Municipal utility pricing dispute; Breach of contract; Applicability of the rules of statutory interpretation to municipal ordinances; Bonner v. City of Brighton; Strong presumption that statutes do not create contractual rights; Studier v. Michigan Pub. Sch. Employees’ Ret. Bd.; Unjust enrichment; Belle Isle Grill Corp. v. Detroit; Wright v. Genesee Cnty. Bd. of Comm’rs; The Governmental Tort Liability Act (GTLA) (MCL 691.1401 et seq.); Whether an ordinance afforded plaintiffs a private right of action; Myers v. City of Portage; Lash v. City of Traverse City; Availability of a common-law action to allow recovery for unlawful extractions; Pingree v. Mutual Gas Co.; Hyde Park Coop. v. City of Detroit; Bond v. Public Sch. of Ann Arbor Sch. Dist.; City of Detroit v. Martin; The law of the case doctrine; Grievance Adm’r v. Lopatin; Claim for declaratory relief; In re Bradley Estate
On remand from the Supreme Court to reconsider plaintiffs’ unjust enrichment claim in light of Wright and, as necessary, issues defendant-City of Flint raised that it did not previously consider, the court held that Flint was entitled to summary disposition on plaintiffs’ breach of contract claims. As to the unjust enrichment claims (Counts II and IV), it held that Count IV properly set forth a claim based on an unlawful extraction, but Count II only alleged a statutory violation, for which no private right of action for money damages was available. Thus, Flint was entitled to summary disposition of Count II but not Count IV. The law of the case doctrine barred Count V (alleging Flint unlawfully used its sewer and water revenues for the general fund), but the trial court did not err in denying summary disposition on Count VI (for declaratory relief). The case involved a municipal utility pricing dispute. Plaintiffs alleged in their first amended complaint that Flint’s ordinances created a contract for the provision of water services. However, the court concluded, based on their plain language, that the relevant ordinances did not expressly “state any intent to bind defendant contractually with regard to pricing structures.” Plaintiffs in fact admitted in their appellate brief that no express contract existed. Even assuming an intent to contract could be inferred from the ordinances, such an inference was insufficient. “On their face, the ordinances are equally susceptible—if not more so—to a reasonable interpretation that they were merely intended to state Flint’s policy with regard to rate calculation. Also fatal to plaintiffs breach of contract claims is that the ordinances did not state (or imply in any way), that Flint would be unable to subsequently amend them.” However, as to the unjust enrichment claims, in Count IV “plaintiffs expressly identified the 22% increase to the water and sewer rates as the misconduct that resulted in plaintiffs’ overpaying for water and sewer services.” The court concluded in a prior appeal (Kincaid II) that some of the “rate increases violated the applicable ordinances.” Thus, there was an unlawful extraction. Further, as the Supreme Court made clear in Wright, the GTLA does not bar an unjust enrichment claim. It also does not provide governmental immunity for declaratory relief claims. Affirmed in part, reversed in part, and remanded.
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