Opinion
Docket No. 77-2883.
Decided August 21, 1979.
Roger E. Craig, Corporation Counsel, and James C. Cobb, Jr., Assistant Corporation Counsel, for the City of Detroit.
On January 26, 1976, the appellant, City of Detroit, filed a petition to condemn property which included a parcel owned by the appellee, Mrs. Hopkins. On June 8, 1977, a Wayne County Circuit Court jury awarded Mrs. Hopkins $24,500 compensation for the taking of that property. On June 24, 1977, the trial court awarded her interest on the judgment at the rate of 6% from the date the petition was filed. The city now appeals by right.
The appellant argues that the trial court erred in awarding Mrs. Hopkins interest on the judgment from the date the petition was filed rather than from either the date of judgment or the date of taking.
In granting the appellee's motion for interest from the date of filing the petition in this action, the trial court relied upon MCL 600.6013; MSA 27A.6013, which states, inter alia:
"Interest shall be allowed on any money judgment recovered in a civil action, such interest to be calculated from the date of filing the complaint at the rate of 6% per year unless the judgment is rendered on a written instrument having a higher rate of interest in which case interest shall be computed at the rate specified in the instrument if such rate was legal at the time the instrument was executed."
This statute, the court reasoned, applied in condemnation actions pursuant to MCL 125.75; MSA 5.3505, which states that actions brought under the blighted area rehabilitation act should be instituted "in accordance with the laws of the state or provisions of any local charter relative to condemnation".
However, a review of case law in the area of condemnation actions reveals that a different rule regarding interest on judgments has evolved. Namely, interest is allowed on a judgment from the date of judgment or from the date of taking.
In re Lansing Urban Renewal, 68 Mich. App. 158, 166; 242 N.W.2d 51 (1976), stated the general rule regarding interest on judgments in condemnation cases. In holding that interest should run from the date of the taking, the Court stated:
"In general, case law has equated condemnation awards with all other types of judgments on which interest begins to accumulate on the date of judgment. Campau v Detroit, 225 Mich. 519; 196 N.W. 527 (1923), Friedt v Detroit, 343 Mich. 610; 73 N.W.2d 211 (1955). Where however, there has been a taking of property during the pendency of the proceedings, interest is allowed from the date of taking. In re Petition of State Highway Commissioner, 279 Mich. 285; 271 N.W. 760 (1937), State Highway Commissioner v Rowe, 372 Mich. 341; 126 N.W.2d 702 (1964)."
The theory underlying the "date of taking or judgment" rule in condemnation cases was stated in State Highway Comm'r v Great Lakes Express Co, 50 Mich. App. 170, 185; 213 N.W.2d 239 (1973):
"The purpose of interest on a condemnation award is to provide the condemnee with just compensation for that which has been taken. In State Highway Commissioner v Eilender, 362 Mich. 697, 699; 108 N.W.2d 755, 756 (1961), it was stated:
"`Just compensation, we have held, must put the party injured in as good position as he would have been if the injury had not occurred. It should neither enrich the individual at the expense of the public nor the public at the expense of the individual.' (Emphasis added.)"
The general rule in all cases is to allow an injured party to be made whole, thereby recovering damages from the date of injury. In contracts or tort cases, the date most closely approximating the date of injury and therefore the date from which interest should run is the date the suit was filed.
However, this is not the case in condemnation actions. In these actions, the property owner may not be injured, his right to possession and enjoyment of his property may not be interfered with, until long after the petition has been filed, and, in many cases, not until judgment has been granted.
Accordingly, we hold that MCL 600.6013; MSA 27A.6013 is not controlling in this case and that interest should not run from the date the complaint was filed but rather from the date of judgment or taking.
In this case, the appellee stipulated at trial that the time of taking was the date of judgment.
Accordingly, we hold that the trial court erred in holding that the city was liable for interest on the condemnation award from the date the petition was filed. Interest should run from the date of judgment, which in this case was also the date of taking.
Reversed.