Court Opinion

ID: 3213451
Source: CourtListenerOpinion
Date Created: 2016-06-15 15:07:02.699517+00
Date Added: 2024-06-11T07:39:34.085577
License: Public Domain

STATE OF MICHIGAN

                          COURT OF APPEALS

ROBERT AGUIRRE, LAURIN THOMAS, JOHN                              FOR PUBLICATION
SULLIVAN, JAMES ATTERBERRY SR., TED                              June 14, 2016
HAMMON, and ARTINA HARDMAN,                                      9:10 a.m.

              Plaintiffs-Appellants,

v                                                                No. 327022
                                                                 Court of Claims
STATE OF MICHIGAN and DEPARTMENT OF                              LC No. 11-000129-MK
CORRECTIONS,

              Defendants-Appellees.

Before: SAWYER, P.J., and HOEKSTRA and WILDER, JJ.

PER CURIAM.

        Following a remand from this Court, plaintiffs, Robert Aguirre, Laurin Thomas, John
Sullivan, James Atterberry, Sr., Ted Hammon, and Artina Hardman (collectively, “the
members”), appeal as of right the trial court’s order denying their motion for summary
disposition, denying their motion to amend their complaint, and granting summary disposition in
favor of defendants, the Department of Corrections (the Department) and the state of Michigan
(collectively, “the State”). Because the members have failed to state a viable claim of a
constitutional Contract Clause violation and an amendment to add such a claim would be futile,
we affirm.

                                          I. FACTS

       The basic facts giving rise to this dispute were succinctly set forth in this Court’s
previous opinion as follows:

              In 1992, the Michigan Legislature established “a parole board consisting
       of 10 members” within the Department. In 2009, Governor Jennifer Granholm
       reorganized the Department, abolished the parole board, and created the 15–
       member Parole and Commutation Board.

              The members were members of the Parole and Commutation Board. The
       members each received a letter of appointment from the Governor's office.
       Hardman's term was from April 19, 2009, to November 20, 2012, Sullivan,
       Aguirre, and Hammon's terms were from December 1, 2009, to November 30,

                                              -1-
       2013, and Thomas and Atterberry's terms were from December 1, 2010, to
       November 30, 2014.

                                               ***

               In 2011, by ERO 2011–3, Governor Rick Snyder abolished the Parole and
       Commutation Board and created a new Parole Board. ERO 2011–3 provided in §
       III(A) that the new Parole Board “shall consist of 10 members appointed by the
       Director of the Department of Corrections.” Section II(A) of ERO 2011–3
       transferred to the new Parole Board

               [a]ll of the authority, powers, duties, functions, responsibilities,
               records, personnel, property, and unexpended balances of
               appropriations, allocations, or other funds of the Michigan Parole
               and Commutation Board[.]

       Section V(B) provided that

               [a]ll rules, orders, contracts, and agreements relating to the
               transfers under this Order lawfully adopted prior to the effective
               date of this Order shall continue to be effective until revised,
               amended, repealed, or rescinded.

       ERO 2011–3 granted the director of the Department of Corrections the power to
       appoint Parole Board members. The director did not appoint any of the members
       to serve as members on the new Parole Board. [Aguirre v Dep’t of Corrections,
       307 Mich. App. 315, 317-318; 859 NW2d 267 (2014) (footnotes omitted).]

                                 II. PROCEDURAL HISTORY

       On January 5, 2012, the members filed suit against the State, alleging a breach of contract
and a claim of promissory estoppel. Both parties moved for summary disposition. The trial
court granted the members’ motion for summary disposition and denied the State’s motion for
summary disposition. As summarized in this Court’s previous opinion:

       The trial court concluded that the members' letters of appointment continued to be
       effective after ERO 2011–3. The trial court also concluded that ERO 2011–3
       transferred the members' contracts from the Parole and Commutation Board to the
       Parole Board. The trial court agreed that the Governor had authority to eliminate
       the members' positions, but concluded that their contracts remained valid and the
       termination breached their contracts. [Aguirre, 307 Mich. App. at 319.]

       The State appealed, and this Court reversed and remanded for further proceedings. In
doing so, this Court made two main holdings relevant to the dispute now before us. First,
assuming for the sake of argument that the members had a contract with the State, this Court

                                               -2-
determined that ERO 2011-3 abolished the members’ positions, and that this abolishment did not
constitute a breach of contract.1 Aguirre, 307 Mich. App. at 323-325, 327. Second, this Court
considered the members’ constitutional challenges and determined that the abolishment of the
members’ positions was “permissible.” Id. at 322. Specifically, we rejected claims that
eliminating positions violated the good-cause termination provisions found in Const 1963, art 5,
§ 10, and instead characterized Governor Snyder’s actions as the reorganization of an executive
department and the elimination of positions under the governor’s plenary control over the
organization of the executive branch under Const 1963, art 5 § 2. See Aguirre, 307 Mich. App. at
317, 321, 325-326.

        While largely resolving the parties’ dispute, this Court noted that the members had
asserted, as an alternative ground for affirmance, that the reorganization of the parole board
violated the Contracts Clause of the Michigan Constitution, Const 1963, art 1 § 10. However,
we declined to address this issue on appeal because it had not been decided by the trial court and
we reasoned that “[o]ur analysis of this issue would benefit from a decision of the trial court and
full argument.” Aguirre, 307 Mich. App. at 326. Consequently, while reversing the trial court’s
grant of summary disposition to the members and its denial of summary disposition to the State,
we left open the question of whether ERO 2011-3 violated the Contracts Clause of the Michigan
Constitution and we remanded for further proceedings consistent with our opinion.

      On remand, the trial court granted summary disposition to the State “as to all issues in the
Complaint except that preserved [in] the Court of Appeals on the issue of Unconstitutional
Impairment of Contract.”2 The parties then filed cross motions for summary disposition in

1
  On appeal, the members assert that this Court’s previous opinion did not resolve all their
arguments pertaining to their breach of contract claim. In particular, the members maintain that
this Court addressed the breach claim in terms of the members’ argument that their contracts
transferred to the new parole board and that those transferred contracts were then breached by
their subsequent termination. The members argue that we did not decide whether the
reorganization was itself a breach of contract. We do not read our previous decision so narrowly.
We plainly rejected their breach of contract claim, Aguirre, 307 Mich. App. at 323-325, 327, and
the law of the case forecloses further consideration of this question. See Duncan v Michigan,
300 Mich. App. 176, 188; 832 NW2d 761 (2013). In any event, as discussed infra in the context
of the members’ Contract Clause argument, the members do not have a contract right to hold
their positions for the appointed term in contravention of the governor’s constitutional
reorganization authority. Applying the same reasoning, the governor’s reorganization of the
Department could not have resulted in a breach of contract if the alleged contractual right to hold
the positions did not exist in the first place. See AFT Mich v Michigan, 497 Mich. 197, 210 n 2;
866 NW2d 782 (2015).
2
  On appeal, the members note that, when granting summary disposition, the trial court did not
expressly address their promissory estoppel claim, and they maintain that the grant of summary
disposition as to this claim should be reversed. This argument is without merit. Given this
Court’s previous decision, the only question open on remand was the Contract Clause issue and
thus, consistent with this Court’s directives, the trial court properly granted summary disposition

                                                -3-
relation to the Contracts Clause issue, and the members filed a motion to amend their complaint
to add a claim that ERO 2011-3 violated the Contracts Clause of the Michigan Constitution and
the United States Constitution, US Const, Art I, § 10. Because this count was not contained in
the members’ original complaint, the trial court concluded that the State was entitled to summary
disposition under MCR 2.116(C)(8). However, the court also considered whether the members
should be allowed to amend their complaint under MCR 2.116(I)(5), and the court determined
that such amendment would be futile. The court offered several reasons for this conclusion,
most notably explaining that the governor’s constitutional power to recognize the executive
branch in the future was an implicit term of any contract that the members might have with the
State. Reasoning that the members must have contracted “with reference to this fundamental
law,” the court concluded that, under Harsha v Detroit, 261 Mich. 586, 595; 246 N.W. 849 (1933),
their contract could not have been impaired by Governor Snyder’s exercise of his constitutional
authority and thus the members’ Contract Clause argument was without merit. Consequently,
the trial court denied the members’ motion to amend their complaint, denied the members’
motion for summary disposition, and granted the State’s motion for summary disposition. The
members now appeal to this Court as of right.

                                  III. STANDARD OF REVIEW

        We review de novo a trial court’s grant or denial of summary disposition. Detroit Edison
Co v Stenman, 311 Mich. App. 367, 377; 875 NW2d 767 (2015). Constitutional questions are
reviewed de novo. Studier v Mich Pub Sch Employees' Ret Bd, 472 Mich. 642, 649; 698 NW2d
350 (2005). Likewise, whether a contract exists is a question of law to be reviewed de novo.
Kloian v Domino's Pizza LLC, 273 Mich. App. 449, 452; 733 NW2d 766 (2006). When a contract
is found to exist, “questions involving the proper interpretation of a contract or the legal effect of
a contractual clause are also reviewed de novo.” Rory v Continental Ins Co, 473 Mich. 457, 464;
703 NW2d 23 (2005). Finally, a trial court’s decision on a motion to amend a complaint is
reviewed for an abuse of discretion. Diem v Sallie Mae Home Loans, Inc, 307 Mich. App. 204,
216; 859 NW2d 238 (2014).

                                          IV. ANALYSIS

       On appeal, the members begin their argument with the assertion that they have fully
enforceable contractual rights in their Parole and Commutation Board offices for the term of

“as to all issues in the Complaint” except the Contract Clause issue. See K & K Const, Inc v
Dep’t of Environmental Quality, 267 Mich. App. 523, 544; 705 NW2d 365 (2005) (“[W]hen an
appellate court gives clear instructions in its remand order, it is improper for a lower court to
exceed the scope of the order.”). In any event, it is clear that the members’ promissory estoppel
claim is without merit. Among other elements, promissory estoppel requires a promise that
produced reliance, and “the reliance on it must be reasonable.” Zaremba Equip, Inc v Harco
Nat'l Ins Co, 280 Mich. App. 16, 41; 761 NW2d 151 (2008). In light of the governor’s known
plenary authority to reorganize the Department as discussed in more detail infra, any reliance on
assurances of continued employment could not be considered reasonable.

                                                 -4-
years set forth in their letters of appointment.3 Given these purported contractual rights, the
members contend that Governor Snyder’s elimination of their positions under ERO 2011-3
constituted an unconstitutional impairment of the members’ contracts in violation of the
Michigan and the United States Constitutions. Notably, in making these arguments, the
members in no way dispute the legality of ERO 2011-3 insofar as it represented an exercise of
the governor’s plenary authority to reorganize the executive branch under Const 1963, art 5, § 2.
Instead, the members characterize the issue as whether the State is liable for monetary damages
when the governor exercises this constitutional authority to eliminate executive positions,
thereby purportedly impairing the members’ contractual right to their positions—and their
related employment benefits—for the time period defined in their letters of appointment. For the
reasons stated below, we find this argument to be without merit.

                                 A. THE CONTRACT CLAUSE

       “Both the Michigan and United States Constitutions prohibit laws that impair obligations
under contracts.”4 AFT Mich, 497 Mich. at 232-233. “These clauses provide that vested rights
acquired under a contract may not be destroyed by subsequent state legislation.”5 Seitz v Probate
Judges Ret Sys, 189 Mich. App. 445, 455; 474 NW2d 125 (1991). “However, the Contract Clause
prohibition on state laws impairing the obligations of contract is not absolute.” Health Care
Ass'n Workers Comp Fund v Dir of the Bureau of Worker's Comp, Dep’t of Consumer & Indus
Services, 265 Mich. App. 236, 240; 694 NW2d 761 (2005) “Rather, the prohibition must be

3
  The members suggest that the State has conclusively conceded that the members have
enforceable contracts and that the trial court’s finding, during a 2013 hearing, that the members
had contracts is somehow “binding.” The members are mistaken. The existence of a contract is
a question of law which we review de novo, Kloian, 273 Mich. App. at 452, and the parties’
agreements as to the law are not binding on this Court, People v Metamora Water Serv, Inc, 276
Mich. App. 376, 385; 741 NW2d 61 (2007). This Court did not decide this question during the
previous appeal and instead remanded for “full argument” on the Contract Clause issue. We note
also that the State has denied the existence of a contract and briefed the matter, on remand and
on appeal, in relation to the members’ Contract Clause claim. In short, there has been no binding
determination of this issue, and we consider it properly before us at this time.
4
  U.S. Const, art I, § 10 states, in part, “No State shall . . . pass any Bill of Attainder, ex post
facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility.”
Similarly, Const 1963, art 1, § 10 states: “No bill of attainder, ex post facto law or law impairing
the obligation of contract shall be enacted.” These provisions have typically been interpreted to
provide coextensive protections against the impairment of a contractual relationship. AFT Mich,
497 Mich. at 233.
5
 Although the present case involves an executive order, we note that an executive order under
Const 1963, art 5, § 2 “has the status of enacted legislation,” Health Care Ass'n Workers Comp
Fund v Dir of the Bureau of Worker's Comp, Dep’t of Consumer & Indus Servs, 265 Mich. App.
236, 250; 694 NW2d 761 (2005), and we will treat it as such for purposes of analyzing the
members’ Contract Clause claims.

                                                -5-
accommodated to the inherent police power of the State to safeguard the vital interests of its
people.” Id. at 240-241 (citation and quotation marks omitted).

        Consequently, when examining whether a state law substantially impairs an existing
contract, courts apply a three pronged balancing test, “with the first prong being a determination
whether the state law has, in fact, operated as a substantial impairment of a contractual
relationship.” In re Certified Question, 447 Mich. 765, 777; 527 NW2d 468 (1994) (citation
omitted). See also Blue Cross & Blue Shield of Mich v Milliken, 422 Mich. 1, 21; 367 NW2d 1
(1985). Under this first prong of the analysis, “[w]hether a change in state law has resulted in ‘a
substantial impairment of a contractual relationship’ itself requires consideration of three factors:
[1] whether there is a contractual relationship, [2] whether a change in law impairs that
contractual relationship, and [3] whether the impairment is substantial.” Gillette Commercial
Operations N Am & Subsidiaries v Dep't of Treasury, 312 Mich. App. 394, 408; __ NW2d __
(2015). For purposes of this analysis, “an impairment takes on constitutional dimensions only
when it interferes with reasonably expected contractual benefits.” Id., quoting Borman, LLC v
18718 Borman, LLC, 777 F3d 816, 826 (CA 6 2015). If it is determined that the state law
resulted in a substantial impairment of a contractual relationship, courts must then examine the
second and third prongs, as follows: whether “the legislative disruption of contract expectancies
be necessary to the public good” and whether “the means chosen by the Legislature to address
the public need are reasonable.” In re Certified Question, 447 Mich. at 777 (citations omitted).

        The protection offered by the Contract Clause can be applied to prevent the impairment
of the state’s own contractual obligations. See US Trust Co of New York v New Jersey, 431 U.S.
1, 23; 97 S. Ct. 1505; 52 L. Ed. 2d 92 (1977). That is, by contract, the Legislature may
contractually bind successive Legislatures to agreements. Studier v Mich Pub Sch Employees'
Ret Bd, 472 Mich. 642, 661; 698 NW2d 350 (2005). However, “such surrenders of legislative
power are subject to strict limitations that have developed in order to protect the sovereign
prerogatives of state governments.” Id. Among these protections of sovereignty is the
“‘reserved power’ doctrine, which held that certain substantive powers of sovereignty could not
be contracted away.” United States v Winstar Corp, 518 U.S. 839, 874; 116 S. Ct. 2432; 135 L. Ed.
2d 964 (1996). In other words, when analyzing a Contract Clause claim in the context of a
contract with the state, there must be “a determination of the State's power to create irrevocable
contract rights in the first place.” US Trust Co of New York, 431 U.S. at 23. Additionally, the
distinct “unmistakability doctrine” provides that, when governmental powers may be contracted
away, such surrender will not be presumed or inferred, but must be “expressed in terms too plain
to be mistaken.” Windstar Corp, 518 U.S. at 875.

                        B. CONTRACT RIGHTS TO PUBLIC OFFICE

        In Michigan, appointment to public office does not create a contractual right to hold that
office, any holder of public office necessarily accepts the position with the knowledge that he or
she may be removed as provided by law, and an express contract interfering with the power to

                                                -6-
abolish an office in the manner provided by law would be void as against public policy.6 In
particular, well over 100 years ago, our Supreme Court acknowledged that “[n]othing seems
better settled than that an appointment or election to a public office does not establish contract
relations between the person appointed or elected and the public.” Attorney Gen v Jochim, 99
Mich. 358, 368; 58 N.W. 611 (1894). See also Molinaro v Driver, 364 Mich. 341, 350; 111 NW2d
50 (1961); Robbins v Wayne Co Bd of Auditors, 357 Mich. 663, 667; 99 NW2d 591 (1959). “A
public office cannot be called ‘property,’” and it does not provide the officer with a vested right
to hold his or her office until the expiration of the term. Attorney Gen, 99 Mich. at 367. Rather,
“[a]n office is a special trust or charge created by competent authority.” Solomon v Civil Serv
Comm, City of Highland Park, 64 Mich. App. 433, 438; 236 NW2d 94 (1975) (citation omitted).

       Public officers are created for the purposes of government. They are delegations
       of portions of the sovereign power for the welfare of the public. They are not the
       subjects of contract, but they are agencies for the state, revocable at pleasure by
       the authority creating them, unless such authority be limited by the power which
       conferred it. [Attorney Gen, 99 Mich. at 367.]

Thus, “except as it may be restrained by the constitution, the legislature has the same inherent
authority to modify or abolish that it has to create; and it will exercise it with the like
considerations in view.” Id. at 368. Indeed, absent a constitutional prohibition, an office may
be lawfully abolished “within the terms for which the incumbents were elected or appointed.”
MacDonald v De Waele, 263 Mich. 233, 235; 248 N.W. 605 (1933).

6
  At the outset we note that, in our judgment, the members’ positions on the Parole and
Commutation Board were of such importance, dignity and independence as to be properly
characterized as public offices rather than mere employment. See People v Coutu, 459 Mich.
348, 354; 589 NW2d 458 (1999) (enumerating the distinguishing features of a “public office”);
Council of Organizations & Others for Ed About Parochiaid, Inc v Governor, 455 Mich. 557,
585 n 22; 566 NW2d 208 (1997) (same). First, the positions were created incident to the
governor’s authority under Const 1963, Art 5, § 2, which, in the absence of legislative veto, has
the same status as enacted legislation. Straus v Governor, 459 Mich. 526, 534; 592 NW2d 53
(1999). See also MCL 16.134; MCL 791.304. Second, as members of the Parole and
Commutation Board, the members exercised sovereign power while engaged in the discretionary
discharge of their duties. See generally Jones v Dep’t of Corrections, 468 Mich. 646, 652; 664
NW2d 717 (2003). Third, the powers and duties exercised by the members are set forth by
statute as conferred by executive order. See MCL 791.304; ERO 2009-3. Fourth, while the
Parole and Commutation Board is an entity within the Department, ERO 2009-3, In re Parole of
Bivings, 242 Mich. App. 363, 372; 619 NW2d 163 (2000), these offices were created and placed
within the Department as provided by law. Cf. Coutu, 459 Mich. at 355. Fifth, the positions
were not created as temporary positions. Finally, the members were required to take an oath of
office. See id. at 356. In short, the members held public offices and “are subject to all
applicable law pertaining to public officials.” Council of Organizations & Others for Ed About
Parochiaid, Inc, 455 Mich. at 585 & n 22.

                                                -7-
        Because an officer has no vested property right to the office, the constitutional
protections of the Contract Clause do not apply and, when an office is abolished or an officer
lawfully removed, he or she is not entitled to payment for future services which would have been
rendered but for the elimination of the office. See Butler v Commonwealth of Pennsylvania, 51
U.S. 402, 416-417; 13 L. Ed. 472 (1850).

       The selection of officers, who are nothing more than agents for the effectuating of
       such public purposes, is [a] matter of public convenience or necessity, and so too
       are the periods for the appointment of such agents; but neither the one nor the
       other of these arrangements can constitute any obligation to continue such agents,
       or to re-appoint them, after the measures which brought them into being shall
       have been found useless, shall have been fulfilled, or shall have been abrogated as
       even detrimental to the well-being of the public. The promised compensation for
       services actually performed and accepted, during the continuance of the particular
       agency, may undoubtedly be claimed, both upon principles of compact and of
       equity; but to insist beyond this on the perpetuation of a public policy either
       useless or detrimental, and upon a reward for acts neither disired nor performed,
       would appear to be reconcilable with neither common justice nor common sense.
       The establishment of such a principle would arrest necessarily every thing like
       progress or improvement in government; or if changes should be ventured upon,
       the government would have to become one great pension establishment on which
       to quarter a host of sinecures. [Id. (emphasis added).]

        Given the reality that public offices may be abolished as provided by law, an individual
who accepts a public office, takes that position “subject to the contingency that it may be
abolished lawfully.” Sprister v City of Sturgis, 242 Mich. 68, 72; 218 N.W. 96 (1928). See also
Attorney Gen, 99 Mich. at 368, 370 (“One of the constitutional conditions upon which the
respondent took his office was that he would be subject to removal by the Governor . . . .”).
Moreover, when the power of appointment or removal is provided for by law, the future exercise
of this governmental power of appointment or removal typically cannot be bargained away by
contract. See, e.g., City of Hazel Park v Potter, 169 Mich. App. 714, 720; 426 NW2d 789
(1988).7 A contract to limit a future governing body’s lawful power of removal or appointment
of a public officer is considered void as a matter of public policy. See, e.g., id. (holding written
employment contract with a city manager was void where it deprived incoming city counsel of
power to select and appoint a city manager as provided in the city charter). And, a party

7
  See also US Trust Co of New York, 431 U.S. at 22 (“One whose rights, such as they are, are
subject to state restriction, cannot remove them from the power of the State by making a contract
about them.”); Detroit v Div 26 of Amalgamated Ass'n of St, Elec Ry & Motor Coach Employees
of Am, 332 Mich. 237, 252; 51 NW2d 228 (1952) (“To the extent that terms and conditions of
public employment are governed by statute or charter, they are not subject to modification by
contract . . . .”); Thorin v Bloomfield Hills Bd of Ed, 203 Mich. App. 692, 702; 513 NW2d 230
(1994) (finding that a public employee could not have entered into a contract for longer period of
employment than that permissible by statute).

                                                -8-
conducting business with the state is charged with understanding the extent of any limitations on
the appointing official’s authority to bind the state. See Roxborough v Mich Unemployment
Comp Comm, 309 Mich. 505, 511; 15 NW2d 724 (1944).

        C. GOVERNOR’S POWER TO REORGANIZE THE EXECUTIVE BRANCH

        As we discussed in our previous opinion in this case, under Const 1963, Art 5, § 2, “the
governor may make changes in the organization of the executive branch or in the assignment of
functions among its units which he considers necessary for efficient administration.” The
governor's power under Const 1963, art 5, § 2, “is nearly plenary” and “is limited only by
constitutional provisions that would inhibit the Legislature itself.” Straus, 459 Mich. at 534.
“The Framers of the Michigan Constitution desired to give the Governor real control over the
executive branch,” including the power to appoint officials, Mich Farm Bureau v Dep't of
Environmental Quality, 292 Mich. App. 106, 144; 807 NW2d 866 (2011), and to abolish
positions, Aguirre, 307 Mich. App. at 326-327; Morris v Governor, 214 Mich. App. 604, 609; 543
NW2d 363 (1995). “The constitution, then, specifically recognizes that, where the Governor
feels compelled to make certain changes within the executive branch, he has authority, through
the executive order procedure, in effect, to enact laws to carry out those changes.” House
Speaker v Governor, 443 Mich. 560, 579; 506 NW2d 190 (1993).

                                       D. APPLICATION

        In view of the foregoing, in this case, the members’ Contract Clause claim is without
merit because they do not have, and cannot have, a contract that entitles them to serve a set term
of years on the Parole and Commutation Board in contravention of the governor’s plenary
authority to abolish offices within the executive branch.8 That is, when the members accepted
their appointments to the Parole and Commutation Board, they necessarily did so subject to the
contingency that their positions could be lawfully abolished in the future, even during the term of
their appointments. MacDonald, 263 Mich. at 235; Sprister, 242 Mich. at 72; Attorney Gen, 99
Mich. at 368, 370. The governor has nearly plenary authority under Const 1963, Art 5, § 2 with
regard to the reorganization of the executive branch, and Governor Granholm was without
authority to contractually surrender or impede a future governor’s constitutional authority to

8
  On appeal, the members cite Bracco v Mich Technological Univ, 231 Mich. App. 578, 588; 588
NW2d 467 (1998), for the proposition that public employees may form contractual employment
relationships with public employers. We do not hold otherwise, and we do not suggest that the
members were not contractually entitled to compensation and benefits relating to the time that
they held their positions. See Butler, 51 U.S. at 416-417; Fisk v Police Jury of Jefferson, 116 U.S.
131, 134; 6 S. Ct. 329, 330; 29 L. Ed. 587 (1885). Instead, applying long-established caselaw, we
hold only that a public officer may not form a contract to hold an office for a set term of
appointment when the term of appointment would interfere with the exercise of the governor’s
plenary reorganizational authority over the executive branch under Const 1963, Art 5, § 2. See
Butler, 51 U.S. at 416-417; MacDonald, 263 Mich. at 235; Sprister, 242 Mich. at 72; Attorney Gen,
99 Mich. at 368, 370. See also City of Hazel Park, 169 Mich. App. at 720.

                                                -9-
reorganize the Department by guaranteeing the members a set term of appointment in
contravention of a future governor’s reorganization power. Cf. City of Hazel Park, 169 Mich
App at 720. See also Mich Farm Bureau, 292 Mich. App. at 144 (“For our constitutional
framework to operate as it was intended, each newly elected governor must possess the power
and ability to manage the bureaucracy, to supervise the administrative agencies, and to influence
those agencies' rulemaking decisions through his or her appointments and directives.”). When
conducting business with the state, the members were charged with knowledge of such
limitations on the Governor Granholm’s authority. See Roxborough, 309 Mich. at 511. In other
words, as the trial court aptly recognized, the members dealing with the State must have
contracted “with reference” to the governor’s fundamental power of reorganization. Cf. Harsha,
261 Mich. at 595.

        It follows that the members do not have vested rights to hold their positions on the Parole
and Commutation Board for their full term of appointment in contravention of the governor’s
plenary authority to abolish the positions as provided by law. See Butler, 51 U.S. at 416-417;
Attorney Gen, 99 Mich. at 367. There being no vested contractual right to the continued
existence of the Parole and Commutation Board or to hold a position on the board for a set
period of time in contravention of the governor’s reorganization power, there can be no
impairment of a contract by ERO 2011-3. See Butler, 51 U.S. at 416-417; Harsha, 261 Mich. at
595; Gillette, 312 Mich. App. at 408, 414. Consequently, the trial court properly granted the
State’s motion for summary disposition, denied the members’ motion for summary disposition,
and denied the members’ motion to amend their complaint as any amendment would be futile.

       Affirmed.

                                                            /s/ David H. Sawyer
                                                            /s/ Joel P. Hoekstra
                                                            /s/ Kurtis T. Wilder

                                               -10-