Michigan Municipal Liability Lawyers

Defendant Michigan Municipal Liability And Property Pool Is A Group Self-Insurance Pool

In 1938, plaintiff city of Grosse Pointe Park entered into a contract with the city of Detroit to use Detroit’s sewer system. Under the terms of the contract, Grosse Pointe Park acquired the right to pump the contents of its sewer line into an interceptor sewer for transport to Detroit’s treatment plant. Further, Grosse Pointe Park was permitted under the contract to build a pump station and a discharge pipe. If Grosse Pointe Park’s sewer flow exceeded eighty-four cubic feet a second and its line became overtaxed, the discharge pipe would allow Grosse Pointe Park to discharge the overflow into Fox Creek. Fox Creek is a tributary located in Detroit, but rests close to the Detroit-Grosse Pointe Park border.

At the time, Grosse Pointe Park had what is known as a combined sewer system, whereby sewage and rainwater are
transported to a treatment plant in a single sewer line. If, for example, there was a heavy rainfall and the capacity of the sewer system became strained, both sewage and rainwater would flow into the basements of buildings 4 connected to the city’s sewer line. To relieve the overflow and prevent basement backups, the city would pump sewage and rainwater into Fox Creek. Beginning in about 1940, the city began discharging overflow from the combined sewer system into Fox Creek. Soon after the first discharges, residents near Fox Creek began to complain of this practice. Nonetheless, this practice continued until 1995, roughly fifty-five years.

Defendant Michigan Municipal Liability and Property Pool is a group self-insurance pool created by certain local governments. See MCL 124.5. Every year, beginning in 1985 and running through 1998, Grosse Pointe Park
purchased one-year, occurrence-based liability policies from the pool. Each policy period ran from August 1 to
July 31. While these policies were in effect, Grosse Pointe Park residents made numerous claims against the city
for sewage backups into their homes and businesses, and the pool covered these claims. At issue in this case is the
policy issued on August 1, 1994, and effective through July 31, 1995.

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