Plaintiffs awarded $3.8 million in water suit

Oakland County Circuit Court Judge Dan O'Brien awarded $3.8 million in damages in one part of a class action suit against Bloomfield Township on Wednesday, September 5, on the issue of where water that is lost from the system should be paid from, determining that those costs should be paid from the township's general fund and not from water and sewer customers.

A class action suit was filed against Bloomfield Township filed in April 2016 by the law firm Hanley Kickham, which has been largely successful suing municipalities for excessive water and sewer fees, asserting municipalities have raised revenue in violation of the Headlee tax limitation amendment. Bloomfield Township residents who had paid the township for water and sewer services since March 31, 2010, had been included in the Oakland County Circuit County suit, Youmans v. Charter Township Bloomfield, which challenged Bloomfield Township's imposition of water and sewer charges as a tax in excess of rates imposed by Southeast Oakland County Water Authority (SOCWA). SOCWA resells water to Bloomfield Township from the city of Detroit, and the Oakland County Water Resources Commission, which provides sewer services for the township.

The case was tried for the full month of February 2018 before O'Brien, who took the case under advisement until July 12.

There were seven issues under contention in the lawsuit. O'Brien ruled that there was no violation of the Headlee Amendment; that stormwater charges were not pass through fees levied from Oakland County; and that water that is used to fight fires in the township, the “public fire protection remedy,” which the plaintiff asserted was money water and sewer customers should not have been paying for, and they had requested $8.4 million for The Maine Curve analysis theory, which deals with stormwater management hydrology and floodwater control, based on population, O'Brien rejected the analysis, and ruled for the township.

In the lost water category, which was broken down into three categories, the court found in favor of the plaintiff for tap water, but ordered no damages. They were seeking $3.5 million.

On other issues, O'Brien had directed the two sides to come up with what the damages, if any, should be.

Bloomfield Township attorney Bill Hampton said, “The plaintiff had entered a motion for $9.5 million, and we had a motion to enter for $0. That is how it got from $9.5 million to $3.8 million. There were two outstanding issues – sewer only customers and non-rate revenue. The judge on those two issues didn't award any damages. It was awarded in the water loss issue.

“That dealt with his (O'Brien's) interpretation of a township ordinance,” Hampton continued, “for water that is lost through leaky pipes, water main breaks, water used during construction, that it shouldn't be paid for by water and sewer customers but should be paid for by the township's general fund – so he awarded Kickham Hanley, i.e., the class, $3.8 million.”

Hampton said he will recommend the township file an appeal of that award to the Michigan Court of Appeals. The township has 21 days from when the judgement is filed to appeal.

Over the last several years, Kickham Hanley PLLC of Royal Oak has filed water and sewer lawsuits against several other municipalities, in the name of a resident, as class action suits. They came to settlements with Royal Oak, for $2 million; Ferndale, for $4.2 million; Waterford for $1.4 million; and Birmingham, for $2.8 million, among other communities. A class action lawsuit against the city of Westland was dismissed.