Property damage claims under the Sewage Disposal System Event (SDSE) exception to governmental immunity; The Governmental Tort Liability Act; MCL 691.1417; Whether further discovery was warranted; Pleading notice of the sewer defect; Evidence that defendant had notice of the defect; Reasonable steps within a reasonable time to remedy the defect(s); Ypsilanti Community Utilities Authority (YCUA)

The court held that: (1) the trial court was correct that defendant-YCUA’s summary disposition motion was premature as discovery was incomplete; (2) plaintiffs “pled sufficiently to avoid governmental immunity” in this consolidated case arising from sewer backups; and (3) questions of fact existed as to whether YCUA “knew, or in the exercise of reasonable diligence should have known, about the” defect or defects and whether it “took reasonable steps to remedy the defect or defects in a reasonable time.” Thus, it affirmed the denial of YCUA’s motion. It first found there was no merit in YCUA’s argument that further discovery was not warranted, and that its actions in the case were “incongruous with its argument.” YCUA also argued there was “no actual identification in the Litwalk plaintiffs’ complaint of any alleged defect or any way in which [it] knew or should have known of a defect.” The court disagreed. It also disagreed with YCUA’s claim “that the allegations in the Stone plaintiffs’ complaint are insufficient to show knowledge of the defect by YCUA.” Next, YCUA contended that “plaintiffs’ claims fail as a matter of law because” it presented evidence (the affidavit of its expert witness, B) that it “lacked the notice required by statute and plaintiffs failed to present evidence to the contrary.” But the court noted that plaintiffs rightly countered this “argument by noting that [YCUA] relied upon an affidavit signed by a defense witness that [it] refused to present for deposition, despite the fact that” they sent YCUA “a notice for the taking of his deposition” before the close of discovery. They also countered B’s affidavit with their own expert’s affidavit, which detailed “the defects that caused plaintiffs’ damages and” supported their notice argument. As to YCUA’s claim that it took reasonable steps, the actual issue was whether it “took reasonable steps within a reasonable time to remedy the defect or defects that caused plaintiffs’ damages. The collapsed pipe was not the sole defect” – the defects consisted of “design defects and other matters that caused the pipe to collapse, which resulted in the flooding. While” YCUA offered evidence of steps it took to try “to remedy the issues caused by the pipe after its collapse, [it] offered no evidence that it took steps to remedy the defects that led to the” collapse. And as to the steps it took “after it became aware of the collapsed pipe, questions of fact exist as to whether they were reasonable or made within a reasonable time.”