Michigan Court’s Ruling on Flint Water Supply Claims Raises Concerns for Companies Facing Tort Claims for Migrating Contamination

Companies faced with environmental claims in Michigan should take note of last week’s Michigan Court of Claims’ 50-page opinion in Mays v. Snyder, Case No. 16-000017-MM (October 26, 2016), in which it ruled on a motion seeking summary disposition as to all constitutional tort claims of a putative class of water users and property owners in Flint arising out of the infamous water supply distribution issue. Ultimately, the Mays court allowed two of the plaintiffs’ claims to proceed: the violation of their individual rights to bodily integrity under substantive due process, and inverse condemnation.

In Michigan, tort claims—which include claims for property damage or personal injury—accrue for limitations purposes “at the time of the wrong upon which the claim is based was done regardless of the time when damage results.” MCL 600.5827. Only in narrow circumstances is tolling of the limitations period allowed, including where the defendant fraudulently conceals the existence of the claim or the identity of the person responsible for the claim. MCL 600.5855. Until 2007, many courts in Michigan held that, despite the unambiguous language of the accrual provision, a claim did not accrue until the claimant discovered its existence. In 2007, however, the Michigan Supreme Court in Trentadue v. Gorton, 479 Mich 378; 738 NW2d 664, abrogated this court-created “discovery rule.” Since that ruling, the statutory accrual provision has not been amended. Thus, the law in Michigan is clear: a claim accrues when the wrong is done, not when a claimant discovers the wrong or the damage it caused.

Citing the Court of Appeals’ opinion in Rusha v. Dept of Corrections, 307 Mich App 300; 859 NW2d 735 (2014), the Mays court applied a rarely-successful judicial exception to the rule that statutes of limitation are to be upheld: “where they are so harsh and unreasonable in their consequences that they effectively divest plaintiffs of the access to the courts intended by the grant of the substantive right.” Rusha, 307 Mich App at 310, citing Curtin v. Dept of State Highways, 127 Mich App 160; 339 NW2d 7 (1983). As did the Rusha court, the Mays court held that this exception applied to statutory notice requirements as well as statutes of limitations. But unlike the Rusha court, the Mays court found that the exception excused the plaintiffs before it from complying with a statute requiring them to provide notice of their claim (or the claim itself) to the Court of Claims within six months following the happening of the event giving rise to the cause of action. MCL 600.6431(3). Had it not so found, the plaintiffs’ claims would likely have been barred. The Mays court’s logic was that unlike a suit for auto accident injuries, the plaintiffs’ injuries were “not readily apparent at the time of the happening” and that a “significant portion of the injuries…likely manifest so gradually as to have become well established before becoming apparent to plaintiffs because the evidence of the injury was concealed in the water supply infrastructure buried beneath Flint and in the bloodstreams of those drinking the water supplied via that infrastructure.” If such logic—that the six-month statutory notice period did not start running because the plaintiffs had not discovered the effect on their properties of the water supply distribution—were extended to statutes of limitation accrual, it would fly in the face of the 2007 abolishment of the discovery rule. Absent facts sufficient to support fraudulent concealment tolling, under Michigan law it is simply irrelevant to determining the accrual date for tort claims when a plaintiff first discovered the wrong (or resulting damage) or, indeed, whether a plaintiff could have discovered it during the limitations period.

For companies faced with tort claims for off-site environmental contamination, the Mays court’s reliance on the “gradual” manifestation of the injury to plaintiffs’ properties and the fact that injury was “concealed” in the water supply pipes is troubling because migrating contamination may be both gradual and not manifest. No court has ever adopted the Mays logic in determining the accrual of such environmental tort claims; this is not surprising, as the consequences of doing so would never be “so harsh and unreasonable” that it would “effectively divest plaintiffs of the access to the courts….” Yet, the Mays court creates the risk that its logic may be attempted to be applied, albeit inappropriately, in evaluating the accrual of such claims. While in future rulings the Mays court may (and should) address the perhaps unwitting effect of its logic, companies who face tort claims for groundwater contamination would do well to monitor the Mays case closely and consider petitioning to file amicus briefs in any appeal of the court’s October 26 opinion.

For more information, or if you have any questions, please contact the author of this alert, John A. Ferroli (jferroli@dykema.com; 616-776-7542 or 213-457-1742), Grant Gilezan, Environmental Practice Group Leader (ggilezan@dykema.com or 313-568-6789), or your Dykema relationship attorney.