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157522 - Honigman Miller Schwartz & Cohn, LLP v Detroit

Honigman Miller Schwartz & Cohn, LLP,


Leonard Niehoff





(Appeal from Ct of Appeals)



(Tax Tribunal – Lasher, S.)


City of Detroit,


Charles Raimi





From 2010 to 2014, plaintiff law firm, Honigman Miller Schwartz & Cohn, LLP, reported, pursuant to § 23 of the Uniform City Income Tax Ordinance, MCL 141.623, that approximately 11% of its gross revenues were for “services rendered within the city.”  Defendant City of Detroit determined that this figure was closer to 50% of plaintiff’s gross revenues and assessed the firm approximately $1.1 million in local taxes.  Plaintiff filed a petition in the Michigan Tax Tribunal.  Both parties moved for partial summary disposition pursuant to MCR 2.116(C)(10).  Plaintiff contended that, although its services were performed in the city, they were delivered to clients outside the city, and thus, not “rendered within the city.”  Plaintiff took the position that the phrase “services rendered” in MCL 141.623 has a different meaning than the phrase “services performed” in MCL 141.622 because, when the Legislature uses different terms, it intends to ascribe different meanings to those terms.  The defendant argued that the terms were synonymous and that because the services were performed within the city the revenues derived from those services were subject to city tax.  The tax tribunal agreed with the defendant and granted its motion for partial summary disposition.  The Court of Appeals reversed in a published decision, adopting plaintiff’s argument.  The Supreme Court has granted leave to appeal to address whether the Court of Appeals erred in its construction of the phrase “services rendered within the city” in § 23 of the Uniform City Income Tax Ordinance, MCL 141.623.​