Actions Taken by Receiver

Late on December 2, 1986, Mr. Louis Schimmel was contacted by Judge Dunn and asked whether he would be willing to accept the position of Receiver for the City of Ecorse. Mr. Schimmel indicated an interest in the position, but requested the opportunity to consider the position and its time commitments over the next several days.

The following morning, Judge Dunn summoned Mr. Schimmel to the Court for a 10:00 a.m. meeting. By 10:15 a.m., Judge Dunn had appointed Mr. Schimmel as Receiver and the Receiver was answering questions posed by the media. The media’s questions centered on the nature of the powers and authority of a receiver and his plans to correct Ecorse’s fiscal distress.

As Mr. Schimmel had not yet expended any efforts towards understanding the depth of Ecorse’s problems, no specific answers could be given. In addition, as there had not been a receiver appointed to operate a governmental unit in Michigan, or the nation for that matter, the Receiver’s powers and authority were not defined. Over the course of the next several weeks, meetings were held with various Ecorse department heads and others at the municipal offices in an effort to understand the underlying causes of the fiscal distress.

Having formulated actions to be taken to mitigate the immediate fiscal problems after approximately two weeks, the Receiver returned to the Circuit Court to discuss the staff and service reductions and other issues with Judge Dunn. Instead, he found Judge Dunn had retired and was not available. The receivership had been turned over to a newly elected judge who would be in training for the first several weeks of January 1987.

Although Judge Rashid, 32, who was elected in November 1986, was no stranger to the political arena (he had been a Wayne County commissioner and his father held the position of a Wayne County judge for 25 years), he had inherited a politically-sensitive lawsuit without any specific guidance in legal precedent.