STATE OF MICHIGAN

FRANK J. KELLEY, ATTORNEY GENERAL

Opinion No. 6511

April 16, 1988

DRAINS AND DRAINAGE: Disposition of special assessments from abandoned project to improve an intracounty drain

If a project to improve an existing intracounty drain is abandoned after special assessments have been collected, the county drain commissioner should distribute such funds to persons having a rightful claim to them and may bring an interpleader action against those who may have a claim against moneys held in the drain fund.

Mr. William D. Bond

Tuscola County Prosecuting Attorney

440 North State Street

Caro, Michigan 48723

You have requested my opinion on two questions which have been combined and rephrased as follows:

The Drain Code of 1956, 1956 PA 40, as amended, MCL 280.1 et seq; MSA 11.1001 et seq (Code), makes provision for the improvement of an existing intracounty drain, MCL 280.191; MSA 11.1191, and the assessment of the costs thereof, MCL 280.262; MSA 11.1262.

Various sections of the Code deal with the return of moneys held in a drain fund. However, due to the unique factual situation which you have described, none answers your specific question.

MCL 280.283; MSA 11.1283, which provides for the return of surplus construction funds upon completion of a proposed project, is inapplicable since the proposed improvements were never undertaken. Nor does MCL 280.392; MSA 11.1392, which provides for the return of moneys held in a drain fund upon the abandonment and vacation of a drain which is no longer of benefit to the public, answer your question since only the proposed improvements have been abandoned, not the original drain. Other sections of the Code are equally inapposite.

Although the Code does not specifically provide for the distribution of funds held under the circumstances which you have described, this does not mean that the money cannot be distributed. To the contrary, when a public improvement project has been intentionally abandoned, it is appropriate to return any special assessment taxes previously collected. Woodruff v Chicago, 326 Ill App 577; 63 NE2d 124 (1945). There is also authority which holds that valid costs attendant to a drainage project may be paid from the drain fund though the project has been abandoned. Blakely Drain Improvements Drainage Dist v Woodhaven, 112 Mich App 675; 317 NW2d 220 (1982), lv den 417 Mich 880 (1983).

It is noted that any such distribution may be handled through the filing of an interpleader action by the county drain commissioner against those who may have a claim against the money held in the drain fund. See MCR 3.603.

It is my opinion, therefore, that a county drain commissioner should distribute to those persons having a rightful claim to them special assessment taxes collected from a special assessment district established for the improvement of an existing intracounty drain when contracts for the proposed improvements have been let but the project is thereafter officially abandoned.

Frank J. Kelley

Attorney General