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Retention pond used solely for wastewater conveynace not "waters of the state" for purposes of water resources protection

The court held that the trial court erred by granting summary disposition for the defendant-DNR because the plaintiff-township's CAP is being "used solely for wastewater conveyance, treatment or control" and consequently is not "waters of the state." Thus, it reversed and remanded, instructing the trial court to "(a) determine whether, by the operation of equitable estoppel, defendant is barred from asserting that the CAP is not a pond, (b) if necessary, determine whether the CAP is a pond and, (3) conduct any other proceedings not inconsistent with this opinion." Plaintiff sought a declaratory judgment that water treatment residuals, backwash water, and water softening sludge received by the CAP from its water treatment plant are not "waters of the state." It also claimed that equitable estoppel and collateral estoppel should bar defendant from ruling that the CAP is "waters of the state," and that defendant's attempt to rule as such constituted inverse condemnation. On appeal, the court agreed with plaintiff that the CAP is used solely for wastewater conveyance, treatment, or control, and is thus exempt from Part 4 of the Michigan Administrative Rules governing water resources protection, finding that the trial court's view of the regulation was overbroad. "If the mere movement of groundwater through a pond constitutes a 'use,' then there is no pond that could qualify for the exemption unless it was artificially lined, a requirement clearly not contained within the text of the exemption. Moreover, [plaintiff] has enacted an ordinance barring any other use of the CAP other than wastewater conveyance, treatment, or control." It rejected defendant's argument that a failure to consider the passage of groundwater through the CAP as a "use" endangers the nearby Grand River and the surrounding groundwater that ultimately is a source of drinking water. It noted that although the nearby groundwater is "waters of the state," defendant never claimed that "any seepage of the CAP contents into the groundwater" constituted "a violation of any law." Moreover, defendant failed to show "any conditions required by the exemption that plaintiff" did not meet. The court then noted that the trial court never reached the second issue for exemption, which was whether the CAP is a "pond," and concluded that this presents a question of fact. "The factfinder must consider the size and appearance of the CAP, the way in which it has been referred to, used, and described by the parties and others, comparisons to other bodies of water, and any other relevant evidence."

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