By Ben Solis
Gongwer News Service
An advertising company that sued the Michigan Department of Transportation for money damages after three of its billboards were damaged during a storm did not exhaust its administrative remedies before suing the state, the Court of Claims recently ruled.
In an opinion written by Judge Brock Swartzle, the court awarded summary disposition to the defendants in Adams Outdoor Advertising Limited Partnership v. MDOT (COC Docket No 24-000031). Swartzle said there was no dispute that the company did not exhaust its administrative remedies and that an administrative hearing in the matter would not be futile, as argued by the plaintiff.
A tornado in August 2023 damaged several billboard signs along a portion of I-96 between Williamston and Fowlerville, three of which were owned by the plaintiff and were permitted by MDOT as nonconforming signs under the Highway Advertising Act of 1972. The law states that a nonconforming sign may continue to exist as long as it is not destroyed, abandoned or prohibited. Customary maintenance is allowed for signs that are damaged as a result of a storm, but damages from a storm cannot exceed 60 percent of the replacement cost for a new sign of similar materials or equipment used.
A destroyed sign under law is one that has been decimated by a fire, storm or other casualty that exceeds that 60 percent threshold. A destroyed sign by law cannot be repaired.
MDOT assessed the damage and labeled the signs as destroyed but a dispute arose over whether disallowing the company to rebuild the signs violated the Highway Advertising Act.
In the opinion issued last week, Swartzle said that the court did not find persuasive the plaintiff's argument that the exhaustion requirement be excused because it would be futile.
"The plaintiff contends that MDOT had already determined that the signs were destroyed, Director Brad Wieferich agreed with this determination, and the director would agree with MDOT's determination after a hearing," Swartzle wrote. "The plaintiff's argument is mere conjecture. Absent a hearing and the presentation of evidence, it is impossible to know what Director Wieferich's final decision would be."
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