Order                                                                    Michigan Supreme Court
                                                                               Lansing, Michigan

  February 3, 2012                                                              Robert P. Young, Jr.,
                                                                                          Chief Justice

  143721                                                                        Michael F. Cavanagh
                                                                                      Marilyn Kelly
                                                                                Stephen J. Markman
                                                                                Diane M. Hathaway
  MASON COUNTY and OCEANA COUNTY,                                                   Mary Beth Kelly
          Plaintiffs-Appellees,                                                     Brian K. Zahra,
                                                                                               Justices
  v                                                    SC: 143721
                                                       COA: 295365
                                                       Mason CC: 08-000269-CK
  DEPARTMENT OF COMMUNITY HEALTH,
  DIRECTOR OF DEPARTMENT OF
  COMMUNITY HEALTH, DIRECTOR OF
  COMMUNITY MENTAL HEALTH SERVICES
  BUREAU, and DIRECTOR OF PROGRAM
  DEVELOPMENT CONSULTATIONS &
  CONTRACTS DIVISION,
            Defendants-Appellants,
  and
  WEST MICHIGAN COMMUNITY MENTAL
  HEALTH SYSTEM, and RICHARD
  VANDENHEUVEL,
           Defendants-Appellees.

  _________________________________________/

        On order of the Court, the application for leave to appeal the August 2, 2011
  judgment of the Court of Appeals is considered, and it is DENIED, because we are not
  persuaded that the question presented should be reviewed by this Court.

        MARKMAN, J. (dissenting).

         I respectfully dissent, and would grant leave to appeal. Defendant West Michigan
  Community Mental Health System (WMCMHS) refused to make lease payments on
  buildings it leased from plaintiffs Mason and Oceana Counties because the Department of
  Community Health (DCH), which funds WMCMHS, considered the lease agreements not
  to be arm’s-length transactions within the meaning of an Office of Management and
  Budget Circular, with which a contract between WMCMHS and codefendant DCH
  requires compliance. The circuit court granted plaintiffs’ motion for summary
  disposition, and in a published opinion, the Court of Appeals affirmed.
                                                                                                                2


       Codefendant DCH argues that the Court of Claims has exclusive jurisdiction in
this case because plaintiffs’ claims pertain to the state’s contracts with WMCMHS and
require state payments to WMCMHS. The Court of Claims has exclusive jurisdiction
“[t]o hear and determine all claims and demands, liquidated and unliquidated, ex
contractu and ex delicto, against the state and any of its departments, commissions,
boards, institutions, arms, or agencies.” MCL 600.6419(1). In Parkwood Ltd Dividend
Housing Ass’n v State Housing Dev Auth, 468 Mich 763 (2003), we held that the Court of
Claims has exclusive jurisdiction over a declaratory judgment action directly involving a
state contract.

        In this case, the circuit court held that it had jurisdiction because the witnesses are
all “local individuals.” The Court of Appeals affirmed because this is a “simple breach of
contract [action] between two parties . . . neither of which is a state agency,” and stated:

               That breach of the contract between plaintiffs and WMCMHS
       occurred as a result of WMCMHS’s contract with defendants. Not being
       parties to the contract between defendants and WMCMHS, however,
       plaintiffs have no rights under that contract and could not seek a declaratory
       ruling regarding the contract with the state at the Court of Claims. [Mason
       Co v Dep’t of Community Health, 293 Mich App ___, ___ (2011), slip op at
       5.]

The concern I have with this analysis is that plaintiffs did also bring this cause of action
against DCH, and the issue decided by the circuit court was whether WMCMHS would
be breaching its contract with DCH if it made the lease payments to plaintiffs. Thus, the
action was (a) brought against a state department and (b) involved the interpretation of a
state contract. In order to avoid raising unnecessary confusion concerning the exclusive
jurisdiction of the Court of Claims, I would grant leave to appeal.




                          I, Corbin R. Davis, Clerk of the Michigan Supreme Court, certify that the
                    foregoing is a true and complete copy of the order entered at the direction of the Court.
                          February 3, 2012                    _________________________________________
        0131                                                                  Clerk
