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The following opinion is presented on-line for informational use only and does not replace the official version. (Mich Dept of Attorney General Web Site - www.ag.state.mi.us)



Opinion No. 6454

July 16, 1987


Procedures for the sale of county hospital property

A county board of commissioners may, in the absence of a controlling statute or a contrary charter provision, determine the procedures for the sale of county hospital property and may include or exclude procedural requirements of appraisals, declaration of surplus property, or competitive bidding.

Honorable Justine Barns

State Representative

The Capitol

Lansing, Michigan 48909

You have requested my opinion on the following question:

"Is it legal to sell the county owned hospital, equipment, personal property and grounds, when the following actions have not been taken?

"1. There has been no declaration of this property being surplus.

"2. There has been no appraisal of the property.

"3. There has been no invitation published for bids on this property."

Your letter requesting my opinion encloses an uncertified copy of a resolution of the Wayne County Board of Supervisors (now Commissioners), dated January 20, 1959, which specifies procedures for the disposal of surplus county-owned property, including provisions for appraisals of property being sold and public sale of property with an appraised value of $2,000 or more.

The County Board of Commissioners in a county with a population in excess of 1,000,000, such as Wayne County, is authorized by MCL 331.212a; MSA 14.1150(12a), to maintain and operate a county general hospital.

The Wayne County Charter was adopted by the electors of the county in 1981. Wayne County Charter, Sec. 3.117, provides, as follows:

"The Commission shall provide by ordinance for the operation, maintenance, and administration of public County hospital facilities and shall assure an adequate level of physical and mental health services for the residents of the County."

In University Medical Affiliates, PC v Wayne Co Executive, 142 Mich App 135, 141; 369 NW2d 277 (1985), the Court of Appeals refused to enjoin the lease or sale of the Wayne County General Hospital in a case where the hospital was being leased for a period of 10 years with an option to purchase. While the county was obligated by charter provision to provide for the physical and mental needs of county residents through public hospital facilities, the court, nevertheless, concluded "that [Wayne County Charter] Sec. 3.117 does not require the county to 'own' Wayne County General Hospital."

Under Wayne County Charter, Sec. 3.115(3), the Wayne County Commission, as the county's legislative body, has the power to approve all contracts of the county. Similarly, a county board of commissioners, pursuant to MCL 46.11(d); MSA 5.331(d), may authorize the sale of real estate belonging to the county.

OAG, 1985-1986, No 6411, p 444 (December 19, 1986), held that a county hospital established under MCL 331.151 et seq; MSA 14.1131 et seq, is a type of municipal corporation since the Act declares that the board of hospital trustees constitutes a body corporate which may sue and be sued. OAG, 1985-1986, No 6411, supra, also held that as a municipal corporation a county hospital governed by a hospital board of trustees per MCL 331.151 et seq; MSA 14.1131 et seq, may cease to exist only by legislative consent or pursuant to legislative provision. OAG, 1985-1986, No 6411, stated that there was no mechanism in the Act or otherwise in Michigan law for dissolution of a county hospital governed by a hospital board of trustees. However, as noted in OAG, 1985-1986, No 6411, supra, Wayne County General Hospital is being operated by Wayne County pursuant to its charter.

There are no state statutes which require competitive bidding or appraisals as prerequisites to the sale of county property. While the provisions of the 1959 resolution set forth detailed procedures for competitive bidding and appraisals with respect to the sale of county property, the Wayne County Commission, of course, may utilize other procedures in its review and approval of such sales. In Atlas v Wayne County Bd of Auditors, 281 Mich 596, 599; 275 NW2d 507 (1937), it was held that the then Wayne County Board of Supervisors was not bound by the legislative actions of a previous board of supervisors:

"The act of one legislative body does not tie the hands of future legislatures. Cooper, Wells & Co. v. City of St. Joseph, 232 Mich. 255 [205 NW 86 (1925) ]. The power to amend and repeal legislation as well as to enact it is vested in the legislature, and the legislature cannot restrict or limit its right to exercise the power of legislation by prescribing modes of procedure for the repeal or amendment of statutes; nor may one legislature restrict or limit the power of its successors. 12 C.J. p. 806. One legislature cannot enact irrepealable legislation or limit or restrict its own power, or the power of its successors, as to the repeal of statutes; and an act of one legislature is not binding on, and does not tie the hands of, future legislatures. 59 C.J. p. 900.

"From the very nature of the powers conferred upon the board of supervisors by the Constitution and laws of the State, the board of supervisors of Wayne County of 1931 was without power or authority by ordinance or otherwise to limit in any way the power of subsequent boards of supervisors to exercise their constitutional or legislative power to fix salaries."

Although this doctrine has some limitations with respect to contractual obligations as noted in OAG, 1975-1976, No 4936, pp 285, 286-287 (February 3, 1976), the Atlas case makes clear that the 1959 resolution is not an obstacle to action by the Wayne County Commission in approving sales of public land pursuant to such procedures as it deems appropriate.

As to the amount of consideration for a sale of public property, the court in Alan v Wayne County, 388 Mich 210, 325-327; 200 NW2d 628 (1972), stated:

"Michigan case law interpreting Const 1963, art 9, Sec. 18 is neither ample nor precise. It is clear the state or its subdivision the county cannot give anything away without consideration.... Note that the constitution as far as the state and county are concerned makes no difference between a public and a private purpose in this regard. When the state acquires or transfers something of value in return for value the state does not offend Const 1963, art 9, Sec. 18....

"Now the nub of the problem in all probability is the value received by the state in return for the value transferred. So our inquiry goes to what is the value and who determines it. While the cases definitely describing all the earmarks of the value to be received appear yet to be written, it is probably because any citizen would immediately prescribe full value, and this Court is not going to argue with so logical, reasonable and just a standard.


"This Court will assume that the officers of the Legislative and Executive Branches will do their duty and exercise a proper judgment. The courts will respect that judgment unless there has been a clear abuse of discretion. Obviously, if the state or county were to make a valuable grant for next to no consideration, the courts would be forced to regard that not as an exercise of discretion, but an abuse of discretion." [Citations and footnotes omitted.]

See, also, Sinas v City of Lansing, 7 Mich App 464; 151 NW2d 858 (1967), aff'd 382 Mich 407; 170 NW2d 23 (1969), holding that conveyance of public land to a public agency is not dependent upon payment of fair market value.

It is noted that records in my office indicate that on November 29, 1979, the Wayne County Board of Commissioners approved the sale to the State of Michigan of that part of the Wayne County General Hospital known as the Walter Reuther Facility. The sale-approving resolution that was adopted by the board makes no reference to topics referred to in your question, e.g., surplus declaration, appraisal, and invitation for bids.

In answer to your question, it is my opinion that a county board of commissioners, as the legislative body of the county, has the authority to determine the terms and procedures for the sale of county property. It is further my opinion that the county commission may authorize sales of county property which include or exclude, as determined by the commission in its discretion, such procedural requirements as a declaration of the surplus nature of the property being sold, appraisals of the property being sold, or competitive bidding for the property being sold.

Frank J. Kelley

Attorney General

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