands are acquired by the government and put to private use. Thus, the present case is quite unlike Slum Clearance because there are no facts of independent public significance (such as the need to promote health and safety) that might justify the condemnation of defendants' lands. We can only conclude, therefore, that no one sophisticated in the law at the 1963 Constitution's ratification would have understood public use to permit the condemnation of defendants' properties for the construction of a business and technology park owned by private entities. Therefore, the condemnations proposed in this case are unconstitutional under art. 10, § 2. Indeed, the only support for plaintiff's position in our eminent domain jurisprudence is the majority opinion in Poletown. In that opinion per curiam, a majority of this Court concluded that our Constitution permitted the Detroit Economic Development Corporation to condemn private residential properties in order to convey those properties to a private corporation for the construction of an assembly plant. [74] As an initial matter, the opinion contains an odd but telling internal inconsistency. The majority first acknowledges that the property owners in that case urge[d the Court] to distinguish between the terms `use' and `purpose', asserting they are not synonymous and have been distinguished in the law of eminent domain. [75] This argument, of course, was central to plaintiffs' case, because the Constitution allows the exercise of eminent domain only for a public use.  [76] The Court then asserted that the plaintiffs conceded that the Constitution allowed condemnation for a public use or a public purpose, despite the fact that such a concession would have dramatically undermined plaintiffs' argument: There is no dispute about the law. All agree that condemnation for a public use or purpose is permitted. ... The heart of this dispute is whether the proposed condemnation is for the primary benefit of the public or the private user.[ [77] ] The majority therefore contended that plaintiffs waived a distinction they had urged upon the Court. And in so doing, the majority was able to avoid the difficult question whether the condemnation of private property for another private entity was a public use as that phrase is used in our Constitution. [78] This inconsistency aside, the majority opinion in Poletown is most notable for its radical and unabashed departure from the entirety of this Court's pre-1963 eminent domain jurisprudence. The opinion departs from the common understanding of public use at the time of ratification in two fundamental ways. First, the majority concluded that its power to review the proposed condemnations is limited because [t]he determination of what constitutes a public purpose is primarily a legislative function, subject to review by the courts when abused, and the determination of the legislative body of that matter should not be reversed except in instances where such determination is palpable and manifestly arbitrary and incorrect. [ [79] ] The majority derived this principle from a plurality opinion of this Court [80] and supported the application of the principle with a citation of an opinion of the United States Supreme Court concerning judicial review of congressional acts under the Fifth Amendment of the federal constitution. [81] Neither case, of course, is binding on this Court in construing the takings clause of our state Constitution, and neither is persuasive authority for the use to which they were put by the Poletown majority. It is not surprising, however, that the majority would turn to nonbinding precedent for the proposition that the Court's hands were effectively tied by the Legislature. As Justice RYAN'S dissent noted: In point of fact, this Court has never employed the minimal standard of review in an eminent domain case which is adopted by the [ Poletown ] majority.... Notwithstanding explicit legislative findings, this Court has always made an independent determination of what constitutes a public use for which the power of eminent domain may be utilized.[ [82] ] Our eminent domain jurisprudence since Michigan's entry into the union amply supports Justice RYAN'S assertion. [83] Questions of public purpose aside, whether the proposed condemnations were consistent with the Constitution's public use requirement was a constitutional question squarely within the Court's authority. [84] The Court's reliance on Gregory Marina and Berman for the contrary position was, as Justice RYAN observed, disingenuous. [85] Second, the Poletown majority concluded, for the first time in the history of our eminent domain jurisprudence, that a generalized economic benefit was sufficient under art. 10, § 2 to justify the transfer of condemned property to a private entity. Before Poletown, we had never held that a private entity's pursuit of profit was a public use for constitutional takings purposes simply because one entity's profit maximization contributed to the health of the general economy. Justice COOLEY considered a similar proposition [86] well over a century ago and held that incidental benefits to the economy did not justify the exercise of eminent domain for private, water-powered mills: The statute [allowing the condemnation of private property for the construction of private powermills] appears to have been drawn with studious care to avoid any requirement that the person availing himself of its provisions shall consult any interest except his own, and it therefore seems perfectly manifest that when a public use is spoken of in this statute nothing further is intended than that the use shall be one that, in the opinion of the commission or jury, will in some manner advance the public interest. But incidentally every lawful business does this.[ [87] ] Justice COOLEY was careful to point out that the Court was not ruling out the possibility that incidental benefits to the public might, in some cases, justify an exercise of the right of eminent domain. [88] But Wayne County has not directed us to a single case, other than Poletown, holding that a vague economic benefit stemming from a private profit-maximizing enterprise is a public use. Every business, every productive unit in society, does, as Justice COOLEY noted, contribute in some way to the commonwealth. [89] To justify the exercise of eminent domain solely on the basis of the fact that the use of that property by a private entity seeking its own profit might contribute to the economy's health is to render impotent our constitutional limitations on the government's power of eminent domain. Poletown's economic benefit rationale would validate practically any exercise of the power of eminent domain on behalf of a private entity. After all, if one's ownership of private property is forever subject to the government's determination that another private party would put one's land to better use, then the ownership of real property is perpetually threatened by the expansion plans of any large discount retailer, megastore, or the like. Indeed, it is for precisely this reason that this Court has approved the transfer of condemned property to private entities only when certain other conditions  those identified in our pre-1963 eminent domain jurisprudence in Justice RYAN'S Poletown dissent  are present. [90] Because Poletown's conception of a public use  that of alleviating unemployment and revitalizing the economic base of the community [91]  has no support in the Court's eminent domain jurisprudence before the Constitution's ratification, its interpretation of public use in art. 10, § 2 cannot reflect the common understanding of that phrase among those sophisticated in the law at ratification. Consequently, the Poletown analysis provides no legitimate support for the condemnations proposed in this case and, for the reasons stated above, is overruled. We conclude that the condemnations proposed in this case do not pass constitutional muster because they do not advance a public use as required by Const. 1963, art. 10, § 2. Accordingly, this case is remanded to the Wayne Circuit Court for entry of summary disposition in defendants' favor.