You heard that right. After the Michigan Court of Appeals' recent ruling in Lanzi v. Township of St. Clair, No. 329795 (May 23, 2017), you should consider skipping the usual Williamson County step of filing your federal takings claims in state court.
In that case, property owners sued the township after the township's sewage system broke down and backed up grey water into the plaintiffs' basement. They brought a complaint in Michigan state court alleging both negligence and a physical invasion taking. The township alleged it was immune by statute from such suits. The trial court rejected the argument and the township appealed.
The court of appeals reversed on the negligence claim, agreeing with the township that it was immune because it had taken reasonable steps to repair any defects in the sewer system. We'll let you read that part of the opinion if you're interested.
What got us thinking about Williamson County and state-vs-federal court for takings claims starts on page 6 of the slip opinion. The court held that in Michigan, "no damage remedy exists for claims against a municipality, or government employee, for a violation of the Michigan Constitution when an alternative remedy exists." Slip op. at 6 (citing Jones v Powell, 612 N.W.2d 42 (Mich. 2000)). And the Lanzis' takings claim not only alleges a violation of the Michigan Constitution, it also is a taking under the Fifth Amendment.
And here's where the opinion gets a bit weird:
Accordingly, because plaintiffs have an alternative avenue for relief, namely a claim under 42 USC 1983, they cannot sustain a claim for monetary damages against defendant, a municipality, for a violation of the Michigan Constitution. Jones, 462 Mich 329. Thus, pursuant to MCR 2.116(C)(8), the trial court should have granted defendant’s motion for summary disposition as it related to plaintiffs’ takings claim. Accordingly, we reverse the trial court on the takings claim.
Slip op. at 6-7. In other words, you have no claim under Michigan law for a state taking, because you have a federal takings claim.
Williamson County requires that you first pursue available state remedies to recover compensation in state court, before you can raise your federal takings claim in federal court. But what Lanzi concluded is that you can't go to a Michigan court with a state law takings claim because -- get this -- you have a remedy in federal court.
A somewhat circular argument, but we can dig it, because the end result tells us that, having the door to the state courthouse slammed in your face, takings plaintiff, in Michigan you can now go directly to "Go" and file in federal court. When the defendant invariably raises Williamson County ripeness as a way to get you tossed, hand the court a copy of Lanzi (and Jones).
Hat tip to our Pacific Legal Foundation colleague Dave Breemer from bringing notice of this unpublished decision.
Also note: the Seventh Circuit not too long ago held that Illinois law does not recognize a compensation remedy for regulatory takings, only physical.
Lanzi v. Township of St. Clair, No. 329795 (Mich. App. May 23, 2017) (per curiam)
